Attached files
| file | filename |
|---|---|
| EX-99.4 - EX-99.4 - WebMD Health Corp. | d275292dex994.htm |
| EX-99.3 - EX-99.3 - WebMD Health Corp. | d275292dex993.htm |
| EX-99.1 - EX-99.1 - WebMD Health Corp. | d275292dex991.htm |
| 8-K - 8-K - WebMD Health Corp. | d275292d8k.htm |
Exhibit 99.2
WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Revenue |
$ | 171,438 | $ | 152,607 | $ | 497,574 | $ | 444,270 | ||||||||
| Cost of operations |
65,458 | 59,552 | 193,759 | 177,836 | ||||||||||||
| Sales and marketing |
35,264 | 32,850 | 104,634 | 97,896 | ||||||||||||
| General and administrative |
20,005 | 22,942 | 67,744 | 67,397 | ||||||||||||
| Depreciation and amortization |
7,912 | 7,266 | 23,071 | 23,103 | ||||||||||||
| Interest income |
1,034 | 10 | 1,607 | 36 | ||||||||||||
| Interest expense |
7,065 | 5,681 | 17,430 | 18,024 | ||||||||||||
| Loss on convertible notes |
— | 2,058 | — | 2,058 | ||||||||||||
| Gain on investments |
— | — | — | 139 | ||||||||||||
| Other expense |
1,712 | — | 1,712 | 4,100 | ||||||||||||
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| Income before income tax provision |
35,056 | 22,268 | 90,831 | 54,031 | ||||||||||||
| Income tax provision |
13,438 | 9,080 | 35,715 | 17,468 | ||||||||||||
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| Net income |
$ | 21,618 | $ | 13,188 | $ | 55,116 | $ | 36,563 | ||||||||
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| Net income per common share: |
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| Basic |
$ | 0.57 | $ | 0.36 | $ | 1.46 | $ | 1.00 | ||||||||
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| Diluted |
$ | 0.47 | $ | 0.32 | $ | 1.22 | $ | 0.89 | ||||||||
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| Weighted-average shares outstanding used in |
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| computing income per common share: |
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| Basic |
38,103 | 36,721 | 37,804 | 36,606 | ||||||||||||
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| Diluted |
55,845 | 49,958 | 53,836 | 49,912 | ||||||||||||
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WEBMD HEALTH CORP.
CONSOLIDATED SUPPLEMENTAL FINANCIAL INFORMATION
(In thousands, unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Revenue |
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| Advertising and sponsorship |
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| Biopharma and medical device |
$ | 107,048 | $ | 89,870 | $ | 296,353 | $ | 251,692 | ||||||||
| OTC, CPG and other |
29,026 | 28,850 | 93,907 | 89,047 | ||||||||||||
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| 136,074 | 118,720 | 390,260 | 340,739 | |||||||||||||
| Health services |
28,247 | 27,460 | 85,134 | 83,223 | ||||||||||||
| Information services |
7,117 | 6,427 | 22,180 | 20,308 | ||||||||||||
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| $ | 171,438 | $ | 152,607 | $ | 497,574 | $ | 444,270 | |||||||||
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| Net income |
$ | 21,618 | $ | 13,188 | $ | 55,116 | $ | 36,563 | ||||||||
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| Interest, taxes, non-cash and other items (a) |
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| Interest income |
(1,034 | ) | (10 | ) | (1,607 | ) | (36 | ) | ||||||||
| Interest expense |
7,065 | 5,681 | 17,430 | 18,024 | ||||||||||||
| Income tax provision |
13,438 | 9,080 | 35,715 | 17,468 | ||||||||||||
| Depreciation and amortization |
7,912 | 7,266 | 23,071 | 23,103 | ||||||||||||
| Non-cash stock-based compensation |
4,638 | 9,142 | 21,038 | 24,731 | ||||||||||||
| Loss on convertible notes |
— | 2,058 | — | 2,058 | ||||||||||||
| Gain on investments |
— | — | — | (139 | ) | |||||||||||
| Other expense |
1,712 | — | 1,712 | 4,100 | ||||||||||||
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| Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (b) |
$ | 55,349 | $ | 46,405 | $ | 152,475 | $ | 125,872 | ||||||||
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| (a) | Reconciliation of net income to Adjusted EBITDA. |
| (b) | See Annex A-Explanation of Non-GAAP Financial Measures. |
WEBMD HEALTH CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| September 30, | December 31, | |||||||
| 2016 | 2015 | |||||||
| (unaudited) | ||||||||
| Assets |
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| Cash and cash equivalents |
$ | 88,600 | $ | 641,165 | ||||
| Accounts receivable, net |
153,255 | 174,313 | ||||||
| Investments |
949,488 | — | ||||||
| Prepaid expenses and other current assets |
17,972 | 18,998 | ||||||
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| Total current assets |
1,209,315 | 834,476 | ||||||
| Property and equipment, net |
84,929 | 81,027 | ||||||
| Goodwill |
202,980 | 202,980 | ||||||
| Intangible assets, net |
8,554 | 10,894 | ||||||
| Deferred tax assets, net |
8,984 | 15,694 | ||||||
| Other assets |
8,497 | 10,852 | ||||||
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| Total Assets |
$ | 1,523,259 | $ | 1,155,923 | ||||
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| Liabilities and Stockholders’ Equity |
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| Accrued expenses |
$ | 65,892 | $ | 80,664 | ||||
| Deferred revenue |
102,251 | 102,715 | ||||||
| 2.25% convertible notes due 2016, net |
— | 102,523 | ||||||
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| Total current liabilities |
168,143 | 285,902 | ||||||
| 2.50% convertible notes due 2018, net |
397,620 | 396,281 | ||||||
| 1.50% convertible notes due 2020, net |
295,140 | 294,266 | ||||||
| 2.625% convertible notes due 2023, net |
350,849 | — | ||||||
| Other long-term liabilities |
28,965 | 23,246 | ||||||
| Stockholders’ equity |
282,542 | 156,228 | ||||||
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| Total Liabilities and Stockholders’ Equity |
$ | 1,523,259 | $ | 1,155,923 | ||||
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WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
| Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2016 | 2015 | |||||||
| Cash flows from operating activities: |
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| Net income |
$ | 55,116 | $ | 36,563 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
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| Depreciation and amortization |
23,071 | 23,103 | ||||||
| Non-cash interest, net |
2,827 | 3,276 | ||||||
| Non-cash stock-based compensation |
21,038 | 24,731 | ||||||
| Deferred income taxes |
6,632 | (7,246 | ) | |||||
| Loss on convertible notes |
— | 2,058 | ||||||
| Gain on investments |
— | (139 | ) | |||||
| Changes in operating assets and liabilities: |
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| Accounts receivable |
21,058 | (10,201 | ) | |||||
| Prepaid expenses and other, net |
2,747 | (5,692 | ) | |||||
| Accrued expenses and other long-term liabilities |
(9,748 | ) | (4,555 | ) | ||||
| Deferred revenue |
(464 | ) | 15,280 | |||||
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| Net cash provided by operating activities |
122,277 | 77,178 | ||||||
| Cash flows from investing activities: |
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| Purchases of property and equipment |
(24,449 | ) | (25,638 | ) | ||||
| Purchase of investments |
(948,078 | ) | — | |||||
| Partial redemption of cost-method investment |
1,193 | — | ||||||
| Proceeds from sale of investments |
— | 139 | ||||||
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| Net cash used in investing activities |
(971,334 | ) | (25,499 | ) | ||||
| Cash flows from financing activities: |
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| Proceeds from exercise of stock options |
52,702 | 15,185 | ||||||
| Cash used for withholding taxes due on stock-based awards |
(7,705 | ) | (3,836 | ) | ||||
| Net proceeds from issuance of convertible notes |
350,394 | — | ||||||
| Maturity of convertible notes |
(102,682 | ) | (151,038 | ) | ||||
| Purchases of treasury stock |
(22,447 | ) | (28,406 | ) | ||||
| Excess tax benefit on stock-based awards |
26,230 | 21,972 | ||||||
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| Net cash provided by (used in) financing activities |
296,492 | (146,123 | ) | |||||
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| Net decrease in cash and cash equivalents |
(552,565 | ) | (94,444 | ) | ||||
| Cash and cash equivalents at beginning of period |
641,165 | 706,776 | ||||||
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| Cash and cash equivalents at end of period |
$ | 88,600 | $ | 612,332 | ||||
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WEBMD HEALTH CORP.
NET INCOME PER COMMON SHARE
(In thousands, except per share data, unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Numerator: |
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| Net income – Basic |
$ | 21,618 | $ | 13,188 | $ | 55,116 | $ | 36,563 | ||||||||
| Interest expense on 1.50% convertible notes, net of tax |
878 | 864 | 2,635 | 2,592 | ||||||||||||
| Interest expense on 2.50% convertible notes, net of tax |
1,827 | 1,797 | 5,480 | 5,392 | ||||||||||||
| Interest expense on 2.25% convertible notes, net of tax |
— | — | 457 | — | ||||||||||||
| Interest expense on 2.625% convertible notes, net of tax |
1,675 | — | 2,235 | — | ||||||||||||
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| Net income – Diluted |
$ | 25,998 | $ | 15,849 | $ | 65,923 | $ | 44,547 | ||||||||
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| Denominator: |
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| Weighted-average shares – Basic |
38,103 | 36,721 | 37,804 | 36,606 | ||||||||||||
| Stock options and restricted stock |
1,709 | 1,338 | 1,824 | 1,407 | ||||||||||||
| 1.50% convertible notes |
5,694 | 5,694 | 5,694 | 5,694 | ||||||||||||
| 2.50% convertible notes |
6,205 | 6,205 | 6,205 | 6,205 | ||||||||||||
| 2.25% convertible notes |
— | — | 471 | — | ||||||||||||
| 2.625% convertible notes |
4,134 | — | 1,838 | — | ||||||||||||
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| Adjusted weighted-average shares after assumed conversions – Diluted |
55,845 | 49,958 | 53,836 | 49,912 | ||||||||||||
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| Net income per common share: |
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| Basic |
$ | 0.57 | $ | 0.36 | $ | 1.46 | $ | 1.00 | ||||||||
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| Diluted |
$ | 0.47 | $ | 0.32 | $ | 1.22 | $ | 0.89 | ||||||||
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