Marchex Announces Third Quarter 2020 Results
Q3 2020 Financial Highlights
-
Revenue was
$26.5 million for the third quarter of 2020, compared to$24.8 million for the third quarter of 2019. -
Core analytics and solutions revenue was
$13.6 million for the third quarter of 2020, which included the benefit of recognizing$776,000 of revenues that were reserved at the end of the second quarter given they did not meet recognition criteria under our revenue recognition policies at such time. Excluding this amount, core analytics and solutions revenue for the third quarter of 2020 was$12.9 million , compared to$13.5 million for the third quarter of 2019. -
Net loss was
$3.7 million for the third quarter of 2020 or$0.08 per diluted share. For the third quarter of 2019, net loss was$1.2 million or$0.03 per diluted share.
|
|
Q3 2019 |
|
Q3 2020 |
Revenue |
|
|
|
|
Net cash provided by (used in) operating activities |
|
|
|
|
Cash balance |
|
|
|
|
Cash balance (net of current debt obligations) |
|
|
|
|
Non-GAAP Results1: |
|
|
|
|
Adjusted EBITDA |
|
|
|
|
-
Adjusted non-GAAP income (loss) per share1 for the third quarter of 2020 was (
$0.03 ), compared to$0.01 for the third quarter of 2019.
____________________ |
1 Reconciliations of non-GAAP measures are included in the financial tables attached to this press release and we encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measures. |
Strategic Priorities Update
Completion of tender offer. In
Completion of divestiture of certain assets, including its Local Leads platform and its
-
$2.5 million in cash consideration pro-rata for the disposition percentage; - Shares of Class B common stock in the purchaser equal to the issuance of a 10% equity interest;
-
$3.5 million in guaranteed year 1 funding for an ongoing shared services agreement post transaction. Year 2 is guaranteed at$1.5 million funding subject to a year 2 minimum revenue threshold; and - A return of 1.5 million stock options currently outstanding and held by two executives of the company and shareholders of the purchaser.
Further conditional consideration as follows:
-
30% of any resale proceeds above a transaction value for Marchex’s disposed stake of greater than
$10 million within 24 months; -
0.25% of revenues from the disposed assets above
$53 million annually for 3 years; -
15% of revenues net of direct variable costs for the Local Leads platform in the event cumulative revenues exceed
$6 million post transaction; and -
2.5% of revenues net of direct variable costs for the
Call Marketplace for a 24-month period once cumulative revenues exceed$140 million post transaction.
“The trend toward AI-powered conversational intelligence and sales engagement solutions is one that we believe can be transformational,” said
1 Information regarding the impact of the divestiture and discontinued operations is expected to be filed in the Company’s Form10-K for its fiscal year ended |
Business Outlook
“The year remains highly fluid and there is a degree of uncertainty in the near term, however, we are seeing encouraging engagement from customers with prospective planning, which we believe could positively impact the intermediate term,” said
“As we look at the intermediate term, we are encouraged by the conversations we are having with existing and potential new customers about next year. Assuming the current trajectory of these continue, and there is an unwinding of the business impact from the pandemic in 2021, we believe there is a path to achieving organic double-digit annual revenue growth on a run rate basis for core analytics and solutions. Additionally, as some of our new products sell through and contribute, we believe we can see a path in 2021 to break-even or better on an Adjusted EBITDA basis before the end of the year,” said Arends.
Conference Call and Webcast Information
Management will hold a conference call, starting at
About
Please visit http://www.marchex.com, www.marchex.com/blog or @marchex on Twitter (Twitter.com/Marchex), where
Forward-Looking Statements:
This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding our strategy, future operations, future financial position, future revenues, other financial guidance, acquisitions, dispositions, projected costs, prospects, plans and objectives of management are forward-looking statements. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make due to a number of important factors including but not limited to product demand, order cancellations and delays, competition, changes in business strategy or development plans, and general economic and business conditions, as well as the continuing impact of the COVID-19 pandemic on the general economy, our customers and on our business, operations, employees and financial condition. These factors are described in greater detail in the "Risk Factors" section of our most recent periodic report or registration statement filed with the
In the event the press release contains links to third party websites or materials, the links are provided solely as a convenience to you.
Non-GAAP Financial Information:
To supplement
Adjusted OIBA represents income (loss) from operations excluding stock-based compensation expense, amortization of intangible assets from acquisitions, impairment of intangible assets and goodwill, acquisition related costs (benefit), and foreign government paycheck assistance subsidies. This measure, among other things, is one of the primary metrics by which
|
||||||||||||||||
Condensed Consolidated Statements of Operations |
||||||||||||||||
(in thousands, except per share amounts) |
||||||||||||||||
(unaudited) |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
||||||||
Revenue |
|
$ |
24,794 |
|
|
$ |
26,492 |
|
|
$ |
77,541 |
|
|
$ |
77,124 |
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service costs (1) |
|
|
12,770 |
|
|
|
15,289 |
|
|
|
40,951 |
|
|
|
44,991 |
|
Sales and marketing (1) |
|
|
3,971 |
|
|
|
4,263 |
|
|
|
12,172 |
|
|
|
14,692 |
|
Product development (1) |
|
|
5,135 |
|
|
|
5,755 |
|
|
|
14,708 |
|
|
|
17,684 |
|
General and administrative (1) |
|
|
3,130 |
|
|
|
3,695 |
|
|
|
9,939 |
|
|
|
10,470 |
|
Amortization of intangible assets from acquisitions |
|
|
1,568 |
|
|
|
1,206 |
|
|
|
4,704 |
|
|
|
4,175 |
|
Acquisition and disposition-related costs (benefit) |
|
|
(432 |
) |
|
|
24 |
|
|
|
(710 |
) |
|
|
(972 |
) |
Total operating expenses |
|
|
26,142 |
|
|
|
30,232 |
|
|
|
81,764 |
|
|
|
91,040 |
|
Impairment of goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(14,213 |
) |
Impairment of intangible assets from acquisitions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,903 |
) |
Loss from operations |
|
|
(1,348 |
) |
|
|
(3,740 |
) |
|
|
(4,223 |
) |
|
|
(34,032 |
) |
Interest income (expense) and other, net |
|
|
189 |
|
|
|
(4 |
) |
|
|
592 |
|
|
|
138 |
|
Loss before provision for income taxes |
|
|
(1,159 |
) |
|
|
(3,744 |
) |
|
|
(3,631 |
) |
|
|
(33,894 |
) |
Income tax expense (benefit) |
|
|
56 |
|
|
|
(79 |
) |
|
|
(3 |
) |
|
|
(846 |
) |
Net loss applicable to common stockholders |
|
$ |
(1,215 |
) |
|
$ |
(3,665 |
) |
|
$ |
(3,628 |
) |
|
$ |
(33,048 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic and diluted net loss per Class A and Class B share applicable to common stockholders |
|
$ |
(0.03 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.70 |
) |
Shares used to calculate basic net loss per share applicable to common stockholders |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Class A |
|
|
4,661 |
|
|
|
4,661 |
|
|
|
4,838 |
|
|
|
4,661 |
|
Class B |
|
|
40,984 |
|
|
|
42,470 |
|
|
|
40,459 |
|
|
|
42,333 |
|
Shares used to calculate diluted net loss per share applicable to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Class A |
|
|
4,661 |
|
|
|
4,661 |
|
|
|
4,838 |
|
|
|
4,661 |
|
Class B |
|
|
45,645 |
|
|
|
47,131 |
|
|
|
45,297 |
|
|
|
46,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(1) Includes stock-based compensation allocated as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service costs |
|
$ |
36 |
|
|
$ |
10 |
|
|
$ |
131 |
|
|
$ |
42 |
|
Sales and marketing |
|
|
180 |
|
|
|
291 |
|
|
|
529 |
|
|
|
898 |
|
Product development |
|
|
72 |
|
|
|
96 |
|
|
|
215 |
|
|
|
287 |
|
General and administrative |
|
|
535 |
|
|
|
481 |
|
|
|
1,275 |
|
|
|
1,615 |
|
Total |
|
$ |
823 |
|
|
$ |
878 |
|
|
$ |
2,150 |
|
|
$ |
2,842 |
|
|
||||||||
Condensed Consolidated Balance Sheets |
||||||||
(in thousands) |
||||||||
(unaudited) |
||||||||
|
|
|
|
|
||||
|
|
2019 |
|
2020 |
||||
Assets |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
42,526 |
|
|
$ |
44,617 |
|
Accounts receivable, net |
|
|
17,809 |
|
|
|
16,631 |
|
Prepaid expenses and other current assets |
|
|
2,084 |
|
|
|
2,249 |
|
Total current assets |
|
|
62,419 |
|
|
|
63,497 |
|
Property and equipment, net |
|
|
3,028 |
|
|
|
3,100 |
|
Right-of-use lease asset |
|
|
5,801 |
|
|
|
4,094 |
|
Other assets, net |
|
|
335 |
|
|
|
1,052 |
|
|
|
|
33,433 |
|
|
|
19,132 |
|
Intangible assets from acquisitions, net |
|
|
19,485 |
|
|
|
9,408 |
|
Total assets |
|
$ |
124,501 |
|
|
$ |
100,283 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
7,082 |
|
|
$ |
7,324 |
|
Accrued expenses and other current liabilities |
|
|
6,679 |
|
|
|
10,866 |
|
Current portion of acquisition-related liabilities |
|
|
1,111 |
|
|
|
74 |
|
Deferred revenue and deposits |
|
|
1,173 |
|
|
|
1,523 |
|
Lease liability current |
|
|
1,500 |
|
|
|
1,821 |
|
Loan obligations, current |
|
|
— |
|
|
|
5,306 |
|
Total current liabilities |
|
|
17,545 |
|
|
|
26,914 |
|
Deferred tax liabilities |
|
|
981 |
|
|
|
135 |
|
Lease liability non-current |
|
|
5,664 |
|
|
|
3,549 |
|
Non-current portion of acquisition-related liabilities |
|
|
473 |
|
|
|
— |
|
Total liabilities |
|
|
24,663 |
|
|
|
30,598 |
|
Stockholders’ equity: |
|
|
|
|
|
|
||
Class A common stock |
|
|
49 |
|
|
|
49 |
|
Class B common stock |
|
|
396 |
|
|
|
399 |
|
Additional paid-in capital |
|
|
359,633 |
|
|
|
362,525 |
|
Accumulated deficit |
|
|
(260,240 |
) |
|
|
(293,288 |
) |
Total stockholders’ equity |
|
|
99,838 |
|
|
|
69,685 |
|
Total liabilities and stockholders’ equity |
|
$ |
124,501 |
|
|
$ |
100,283 |
|
|
||||||||||||||||
(in thousands) |
||||||||||||||||
(unaudited) |
||||||||||||||||
Reconciliation of GAAP Loss from Operations to Adjusted Operating Income (Loss) Before Amortization (OIBA) |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
||||||||
Loss from operations |
|
$ |
(1,348 |
) |
|
$ |
(3,740 |
) |
|
$ |
(4,223 |
) |
|
$ |
(34,032 |
) |
Stock-based compensation |
|
|
823 |
|
|
|
878 |
|
|
|
2,150 |
|
|
|
2,842 |
|
Amortization of intangible assets from acquisitions |
|
|
1,568 |
|
|
|
1,206 |
|
|
|
4,704 |
|
|
|
4,175 |
|
Acquisition and disposition-related costs (benefit) |
|
|
(432 |
) |
|
|
24 |
|
|
|
(710 |
) |
|
|
(972 |
) |
Impairment of goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
14,213 |
|
Impairment of intangible assets from acquisitions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,903 |
|
Foreign government paycheck assistance subsidies1 |
|
|
— |
|
|
|
(115 |
) |
|
|
— |
|
|
|
(367 |
) |
Adjusted OIBA |
|
$ |
611 |
|
|
$ |
(1,747 |
) |
|
$ |
1,921 |
|
|
$ |
(8,238 |
) |
1 |
Includes pandemic related wage relief subsidies, recognized as a reduction of wages during the period received. |
Reconciliation from |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
||||||||
Net cash provided by (used in) operating activities |
|
$ |
1,883 |
|
|
$ |
(1,914 |
) |
|
$ |
6,843 |
|
|
$ |
(2,035 |
) |
Changes in assets and liabilities |
|
|
(227 |
) |
|
|
778 |
|
|
|
(2,195 |
) |
|
|
(2,434 |
) |
Income tax expense |
|
|
56 |
|
|
|
(79 |
) |
|
|
(3 |
) |
|
|
(846 |
) |
Acquisition and disposition-related costs (benefit) |
|
|
(432 |
) |
|
|
24 |
|
|
|
(710 |
) |
|
|
(972 |
) |
Interest (income) expense and other, net |
|
|
(189 |
) |
|
|
4 |
|
|
|
(592 |
) |
|
|
(138 |
) |
Foreign government paycheck assistance subsidies1 |
|
|
— |
|
|
|
(115 |
) |
|
|
- |
|
|
|
(367 |
) |
Adjusted EBITDA |
|
$ |
1,091 |
|
|
$ |
(1,302 |
) |
|
$ |
3,343 |
|
|
$ |
(6,792 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net cash used in investing activities |
|
$ |
(577 |
) |
|
$ |
(269 |
) |
|
$ |
(1,447 |
) |
|
$ |
(1,210 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net cash provided by financing activities |
|
$ |
145 |
|
|
$ |
24 |
|
|
$ |
1,841 |
|
|
$ |
5,336 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue Reconciliation |
|||||||||||||||
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
||||||||||
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
||||
Core analytics and solutions revenue2 |
|
$ |
13,466 |
|
|
$ |
13,631 |
|
|
$ |
39,649 |
|
|
$ |
37,875 |
Marketplace, Local Leads, and other analytics3 |
|
|
11,328 |
|
|
|
12,861 |
|
|
|
37,892 |
|
|
|
39,249 |
Total Revenue |
|
$ |
24,794 |
|
|
$ |
26,492 |
|
|
$ |
77,541 |
|
|
$ |
77,124 |
2 |
Core analytics and solutions revenue includes revenue from analytics and sales engagement solutions customers, including those that are purchasing or buying products derived from the company’s speech technology platform. |
|
3 |
Includes revenue from marketplace, local leads and from tests, consulting services or other analytics revenues that may continue for a limited time but are not anticipated to continue in future periods. |
|
||||||||||||||||
Reconciliation of GAAP Net Loss per Share to Adjusted Non-GAAP Income (Loss) per Share |
||||||||||||||||
(in thousands, except per share amounts) |
||||||||||||||||
(unaudited) |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
||||||||
Adjusted Non-GAAP loss per share |
|
$ |
0.01 |
|
|
$ |
(0.03 |
) |
|
$ |
0.03 |
|
|
$ |
(0.13 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss per share applicable to common stockholders - diluted (GAAP loss per share) |
|
$ |
(0.03 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.70 |
) |
Shares used to calculate diluted net loss per share applicable to common stockholders |
|
|
45,645 |
|
|
|
47,131 |
|
|
|
45,297 |
|
|
|
46,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss applicable to common stockholders |
|
$ |
(1,215 |
) |
|
$ |
(3,665 |
) |
|
$ |
(3,628 |
) |
|
$ |
(33,048 |
) |
Stock-based compensation |
|
|
823 |
|
|
|
878 |
|
|
|
2,150 |
|
|
|
2,842 |
|
Acquisition and disposition-related costs (benefit) |
|
|
(432 |
) |
|
|
24 |
|
|
|
(710 |
) |
|
|
(972 |
) |
Amortization of intangible assets from acquisitions |
|
|
1,568 |
|
|
|
1,206 |
|
|
|
4,704 |
|
|
|
4,175 |
|
Impairment of goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
14,213 |
|
Impairment of intangible assets from acquisitions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,903 |
|
Interest income and other, net |
|
|
(189 |
) |
|
|
4 |
|
|
|
(592 |
) |
|
|
(138 |
) |
Estimated impact of income taxes |
|
|
(192 |
) |
|
|
289 |
|
|
|
(596 |
) |
|
|
787 |
|
Adjusted Non-GAAP income (loss) |
|
$ |
363 |
|
|
$ |
(1,264 |
) |
|
$ |
1,328 |
|
|
$ |
(6,238 |
) |
Adjusted Non-GAAP income (loss) per share |
|
$ |
0.01 |
|
|
$ |
(0.03 |
) |
|
$ |
0.03 |
|
|
$ |
(0.13 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Shares used to calculate diluted net loss per share applicable to common stockholders (GAAP) |
|
|
45,645 |
|
|
|
47,131 |
|
|
|
45,297 |
|
|
|
46,994 |
|
Weighted average stock options and common shares subject to purchase or cancellation (if applicable) |
|
|
545 |
|
|
|
— |
|
|
|
793 |
|
|
|
— |
|
Diluted shares used to calculate Adjusted Non-GAAP income (loss) per share 1 |
|
|
46,190 |
|
|
|
47,131 |
|
|
|
46,090 |
|
|
|
46,994 |
|
1 |
For the purpose of computing the number of diluted shares for Adjusted Non-GAAP income (loss) per share, |
Reconciliation of GAAP Net Loss to Non-GAAP Net Loss excluding Impairment of |
||||||||||||||||
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2019 |
|
2020 |
|
2019 |
|
2020 |
||||||||
Net loss applicable to common stockholders (GAAP) |
|
$ |
(1,215 |
) |
|
$ |
(3,665 |
) |
|
$ |
(3,628 |
) |
|
$ |
(33,048 |
) |
Impairment of goodwill |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
14,213 |
|
Impairment of intangible assets from acquisitions |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
5,903 |
|
Net loss excluding impairment of goodwill and intangible assets (Non-GAAP) |
|
$ |
(1,215 |
) |
|
$ |
(3,665 |
) |
|
$ |
(3,628 |
) |
|
$ |
(12,932 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss applicable to common stockholders - diluted (GAAP loss per share) |
|
$ |
(0.03 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.70 |
) |
Impairment of goodwill per diluted share |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
0.30 |
|
Impairment of intangible assets from acquisitions per diluted share |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
0.13 |
|
Net loss excluding impairment of goodwill and intangible assets per diluted share (Non-GAAP) |
|
$ |
(0.03 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.27 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Shares used to calculate diluted net loss per share applicable to common stockholders (GAAP) and diluted net loss excluding impairment of goodwill and intangible assets (Non-GAAP) |
|
|
45,645 |
|
|
|
47,131 |
|
|
|
45,297 |
|
|
|
46,994 |
|
PRELIMINARY AND UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION
The following preliminary and in certain instances estimated unaudited pro forma condensed consolidated statement of operations is derived from the historical consolidated statement of operations of
These preliminary and in certain instances estimated unaudited pro forma condensed consolidated financial statements include adjustments to reflect the following:
- the sale of all of Marchex’s interest in the divested assets, liabilities, and operations;
- the proceeds received from the sale, including a 10% issuance of an equity interest in the entity purchasing the divested net assets (the “Purchaser”);
-
the effects of the anticipated support services agreement between
Marchex and the Purchaser (the “Support Services Agreement”) at the level of services expected during the first year of the Support Services Agreement term.
The preliminary and in certain instances estimated pro forma financial information reflects the accounting treatment of the Divestiture as discontinued operations within Marchex’s preliminary and in certain instances estimated pro forma historical statement of operations. Furthermore, amounts reflected within discontinued operations reflect anticipated accounting treatment and, in some cases, are based on estimates of expected value. Final values may differ significantly and are expected to reflect changes that occur from now until the accounting for the Divestiture is finalized.
The preliminary and in certain instances estimated unaudited pro forma consolidated statements of operations for the nine months ended
The following preliminary and in certain instances estimated unaudited pro forma condensed consolidated financial statements should be read in conjunction with:
- the accompanying notes to the preliminary and unaudited pro forma consolidated financial information;
- other financial tables attached to this press release;
-
Marchex’s Definitive Proxy Statement, dated
August 24, 2020 , containing further information related to the Divestiture.
The preliminary and in certain instances estimated unaudited pro forma condensed consolidated financial data has been presented for informational purposes only. The assumptions used and pro forma adjustments derived from such assumptions are based on currently available information, and the Company believes such assumptions are reasonable under the circumstances, but are preliminary and in certain instances estimated given the accounting for the Divestiture has not been finalized. The pro forma data is not necessarily indicative of our results of operations had the Divestiture been completed on the dates assumed. In addition, they are not necessarily indicative of our future results of operations.
|
||||||||||||||||||
Preliminary and Unaudited Pro Forma Consolidated Statement of Operations |
||||||||||||||||||
For the nine months ended |
||||||||||||||||||
(in thousands, except per share amounts) |
||||||||||||||||||
|
|
Marchex,
|
|
Discontinued
|
|
Pro Forma
|
|
|
|
Marchex,
|
||||||||
Revenue |
|
$ |
77,124 |
|
|
$ |
(38,597 |
) |
|
|
— |
|
|
|
|
$ |
38,527 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service costs (1) |
|
|
44,991 |
|
|
|
(28,848 |
) |
|
|
(150 |
) |
|
(a) |
|
|
15,993 |
|
Sales and marketing (1) |
|
|
14,692 |
|
|
|
(2,123 |
) |
|
|
(75 |
) |
|
(a) |
|
|
12,494 |
|
Product development (1) |
|
|
17,684 |
|
|
|
(1,971 |
) |
|
|
(75 |
) |
|
(a) |
|
|
15,638 |
|
General and administrative (1) |
|
|
10,470 |
|
|
|
(378 |
) |
|
|
(2,325 |
) |
|
(a) |
|
|
7,767 |
|
Amortization of intangible assets from acquisitions (2) |
|
|
4,175 |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
4,175 |
|
Acquisition related costs (benefit) |
|
|
(972 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
|
(972 |
) |
Total operating expenses |
|
|
91,040 |
|
|
|
(33,320 |
) |
|
|
(2,625 |
) |
|
|
|
|
55,095 |
|
Impairment of goodwill |
|
|
(14,213 |
) |
|
|
1,141 |
|
|
— |
|
|
|
|
|
(13,072 |
) |
|
Impairment of intangible assets from acquisitions |
|
|
(5,903 |
) |
|
|
— |
|
|
— |
|
|
|
|
|
(5,903 |
) |
|
Income (loss) from operations |
|
|
(34,032 |
) |
|
|
(4,136 |
) |
|
|
2,625 |
|
|
|
|
|
(35,543 |
) |
Other income (loss) |
|
|
6 |
|
|
|
|
|
|
207 |
|
|
(b) |
|
|
213 |
|
|
Interest income, net |
|
|
132 |
|
|
— |
|
|
— |
|
|
|
|
|
132 |
|
||
Income (loss) before provision for income taxes |
|
|
(33,894 |
) |
|
|
(4,136 |
) |
|
|
2,832 |
|
|
|
|
|
(35,198 |
) |
Income tax (benefit) expense |
|
|
(846 |
) |
|
— |
|
|
— |
|
|
(c) |
|
|
(846 |
) |
||
Net loss applicable to common stockholders |
|
$ |
(33,048 |
) |
|
$ |
(4,136 |
) |
|
$ |
2,832 |
|
|
|
|
$ |
(34,352 |
) |
Earnings (Loss) Per Common Share (“EPS”): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic and diluted net loss per Class A share applicable to common stockholders |
|
$ |
(0.70 |
) |
|
|
|
|
|
|
|
|
|
$ |
(0.73 |
) |
||
Basic and diluted net loss per Class B share applicable to common stockholders |
|
$ |
(0.70 |
) |
|
|
|
|
|
|
|
|
|
$ |
(0.73 |
) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding for basic EPS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Class A |
|
|
4,661 |
|
|
|
|
|
|
|
|
|
|
|
4,661 |
|
||
Class B |
|
|
42,333 |
|
|
|
|
|
|
|
|
|
|
|
42,333 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding for diluted EPS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Class A |
|
|
4,661 |
|
|
|
|
|
|
|
|
|
|
|
4,661 |
|
||
Class B |
|
|
46,994 |
|
|
|
|
|
|
|
|
|
|
|
46,994 |
|
||
(1) Excludes amortization of intangibles from acquisitions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(2) Components of amortization of intangibles from acquisitions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service costs |
|
$ |
2,012 |
|
|
|
— |
|
|
|
— |
|
|
|
$ |
|
2,012 |
|
Sales and marketing |
|
|
1,616 |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
1,616 |
|
General and administrative |
|
|
547 |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
547 |
|
Total |
|
$ |
4,175 |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
$ |
4,175 |
|
|
||
Notes to Preliminary and Unaudited Pro Forma Consolidated Condensed Financial Information |
||
Certain amounts included in the preliminary and unaudited pro forma consolidated condensed statement of operations are based on estimates, which may change as accounting for the Divestiture is finalized. |
||
(a) |
Reflects estimated expense recovery from performing services under the Support Services Agreement, to the extent not already reflected as part of discontinued operations adjustments. |
|
(b) |
Reflects Marchex’s equity interest in the net income of the Purchaser, which is part of the consideration received by |
|
(c) |
No tax effects of pro forma adjustments have been recorded due to the extent of the Company’s tax loss carryforwards reduced by valuation allowances. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20201104005685/en/
Marchex Investor Relations
Telephone: 206.331.3600
Email: ir(at)marchex.com
Or
MEDIA INQUIRIES
Telephone: 206.331.3434
Email: pr(at)marchex.com
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