Exhibit 99.2
FINANCIAL SUPPLEMENT
June 30, 2014
Monster Worldwide, Inc. (together with its consolidated subsidiaries, the “Company,” “Monster,” “we,” “our” or “us”) provides this supplement to assist investors in evaluating the Company’s financial and operating metrics. We suggest that the notes to this supplement be read in conjunction with the financial tables. The financial information included in this supplement contains certain non-GAAP financial measures. These measures should be considered in addition to results prepared in accordance with generally accepted accounting principles (“GAAP”), but are not a substitute for, or superior to, GAAP results. The non-GAAP measures included in this supplement have been reconciled to the most comparable GAAP measure. The Company intends to update the financial supplement on a quarterly basis.
Notes to Financial Supplement
Presentation
Stock Based Compensation
Non-cash, stock-based compensation expense has been excluded from our non-GAAP financial statements for all periods presented.
Facilities and Acquisition Costs
The Company incurred $6.3 million of charges associated with exited facilities and acquisition related costs in the first quarter of 2014 which have been excluded from our non-GAAP financial statements for the six months ended June 30, 2014. The majority of this charge related to facility charges associated with the consolidation of multiple offices into the Company’s new corporate headquarters in Weston, Massachusetts. The Company also incurred $0.3 million of acquisition related charges associated with the purchase of TalentBin, Inc., a social profile talent search engine, and Gozaik LLC, a developer of social jobs aggregation and distribution technology.
Strategic Alternatives
On March 1, 2012, the Company announced that it had resolved to explore strategic alternatives to maximize value for the Company’s stockholders. During the three months and six months ended June 30, 2013, the Company incurred $1.5 million and $2.9 million of costs related to the review of strategic alternatives, respectively, which have been excluded from our non-GAAP financial statements for the respective periods.
Restructuring
On November 8, 2012, the Company announced actions to concentrate resources on core businesses within North America and key European and Asian markets with increased spending in marketing and sales. The restructuring actions included reducing the Company’s workforce, consolidating certain office facilities and impairing certain fixed assets. The Company incurred $6.8 million and $20.0 million of restructuring costs relating to this program in the three and six months ended June 30, 2013, respectively, which have been excluded from our non-GAAP financial statements for the respective periods.
Gain on deconsolidation of subsidiaries, net
Prior to January 3, 2014, the Company had a 25% equity investment in a company located in Finland related to a business combination completed in 2001, with the remaining 75% held by Alma Media Corporation (“Alma Media”). Alma Media is a leading media company based in Finland, focused on digital services and publishing in Finland, the Nordic countries, the Baltics and Central Europe. Effective January 3, 2014, the Company expanded its relationship with Alma Media. Monster and Alma Media each contributed several additional entities and businesses into the existing joint venture and formed a significantly larger joint venture where Monster has an equity ownership of 15% with the opportunity to increase ownership up to 20%. The Company also contributed cash of approximately $6.5 million. Following closing, Monster no longer held a controlling interest in its subsidiaries in Poland, Hungary and the Czech Republic and therefore deconsolidated those subsidiaries effective January 3, 2014. The Company accounts for its investment under the equity method of accounting due to the Company’s ability to exert significant influence over the financial and operating policies of the new joint venture, primarily through our representation on the board of directors.
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The Company recorded a gain of approximately $14.0 million as a result of the deconsolidation. The gain was measured as the difference between the (a) net fair value of the retained noncontrolling investment and the consideration transferred and (b) the carrying value of the contributed subsidiaries’ net assets of approximately $4.2 million. The fair value of the retained noncontrolling investment was approximately $24.8 million which was determined based on the present value of estimated future cash flows. The Company also recognized $1.8 million of accumulated unrealized currency translation loss related to the net assets of the subsidiaries contributed by Monster.
As a result of the deconsolidation, the Company recorded a net gain of approximately $12.0 million to Gain on deconsolidation of subsidiaries, net during the first quarter of 2014 which has been excluded from our non-GAAP financial statements for the six months ended June 30, 2014.
Income Tax
As a result of the gain related to the deconsolidation of our subsidiaries in Poland, Hungary and the Czech Republic, the Company recognized a tax provision of $5.5 million in the first quarter of 2014 which has been excluded from our non-GAAP financial statements for the six months ended June 30, 2014.
In the six months ended June 30, 2013, the Company recognized an income tax benefit relating to the reversal of uncertain tax positions which has been excluded from our non-GAAP financial statements for the six months ended June 30, 2013.
Discontinued Operations
During the third quarter of 2012, as part of the Company’s review of strategic alternatives, the Company made the decision to sell its Careers-China business. The sale of the Careers-China business to Saongroup, Ltd. (“Saongroup”) was completed on February 5, 2013. The Company received a 10% minority interest in the combined China business of Saongroup.
Prior to the close of the sale of Careers-China in the first quarter of 2013, the Company incurred charges relating to severance benefits associated with terminated employees, retention benefits for employees who remained with the combined operations and certain lease obligation costs. At February 5, 2013, there was $23.1 million of accumulated unrealized currency translation gain related to the net assets of Careers-China. With the sale of Careers-China on February 5, 2013, the Company recorded the foreign currency translation adjustment as a reduction of the loss on disposition of discontinued operations. Additionally, the Company recorded a tax benefit of $4.0 million in the first quarter of 2013. Accordingly, the Company recorded a loss from discontinued operations, net of tax, of $0.6 million and $5.2 million for the three and six months ended June 30, 2013, respectively, which have been excluded from our non-GAAP financial statements for the respective periods. The Company does not expect to incur significant additional charges in future periods relating to Careers-China.
During the fourth quarter of 2012, the Company made the strategic decision to discontinue operations in Latin America and Turkey. All of the Latin America and Turkey business operations were discontinued on or before December 31, 2012. For the three and six months ended June 30, 2013, the Company incurred $0.1 million and $2.2 million of costs, respectively, which was primarily relating to severance costs associated with terminated employees of our operations in Latin America and Turkey. Additionally, the Company recorded a tax benefit of $0.5 million first quarter of 2013. Accordingly, the Company recorded a loss from discontinued operations, net of tax, of $0.1 million and $1.7 million in the for the three and six months ended June 30, 2013, respectively, which have been excluded from our non-GAAP financial statements for the respective periods. The Company does not expect to incur significant additional charges in future periods relating to Latin America or Turkey.
Reclassifications
Certain reclassifications of prior year amounts have been made for consistent presentation.
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Non-GAAP financial measures
The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or an alternative for, GAAP and may be different from non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations.
Non-GAAP revenue, operating expenses, operating income from continuing operations, operating margin, income (loss) from continuing operations, (loss) income from discontinued operations, net of tax, and diluted earnings (loss) per share attributable to Monster Worldwide, Inc. all exclude certain pro-forma adjustments including: non-cash stock based compensation expense; costs incurred for the 2012 restructurings; costs incurred related to the Company’s review of strategic alternatives; income tax benefits associated with the reversal of income tax reserves on uncertain tax positions and a tax benefit related to certain losses arising from the Company’s restructuring programs; income tax provision related to the sale of a noncontrolling interest; the results of the businesses in Careers – China, Latin America and Turkey as they have been classified as discontinued operations; gain on deconsolidation of subsidiaries, net; and charges related to exited facilities and acquisition related costs. The Company uses these non-GAAP measures for reviewing the ongoing results of the Company’s core business operations and in certain instances, for measuring performance under certain of the Company’s incentive compensation plans. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is defined as operating income or loss before depreciation and amortization, non-cash compensation expense, and non-cash costs incurred in connection with the Company’s restructuring programs. The Company considers EBITDA to be an important indicator of its operational strength which the Company believes is useful to management and investors in evaluating its operating performance. EBITDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA excludes the impact of the pro-forma adjustments discussed above.
Free cash flow is defined as cash flow from operating activities less capital expenditures. Free cash flow is considered a liquidity measure and provides useful information about the Company’s ability to generate cash after investments in property and equipment. Free cash flow reflected herein is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies. Free cash flow does not reflect the total change in the Company’s cash position for the period and should not be considered a substitute for such a measure.
Net cash and securities are defined as cash and cash equivalents plus short-term and long-term marketable securities, less total debt. Total available liquidity is defined as cash and cash equivalents, plus short-term and long-term marketable securities, plus unused borrowings under our credit facility. The Company considers net cash and securities and total available liquidity to be important measures of liquidity and indicators of its ability to meet its ongoing obligations. The Company also uses net cash and securities and total available liquidity, among other measures, in evaluating its choices for capital deployment. Net cash and securities and total available liquidity are presented herein as non-GAAP measures and may not be comparable to similarly titled measures used by other companies.
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Monster Worldwide, Inc.
Statements of Operations
(unaudited, in thousands, except per share amounts)
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| | | Trended Data | |
Summary P&L Information | | Q1 2013 | | | Q2 2013 | | | Q3 2013 | | | Q4 2013 | | | FY 2013 | | | Q1 2014 | | | Q2 2014 | |
Monster Careers | | $ | 193,654 | | | $ | 181,819 | | | $ | 178,737 | | | $ | 180,687 | | | $ | 734,897 | | | $ | 182,251 | | | $ | 178,581 | |
Internet Advertising & Fees | | | 18,332 | | | | 18,239 | | | | 18,080 | | | | 18,031 | | | | 72,682 | | | | 15,898 | | | | 15,860 | |
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Revenue | | | 211,986 | | | | 200,058 | | | | 196,817 | | | | 198,718 | | | | 807,579 | | | | 198,149 | | | | 194,441 | |
Salary and related | | | 90,781 | | | | 83,997 | | | | 88,030 | | | | 91,207 | | | | 354,015 | | | | 93,826 | | | | 94,157 | |
Office and general | | | 35,028 | | | | 36,537 | | | | 36,997 | | | | 37,679 | | | | 146,241 | | | | 42,688 | | | | 37,296 | |
Marketing and promotion | | | 49,267 | | | | 43,394 | | | | 38,089 | | | | 38,840 | | | | 169,590 | | | | 41,413 | | | | 37,377 | |
Restructuring and other special charges | | | 13,167 | | | | 6,828 | | | | — | | | | — | | | | 19,995 | | | | — | | | | — | |
Depreciation expense | | | 13,000 | | | | 12,644 | | | | 12,297 | | | | 11,981 | | | | 49,922 | | | | 11,885 | | | | 11,217 | |
Stock based compensation expense | | | 6,794 | | | | 5,470 | | | | 4,901 | | | | 8,226 | | | | 25,391 | | | | 8,173 | | | | 9,063 | |
Amortization of intangibles | | | 3,104 | | | | 3,081 | | | | 2,248 | | | | 801 | | | | 9,234 | | | | 634 | | | | 618 | |
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Operating expenses | | | 211,141 | | | | 191,951 | | | | 182,562 | | | | 188,734 | | | | 774,388 | | | | 198,619 | | | | 189,728 | |
Operating income (loss) | | | 845 | | | | 8,107 | | | | 14,255 | | | | 9,984 | | | | 33,191 | | | | (470 | ) | | | 4,713 | |
Gain on deconsolidation of subsidiaries, net | | | — | | | | — | | | | — | | | | — | | | | — | | | | 11,828 | | | | — | |
Interest and other, net | | | (1,268 | ) | | | (1,357 | ) | | | (1,482 | ) | | | (1,663 | ) | | | (5,770 | ) | | | (1,323 | ) | | | (1,660 | ) |
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(Loss) income before income taxes and equity interests | | | (423 | ) | | | 6,750 | | | | 12,773 | | | | 8,321 | | | | 27,421 | | | | 10,035 | | | | 3,053 | |
(Benefit from) provision for income taxes | | | (11,999 | ) | | | 2,366 | | | | 4,480 | | | | 28,157 | | | | 23,004 | | | | 6,663 | | | | 1,615 | |
(Loss) income in equity interests, net | | | (458 | ) | | | (245 | ) | | | (119 | ) | | | (86 | ) | | | (908 | ) | | | (133 | ) | | | 58 | |
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Income (loss) from continuing operations | | | 11,118 | | | | 4,139 | | | | 8,174 | | | | (19,922 | ) | | | 3,509 | | | | 3,239 | | | | 1,496 | |
(Loss) income from discontinued operations, net of tax | | | (6,134 | ) | | | (759 | ) | | | 3,095 | | | | — | | | | (3,798 | ) | | | — | | | | — | |
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Net income (loss) | | | 4,984 | | | | 3,380 | | | | 11,269 | | | | (19,922 | ) | | | (289 | ) | | | 3,239 | | | | 1,496 | |
Net income attributable to noncontrolling interest | | | — | | | | — | | | | — | | | | (193 | ) | | | (193 | ) | | | (1,174 | ) | | | (1,462 | ) |
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Net income (loss) attributable to Monster Worldwide, Inc. | | $ | 4,984 | | | $ | 3,380 | | | $ | 11,269 | | | $ | (20,115 | ) | | $ | (482 | ) | | $ | 2,065 | | | $ | 34 | |
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Basic earnings (loss) per share attributable to Monster Worldwide, Inc.: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | | 0.10 | | | | 0.04 | | | | 0.08 | | | | (0.21 | ) | | | 0.03 | | | | 0.02 | | | | — | |
(Loss) income from discontinued operations, net of tax | | | (0.06 | ) | | | (0.01 | ) | | | 0.03 | | | | — | | | | (0.04 | ) | | | — | | | | — | |
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Net income (loss) | | $ | 0.04 | | | $ | 0.03 | | | $ | 0.11 | | | $ | (0.21 | ) | | $ | — | | | $ | 0.02 | | | $ | — | |
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Diluted earnings (loss) per share attributable to Monster Worldwide, Inc.: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from continuing operations | | | 0.10 | | | | 0.04 | | | | 0.08 | | | | (0.21 | ) | | | 0.03 | | | | 0.02 | | | | — | |
(Loss) income from discontinued operations, net of tax | | | (0.06 | ) | | | (0.01 | ) | | | 0.03 | | | | — | | | | (0.04 | ) | | | — | | | | — | |
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Net income (loss) | | $ | 0.04 | | | $ | 0.03 | | | $ | 0.11 | | | $ | (0.21 | ) | | $ | — | | | $ | 0.02 | | | $ | — | |
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Weighted avg. shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic shares | | | 111,402 | | | | 110,932 | | | | 105,394 | | | | 97,872 | | | | 106,947 | | | | 91,102 | | | | 87,080 | |
Diluted shares | | | 112,637 | | | | 111,937 | | | | 105,967 | | | | 97,872 | | | | 107,913 | | | | 94,416 | | | | 89,955 | |
Global employees — continuing operations (ones) | | | 3,852 | | | | 3,905 | | | | 3,948 | | | | 3,998 | | | | 3,998 | | | | 4,068 | | | | 4,078 | |
Annualized revenue per average employee | | $ | 215.0 | | | $ | 206.3 | | | $ | 200.5 | | | $ | 200.1 | | | $ | 205.5 | | | $ | 196.5 | | | $ | 191.0 | |
Monster Worldwide, Inc.
Non-GAAP Statements of Operations
(Unaudited, in thousands, except per share amounts)
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| | | Trended Data | |
Summary P&L Information | | Q1 2013 | | | Q2 2013 | | | Q3 2013 | | | Q4 2013 | | | FY 2013 | | | Q1 2014 | | | Q2 2014 | |
Monster Careers | | $ | 193,654 | | | $ | 181,819 | | | $ | 178,737 | | | $ | 180,687 | | | $ | 734,897 | | | $ | 182,251 | | | $ | 178,581 | |
Internet Advertising & Fees | | | 18,332 | | | | 18,239 | | | | 18,080 | | | | 18,031 | | | | 72,682 | | | | 15,898 | | | | 15,860 | |
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Revenue | | | 211,986 | | | | 200,058 | | | | 196,817 | | | | 198,718 | | | | 807,579 | | | | 198,149 | | | | 194,441 | |
Salary and related | | | 90,781 | | | | 83,997 | | | | 88,030 | | | | 91,207 | | | | 354,015 | | | | 93,826 | | | | 94,157 | |
Office and general | | | 33,653 | | | | 34,992 | | | | 36,997 | | | | 37,679 | | | | 143,321 | | | | 36,339 | | | | 37,296 | |
Marketing and promotion | | | 49,267 | | | | 43,394 | | | | 38,089 | | | | 38,840 | | | | 169,590 | | | | 41,413 | | | | 37,377 | |
Depreciation expense | | | 13,000 | | | | 12,644 | | | | 12,297 | | | | 11,981 | | | | 49,922 | | | | 11,885 | | | | 11,217 | |
Amortization of intangibles | | | 3,104 | | | | 3,081 | | | | 2,248 | | | | 801 | | | | 9,234 | | | | 634 | | | | 618 | |
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Operating expenses | | | 189,805 | | | | 178,108 | | | | 177,661 | | | | 180,508 | | | | 726,082 | | | | 184,097 | | | | 180,665 | |
Operating income | | | 22,181 | | | | 21,950 | | | | 19,156 | | | | 18,210 | | | | 81,497 | | | | 14,052 | | | | 13,776 | |
Interest and other, net | | | (1,268 | ) | | | (1,357 | ) | | | (1,482 | ) | | | (1,663 | ) | | | (5,770 | ) | | | (1,323 | ) | | | (1,660 | ) |
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Income before income taxes and equity interests | | | 20,913 | | | | 20,593 | | | | 17,674 | | | | 16,547 | | | | 75,727 | | | | 12,729 | | | | 12,116 | |
Provision for income taxes | | | 7,320 | | | | 7,222 | | | | 6,199 | | | | 5,791 | | | | 26,532 | | | | 4,083 | | | | 3,756 | |
(Loss) income in equity interests, net | | | (458 | ) | | | (245 | ) | | | (119 | ) | | | (86 | ) | | | (908 | ) | | | (133 | ) | | | 58 | |
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Net income | | | 13,135 | | | | 13,126 | | | | 11,356 | | | | 10,670 | | | | 48,287 | | | | 8,513 | | | | 8,418 | |
Net income attributable to noncontrolling interest | | | — | | | | — | | | | — | | | | (193 | ) | | | (193 | ) | | | (1,174 | ) | | | (1,462 | ) |
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Income from continuing operations attributable to Monster Worldwide, Inc. | | $ | 13,135 | | | $ | 13,126 | | | $ | 11,356 | | | $ | 10,477 | | | $ | 48,094 | | | $ | 7,339 | | | $ | 6,956 | |
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Diluted earnings per share attributable to Monster Worldwide, Inc.: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Income from continuing operations | | $ | 0.12 | | | $ | 0.12 | | | $ | 0.11 | | | $ | 0.11 | | | $ | 0.45 | | | $ | 0.08 | | | $ | 0.08 | |
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Weighted avg. shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic shares | | | 111,402 | | | | 110,932 | | | | 105,394 | | | | 97,872 | | | | 106,947 | | | | 91,102 | | | | 87,080 | |
Diluted shares | | | 112,637 | | | | 111,937 | | | | 105,967 | | | | 98,655 | | | | 107,913 | | | | 94,416 | | | | 89,955 | |
Monster Worldwide, Inc.
Segment Information—GAAP and Non-GAAP
(unaudited, in thousands)
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| | | Trended Data | |
| | | Q1 2013 | | | Q2 2013 | | | Q3 2013 | | | Q4 2013 | | | FY 2013 | | | Q1 2014 | | | Q2 2014 | |
Segment Revenue: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Careers—North America | | $ | 115,935 | | | $ | 109,717 | | | $ | 109,622 | | | $ | 111,000 | | | $ | 446,274 | | | $ | 111,647 | | | $ | 110,301 | |
Careers—International | | | 77,719 | | | | 72,102 | | | | 69,115 | | | | 69,687 | | | | 288,623 | | | | 70,604 | | | | 68,280 | |
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Careers Revenue | | | 193,654 | | | | 181,819 | | | | 178,737 | | | | 180,687 | | | | 734,897 | | | | 182,251 | | | | 178,581 | |
Internet Advertising & Fees Revenue | | | 18,332 | | | | 18,239 | | | | 18,080 | | | | 18,031 | | | | 72,682 | | | | 15,898 | | | | 15,860 | |
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Total Monster Revenue | | $ | 211,986 | | | $ | 200,058 | | | $ | 196,817 | | | $ | 198,718 | | | $ | 807,579 | | | $ | 198,149 | | | $ | 194,441 | |
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Segment operating income (loss): GAAP | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Careers—North America | | $ | 12,423 | | | $ | 19,272 | | | $ | 16,346 | | | $ | 16,968 | | | $ | 65,009 | | | $ | 12,120 | | | $ | 17,902 | |
Careers—International | | | (8,991 | ) | | | (6,054 | ) | | | (325 | ) | | | (3,226 | ) | | | (18,596 | ) | | | (5,289 | ) | | | (6,974 | ) |
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Careers operating income GAAP | | | 3,432 | | | | 13,218 | | | | 16,021 | | | | 13,742 | | | | 46,413 | | | | 6,831 | | | | 10,928 | |
Internet Advertising & Fees operating income GAAP | | | 6,262 | | | | 6,312 | | | | 5,902 | | | | 6,016 | | | | 24,492 | | | | 3,691 | | | | 3,464 | |
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Total Monster operating income | | $ | 9,694 | | | $ | 19,530 | | | $ | 21,923 | | | $ | 19,758 | | | $ | 70,905 | | | $ | 10,522 | | | $ | 14,392 | |
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Corporate expenses GAAP | | | (8,849 | ) | | | (11,423 | ) | | | (7,668 | ) | | | (9,774 | ) | | | (37,714 | ) | | | (10,992 | ) | | | (9,679 | ) |
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Total Monster Consolidated operating income (loss) GAAP | | $ | 845 | | | $ | 8,107 | | | $ | 14,255 | | | $ | 9,984 | | | $ | 33,191 | | | $ | (470 | ) | | $ | 4,713 | |
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Segment operating income (loss)(1): Non-GAAP | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Careers—North America | | $ | 22,424 | | | $ | 22,277 | | | $ | 17,902 | | | $ | 20,315 | | | $ | 82,918 | | | $ | 17,508 | | | $ | 21,058 | |
Careers—International | | | (1,747 | ) | | | (1,674 | ) | | | 1,281 | | | | (2,795 | ) | | | (4,935 | ) | | | (3,130 | ) | | | (4,512 | ) |
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Careers operating income Non-GAAP | | | 20,677 | | | | 20,603 | | | | 19,183 | | | | 17,520 | | | | 77,983 | | | | 14,378 | | | | 16,546 | |
Internet Advertising & Fees operating income Non-GAAP | | | 6,883 | | | | 6,978 | | | | 6,353 | | | | 6,753 | | | | 26,967 | | | | 4,415 | | | | 3,922 | |
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Total Monster operating income Non-GAAP | | $ | 27,560 | | | $ | 27,581 | | | $ | 25,536 | | | $ | 24,273 | | | $ | 104,950 | | | $ | 18,793 | | | $ | 20,468 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Corporate expenses Non-GAAP | | | (5,379 | ) | | | (5,631 | ) | | | (6,380 | ) | | | (6,063 | ) | | | (23,453 | ) | | | (4,741 | ) | | | (6,692 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total Monster Consolidated operating income Non-GAAP | | $ | 22,181 | | | $ | 21,950 | | | $ | 19,156 | | | $ | 18,210 | | | $ | 81,497 | | | $ | 14,052 | | | $ | 13,776 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | - See notes to financial supplement for further explanation of Non-GAAP measures. |
Monster Worldwide, Inc.
Segment Information—GAAP and Non-GAAP
(unaudited, in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Trended Data | |
Summary P&L Information | | Q1 2013 | | | Q2 2013 | | | Q3 2013 | | | Q4 2013 | | | FY 2013 | | | Q1 2014 | | | Q2 2014 | |
Revenue | | $ | 211,986 | | | $ | 200,058 | | | $ | 196,817 | | | $ | 198,718 | | | $ | 807,579 | | | $ | 198,149 | | | $ | 194,441 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
EBITDA | | $ | 24,518 | | | $ | 33,842 | | | $ | 33,701 | | | $ | 30,992 | | | $ | 123,053 | | | $ | 20,222 | | | $ | 25,611 | |
Depreciation expense | | | 13,000 | | | | 12,644 | | | | 12,297 | | | | 11,981 | | | | 49,922 | | | | 11,885 | | | | 11,217 | |
Stock based compensation expense | | | 6,794 | | | | 5,470 | | | | 4,901 | | | | 8,226 | | | | 25,391 | | | | 8,173 | | | | 9,063 | |
Restructuring non-cash charges | | | 775 | | | | 4,540 | | | | — | | | | — | | | | 5,315 | | | | — | | | | — | |
Amortization of intangibles | | | 3,104 | | | | 3,081 | | | | 2,248 | | | | 801 | | | | 9,234 | | | | 634 | | | | 618 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Operating income (loss)—GAAP | | $ | 845 | | | $ | 8,107 | | | $ | 14,255 | | | $ | 9,984 | | | $ | 33,191 | | | $ | (470 | ) | | $ | 4,713 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stock based compensation | | | 6,794 | | | | 5,470 | | | | 4,901 | | | | 8,226 | | | | 25,391 | | | | 8,173 | | | | 9,063 | |
Facilities and acquisition costs | | | — | | | | — | | | | — | | | | — | | | | — | | | | 6,349 | | | | — | |
Fees associated with strategic alternatives | | | 1,375 | | | | 1,545 | | | | — | | | | — | | | | 2,920 | | | | — | | | | — | |
Restructuring program non-cash charges | | | 775 | | | | 4,540 | | | | — | | | | — | | | | 5,315 | | | | — | | | | — | |
Restructuring expenses, less non-cash items | | | 12,392 | | | | 2,288 | | | | — | | | | — | | | | 14,680 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total Non-GAAP Adjustments | | | 21,336 | | | | 13,843 | | | | 4,901 | | | | 8,226 | | | | 48,306 | | | | 14,522 | | | | 9,063 | |
Operating income Non-GAAP(1) | | $ | 22,181 | | | $ | 21,950 | | | $ | 19,156 | | | $ | 18,210 | | | $ | 81,497 | | | $ | 14,052 | | | $ | 13,776 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | - See notes to financial supplement for further explanation of Non-GAAP measures. |
Monster Worldwide, Inc.
Statements of Cash Flows
(unaudited, in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Trended Data | |
| | | Q1 2013 | | | Q2 2013 | | | Q3 2013 | | | Q4 2013 | | | FY 2013 | | | Q1 2014 | | | Q2 2014 | |
Cash flows (used for) provided by operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net income (loss) | | $ | 4,984 | | | $ | 3,380 | | | $ | 11,269 | | | $ | (19,922 | ) | | $ | (289 | ) | | $ | 3,239 | | | $ | 1,496 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustments to reconcile net income (loss) to cash (used for) provided by operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | 16,104 | | | | 15,725 | | | | 14,545 | | | | 12,782 | | | | 59,156 | | | | 12,519 | | | | 11,835 | |
Provision for doubtful accounts | | | 535 | | | | 897 | | | | 318 | | | | 617 | | | | 2,367 | | | | 316 | | | | 412 | |
Non-cash compensation | | | 6,794 | | | | 5,470 | | | | 4,901 | | | | 8,226 | | | | 25,391 | | | | 8,173 | | | | 9,063 | |
Deferred income taxes | | | (2,172 | ) | | | (435 | ) | | | 4,825 | | | | 26,356 | | | | 28,574 | | | | 3,893 | | | | (491 | ) |
Non-cash restructuring charges | | | 775 | | | | 4,540 | | | | — | | | | — | | | | 5,315 | | | | — | | | | — | |
Loss (income) in equity interests, net | | | 458 | | | | 245 | | | | 119 | | | | 86 | | | | 908 | | | | 133 | | | | (58 | ) |
Gain on deconsolidation of subsidiaries | | | — | | | | — | | | | — | | | | — | | | | — | | | | (13,647 | ) | | | — | |
Tax benefit from change in uncertain tax positions | | | (12,869 | ) | | | — | | | | (1,486 | ) | | | — | | | | (14,355 | ) | | | — | | | | — | |
Amount reclassified from accumulated other comprehensive income | | | (23,109 | ) | | | — | | | | — | | | | — | | | | (23,109 | ) | | | 1,819 | | | | — | |
Excess income tax benefit from equity compensation plans | | | — | | | | (2,044 | ) | | | (1,970 | ) | | | (1,893 | ) | | | (5,907 | ) | | | (130 | ) | | | (69 | ) |
Changes in assets and liabilities, net of acquisitions: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable | | | 5,907 | | | | 22,734 | | | | 12,820 | | | | (33,443 | ) | | | 8,018 | | | | 14,501 | | | | 25,023 | |
Prepaid and other | | | 14,690 | | | | 865 | | | | (3,371 | ) | | | 2,389 | | | | 14,573 | | | | (14,838 | ) | | | 6,848 | |
Deferred revenue | | | (5,039 | ) | | | (26,203 | ) | | | (16,582 | ) | | | 25,635 | | | | (22,189 | ) | | | (964 | ) | | | (26,525 | ) |
Accounts payable, accrued liabilities, and other | | | (15,695 | ) | | | (9,771 | ) | | | (23,137 | ) | | | 3,972 | | | | (44,631 | ) | | | 3,893 | | | | (2,634 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total adjustments | | | (13,621 | ) | | | 12,023 | | | | (9,018 | ) | | | 44,727 | | | | 34,111 | | | | 15,668 | | | | 23,404 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net cash (used for) provided by operatingactivities | | | (8,637 | ) | | | 15,403 | | | | 2,251 | | | | 24,805 | | | | 33,822 | | | | 18,907 | | | | 24,900 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows used for investing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | | (9,149 | ) | | | (9,239 | ) | | | (6,602 | ) | | | (7,626 | ) | | | (32,616 | ) | | | (10,700 | ) | | | (11,769 | ) |
Payments for acquisitions, net of cash acquired | | | — | | | | — | | | | — | | | | — | | | | — | | | | (27,005 | ) | | | — | |
Investment in Alma Career Oy | | | — | | | | — | | | | — | | | | — | | | | — | | | | (6,516 | ) | | | — | |
Cash funded to and dividends received from equity investee and other | | | 623 | | | | (484 | ) | | | (2,638 | ) | | | (3,767 | ) | | | (6,266 | ) | | | (729 | ) | | | 113 | |
Capitalized patent defense costs | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | (1,220 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net cash used for investing activities | | | (8,526 | ) | | | (9,723 | ) | | | (9,240 | ) | | | (11,393 | ) | | | (38,882 | ) | | | (44,950 | ) | | | (12,876 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows provided by (used for) financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Proceeds from borrowings on credit facilities | | | 17,500 | | | | — | | | | 52,000 | | | | — | | | | 69,500 | | | | 78,800 | | | | — | |
Payments on borrowings on credit facilities | | | (11,399 | ) | | | (28,400 | ) | | | — | | | | (51,800 | ) | | | (91,599 | ) | | | — | | | | (8,100 | ) |
Payments on borrowings on term loan | | | (1,250 | ) | | | (1,875 | ) | | | (1,875 | ) | | | (1,875 | ) | | | (6,875 | ) | | | (1,875 | ) | | | (2,500 | ) |
Tax withholdings related to net share settlements of restricted stock awards and units | | | (1,793 | ) | | | (3,194 | ) | | | (927 | ) | | | (147 | ) | | | (6,061 | ) | | | (1,427 | ) | | | (2,280 | ) |
Repurchase of common stock | | | — | | | | (23,378 | ) | | | (37,404 | ) | | | (46,385 | ) | | | (107,167 | ) | | | (39,653 | ) | | | (11,864 | ) |
Excess income tax benefit from equity compensation plans | | | — | | | | 2,044 | | | | 1,970 | | | | 1,893 | | | | 5,907 | | | | 130 | | | | 69 | |
Net proceeds from sale of noncontrolling interest | | | — | | | | — | | | | — | | | | 86,523 | | | | 86,523 | | | | — | | | | — | |
Dividend paid to noncontrolling interest | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | (3,021 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net cash provided by (used for) financing activities | | | 3,058 | | | | (54,803 | ) | | | 13,764 | | | | (11,791 | ) | | | (49,772 | ) | | | 35,975 | | | | (27,696 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Effects of exchange rates on cash | | | (3,172 | ) | | | (2,452 | ) | | | 837 | | | | 15 | | | | (4,772 | ) | | | 118 | | | | 1,436 | |
Net (decrease) increase in cash and cash equivalents | | | (17,277 | ) | | | (51,575 | ) | | | 7,612 | | | | 1,636 | | | | (59,604 | ) | | | 10,050 | | | | (14,236 | ) |
Cash and cash equivalents, beginning of period | | | 148,185 | | | | 130,908 | | | | 79,333 | | | | 86,945 | | | | 148,185 | | | | 88,581 | | | | 98,631 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents, end of period | | $ | 130,908 | | | $ | 79,333 | | | $ | 86,945 | | | $ | 88,581 | | | $ | 88,581 | | | $ | 98,631 | | | $ | 84,395 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
9
Monster Worldwide, Inc.
Consolidated Condensed Balance Sheets
(unaudited, in thousands)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | Trended Data | |
| | | March 2013 | | | June 2013 | | | September 2013 | | | December 2013 | | | March 2014 | | | June 2014 | |
| ASSETS | | | | | | | | | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 130,908 | | | $ | 79,333 | | | $ | 86,945 | | | $ | 88,581 | | | $ | 98,631 | | | $ | 84,395 | |
Accounts Receivable, net | | | 333,174 | | | | 309,064 | | | | 298,823 | | | | 332,675 | | | | 318,615 | | | | 293,732 | |
Prepaid and other | | | 75,229 | | | | 73,853 | | | | 73,801 | | | | 82,809 | | | | 92,717 | | | | 88,127 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current assets | | | 539,311 | | | | 462,250 | | | | 459,569 | | | | 504,065 | | | | 509,963 | | | | 466,254 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Property and equipment, net | | | 137,998 | | | | 132,393 | | | | 128,409 | | | | 124,169 | | | | 126,232 | | | | 126,345 | |
Goodwill | | | 880,715 | | | | 873,166 | | | | 891,623 | | | | 895,518 | | | | 918,672 | | | | 915,024 | |
Intangibles, net | | | 29,385 | | | | 26,096 | | | | 24,219 | | | | 24,058 | | | | 27,849 | | | | 29,186 | |
Investment in unconsolidated affiliates | | | 170 | | | | 229 | | | | 150 | | | | 220 | | | | 24,584 | | | | 23,759 | |
Other assets | | | 38,644 | | | | 41,078 | | | | 39,960 | | | | 38,227 | | | | 35,496 | | | | 36,697 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 1,626,223 | | | $ | 1,535,212 | | | $ | 1,543,930 | | | $ | 1,586,257 | | | $ | 1,642,796 | | | $ | 1,597,265 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable, accrued expenses and other | | $ | 186,142 | | | $ | 175,335 | | | $ | 151,778 | | | $ | 166,257 | | | $ | 165,535 | | | $ | 160,121 | |
Deferred revenue | | | 356,468 | | | | 329,492 | | | | 315,645 | | | | 342,156 | | | | 341,947 | | | | 315,786 | |
Current portion of long-term debt | | | 7,500 | | | | 8,125 | | | | 8,750 | | | | 9,375 | | | | 212,200 | | | | 201,600 | |
Current liabilities of discontinued operations | | | 3,771 | | | | 2,522 | | | | 2,137 | | | | 1,049 | | | | 735 | | | | 492 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current liabilities | | | 553,881 | | | | 515,474 | | | | 478,310 | | | | 518,837 | | | | 720,417 | | | | 677,999 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Long-term income taxes payable | | | 51,255 | | | | 52,590 | | | | 51,298 | | | | 53,078 | | | | 54,451 | | | | 55,355 | |
Long-term debt, less current portion | | | 161,600 | | | | 130,700 | | | | 180,200 | | | | 125,900 | | | | — | | | | — | |
Other long-term liabilities | | | 8,352 | | | | 8,994 | | | | 5,752 | | | | 44,297 | | | | 53,527 | | | | 57,146 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 775,088 | | | | 707,758 | | | | 715,560 | | | | 742,112 | | | | 828,395 | | | | 790,500 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Common stock | | | 141 | | | | 141 | | | | 142 | | | | 142 | | | | 142 | | | | 142 | |
Additional paid-in capital | | | 1,962,039 | | | | 1,970,025 | | | | 1,976,768 | | | | 2,003,394 | | | | 2,011,447 | | | | 2,019,350 | |
Accumulated other comprehensive income | | | 50,163 | | | | 41,024 | | | | 62,046 | | | | 63,368 | | | | 67,691 | | | | 61,916 | |
Accumulated deficit | | | (559,405 | ) | | | (556,025 | ) | | | (544,756 | ) | | | (564,871 | ) | | | (562,806 | ) | | | (562,772 | ) |
Treasury stock, at cost | | | (601,803 | ) | | | (627,711 | ) | | | (665,830 | ) | | | (712,362 | ) | | | (753,873 | ) | | | (768,050 | ) |
Noncontrolling interest | | | — | | | | — | | | | — | | | | 54,474 | | | | 51,800 | | | | 56,179 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total stockholders’ equity | | | 851,135 | | | | 827,454 | | | | 828,370 | | | | 844,145 | | | | 814,401 | | | | 806,765 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities and stockholders’ equity | | $ | 1,626,223 | | | $ | 1,535,212 | | | $ | 1,543,930 | | | $ | 1,586,257 | | | $ | 1,642,796 | | | $ | 1,597,265 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Memo(1) | | | | | | | | | | | | | | | | | | | | | | | | |
—Net cash | | $ | (38,192 | ) | | $ | (59,492 | ) | | $ | (102,005 | ) | | $ | (46,694 | ) | | $ | (113,569 | ) | | $ | (117,205 | ) |
| (1) | - See notes to financial supplement for definitions and calculations of selected financial metrics. |
