Exhibit 99.1
Move, Inc.
Condensed Consolidated Statements of Operations
Restated for Discontinued Operations
(in thousands)
Condensed Consolidated Statements of Operations
Restated for Discontinued Operations
(in thousands)
Restated | Restated | Restated | Restated | Restated | ||||||||||||||||
Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Year Ended | ||||||||||||||||
March 31, 2007 | June 30, 2007 | September 30, 2007 | December 31, 2007 | December 31, 2007 | ||||||||||||||||
Revenues | $ | 60,443 | $ | 62,533 | $ | 63,380 | $ | 62,563 | $ | 248,919 | ||||||||||
Cost of revenues | 9,991 | 10,598 | 11,053 | 11,266 | 42,908 | |||||||||||||||
Gross profit | 50,452 | 51,935 | 52,327 | 51,297 | 206,011 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Sales and marketing | 22,802 | 22,275 | 23,212 | 21,665 | 89,954 | |||||||||||||||
Product and web site development | 8,775 | 9,223 | 8,615 | 8,043 | 34,656 | |||||||||||||||
General and administrative | 18,222 | 14,528 | 20,479 | 18,205 | 71,434 | |||||||||||||||
Amortization of intangible assets | 181 | 189 | 194 | 197 | 761 | |||||||||||||||
Litigation settlement | — | — | 3,900 | — | 3,900 | |||||||||||||||
Impairment of long-lived assets | — | — | — | 6,125 | 6,125 | |||||||||||||||
Total operating expenses | 49,980 | 46,215 | 56,400 | 54,235 | 206,830 | |||||||||||||||
Operating income (loss) from continuing operations | 472 | 5,720 | (4,073 | ) | (2,938 | ) | (819 | ) | ||||||||||||
Interest income, net | 2,313 | 2,503 | 2,567 | 2,461 | 9,844 | |||||||||||||||
Other income, net | 774 | (372 | ) | 676 | 423 | 1,501 | ||||||||||||||
Income (loss) from continuing operation before income taxes | $ | 3,559 | $ | 7,851 | $ | (830 | ) | $ | (54 | ) | $ | 10,526 | ||||||||
Provision for income taxes | 84 | 169 | 169 | 79 | 501 | |||||||||||||||
Net income (loss) from continuing operations | 3,475 | 7,682 | (999 | ) | (133 | ) | 10,025 | |||||||||||||
Loss from discontinued operations | (2,080 | ) | (2,018 | ) | (1,044 | ) | (3,902 | ) | (9,044 | ) | ||||||||||
Net income (loss) | $ | 1,395 | $ | 5,664 | $ | (2,043 | ) | $ | (4,035 | ) | $ | 981 | ||||||||
Convertible preferred stock dividends and related accretion | (1,232 | ) | (1,241 | ) | (1,248 | ) | (1,256 | ) | (4,977 | ) | ||||||||||
Net income (loss)applicable to common stockholders | $ | 163 | $ | 4,423 | $ | (3,291 | ) | $ | (5,291 | ) | $ | (3,996 | ) | |||||||
Discontinued Operations | ||||||||||||||||||||
Revenue | $ | 10,587 | $ | 11,093 | $ | 12,190 | $ | 10,380 | $ | 44,250 | ||||||||||
Operating expenses | 12,667 | 13,111 | 13,234 | 12,509 | 51,521 | |||||||||||||||
Impairment charges | — | — | — | 1,773 | 1,773 | |||||||||||||||
Loss from discontinued operations | $ | (2,080 | ) | $ | (2,018 | ) | $ | (1,044 | ) | $ | (3,902 | ) | $ | (9,044 | ) | |||||
Move, Inc.
Condensed Consolidated Statements of Cash Flows
Restated for Discontinued Operations
(in thousands)
Condensed Consolidated Statements of Cash Flows
Restated for Discontinued Operations
(in thousands)
Restated | Restated | Restated | ||||||||||||||
Three Months | Restated | Nine Months | Twelve Months | |||||||||||||
Ended March 31, | Six Months Ended | Ended September | Ended December | |||||||||||||
2007 | June 30, 2007 | 30, 2007 | 31, 2007 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income from continuing operations | $ | 3,475 | $ | 11,157 | $ | 10,158 | $ | 10,025 | ||||||||
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | ||||||||||||||||
Depreciation | 2,334 | 4,722 | 7,322 | 9,978 | ||||||||||||
Amortization | 181 | 370 | 564 | 761 | ||||||||||||
Impairment of long-lived assets | — | — | — | 6,125 | ||||||||||||
Gain on sales and disposals of fixed assets | (336 | ) | (336 | ) | (333 | ) | (337 | ) | ||||||||
Provision for doubtful accounts | 253 | 435 | 653 | 1,271 | ||||||||||||
Stock-based compensation and charges | 5,492 | 5,420 | 10,049 | 13,703 | ||||||||||||
Change in market value of embedded derivative liability | (473 | ) | (98 | ) | (688 | ) | (1,052 | ) | ||||||||
Other non-cash items | 12 | 11 | (10 | ) | 128 | |||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts receivable | 410 | 914 | (1,027 | ) | (1,618 | ) | ||||||||||
Other assets | (681 | ) | (3,797 | ) | (4,473 | ) | (3,574 | ) | ||||||||
Accounts payable and accrued expenses | (2,159 | ) | 2,534 | 4,888 | 2,986 | |||||||||||
Deferred revenue | 1,516 | (1,662 | ) | (3,793 | ) | (9,973 | ) | |||||||||
Net cash provided by continuing operating activities | 10,024 | 19,670 | 23,310 | 28,423 | ||||||||||||
Net cash provided by (used in) discontinued operating activities | 488 | (1,199 | ) | (2,748 | ) | (4,660 | ) | |||||||||
Net cash provided by operating activities | 10,512 | 18,471 | 20,562 | 23,763 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Purchases of property and equipment | (4,147 | ) | (12,538 | ) | (15,897 | ) | (18,509 | ) | ||||||||
Proceeds from the surrender of life insurance policy | 5,200 | 5,200 | 5,200 | 5,200 | ||||||||||||
Proceeds from sale of marketable equity securities | 15,743 | 15,743 | 15,743 | 15,743 | ||||||||||||
Proceeds from sale of fixed assets | 336 | 336 | 334 | 338 | ||||||||||||
Purchases of intangible assets | (11 | ) | (418 | ) | (618 | ) | (619 | ) | ||||||||
Maturities of short-term investments | 10,950 | 36,350 | 45,200 | 86,550 | ||||||||||||
Purchases of short term investments | (26,900 | ) | (43,475 | ) | (67,275 | ) | (73,475 | ) | ||||||||
Net cash provided by (used in) continuing operations investing activities | 1,171 | 1,198 | (17,313 | ) | 15,228 | |||||||||||
Net cash used in investing activities of discontinued operations | (8 | ) | (63 | ) | (147 | ) | (221 | ) | ||||||||
Net cash provided by (used in) investing activities | 1,163 | 1,135 | (17,460 | ) | 15,007 | |||||||||||
Cash flows from financing activities: | ||||||||||||||||
Proceeds from exercise of stock options | 2,493 | 2,708 | 2,821 | 3,064 | ||||||||||||
Repurchase of company stock | — | — | — | (10,000 | ) | |||||||||||
Restricted cash | 926 | 993 | 952 | 910 | ||||||||||||
Payments on capital lease obligations | (463 | ) | (935 | ) | (1,415 | ) | (1,904 | ) | ||||||||
Net cash provided by (used in) financing activities | 2,956 | 2,766 | 2,358 | (7,930 | ) | |||||||||||
Change in cash and cash equivalents | $ | 14,631 | $ | 22,372 | $ | 5,460 | $ | 30,840 | ||||||||
Cash and cash equivalents, beginning of period | 14,873 | 14,873 | 14,873 | 14,873 | ||||||||||||
Cash and cash equivalents, end of period | $ | 29,504 | $ | 37,245 | $ | 20,333 | $ | 45,713 | ||||||||
Move, Inc.
Reconciliation of Non-GAAP Financial Measure
Operating Income (Loss) from Continuing Operations Excluding Depreciation, Amortization, Stock-based
Compensation and Charges, Impairment of Long-Lived Assets and Litigation Settlement (Adjusted EBITDA)
(in thousands)
Reconciliation of Non-GAAP Financial Measure
Operating Income (Loss) from Continuing Operations Excluding Depreciation, Amortization, Stock-based
Compensation and Charges, Impairment of Long-Lived Assets and Litigation Settlement (Adjusted EBITDA)
(in thousands)
Restated | Restated | Restated | Restated | Restated | ||||||||||||||||
Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Year Ended | ||||||||||||||||
March 31, 2007 | June 30, 2007 | September 30, 2007 | December 31, 2007 | December 31, 2007 | ||||||||||||||||
Operating income (loss) from continuing operations | $ | 472 | $ | 5,720 | $ | (4,073 | ) | $ | (2,938 | ) | $ | (819 | ) | |||||||
Add Back: | ||||||||||||||||||||
Depreciation expense | 2,334 | 2,388 | 2,600 | 2,656 | 9,978 | |||||||||||||||
Amortization of intangible assets | 181 | 189 | 194 | 197 | 761 | |||||||||||||||
Stock based charges and compensation | 5,492 | (72 | ) | 4,629 | 3,654 | 13,703 | ||||||||||||||
Impairment of long-lived assets | — | — | — | 6,125 | 6,125 | |||||||||||||||
Litigation settlement | — | — | 3,900 | — | 3,900 | |||||||||||||||
Adjusted EBITDA | $ | 8,479 | $ | 8,225 | $ | 7,250 | $ | 9,694 | $ | 33,648 | ||||||||||
Use of Non-GAAP Financial Measures
To supplement its consolidated financial statements presented in accordance with generally accepted accounting principles in the United States (“GAAP”), Move uses a non-GAAP measure of income (loss) from operations excluding restructuring, impairment, litigation settlement charges and certain other non-cash and non-recurring items, principally depreciation, amortization and stock based compensation and other charges, which is referred to as adjusted EBITDA. A reconciliation of these non-GAAP measures to GAAP is provided in the attached tables. These non-GAAP adjustments are provided to enhance the user’s overall understanding of Move’s current financial performance and its prospects for the future and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP. These non-GAAP measures are the primary basis management uses for planning and forecasting its future operations. Move believes these non-GAAP results provide useful information to both management and investors by excluding certain expenses that it believes are not indicative of its core operating results and a more consistent basis for comparison between quarters and should be carefully evaluated.