Exhibit 99.2
WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Revenue | $ | 143,343 | $ | 133,832 | ||||
Cost of operations | 57,877 | 52,564 | ||||||
Sales and marketing | 32,476 | 32,911 | ||||||
General and administrative | 21,453 | 23,781 | ||||||
Depreciation and amortization | 8,245 | 7,328 | ||||||
Interest income | 17 | 15 | ||||||
Interest expense | 6,172 | 6,172 | ||||||
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Income before income tax provision | 17,137 | 11,091 | ||||||
Income tax provision | 7,133 | 4,825 | ||||||
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Net income | $ | 10,004 | $ | 6,266 | ||||
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Net income per common share: | ||||||||
Basic | $ | 0.27 | $ | 0.16 | ||||
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Diluted | $ | 0.25 | $ | 0.15 | ||||
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Weighted-average shares outstanding used in computing income per common share: | ||||||||
Basic | 36,393 | 39,268 | ||||||
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Diluted | 43,465 | 41,852 | ||||||
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WEBMD HEALTH CORP.
CONSOLIDATED SUPPLEMENTAL FINANCIAL INFORMATION
(In thousands, unaudited)
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Revenue | ||||||||
Advertising and sponsorship | ||||||||
Biopharma and medical device | $ | 75,845 | $ | 68,488 | ||||
OTC, CPG and other | 29,948 | 34,469 | ||||||
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105,793 | 102,957 | |||||||
Private portal services | 29,322 | 24,629 | ||||||
Information services | 8,228 | 6,246 | ||||||
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$ | 143,343 | $ | 133,832 | |||||
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Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (a) | $ | 38,918 | $ | 33,266 | ||||
Interest, taxes, non-cash and other items (b) | ||||||||
Interest income | 17 | 15 | ||||||
Interest expense | (6,172 | ) | (6,172 | ) | ||||
Income tax provision | (7,133 | ) | (4,825 | ) | ||||
Depreciation and amortization | (8,245 | ) | (7,328 | ) | ||||
Non-cash stock-based compensation | (7,381 | ) | (8,690 | ) | ||||
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Net income | $ | 10,004 | $ | 6,266 | ||||
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(a) | See Annex A-Explanation of Non-GAAP Financial Measures. |
(b) | Reconciliation of Adjusted EBITDA to net income. |
WEBMD HEALTH CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, 2015 | December 31, 2014 | |||||||
(unaudited) | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 735,292 | $ | 706,776 | ||||
Accounts receivable, net | 130,381 | 136,806 | ||||||
Prepaid expenses and other current assets | 17,413 | 13,877 | ||||||
Deferred tax assets | 18,453 | 18,147 | ||||||
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Total current assets | 901,539 | 875,606 | ||||||
Property and equipment, net | 55,790 | 59,573 | ||||||
Goodwill | 202,980 | 202,980 | ||||||
Intangible assets, net | 13,382 | 14,215 | ||||||
Deferred tax assets | 20,083 | 18,947 | ||||||
Other assets | 26,509 | 26,236 | ||||||
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Total Assets | $ | 1,220,283 | $ | 1,197,557 | ||||
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Liabilities and Stockholders’ Equity | ||||||||
Accrued expenses | $ | 55,615 | $ | 72,658 | ||||
Deferred revenue | 104,616 | 89,785 | ||||||
2.25% convertible notes due 2016 | 252,232 | — | ||||||
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Total current liabilities | 412,463 | 162,443 | ||||||
2.25% convertible notes due 2016 | — | 252,232 | ||||||
2.50% convertible notes due 2018 | 400,000 | 400,000 | ||||||
1.50% convertible notes due 2020 | 300,000 | 300,000 | ||||||
Other long-term liabilities | 20,823 | 21,293 | ||||||
Stockholders’ equity | 86,997 | 61,589 | ||||||
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Total Liabilities and Stockholders’ Equity | $ | 1,220,283 | $ | 1,197,557 | ||||
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WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 10,004 | $ | 6,266 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 8,245 | 7,328 | ||||||
Non-cash interest, net | 1,128 | 1,128 | ||||||
Non-cash stock-based compensation | 7,381 | 8,690 | ||||||
Deferred income taxes | (1,535 | ) | 201 | |||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | 6,425 | (10,009 | ) | |||||
Prepaid expenses and other, net | (4,587 | ) | 210 | |||||
Accrued expenses and other long-term liabilities | (17,515 | ) | (20,401 | ) | ||||
Deferred revenue | 14,831 | 14,490 | ||||||
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Net cash provided by operating activities | 24,377 | 7,903 | ||||||
Cash flows from investing activities: | ||||||||
Purchases of property and equipment | (3,670 | ) | (5,533 | ) | ||||
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Net cash used in investing activities | (3,670 | ) | (5,533 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from exercise of stock options | 4,488 | 17,482 | ||||||
Cash used for withholding taxes due on stock-based awards | (1,044 | ) | (5,326 | ) | ||||
Purchases of treasury stock | (3,219 | ) | (65,052 | ) | ||||
Excess tax benefit on stock-based awards | 7,584 | 4,047 | ||||||
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Net cash provided by (used in) financing activities | 7,809 | (48,849 | ) | |||||
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Net increase (decrease) in cash and cash equivalents | 28,516 | (46,479 | ) | |||||
Cash and cash equivalents at beginning of period | 706,776 | 824,880 | ||||||
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Cash and cash equivalents at end of period | $ | 735,292 | $ | 778,401 | ||||
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WEBMD HEALTH CORP.
NET INCOME PER COMMON SHARE
(In thousands, except per share data, unaudited)
Three Months Ended March 31, | ||||||||
2015 | 2014 | |||||||
Numerator: | ||||||||
Net income — Basic | $ | 10,004 | $ | 6,266 | ||||
Interest expense on 1.50% convertible notes, net of tax | 864 | — | ||||||
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Net income — Diluted | $ | 10,868 | $ | 6,266 | ||||
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Denominator: | ||||||||
Weighted-average shares — Basic | 36,393 | 39,268 | ||||||
Stock options and restricted stock | 1,378 | 2,584 | ||||||
1.50% convertible notes | 5,694 | — | ||||||
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Adjusted weighted-average shares after assumed conversions — Diluted | 43,465 | 41,852 | ||||||
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Net income per common share: | ||||||||
Basic | $ | 0.27 | $ | 0.16 | ||||
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Diluted | $ | 0.25 | $ | 0.15 | ||||
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