ACTIVE Network, the cloud-based event registration specialist, has announced its financial results for the second quarter ended 30 June 2013. The company also confirmed that it has ‘formed a Strategic Transactions Committee to consider and evaluate strategic alternatives.’
Q2 2013:
- Total net revenue was up 9% year on year to US$132.4 million
- Technology revenue increased 10% and constituted 90%, or US$119.5 million, of total net revenue
- Marketing services revenue constituted 10%, or US$12.9 million, of total net revenue
- Registrations grew 6% and revenue per registration was up 4%
- The net loss was US$4.5 million, compared to a net loss of US$2.3 million in the previous year period
- Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) was US$22.2 million. Excluding charges related to management changes, adjusted EBITDA was US$23.7 million, up 18%
“We believe our focus on operational efficiency will result in significant progress towards our future adjusted EBITDA margin target of 23-27%,” said Scott Mendel, CFO of ACTIVE Network. “Our prioritization efforts drove strong margin accretion in the second quarter which we believe will continue, while helping position us for sustainable long-term growth.”
“I am pleased with our strong second quarter results – with revenues at the top end of our outlook range and adjusted EBITDA exceeding the high end of our guidance,” said Jon Belmonte, Interim CEO of ACTIVE Network.
“During the quarter, we commenced on a number of prioritization efforts designed to strengthen our financial performance and extend our market leadership position.”
Strategic Transactions Committee
Separately, the company noted it has received expressions of interest from outside parties ranging from an investment in ACTIVE Network to an acquisition of the company. As a result, ACTIVE Network announced that its Board of Directors has a committee in place to evaluate strategic alternatives.
“The Strategic Transactions Committee and the entire Board of Directors intend to evaluate all options carefully in order to maximize shareholder value, including the continued execution of its stand-alone plan,” added Belmonte.
“The management team remains focused on execution of its operating plan.”
The company noted there can be no assurances as to whether any strategic alternative involving a third party will be recommended by the Board or undertaken or, if so, upon what terms and conditions. ACTIVE does not intend to disclose developments with respect to the progress of its evaluation of strategic alternatives ‘until such time as the Board has determined a course of action or otherwise deems disclosure appropriate.’
The Board has retained Citi as financial advisor to assist in this process.
Financial outlook
For the third quarter of 2013, ACTIVE Network expects total revenue to be in the range of US$113 million to US$116 million. Registrations are expected to grow approximately 2% to 4%; and revenue per registration is expected to grow approximately 1% to 4% compared to the same period in the prior year.
The company expects adjusted EBITDA in the range of US$15 million to US$17 million, and a net loss of US$9 million to US$4 million.
For the full year of 2013, total revenue is expected to be in the range of US$451 million to US$456 million and adjusted EBITDA is expected to be in the range of US$51 million to US$54 million. Excluding charges in the second quarter of 2013 related to company’s management changes, adjusted EBITDA is expected to be in the range of US$52.5 million to US$55.5 million. This is an improvement on the company’s previously issued adjusted EBITDA outlook. Overall, the company expects a net loss of US$41 million to US$35 million.
