|By Business Wire||
|May 7, 2014 04:05 PM EDT||
Millennial Media, Inc. (NYSE: MM), the leading independent mobile advertising platform company, today reported financial results for the first quarter ended March 31, 2014.
Financial Results and Business Highlights for the First Quarter of 2014
Revenue: For the first quarter of 2014, revenue increased to $72.6 million from $49.4 million on a GAAP basis, a year over year increase of 46.9%. Revenue increased from $64.6 million on a pro forma combined basis, a year over year increase of 12.4%. Pro forma combined revenue is calculated as the sum of Millennial Media and Jumptap revenue for the entire first quarter of last year.
Gross Margin: Gross margin was 41.2% for the first quarter of 2014 on a GAAP basis and 41.2% for the first quarter of 2013 on a pro forma combined basis. For the first quarter of 2013, gross margin was 41.6% on a GAAP basis.
Net Income (Loss): For the first quarter of 2014, net loss was $(12.9) million, compared to net loss of $(3.8) million for the first quarter of 2013.
Adjusted EBITDA: For the first quarter of 2014, Adjusted EBITDA, a non-GAAP financial measure (see definition below), was $(4.7) million, compared to pro forma combined Adjusted EBITDA of $(4.8) million for the first quarter of 2013.
Net Income (Loss) per Share: For the first quarter of 2014, basic and diluted net loss per common share was $(0.12), compared to basic and diluted net loss per common share of $(0.05) for the first quarter of 2013.
Non-GAAP Net Income (Loss) Per Common Share: For the first quarter of 2014, non-GAAP net loss per common share was $(0.04), compared to non-GAAP net loss per common share of $(0.01) for the first quarter of 2013.
Other Business Metrics: As of March 31, 2014, Millennial Media reached over 650 million monthly unique users globally, including approximately 170 million monthly unique users in the United States alone. As of March 31, 2014, approximately 60,000 apps and mobile sites were enabled by mobile app developers to operate on Millennial Media’s platform, and Millennial Media had more than 650 million proprietary, anonymous active user profiles used for delivering the most relevant ads to consumers.
Based on information available as of today, Millennial Media expects total revenue for the second quarter of 2014 to be in the range of $70 million to $75 million and Adjusted EBITDA to be a loss between $(5) million and $(6) million.
“Now into my first full quarter, I am pleased with my decision to join Millennial Media and drive this Company to the next level,” said Michael Barrett, President and CEO, Millennial Media. “While I would have liked to have seen stronger performance in the quarter, we have developed an aggressive strategy and I have high confidence that we can execute and capitalize on the growth and promise of mobile.”
EVP and CFO Michael Avon Steps Down
In addition, the Company today announced that Michael Avon, Executive Vice President and Chief Financial Officer, will step down from his position at the end of the second quarter of 2014 to pursue other career interests. Mr. Avon began his relationship with Millennial Media as a venture investor at Columbia Capital, where he led the Company’s first round of financing in 2006. As the Company began to grow, he joined as EVP & CFO in the fall of 2009 and remained in that role for the last four and a half years. He will continue to serve Millennial Media in an advisory role for a transitional period after he steps down as CFO.
The Company has begun a search for a permanent replacement to fill this role.
"I want to thank Michael for his many contributions to Millennial Media over the nearly eight years he has been involved with the Company," said Barrett. "Michael has been a key contributor to Millennial Media’s success. He was instrumental in the Company's initial public offering in 2012, and led numerous important strategic projects and acquisitions during his tenure. On behalf of Millennial Media, I wish him all the best for the future."
"I’ve very much appreciated the opportunity to serve in my roles at Millennial Media during such an exciting time in our Company’s history, in addition to the mobile industry as a whole, and I am very proud of what we’ve accomplished," said Mr. Avon. "After nearly eight successful years with the Company, first as an investor, and then as CFO, I’ve decided now is the time to move back to my entrepreneurial roots. I look forward to watching Millennial Media continue to grow, and have confidence the Company will thrive under the leadership of our new President & CEO and the strong and capable management team in place."
First Quarter 2014 Financial Results Conference Call: Millennial Media will host a conference call today at 5:00 p.m. ET to discuss its first quarter financial results, developments in its business, and the Company’s expectations for the second quarter of 2014. A live webcast of the event will be available on the Investor Relations page of the Millennial Media website at http://investors.millennialmedia.com. A live domestic dial-in is available at 800-706-7745 (U.S.) or 617-614-3472 (international) using passcode 57784757. If you are unable to listen to the live conference call, a replay will be available through May 14, 2014, and can be accessed by dialing 888-286-8010 (U.S.) or 617-801-6888 (international) using passcode 96286770. An archived version of the webcast will also be available at http://investors.millennialmedia.com.
Non-GAAP Financial Measures
To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), Millennial Media reports Adjusted EBITDA, which is a non-GAAP financial measure defined as net income or net loss before interest, taxes, depreciation, amortization, non-cash stock-based compensation and expenses related to acquisitions, such as costs for services of lawyers, investment bankers, accountants and other third parties and acquisition related severance costs, bonuses and retention bonuses and accrual of retention payments that represent contingent compensation to be recognized over a requisite period. We define non-GAAP net income (loss) per common share as Adjusted EBITDA divided by diluted weighted average common shares outstanding. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. Non-GAAP financial measures should be considered in addition to results and guidance prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results.
The Company also presents Adjusted EBITDA on a pro forma combined basis. Pro forma combined Adjusted EBITDA includes results of the Company’s Jumptap, Inc. subsidiary for the entire period. A reconciliation of historical Adjusted EBITDA to net loss, the most directly comparable GAAP financial measure, for each of Millennial Media and Jumptap and on a pro forma combined basis, is set forth in the tables following this release.
About Millennial Media
Millennial Media is the leading independent mobile advertising platform company, supporting the world’s top brands and mobile content providers. The Company's unique data and technology assets enable its clients to connect with their target audiences as they move across screens, media, and moments. Millennial Media drives meaningful results at scale through a diverse suite of products fueled by innovation and the industry's smartest minds. For more information, visit www.millennialmedia.com.
The statements in this press release that are not historical facts constitute “forward-looking statements” that involve risks and uncertainties and are made pursuant to the Private Securities Litigation Reform Act of 1995. These forward-looking statements include expectations regarding financial results for the second quarter of 2014. The achievement or success of the matters covered by such forward-looking statements involve risks, uncertainties and assumptions, and if any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. These risks and uncertainties include, but are not limited to, risks associated with our ability to continue to accelerate growth and provide enhanced gross margin performance; our ability to expand our developer and advertiser base and increase demand for our services; our ability to keep pace with technological and market developments and remain competitive against larger companies in our industry as well as potential new entrants into our markets; and our recent acquisition of Jumptap, including our ability to integrate the two businesses and realize the expected benefits from the acquisition. Further information on these and other factors that could affect our results is included in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission (the “SEC”) on March 3, 2014 and other filings we make with the SEC from time to time. These documents are available on the ‘SEC Filings’ section of the Investor Relations page of our website at http://investors.millennialmedia.com.
The statements made in this release are based on information available to us as of the date of this release, and we assume no obligation and do not intend to update these forward-looking statements, except as required by law.
|Millennial Media, Inc.|
|Consolidated Balance Sheets|
|(in thousands, except share and per share data)|
|March 31,||December 31,|
|Cash and cash equivalents||$||98,039||$||99,237|
|Accounts receivable, net of allowances of $4,642 and $4,773 as of March 31, 2014|
|and December 31, 2013, respectively||79,918||109,056|
|Prepaid expenses and other current assets||3,793||4,243|
|Total current assets||182,214||212,856|
|Property and equipment, net||15,032||12,663|
|Intangible assets, net||55,433||57,706|
|Total long-term assets||206,566||206,748|
|Liabilities and stockholders’ equity|
|Accounts payable and accrued expenses||$||10,272||$||7,617|
|Accrued cost of revenue||42,189||65,053|
|Accrued payroll and payroll related expenses||6,673||8,767|
|Total current liabilities||60,024||82,305|
|Other long-term liabilities||1,911||1,829|
|Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued and outstanding as of March 31, 2014 and December 31, 2013||–||–|
|Common stock, $0.001 par value, 250,000,000 shares authorized, 106,837,523 and 106,314,909 shares issued and outstanding as of March 31, 2014 and December 31, 2013, respectively||107||106|
|Additional paid-in capital||405,066||400,716|
|Accumulated other comprehensive loss||(225||)||(196||)|
|Total stockholders’ equity||326,845||335,470|
|Total liabilities and stockholders’ equity||$||388,780||$||419,604|
|Millennial Media, Inc.|
|Unaudited Consolidated Statements of Operations|
|(in thousands, except per share data)|
|Three Months Ended March 31,|
|Cost of revenue||42,725||28,874|
|Sales and marketing||13,537||8,141|
|Technology and development||7,509||4,193|
|General and administrative||21,751||11,956|
|Total operating expenses||42,797||24,290|
|Loss from operations||(12,902||)||(3,726||)|
|Other income (expense)|
|Interest expense, net||(28||)||(11||)|
|Total other income (expense)||(28||)||(11||)|
|Loss before income taxes||(12,930||)||(3,737||)|
|Income tax expense||(17||)||(16||)|
|Net loss per share:|
|Basic and diluted||$||(0.12||)||$||(0.05||)|
|Weighted average common shares outstanding:|
|Basic and diluted||106,543||78,917|
|Stock-based compensation expense included above:|
|Sales and marketing||$||461||$||219|
|Technology and development||170||855|
|General and administrative||3,141||583|
|Millennial Media, Inc.|
|Unaudited Pro Forma Combined Statement of Operations|
|Three Months Ended March 31, 2013|
|Cost of revenue||28,874||9,115||37,989|
|Sales and marketing||8,141||4,842||12,983|
|Technology and development||4,193||3,922||8,115|
|General and administrative||11,956||1,764||13,720|
|Total operating expenses||24,290||10,528||34,818|
|Loss from operations||(3,726||)||(4,459||)||(8,185||)|
|Other income (expense)|
|Interest expense, net||(11||)||(61||)||(72||)|
|Total other income (expense)||(11||)||(61||)||(72||)|
|Loss before income taxes||(3,737||)||(4,520||)||(8,257||)|
|Income tax expense||(16||)||-||(16||)|
|Millennial Media, Inc.|
|Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA|
|(in thousands, except per share data)|
|GAAP||Pro Forma Combined|
|Three Months Ended March 31,||Three Months Ended March 31,|
|Interest expense, net||28||11||210|
|Income tax expense||17||16||16|
|Depreciation and amortization expense||3,946||941||1,246|
|Stock-based compensation expense||3,772||1,657||1,770|
|Jumptap warrant and derivative income||-||-||(138||)|
|Total net adjustments||8,287||2,986||3,465|
|Reconciliation of GAAP Net Loss per share to Non-GAAP Net Loss per share|
|Three Months Ended March 31,|
|Net loss per share||$||(0.12||)||$||(0.05||)|
|Interest expense, net||-||-|
|Income tax benefit||-||-|
|Depreciation and amortization expense||0.04||0.01|
|Stock-based compensation expense||0.04||0.02|
|Total net adjustments||0.08||0.04|
|Non-GAAP net loss per share||$||(0.04||)||$||(0.01||)|
|Weighted average common shares outstanding||106,543||78,917|
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