Click here to close now.


News Feed Item

Yellow Media Limited Reports Second Quarter 2014 Financial Results

MONTREAL, QUEBEC -- (Marketwired) -- 08/06/14 -- Yellow Media Limited (TSX: Y)

--  Digital revenues across the Company's core YPG operations grew 10.8%
    year-over-year during the second quarter of 2014.

--  Continued acceleration in the annual run-rate of customer acquisition,
    as YPG acquires 18,400 new customers during the twelve-month period
    ended June 30, 2014 as compared to 15,300 for the same period last year.

--  Total digital visits across the YP, RedFlagDeals and ShopWise desktop
    and mobile properties reach 102.4 million during the second quarter of
    2014, up from 100.1 million visits during the same period last year.

--  Strong free cash flow generation of $42.1 million during the second
    quarter of 2014, as compared to $68.5 million during the same period
    last year.

--  The Company records net earnings of $27.6 million during the second
    quarter of 2014, which compares to $50.3 million for the same period
    last year.

Yellow Media Limited (TSX: Y) (the "Company" or "Yellow Media") released its operational and financial results today for the second quarter ended June 30, 2014. The Company continues to execute upon the Return to Growth Plan (the "Plan"), a strategy dedicated at reacquiring revenue growth by helping Yellow Media gain a leadership position within Canada's local digital advertising market.

"The Return to Growth Plan supports our mission of championing neighborhood economies by allowing us to strengthen the relationships we foster between businesses and consumers," said Julien Billot, President and Chief Executive Officer of Yellow Media. "Completion of our Return to Growth Plan will provide Yellow Media with the resources required to enter new digital businesses and, ultimately, meet its long-term objective of becoming Canada's leading local digital company."

Second Quarter 2014 Financial Results

Revenues for the second quarter of 2014 decreased to $220.6 million, representing a 9.3% year-over-year decline. Consolidated revenues continue to be negatively impacted by ongoing declines in print revenues. For the three-month period ended June 30, 2014, print revenues decreased 22.5% year-over-year to reach $112.2 million, in line with prior quarters.

For the quarter ended June 30, 2014, digital revenues across our core YPG operations, which exclude the impact of Mediative, 411 Local Search Corp. ("411") and Wall2Wall, increased by 10.8% year-over-year. On a consolidated basis, digital revenues reached $108.4 million during the second quarter of 2014, growing 10.1% from the same period last year. Digital revenues represented 49.1% of total revenues for the second quarter of 2014, up from 40.5% during the same period in 2013.

Growth in digital revenues continues to be driven by the active migration of traditional media customers towards digital products and services. As at June 30, 2014, 63% of YPG customers were purchasing digital products, as compared to 61% the year prior. Digital revenue growth is also supported by the continued adoption of the Yellow Pages™ 360 degrees Solution among YPG's existing customer base. The customer penetration of the Yellow Pages 360 degrees Solution, which is defined as the percentage of YPG customers who purchase three product categories or more, grew to 32.9% as at June 30, 2014 compared to 21.1% for the same period last year.

EBITDA decreased to $81.3 million during the second quarter of 2014, as compared to $107.2 million the year prior. EBITDA remains adversely impacted by print revenue pressure and a lower EBITDA margin. The EBITDA margin decreased to 36.8% for the three-month period ended June 30, 2014, as compared to 44.1% for the same period last year. In addition to lower print revenues, EBITDA margins were adversely impacted by investments related to the Return to Growth Plan and employee related expenses.

For the second quarter ended June 30, 2014, the Company recorded net earnings of $27.6 million and basic earnings per share of $1.01. This compares to net earnings of $50.3 million and basic earnings per share of $1.81 for the same period last year. The decrease is mainly explained by lower EBITDA and a restructuring and special charge incurred during the second quarter of 2014.

Free cash flow during the second quarter of 2014 totaled $42.1 million, as compared to $68.5 million during the same period last year. This decline results mainly from lower EBITDA, a more stable working capital and higher income taxes paid in 2014, as the Company was not required to pay income tax installments in 2013. Following a $73.5 million mandatory redemption payment made on the senior secured notes on June 2, 2014, net debt totaled $515.7 million as at June 30, 2014, down from $533.1 million as at December 31, 2013.

"Successful execution of the Return to Growth Plan will strengthen the Company's financial profile and deliver long-term, sustainable value to shareholders," said Ginette Maille, Chief Financial Officer of Yellow Media. "The investments underlying the Plan are focused on returning Yellow Media to consolidated revenue and EBITDA growth by 2018, while also generating the free cash flow required to significantly delever the balance sheet over the next four years."

Operational Update

"The Return to Growth Plan is aimed at strengthening Yellow Media's relationship with consumers and local businesses," said Billot. "Having the right strategy is critical, and the Company will continue investing in growing the digital awareness of the Yellow Pages brand, enhancing the user experience across its media assets and delivering an improved end-to-end customer journey in order to grow customer acquisition and, ultimately, return Yellow Media to revenue and profitability growth."

Extending our Brand Promise

--  Yellow Media ran national and local campaigns to promote the download
    and use of the YP mobile application. A national television and digital
    campaign was launched in April 2014 to highlight the improved content
    and search functionalities available on the YP mobile application.
    Increased adoption of the YP mobile application was further supported
    through an extensive local, multimedia advertising initiative across
    Canada's largest urban markets in June and July 2014.

--  The Company's national and local campaigns contributed positively to the
    usage of the YP mobile application, with average weekly downloads and
    visits having increased by 65% and 20%, respectively, when compared to
    pre-campaign periods.

--  The Company launched radio and digital advertising campaigns in Montreal
    and Calgary to introduce prospective customers to its entry-level
    Booster Pack digital solution. To further promote customer acquisition,
    Digital Seminar Series were launched in Alberta and Atlantic Canada to
    educate small business owners on digital trends and strategies, as well
    as the solutions offered by YPG to help them champion local digital

Strengthening our Media Assets

--  Total digital visits, which measures the number of visits made across
    the YP, RedFlagDeals and ShopWise desktop and mobile properties, reached
    102.4 million during the second quarter of 2014. This compares to 100.1
    million visits for the same period last year.

--  The YP mobile application received various acknowledgments on the App
    Store, including "Editor's Choice" and "Best New App" in May 2014, "Best
    of May 2014" and "Top Canadian-Made App" in June 2014. These
    recognitions followed the release of an enhanced version of the YP
    mobile application on the iPhone and iPad, providing users with an
    improved user interface, more relevant search results, a richer database
    of local business information and quicker search response times.

--  The Company delivered a richer search experience on its ShopWise mobile
    application, introducing personalization features that allow users to
    select preferred categories of deals to appear on the homepage. A
    version of the mobile application was also officially
    launched and made available on the Android platform.

Enhancing our Go-to-Market Strategy

a) Promoting Customer Acquisition

--  The rate of customer acquisition continued to improve, with customer
    acquisition for the twelve-month period ended June 30, 2014 having
    totaled 18,400, up from 15,300 during the same period last year and
    16,500 for the twelve-month period ended March 31, 2014. Total customer
    count was 265,000 as at June 30, 2014, compared to 291,000 at the end of
    the same period last year.

--  Promoted by an acceleration in customer acquisition, digital-only
    customers increased to 29,400 as at June 30, 2014, compared to 19,700 at
    the same period last year and 26,100 as at March 31, 2014.

--  Yellow Media acquired the remaining 70% interest of 411 for a purchase
    price of $22.7 million, net of cash acquired of $3.6 million. The
    acquisition results from the exercise of a put option by the other
    shareholders of 411, requiring the Company to acquire the remaining 70%
    interest of 411. 411 is the operator of, an online search engine
    dedicated to finding people and local businesses in Canada. With a sales
    force of 60 call center representatives servicing approximately 15,000
    digital customers nationwide, 411 holds a proven track record in lead
    generation, lead conversion and customer acquisition. The acquisition of
    411 complements Yellow Media's Return to Growth Plan, allowing the
    Company to leverage the expertise of 411's sales team to best support
    its customer acquisition efforts.

b) Promoting Customer Retention

--  YPG experienced a customer renewal rate of 85% over the twelve-month
    period ended June 30, 2014, remaining stable versus the same period last

--  In an effort to improve the customer experience and develop enhanced
    customer-facing tools, the Company launched a redesigned version of its
    B2B 360 degrees Solution website entitled the 360 degrees Business
    Centre ( The 360 degrees Business Centre
    delivers a simplified architecture and more appealing design, making it
    easier for existing and prospective customers to be informed on YPG's
    digital products and services, claim their listings and book

--  A new version of Yellow Pages Analytics was developed, now featuring an
    easier-to-navigate interface, enhanced performance monitoring of
    customers' marketing activities, as well as the introduction of a
    Revenue Calculator to provide insight as to the contacts and revenues
    generated from customers' respective marketing campaigns.

Improving Business Efficiencies

--  In the context of a decline in print revenues, Yellow Media is presently
    consolidating and replacing its legacy print publishing systems, as well
    as reviewing its existing national print distribution model, to protect
    the profitability of the print platform. The Company is also enhancing
    core platforms and infrastructure, having consolidated eight of its IT
    data centers and replaced legacy telephony systems and exchange servers,
    to further promote cost savings across the organization.

Investor Conference Call

Yellow Media Limited will hold an analyst and media call at 1:00 p.m. (Eastern Time) on August 6, 2014 to discuss the second quarter 2014 results. The call may be accessed by dialing (416) 340-2218 within the Toronto area, or 1 866 225-2055 outside of Toronto.

The call will be simultaneously webcast on the Company's website at

The conference call will be archived in the Investors section of the site at

A playback of the call can also be accessed from August 6 to August 13, 2014 by dialing (905) 694-9451 within the Toronto area, or 1 800 408-3053 outside Toronto.

The conference passcode is 1997641.

About Yellow Media Limited

Yellow Media Limited (TSX: Y) is a Canadian digital and print media company, offering businesses comprehensive media solutions to meet their key marketing objectives and providing consumers with platforms to access reliable local business information. By helping local businesses foster stronger relationships with their consumers through its various media, the Company encourages the growth of thriving neighbourhood economies. Yellow Media holds some of Canada's leading local search properties and publications including™, and™, the YP, ShopWise and RedFlagDeals mobile applications and Yellow Pages™ print directories. Yellow Media is also a leader in national digital advertising through Mediative, a division of Yellow Pages Group devoted to digital marketing and performance media services for national-scale agencies and customers. For more information, visit

Caution Concerning Forward-Looking Statements

This press release contains forward-looking statements about the objectives, strategies, financial conditions, results of operations and businesses of the Company. These statements are forward-looking as they are based on our current expectations, as at August 6, 2014, about our business and the markets we operate in, and on various estimates and assumptions. Our actual results could materially differ from our expectations if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. As a result, there is no assurance that any forward-looking statements will materialize. Risks that could cause our results to differ materially from our current expectations are discussed in section 6 of our August 6, 2014 Management's Discussion and Analysis. We disclaim any intention or obligation to update any forward-looking statements, except as required by law, even if new information becomes available, as a result of future events or for any other reason.

Financial Highlights
(in thousands of Canadian dollars - except share information)

                                For the three-month       For the six-month
                             periods ended June 30,  periods ended June 30,
Yellow Media Limited               2014        2013        2014        2013

Revenues                       $220,579    $243,183    $443,782    $496,460
Income from operations          $56,331     $92,455    $129,633    $188,050
Net earnings                    $27,551     $50,326     $66,773    $103,791
Basic earnings per share
 attributable to common
 shareholders                     $1.01       $1.81       $2.45       $3.71
Cash flow from operating
 activities                     $57,823     $86,457     $68,733    $173,045
EBITDA(1)                       $81,261    $107,234    $175,882    $222,712
EBITDA margin(1)                   36.8%       44.1%       39.6%       44.9%
Weighted average number of
 common shares outstanding   27,188,087  27,872,822  27,302,919  27,913,722

Non-IFRS Measures(1)

In order to provide a better understanding of the results, the Company uses the term EBITDA, defined as income from operations before depreciation and amortization and restructuring and special charges. Management believes this measure is reflective of ongoing operations. This term is not a performance measure defined under IFRS. EBITDA does not have any standardized meaning and are therefore not likely to be comparable to similar measures used by other publicly traded companies. Management believes EBITDA to be an important measure.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Today air travel is a minefield of delays, hassles and customer disappointment. Airlines struggle to revitalize the experience. GE and M2Mi will demonstrate practical examples of how IoT solutions are helping airlines bring back personalization, reduce trip time and improve reliability. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Dr. Sarah Cooper, M2Mi's VP Business Development and Engineering, will explore the IoT cloud-based platform technologies driv...
There are many considerations when moving applications from on-premise to cloud. It is critical to understand the benefits and also challenges of this migration. A successful migration will result in lower Total Cost of Ownership, yet offer the same or higher level of robustness. Migration to cloud shifts computing resources from your data center, which can yield significant advantages provided that the cloud vendor an offer enterprise-grade quality for your application.
Docker is hot. However, as Docker container use spreads into more mature production pipelines, there can be issues about control of Docker images to ensure they are production-ready. Is a promotion-based model appropriate to control and track the flow of Docker images from development to production? In his session at DevOps Summit, Fred Simon, Co-founder and Chief Architect of JFrog, will demonstrate how to implement a promotion model for Docker images using a binary repository, and then show h...
In his session at DevOps Summit, Bryan Cantrill, CTO at Joyent, will demonstrate a third path: containers on multi-tenant bare metal that maximizes performance, security, and networking connectivity.
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Achim Weiss is Chief Executive Officer and co-founder of ProfitBricks. In 1995, he broke off his studies to co-found the web hosting company "Schlund+Partner." The company "Schlund+Partner" later became the 1&1 web hosting product line. From 1995 to 2008, he was the technical director for several important projects: the largest web hosting platform in the world, the second largest DSL platform, a video on-demand delivery network, the largest eMail backend in Europe, and a universal billing syste...
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and Containers together help companies to achieve their business goals faster and more effectively.
WebRTC converts the entire network into a ubiquitous communications cloud thereby connecting anytime, anywhere through any point. In his session at WebRTC Summit,, Mark Castleman, EIR at Bell Labs and Head of Future X Labs, will discuss how the transformational nature of communications is achieved through the democratizing force of WebRTC. WebRTC is doing for voice what HTML did for web content.
The buzz continues for cloud, data analytics and the Internet of Things (IoT) and their collective impact across all industries. But a new conversation is emerging - how do companies use industry disruption and technology enablers to lead in markets undergoing change, uncertainty and ambiguity? Organizations of all sizes need to evolve and transform, often under massive pressure, as industry lines blur and merge and traditional business models are assaulted and turned upside down. In this new da...
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
The IoT is upon us, but today’s databases, built on 30-year-old math, require multiple platforms to create a single solution. Data demands of the IoT require Big Data systems that can handle ingest, transactions and analytics concurrently adapting to varied situations as they occur, with speed at scale. In his session at @ThingsExpo, Chad Jones, chief strategy officer at Deep Information Sciences, will look differently at IoT data so enterprises can fully leverage their IoT potential. He’ll sha...
The modern software development landscape consists of best practices and tools that allow teams to deliver software in a near-continuous manner. By adopting a culture of automation, measurement and sharing, the time to ship code has been greatly reduced, allowing for shorter release cycles and quicker feedback from customers and users. Still, with all of these tools and methods, how can teams stay on top of what is taking place across their infrastructure and codebase? Hopping between services a...
In today's digital world, change is the one constant. Disruptive innovations like cloud, mobility, social media, and the Internet of Things have reshaped the market and set new standards in customer expectations. To remain competitive, businesses must tap the potential of emerging technologies and markets through the rapid release of new products and services. However, the rigid and siloed structures of traditional IT platforms and processes are slowing them down – resulting in lengthy delivery ...
As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership ability. Many are unable to effectively engage and inspire, creating forward momentum in the direction of desired change. Renowned for its approach to leadership and emphasis on their people, organizations increasingly look to our military for insight into these challenges.
Overgrown applications have given way to modular applications, driven by the need to break larger problems into smaller problems. Similarly large monolithic development processes have been forced to be broken into smaller agile development cycles. Looking at trends in software development, microservices architectures meet the same demands. Additional benefits of microservices architectures are compartmentalization and a limited impact of service failure versus a complete software malfunction....