before writedown, PROFIT 7 cents/share!!This is a huge turnaround play. I think its going to $1.50- $2 in the new year. $44 million in cash flow for the quarter and on track for a profit of $40 cents a share before wirtedowns for the year and it trades at 35 cents!!! The revenues for the online div is now upto 27%!!!
YELLOW MEDIA INC. REPORTS THIRD-QUARTER 2011 FINANCIAL RESULTS
Yellow Media Inc. released third-quarter results today, strengthening its capital structure and making progress on its transformation to a digital media and marketing solutions company.Yellow Media closed the sale of Trader Corporation in July 2011. As a result of this divestiture, results of the disposed business were reclassified as discontinued operations. Accordingly, results of operations for the quarter and nine months ended September 30, 2011 exclude the results of the disposed business while the prior period income statement and cash flows have been restated to reflect this change.For the quarter ending September 30, 2011, the Company recorded both a net loss and a net loss from continuing operations of $2.8 billion as a result of a goodwill impairment charge of $2.9 billion. This impairment charge is a non-cash item and does not affect the Company's operations, its liquidity, its cash flow from operating activities, its bank credit agreement or its note indentures. Net earnings from continuing operations before the impairment charge was $74.6 million compared to $65.6 million for the same period in 2010.
Net earnings per share from continuing operations before the impairment charge was
.14 compared to net earnings per share from continuing operations of
.12 for the same quarter last year. Adjusted earnings per common share from continuing operations for the quarter was
.07 versus
.19 last year.Revenues decreased 9.1% from $355.9 million to $323.4 million resulting from lower print revenues as well as lower revenues associated with Canpages and our US operations. This was partly offset by higher organic online revenues and revenues generated from Mediative. Online revenues for the third quarter of 2011 were $87.3 million or approximately $350 million on an annualized basis, representing growth of 26.4% versus last year. Online revenues now represent more than 27% of total revenues compared to 20% in the third quarter of 2010.Income from operations before the impairment charge was $127.7 million for the quarter compared to $126.7 million for the third quarter of 2010. EBITDA for the quarter declined from $193.2 million to $166.0 million and EBITDA margin for the third quarter was 51.3% compared to 54.3% for the same period last year. The decrease is mainly attributable to print revenue pressure, higher costs associated with Mediative and Canpages as well as investment in the support of our transformation."Our industry is undergoing a major transformation. We recognize these challenges but remain confident that our 360 strategy will assist us in extending our franchise to digital media" said Marc P. Tellier, President and Chief Executive Officer of Yellow Pages Group. "The Board, the management team and all our employees are focused on the execution of our transformation to a digital media and marketing solutions company."Continued Progress on the Yellow Pages 360 degrees SolutionDuring the quarter, the Company continued to reinforce its position as a leading performance media and marketing solutions provider by focusing on the deployment of the Yellow Pages 360 degrees Solution (www.yellowpages.ca/360). This unique value proposition is a key element of its digital transformation, enabling customers to get unprecedented visibility with online, mobile and print media platforms, and access to various services such as web site development, search engine marketing and search engine optimization.As part of its 360 degrees Solution, the Company recently introduced Yellow Pages Analytics(TM), a detailed reporting platform offering advertisers access to enhanced reporting providing them with valuable insight on the performance of their YPG campaign.Another key component of the YPG 360 degrees Solution is mobile. YPG's mobile strategy revolves around improving the mobile user experience in order to create increased value for our advertisers. The Company continues to leverage its local content and add richer and deeper business content on merchants in order to increase engagement from Canadian mobile users. YPG's mobile applications have been downloaded more than 3.0 million times, with YellowPages.ca mobile business searches now representing over 30% of YPG's overall digital searches.
Mediative
This division, launched a year ago, is a leading North American integrated advertising and digital marketing company. Mediative has extensive experience in developing innovative and unique marketing solutions for national companies. During the quarter, the company was selected as the top company in Canada in two Performance Solution categories by TopSEOs. TopSEOs is an independent authority on search vendors which evaluates and ranks the best vendors in the Internet Marketing community. Mediative was chosen as the top Enterprise SEO Services as well as Integrated Search company. Mediative is now serving the marketing needs of some of the biggest brands in North America such as WalMart, Futureshop, Sears and Disney among others. It is also one of Canada's leading ad display network, managing the ad inventory of over 600 web sites such as Best Buy, Martha Stewart, Sears, FutureShop and Toys 'R Us.Elimination of Dividends on Common sharesAs disclosed on September 28, 2011, Yellow Media's Board of Directors decided to eliminate future dividends on its common shares. This decision is in compliance with the amendments that the Company has agreed to make to its principal credit agreement and will improve its financial profile and capital position. The
.025 dividend per common share that was previously declared by the Company and announced on August 4, 2011 was paid on October 17, 2011 to shareholders of record at the close of business on September 30, 2011. Cash retained from elimination of these dividends will be used to reduce indebtedness and reinvest in the business.Capital StructureDuring the quarter, Yellow Media repaid a total amount of $500 million of its bank indebtedness and the committed size of the revolving term loan was reduced from $750 million to $250 million. The committed size of the non-revolving term loan remains unchanged at $250 million. As a result, the new principal $500 million senior unsecured credit facility will consist of a $250 million revolving tranche and a $250 million non-revolving tranche, each maturing on February 18, 2013. As at September 30, 2011, YPG had approximately $1.7 billion of net debt, or $2.2 billion including preferred shares, Series 1 and 2, and convertible debt instruments. Net debt to Latest Twelve Month EBITDA ratio as of September 30, 2011 was 2.5 times compared to 2.9 times last quarter and 2.6 times as of December 31, 2010. During the third quarter, the Company reduced its total indebtedness by approximately $700 million including the repayment of $238 million principal amount of Medium Term Notes and the reduction of its bank indebtedness as discussed above.Investor Conference CallYellow Media Inc. will hold an analyst and media call at 2:00 pm (Eastern Time) on November 3, 2011 to discuss the third quarter of 2011 results. The call may be accessed by dialing (416) 340-8018 within the Toronto area, or 1 866 223-7781 outside of Toronto. The call will be simultaneously webcast on the Company's web site at https://www.ypg.com/en/investors/financial-reports/2011/quarterly-reports/third-quarter. The conference call will be archived in the Investor Center of the site at www.ypg.com. A playback of the call can also be accessed from November 3 to November 11, 2011 by dialing (905) 694-9451 from within the Toronto area, or 1 800 408-3053 outside Toronto. The conference passcode is 7214585.About Yellow Media Inc.Yellow Media Inc. (TSX:YLO) is Canada's #1 Internet company through its network of companies that include Yellow Pages Group and Canpages. Yellow Media Inc. owns and operates some of Canada's leading properties and publications including Yellow Pages(TM) directories, YellowPages.ca(TM), Canada411.ca(TM), RedFlagDeals.com, and LesPAC.com. Its online destinations reach approximately 9.4 million unique visitors monthly and its mobile applications for finding local businesses and deals have been downloaded over 3.0 million times. Yellow Media Inc. is also a leader in national digital advertising through Mediative, a digital advertising and marketing solutions provider to national agencies and advertisers. For more information, visit www.ypg.com.
Financial Highlights (in thousands of Canadian dollars - except share information) ---------------------------------------------------------------------------- For the three-month For the nine-month periods ended September periods ended September 30, 30, Yellow Media Inc. 2011 2010 2011 2010 ---------------------------------------------------------------------------- Revenues $323,441 $355,949 $1,015,551 $1,055,751 (Loss) income from operations ($2,772,299) $126,729 ($2,524,815) $441,106 Net (loss) earnings from continuing operations ($2,806,099) $65,597 ($2,756,344) $238,937 Basic (loss) earnings per share from continuing operations attributable to common shareholders of Yellow Media Inc. ($5.52)
.12 ($5.42)
.44 Cash flow from operating activities from continuing operations $43,985 $122,526 $243,609 $415,992 ----------------------------------------------------------------------------EBITDA(1) $165,998 $193,223 $532,509 $595,773 EBITDA margin(1) 51.3% 54.3% 52.4% 56.4%Adjusted earnings from continuing operations(1) $37,079 $93,349 $199,300 $338,913 ----------------------------------------------------------------------------Weighted average number of common shares outstanding 509,752,238 501,815,664 511,591,101 503,333,857 Adjusted earnings per common share from continuing operations
.07
.19
.39
.67 Dividends on common shares $40,360 $100,402 $207,345 $302,088 Dividends declared per common share
.08
.20
.40
.60 Payout ratio 114% 105% 103% 90%----------------------------------------------------------------------------