WASHINGTON, April 23, 2018 /PRNewswire/ -- CoStar Group, Inc.
(NASDAQ: CSGP), the leading provider of commercial real estate information, analytics and online marketplaces, announced today
that revenue for the quarter ended March 31, 2018 was $274 million,
an increase of 21% over revenue of $227 million for the first quarter of 2017. Net income for the
quarter ended March 31, 2018 increased $30 million to $52 million or $1.44 per diluted share compared to $22
million for the first quarter 2017, an increase of 136%.
Company-wide net bookings for ongoing services were $54 million in the first quarter of 2018,
but are reduced by negative net bookings of $19 million as a result of the previously announced
discontinuation of the vast majority of the LoopNet Information products in February 2018. Accordingly, overall Company
wide-net bookings in the first quarter were $35 million.
"We had a very strong first quarter of 2018 as we expanded revenue, grew net income and continued to generate strong sales,"
said Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group. "CoStar Suite
revenue accelerated to a growth rate of 19% year-over-year as revenue reached $130 million in the
first quarter of 2018. In the last 12 months, the number of individual subscribers for CoStar Suite in the United States alone grew by over 20,000 to approximately 126,000."
Florance continued, "Apartments.com continues to strengthen its lead as the number one apartment internet listing service and
the addition of ForRent strengthens the value of our network by adding 3.7 million unique visitors and 6.6 million
visits monthly. In the first quarter of 2018, our Apartment network averaged 40 million visits per month, up 40%, and 15.6
million unique monthly visitors, an increase of 38%, year-over-year, as reported by comScore. We are moving quickly to integrate
the operations of the ForRent business with Apartments.com. With ForRent, we have expanded our industry leading multifamily
sales team to over 300 highly seasoned and trained sales professionals, which we believe will result in higher sales and revenue
as the year progresses. In addition, we have already realized significant cost synergies, which include an initial
reduction in force of 158 people earlier this month."
|
Year 2017-2018 Quarterly Results – Unaudited
|
|
(in millions, except per share data)
|
|
2017
|
|
2018
|
|
Q1
|
Q2
|
Q3
|
Q4
|
|
Q1
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
227
|
|
$
|
237
|
|
$
|
248
|
|
$
|
254
|
|
|
$
|
274
|
|
|
Net income
|
22
|
|
22
|
|
34
|
|
44
|
|
|
52
|
|
|
Net income per share - diluted
|
0.68
|
|
0.68
|
|
1.04
|
|
1.22
|
|
|
1.44
|
|
|
Weighted average outstanding shares - diluted
|
32.6
|
|
32.7
|
|
32.8
|
|
36.1
|
|
|
36.4
|
|
|
|
|
|
|
|
|
|
EBITDA
|
55
|
|
44
|
|
73
|
|
66
|
|
|
70
|
|
|
Adjusted EBITDA
|
64
|
|
54
|
|
84
|
|
78
|
|
|
84
|
|
|
Non-GAAP net income
|
34
|
|
28
|
|
46
|
|
45
|
|
|
60
|
|
|
Non-GAAP net income per share - diluted
|
1.05
|
|
0.86
|
|
1.41
|
|
1.25
|
|
|
1.65
|
|
Multifamily revenue for the first quarter of 2018 increased 37% to $88 million versus
$64 million in the first quarter of 2017. On an organic basis, multifamily revenue increased 23% in
the first quarter of 2018 compared to the first quarter of 2017. Revenue by services can be found within the tables included in
this release.
Non-GAAP net income (defined below) for the quarter ended March 31, 2018 was $60 million or $1.65 per diluted share, an increase of $26
million versus the first quarter of 2017. Adjusted EBITDA (which excludes stock-based compensation and other items
as defined below) was $84 million for the first quarter of 2018, an increase of 32% over adjusted
EBITDA for the first quarter of 2017. Adjusted EBITDA margin for the first quarter of 2018 was 31%, an increase of almost 300
basis points compared to the first quarter of 2017.
As of March 31, 2018, the Company had approximately $940 million
in cash, cash equivalents and long-term investments, and no outstanding debt. In the first quarter of 2018, in connection with
the acquisition of ForRent, the Company paid $352 million in cash, which included customary working
capital and other post-closing adjustments, and issued approximately $36 million in shares of
CoStar Group common stock.
2018 Outlook
"With our continued strong sales and revenue performance and focus on margin improvement, we are raising our guidance
for the full year of 2018," stated Scott Wheeler, Chief Financial Officer of CoStar Group. "Our
first quarter performance increases our confidence in achieving our goal of 40% adjusted EBITDA margin for the fourth quarter of
2018."
The Company expects revenue in the range of $1.174 billion to $1.190
billion for the full year of 2018, an increase to the prior midpoint of $2 million and
reflecting revenue growth of 22% at the midpoint of the range. We expect revenue for the second quarter of 2018 in the range of
$292 million to $295 million, representing revenue growth of 24% over
the second quarter of 2017 at the midpoint of the range.
The Company expects adjusted EBITDA in a range of $380 million to $390
million for the full year of 2018, an increase of $15 million at the midpoint versus our
previous outlook. For the second quarter 2018, the Company expects adjusted EBITDA in a range of $66
million to $70 million.
We expect full-year 2018 non-GAAP net income per diluted share in a range of $7.44 to
$7.64, based on 36.6 million shares, an increase of $0.43 at the
midpoint versus the previously provided outlook. For the second quarter 2018, we expect non-GAAP net income per
diluted share in a range of $1.25 to $1.34 based on 36.5 million
shares. These ranges include a non-GAAP tax rate of 25%.
The preceding forward-looking statements reflect CoStar Group's expectations as of April 23,
2018, including forward-looking non-GAAP financial measures on a consolidated basis. Given the risk factors, uncertainties
and assumptions discussed above, actual results may differ materially. Other than in publicly available statements, the Company
does not intend to update its forward-looking statements until its next quarterly results announcement.
Reconciliation of EBITDA, adjusted EBITDA, non-GAAP net income and non-GAAP net income per diluted share and all of the
disclosed non-GAAP financial measures to their GAAP basis results are shown in detail below, along with definitions for those
terms. A reconciliation of forward-looking non-GAAP guidance to the most directly comparable GAAP measure, net income, can be
found within the tables included in this release.
Non-GAAP Financial Measures
For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this
release and why management believes they provide useful information to investors regarding the Company's financial condition and
results of operations, please refer to the Company's latest periodic report.
EBITDA is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before (i) interest income
(expense) and loss on debt extinguishment, (ii) provision for income taxes, and (iii) depreciation and amortization.
Adjusted EBITDA is a non-GAAP financial measure that represents EBITDA before (i) stock-based compensation expense, (ii)
acquisition and integration related costs, (iii) restructuring charges and related costs, and (iv) settlements and impairments
incurred outside the Company's normal business operations.
Non-GAAP net income is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before (i)
amortization of acquired intangible assets, (ii) stock-based compensation expense, (iii) acquisition and integration related
costs, (iv) purchase accounting adjustments, (v) restructuring charges and related costs, (vi) settlements and impairments and
(vii) loss on debt extinguishment. From this figure, we then subtract an assumed provision for income taxes to arrive at non-GAAP
net income. In 2017, the company assumed a 38% tax rate, and in 2018 the company is assuming a 25% tax rate in order to
approximate our statutory corporate tax rate.
Non-GAAP net income per diluted share (also referred to as non-GAAP EPS) is a non-GAAP financial measure that represents
non-GAAP net income divided by the number of diluted shares outstanding for the period. For periods with GAAP net losses
and non-GAAP net income, the weighted-average outstanding shares used to calculate non-GAAP net income per share includes
potentially dilutive securities that were excluded from the calculation of GAAP net income per share as the effect was
anti-dilutive.
Earnings Conference Call
Management will conduct a conference call at 5:00 PM EDT on Monday, April 23, 2018 to
discuss earnings results for the first quarter of 2018 and the Company's outlook. The audio portion of the conference call will
be broadcast live over the Internet at www.costargroup.com/investors/events. To join the conference call by telephone, please dial (800) 230-1059 (from
the United States and Canada) or (612) 234-9959 (from all other
countries) and refer to conference code 446984. An audio recording of the conference call will be available for replay
approximately one hour after the call's completion and will remain available for a period of time following the call. To access
the recorded conference call, please dial (800) 475-6701 (from the U.S. and Canada) or (320)
365-3844 (from all other countries) using access code 446984. The webcast replay will also be available in the Investors section
of CoStar Group's website for a period of time following the call.
|
CoStar Group, Inc.
|
|
Condensed Consolidated Statements of Operations - Unaudited
|
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Revenues
|
|
$
|
273,718
|
|
|
$
|
226,553
|
|
|
Cost of revenues
|
|
62,477
|
|
|
51,346
|
|
|
Gross profit
|
|
211,241
|
|
|
175,207
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
Selling and marketing (excluding customer base amortization)
|
|
88,490
|
|
|
76,402
|
|
|
Software development
|
|
22,913
|
|
|
22,374
|
|
|
General and administrative
|
|
40,590
|
|
|
33,995
|
|
|
Customer base amortization
|
|
5,803
|
|
|
4,774
|
|
|
|
157,796
|
|
|
137,545
|
|
|
|
|
|
|
|
Income from operations
|
|
53,445
|
|
|
37,662
|
|
|
Interest and other income
|
|
2,987
|
|
|
429
|
|
|
Interest and other expense
|
|
(690)
|
|
|
(2,686)
|
|
|
Income before income taxes
|
|
55,742
|
|
|
35,405
|
|
|
Income tax expense
|
|
3,511
|
|
|
13,275
|
|
|
Net income
|
|
$
|
52,231
|
|
|
$
|
22,130
|
|
|
|
|
|
|
|
Net income per share - basic
|
|
$
|
1.46
|
|
|
$
|
0.69
|
|
|
Net income per share - diluted
|
|
$
|
1.44
|
|
|
$
|
0.68
|
|
|
|
|
|
|
|
Weighted average outstanding shares - basic
|
|
35,893
|
|
|
32,276
|
|
|
Weighted average outstanding shares - diluted
|
|
36,350
|
|
|
32,563
|
|
|
CoStar Group, Inc.
|
|
Reconciliation of Non-GAAP Financial Measures - Unaudited
|
|
(in thousands, except per share data)
|
|
|
|
|
|
|
Reconciliation of Net Income to Non-GAAP Net Income
|
|
|
Three Months Ended
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Net income
|
|
$
|
52,231
|
|
|
$
|
22,130
|
|
|
Income tax expense
|
|
3,511
|
|
|
13,275
|
|
|
Income before income taxes
|
|
55,742
|
|
|
35,405
|
|
|
Amortization of acquired intangible assets
|
|
10,411
|
|
|
10,893
|
|
|
Stock-based compensation expense
|
|
10,412
|
|
|
9,357
|
|
|
Acquisition and integration related costs
|
|
3,522
|
|
|
362
|
|
|
Settlements and impairments
|
|
—
|
|
|
(760)
|
|
|
Non-GAAP income before income taxes
|
|
80,087
|
|
|
55,257
|
|
|
Assumed rate for income tax expense *
|
|
25
|
%
|
|
38
|
%
|
|
Assumed provision for income tax expense
|
|
(20,022)
|
|
|
(20,998)
|
|
|
Non-GAAP net income
|
|
$
|
60,065
|
|
|
$
|
34,259
|
|
|
|
|
|
|
|
Net income per share - diluted
|
|
$
|
1.44
|
|
|
$
|
0.68
|
|
|
Non-GAAP net income per share - diluted
|
|
$
|
1.65
|
|
|
$
|
1.05
|
|
|
|
|
|
|
|
Weighted average outstanding shares - basic
|
|
35,893
|
|
|
32,276
|
|
|
Weighted average outstanding shares - diluted
|
|
36,350
|
|
|
32,563
|
|
|
|
|
|
|
|
* A 25% and 38% tax rate is assumed for 2018 and 2017, respectively, which
approximates our statutory corporate tax rate.
|
|
|
|
|
|
|
Reconciliation of Net Income to EBITDA and Adjusted EBITDA
|
|
|
Three Months Ended
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Net income
|
|
$
|
52,231
|
|
|
$
|
22,130
|
|
|
Amortization of acquired intangible assets in cost of revenues
|
|
4,608
|
|
|
6,119
|
|
|
Amortization of acquired intangible assets in operating expenses
|
|
5,803
|
|
|
4,774
|
|
|
Depreciation and other amortization
|
|
6,572
|
|
|
6,405
|
|
|
Interest and other income
|
|
(2,987)
|
|
|
(429)
|
|
|
Interest and other expense
|
|
690
|
|
|
2,686
|
|
|
Income tax expense
|
|
3,511
|
|
|
13,275
|
|
|
EBITDA
|
|
$
|
70,428
|
|
|
$
|
54,960
|
|
|
Stock-based compensation expense
|
|
10,412
|
|
|
9,357
|
|
|
Acquisition and integration related costs
|
|
3,522
|
|
|
362
|
|
|
Settlements and impairments
|
|
—
|
|
|
(760)
|
|
|
Adjusted EBITDA
|
|
$
|
84,362
|
|
|
$
|
63,919
|
|
|
CoStar Group, Inc.
|
|
Condensed Consolidated Balance Sheets
|
|
(in thousands)
|
|
|
|
|
|
|
|
March 31,
2018
|
|
December 31,
2017
|
|
|
(Unaudited)
|
|
|
|
ASSETS
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
931,429
|
|
|
$
|
1,211,463
|
|
|
Accounts receivable, net
|
|
68,914
|
|
|
60,900
|
|
|
Prepaid expenses and other current assets
|
|
31,661
|
|
|
15,572
|
|
|
Total current assets
|
|
1,032,004
|
|
|
1,287,935
|
|
|
|
|
|
|
|
Long-term investments
|
|
10,070
|
|
|
10,070
|
|
|
Deferred income taxes, net
|
|
4,579
|
|
|
5,431
|
|
|
Property and equipment, net
|
|
83,401
|
|
|
84,496
|
|
|
Goodwill
|
|
1,551,248
|
|
|
1,283,457
|
|
|
Intangible assets, net
|
|
313,861
|
|
|
182,892
|
|
|
Deferred commissions costs
|
|
75,201
|
|
|
—
|
|
|
Deposits and other assets
|
|
11,755
|
|
|
6,179
|
|
|
Income tax receivable
|
|
12,981
|
|
|
12,981
|
|
|
Total assets
|
|
$
|
3,095,100
|
|
|
$
|
2,873,441
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable, accrued expenses and other current
liabilities
|
|
$
|
116,175
|
|
|
$
|
100,980
|
|
|
Deferred revenue
|
|
49,468
|
|
|
45,686
|
|
|
Total current liabilities
|
|
165,643
|
|
|
146,666
|
|
|
|
|
|
|
|
Deferred gain on sale of building
|
|
15,561
|
|
|
16,192
|
|
|
Deferred rent
|
|
32,000
|
|
|
33,909
|
|
|
Deferred income taxes, net
|
|
65,456
|
|
|
12,070
|
|
|
Income taxes payable
|
|
15,476
|
|
|
13,354
|
|
|
|
|
|
|
|
Stockholders' equity
|
|
2,800,964
|
|
|
2,651,250
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
3,095,100
|
|
|
$
|
2,873,441
|
|
|
CoStar Group, Inc.
|
|
Condensed Consolidated Statements of Cash Flows - Unaudited
|
|
(in thousands, unaudited)
|
|
|
|
Three Months Ended
March 31,
|
|
2018
|
|
2017
|
|
Operating activities:
|
|
|
|
|
Net income
|
$
|
52,231
|
|
|
$
|
22,130
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
Depreciation and amortization
|
16,983
|
|
|
17,298
|
|
|
Amortization of deferred commissions costs
|
12,006
|
|
|
—
|
|
|
Amortization of debt issuance costs
|
219
|
|
|
772
|
|
|
Stock-based compensation expense
|
10,412
|
|
|
9,357
|
|
|
Deferred income tax expense, net
|
1,851
|
|
|
2,091
|
|
|
Bad debt expense
|
1,431
|
|
|
1,800
|
|
|
Changes in operating assets and liabilities, net of
acquisitions:
|
|
|
|
|
Accounts receivable
|
(2,511)
|
|
|
(2,760)
|
|
|
Prepaid expenses and other current assets
|
(9,522)
|
|
|
(359)
|
|
|
Deferred commissions
|
(16,263)
|
|
|
—
|
|
|
Accounts payable and other liabilities
|
4,288
|
|
|
11,588
|
|
|
Deferred revenue
|
5,272
|
|
|
2,757
|
|
|
Deposits and other assets
|
(3,412)
|
|
|
(117)
|
|
|
Net cash provided by operating activities
|
72,985
|
|
|
64,557
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
Purchases of property and equipment and other assets
|
(8,617)
|
|
|
(6,146)
|
|
|
Acquisitions, net of cash acquired
|
(340,074)
|
|
|
(13,673)
|
|
|
Net cash used in investing activities
|
(348,691)
|
|
|
(19,819)
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
Payments of long-term debt
|
—
|
|
|
(35,000)
|
|
|
Repurchase of restricted stock to satisfy tax withholding
obligations
|
(15,392)
|
|
|
(5,781)
|
|
|
Proceeds from exercise of stock options and employee stock purchase
plan
|
10,616
|
|
|
1,234
|
|
|
Net cash used in financing activities
|
(4,776)
|
|
|
(39,547)
|
|
|
|
|
|
|
Effect of foreign currency exchange rates on cash and cash
equivalents
|
448
|
|
|
58
|
|
|
Net (decrease) increase in cash and cash equivalents
|
(280,034)
|
|
|
5,249
|
|
|
Cash and cash equivalents at the beginning of period
|
1,211,463
|
|
|
567,223
|
|
|
Cash and cash equivalents at the end of period
|
$
|
931,429
|
|
|
$
|
572,472
|
|
|
CoStar Group, Inc.
|
|
Results of Segments - Unaudited
|
|
(in thousands)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2018
|
|
2017
|
|
Revenues
|
|
|
|
|
North America
|
$
|
264,795
|
|
|
$
|
219,341
|
|
|
International
|
|
|
|
|
External customers
|
8,923
|
|
|
7,212
|
|
|
Intersegment revenues *
|
13
|
|
|
11
|
|
|
Total International revenues
|
8,936
|
|
|
7,223
|
|
|
Intersegment eliminations
|
(13)
|
|
|
(11)
|
|
|
Total revenues
|
$
|
273,718
|
|
|
$
|
226,553
|
|
|
|
|
|
|
EBITDA
|
|
|
|
|
North America
|
$
|
71,055
|
|
|
$
|
54,433
|
|
|
International
|
(627)
|
|
|
527
|
|
|
Total EBITDA
|
$
|
70,428
|
|
|
$
|
54,960
|
|
|
|
|
|
|
* Intersegment revenues recorded were attributable to services performed
for the Company's wholly owned subsidiary, CoStar Portfolio Strategy by Grecam S.A.S. ("Grecam"), a wholly owned
subsidiary of CoStar Limited, the Company's wholly owned U.K. holding company. Intersegment revenues are recorded at an
amount the Company believes approximates fair value. North America EBITDA includes a corresponding cost for the
services performed by Grecam for CoStar Portfolio Strategy.
|
|
CoStar Group, Inc.
|
|
Revenues by Services - Unaudited
|
|
(in thousands)
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Information and analytics
|
|
|
|
|
|
CoStar Suite
|
|
$
|
130,361
|
|
|
$
|
109,979
|
|
|
Information services
|
|
15,060
|
|
|
18,336
|
|
|
Online marketplaces
|
|
|
|
|
|
Multifamily
|
|
87,683
|
|
|
63,991
|
|
|
Commercial property and land
|
|
40,614
|
|
|
34,247
|
|
|
Total revenues
|
|
$
|
273,718
|
|
|
$
|
226,553
|
|
|
CoStar Group, Inc.
Reconciliation of Non-GAAP Financial Measures with 2017-2018 Quarterly Results - Unaudited
|
|
(in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income to Non-GAAP Net Income
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
2018
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
|
Q1
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
22.1
|
|
$
|
22.2
|
|
$
|
34.2
|
|
$
|
44.2
|
|
|
52.2
|
|
|
Income tax expense
|
|
13.3
|
|
3.6
|
|
21.0
|
|
4.5
|
|
|
3.5
|
|
|
Income before income taxes
|
|
35.4
|
|
25.8
|
|
55.2
|
|
48.7
|
|
|
55.7
|
|
|
Amortization of acquired intangible assets
|
|
10.9
|
|
9.3
|
|
8.5
|
|
8.7
|
|
|
10.4
|
|
|
Stock-based compensation expense
|
|
9.4
|
|
10.1
|
|
9.7
|
|
9.8
|
|
|
10.4
|
|
|
Acquisition and integration related costs
|
|
0.4
|
|
0.4
|
|
1.2
|
|
2.0
|
|
|
3.5
|
|
|
Settlements and impairments
|
|
(0.8)
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
Loss on debt extinguishment
|
|
—
|
|
—
|
|
—
|
|
3.8
|
|
|
—
|
|
|
Non-GAAP income before income taxes
|
|
55.3
|
|
45.6
|
|
74.6
|
|
73.0
|
|
|
80.1
|
|
|
Assumed rate for income tax expense *
|
|
38
|
%
|
38
|
%
|
38
|
%
|
38
|
%
|
|
25
|
%
|
|
Assumed provision for income tax expense
|
|
(21.0)
|
|
(17.3)
|
|
(28.4)
|
|
(27.7)
|
|
|
(20.0)
|
|
|
Non-GAAP net income
|
|
$
|
34.3
|
|
$
|
28.3
|
|
$
|
46.3
|
|
$
|
45.2
|
|
|
$
|
60.1
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income per share - diluted
|
|
$
|
1.05
|
|
$
|
0.86
|
|
$
|
1.41
|
|
$
|
1.25
|
|
|
$
|
1.65
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding shares - basic
|
|
32.3
|
|
32.4
|
|
32.4
|
|
35.7
|
|
|
35.9
|
|
|
Weighted average outstanding shares - diluted
|
|
32.6
|
|
32.7
|
|
32.8
|
|
36.1
|
|
|
36.4
|
|
|
|
|
|
|
|
|
|
|
* A 25% and 38% tax rate is assumed for 2018 and 2017, respectively, which
approximates our statutory corporate tax rate.
|
|
|
Reconciliation of Net Income to EBITDA and Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
2018
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
|
Q1
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
22.1
|
|
$
|
22.2
|
|
$
|
34.2
|
|
$
|
44.2
|
|
|
$
|
52.2
|
|
|
Amortization of acquired intangible assets
|
|
10.9
|
|
9.3
|
|
8.5
|
|
8.7
|
|
|
10.4
|
|
|
Depreciation and other amortization
|
|
6.4
|
|
6.5
|
|
6.6
|
|
6.7
|
|
|
6.6
|
|
|
Interest and other income
|
|
(0.4)
|
|
(0.6)
|
|
(0.6)
|
|
(2.5)
|
|
|
(3.0)
|
|
|
Interest and other expense
|
|
2.7
|
|
2.7
|
|
2.9
|
|
0.7
|
|
|
0.7
|
|
|
Loss on debt extinguishment
|
|
—
|
|
—
|
|
—
|
|
3.8
|
|
|
—
|
|
|
Income tax expense
|
|
13.3
|
|
3.6
|
|
21.0
|
|
4.5
|
|
|
3.5
|
|
|
EBITDA
|
|
$
|
55.0
|
|
$
|
43.7
|
|
$
|
72.6
|
|
$
|
66.0
|
|
|
$
|
70.4
|
|
|
Stock-based compensation expense
|
|
9.4
|
|
10.1
|
|
9.7
|
|
9.8
|
|
|
10.4
|
|
|
Acquisition and integration related costs
|
|
0.4
|
|
0.4
|
|
1.2
|
|
2.0
|
|
|
3.5
|
|
|
Settlements and impairments
|
|
(0.8)
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
Adjusted EBITDA
|
|
$
|
63.9
|
|
$
|
54.3
|
|
$
|
83.6
|
|
$
|
77.9
|
|
|
$
|
84.4
|
|
|
CoStar Group, Inc.
|
|
Reconciliation of Forward-Looking Guidance - Unaudited
|
|
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
Reconciliation of Forward-Looking Guidance, Net Income to Non-GAAP Net
Income
|
|
Guidance Range
|
|
Guidance Range
|
|
For the Three Months
|
|
For the Twelve Months
|
|
Ended June 30, 2018
|
|
Ended December 31, 2018
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
10,000
|
|
|
$
|
15,000
|
|
|
$
|
164,000
|
|
|
$
|
175,000
|
|
|
Income tax expense
|
3,000
|
|
|
5,000
|
|
|
55,000
|
|
|
59,000
|
|
|
Income before income taxes
|
13,000
|
|
|
20,000
|
|
|
219,000
|
|
|
234,000
|
|
|
Amortization of acquired intangible assets
|
26,000
|
|
|
26,000
|
|
|
77,000
|
|
|
77,000
|
|
|
Stock-based compensation expense
|
12,000
|
|
|
11,000
|
|
|
46,000
|
|
|
44,000
|
|
|
Acquisition and integration related costs
|
10,000
|
|
|
8,000
|
|
|
20,000
|
|
|
17,000
|
|
|
Restructuring and related costs
|
—
|
|
|
—
|
|
|
1,000
|
|
|
1,000
|
|
|
Non-GAAP income before income taxes
|
61,000
|
|
|
65,000
|
|
|
363,000
|
|
|
373,000
|
|
|
Assumed rate for income tax expense *
|
25
|
%
|
|
25
|
%
|
|
25
|
%
|
|
25
|
%
|
|
Assumed provision for income tax expense
|
(15,300)
|
|
|
(16,200)
|
|
|
(90,800)
|
|
|
(93,300)
|
|
|
Non-GAAP net income
|
$
|
45,700
|
|
|
$
|
48,800
|
|
|
$
|
272,200
|
|
|
$
|
279,700
|
|
|
|
|
|
|
|
|
|
|
Net income per share - diluted
|
$
|
0.27
|
|
|
$
|
0.41
|
|
|
$
|
4.48
|
|
|
$
|
4.78
|
|
|
Non-GAAP net income per share - diluted
|
$
|
1.25
|
|
|
$
|
1.34
|
|
|
$
|
7.44
|
|
|
$
|
7.64
|
|
|
|
|
|
|
|
|
|
|
Weighted average outstanding shares - diluted
|
36,500
|
|
|
36,500
|
|
|
36,600
|
|
|
36,600
|
|
|
|
|
|
|
|
|
|
|
* A 25% tax rate is assumed, which approximates our statutory corporate tax
rate.
|
|
|
|
|
|
|
|
|
|
Reconciliation of Forward-Looking Guidance, Net Income to Adjusted
EBITDA
|
|
|
|
|
|
|
Guidance Range
|
|
Guidance Range
|
|
For the Three Months
|
|
For the Twelve Months
|
|
Ended June 30, 2018
|
|
Ended December 31, 2018
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Net income
|
$
|
10,000
|
|
|
$
|
15,000
|
|
|
$
|
164,000
|
|
|
$
|
175,000
|
|
|
Amortization of acquired intangible assets
|
26,000
|
|
|
26,000
|
|
|
77,000
|
|
|
77,000
|
|
|
Depreciation and other amortization
|
6,000
|
|
|
6,000
|
|
|
24,000
|
|
|
24,000
|
|
|
Interest and other expense, net
|
(1,000)
|
|
|
(1,000)
|
|
|
(7,000)
|
|
|
(7,000)
|
|
|
Income tax expense
|
3,000
|
|
|
5,000
|
|
|
55,000
|
|
|
59,000
|
|
|
Stock-based compensation expense
|
12,000
|
|
|
11,000
|
|
|
46,000
|
|
|
44,000
|
|
|
Acquisition and integration related costs
|
10,000
|
|
|
8,000
|
|
|
20,000
|
|
|
17,000
|
|
|
Restructuring and related costs
|
—
|
|
|
—
|
|
|
1,000
|
|
|
1,000
|
|
|
Adjusted EBITDA
|
$
|
66,000
|
|
|
$
|
70,000
|
|
|
$
|
380,000
|
|
|
$
|
390,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
About CoStar Group, Inc.
CoStar Group, Inc. (NASDAQ: CSGP) is the leading provider of commercial real estate information, analytics and online
marketplaces. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most
comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret
and gain unmatched insight on commercial property values, market conditions and current availabilities. LoopNet is the most
heavily trafficked commercial real estate marketplace online with over 5 million monthly unique visitors per month.
Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Westside Rentals, AFTER55.com, CorporateHousing.com,
ForRentUniversity.com and Apartamentos.com form the premier online apartment resource for renters seeking great apartment homes
and provide property managers and owners a proven platform for marketing their properties. CoStar Group's websites
attracted an average of approximately 38 million unique monthly visitors in aggregate in the first quarter of 2018. Headquartered
in Washington, DC, CoStar maintains offices throughout the U.S. and in Europe and Canada with a staff of over 4,100 worldwide, including the
industry's largest professional research organization. For more information, visit www.costargroup.com.
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to, statements about CoStar Group's financial expectations, the Company's
plans, objectives, expectations and intentions and other statements including words such as "hope," "anticipate," "may,"
"believe," "expect," "intend," "will," "should," "plan," "estimate," "predict," "continue" and "potential" or the negative of
these terms or other comparable terminology. Such statements are based upon the current beliefs and expectations of management of
CoStar Group and are subject to significant risks and uncertainties. Actual results may differ materially from the results
anticipated in the forward-looking statements. The following factors, among others, could cause or contribute to such
differences: the risk that the trends stated or implied by this release cannot or will not be sustained at the current pace,
including trends related to revenue, net income, bookings, sales, subscribers, site traffic and visits; the risk that the Company
is unable to sustain current revenue and earnings growth rates or increase them; the risk that the Company's expanded sales team
does not produce higher sales and revenue as the year progresses; the risk that the Company is unable to achieve its stated goal
of 40% adjusted EBITDA margin for the fourth quarter 2018; the risk that revenues for the second quarter and full year 2018 will
not be as stated in this press release;the risk that net income for the second quarter and full year 2018 will not be as stated
in this press release; the risk that adjusted EBITDA for the second quarter and full year 2018 will not be as stated in this
press release; the risk that non-GAAP net income and non-GAAP net income per diluted share for the second quarter and full year
2018 will not be as stated in this press release; the risk that the tax rate estimates stated in this press release are incorrect
or may change; the risk that new tax laws, regulations or guidance may be enacted or issued impacting our effective tax rate; the
risk that the businesses of ForRent, Apartments.com, and CoStar may not be combined successfully or in a timely and
cost-efficient manner; the risk that the combination does not produce the expected results or benefits; the risk that business
disruption relating to the ForRent acquisition may be greater than expected; the risk that synergies and expected operating
efficiencies from the acquisition of ForRent may not be as expected, may not be fully realized, or may take longer to realize
than expected; and the risk that the combination and integration of ForRent will disrupt CoStar's operations or result in the
loss of consumers, property owners or key employees. Additional factors that could cause results to differ materially from
those anticipated in the forward-looking statements can be found in CoStar's Annual Report on Form 10-K for the year ended
December 31, 2017, which is filed with the SEC, including in the "Risk Factors" section of that filing, and the Company's
other filings with the SEC available at the SEC's website (www.sec.gov). CoStar
assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events
or otherwise.
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SOURCE CoStar Group, Inc.