Core Consolidated Revenue Increases 27% in 2010
Metastorm Sale Completed
WAYNE, Pa., Feb. 24, 2011 (GLOBE NEWSWIRE) -- Internet Capital Group, Inc. (Nasdaq:ICGE) ("ICG") today reported its results for the fourth quarter and full year ended December 31, 2010.
"We are pleased with our financial results, which were driven by strong performance at each of our consolidated core partner companies," said Walter Buckley, ICG's Chief Executive Officer. "2010 was a pivotal year for ICG, as we set out on a path to refine our business model by focusing on core consolidated companies while monetizing certain equity companies. We successfully executed against these goals by increasing our stake in ICG Commerce to over 80% and, more recently, by monetizing our stake in Metastorm, one of our core equity companies. As we look ahead, we are well positioned to continue to report strong operating results within a simpler, more transparent structure."
Financial Results
ICG's GAAP revenue increased to $33.1 million for the quarter ended December 31, 2010, up from $24.0 million for the fourth quarter of 2009. GAAP net income for the quarter ended December 31, 2010 was $0.3 million, or $0.01 per diluted share, compared to $32.0 million, or $0.87 per diluted share, in the comparable 2009 period. Core consolidated revenue totaled $33.1 million in the fourth quarter of 2010, an increase of 27% from the corresponding 2009 period. Core consolidated EBITDA totaled $5.6 million for the fourth quarter of 2010, compared to $4.0 million in the corresponding 2009 period.
ICG's GAAP revenue increased to $115.7 million for 2010, up from $90.3 million for 2009. GAAP net income for 2010 was $46.6 million, or $1.26 per diluted share, compared to $15.5 million, or $0.42 per diluted share, for 2009. Core consolidated revenue totaled $117.7 million for 2010, an increase of 27% from 2009. Core consolidated EBITDA totaled $13.7 million for 2010, compared to $9.3 million for 2009.
ICG's corporate cash and cash equivalents were $72.9 million at December 31, 2010, and the value of ICG's holdings in GoIndustry-DoveBid (LSE.AIM: GOI) was $3.5 million. Additionally, as of December 31, 2010, ICG had an income tax receivable of $6.3 million.
ICG Commerce
ICG Commerce reported $28.5 million of revenue for the fourth quarter of 2010, representing an increase of 25% over the comparable 2009 period. ICG Commerce reported $101.1 million of revenue for 2010, representing an increase of 24% over 2009. ICG Commerce's EBITDA, excluding stock-based compensation and unusual items, for the quarter ended December 31, 2010 increased to $6.4 million, up from $4.9 million in the comparable 2009 period. ICG Commerce's EBITDA, excluding stock-based compensation and unusual items, for 2010 increased to $17.1 million, up from $13.4 million in 2009.
Metastorm
On February 17, 2011, the sale of Metastorm to Open Text Corporation was consummated. ICG's portion of the sale proceeds consisted of approximately $53 million, approximately $1.6 million of which has been placed in escrow in connection with a customary indemnification holdback. Subject to any indemnification claims that Open Text may assert, the escrowed sale proceeds will be released to ICG nine months following the closing of the transaction.
2011 Guidance
"As we look forward in 2011, we expect core consolidated revenue for the year to be in the range of $142 million to $148 million, representing 21% to 26% growth over 2010 revenue, and core consolidated EBITDA to be in the range of $16 million to $18 million as we continue to support key growth and expansion efforts at our consolidated partner companies," said Kirk Morgan, Chief Financial Officer at ICG. "Additionally, the proceeds from our recent sale of Metastorm will further strengthen our balance sheet, providing us greater financial flexibility to achieve our goals of owning majority stakes in companies and driving growth."
For information related to ICG's core equity companies, Channel Intelligence, Freeborders, StarCite and WhiteFence, please refer to the supplemental schedule on our website, as well as the slide presentation that will accompany today's earnings results webcast. See below for further details regarding the webcast.
Please see ICG's website at www.icg.com for more information on ICG, its partner companies and its fourth quarter and full year 2010 results.
ICG will host a webcast at 10:00 a.m. ET today to discuss its financial results. As part of the live webcast for this call, ICG will post a slide presentation to accompany the prepared remarks. To access the webcast, go to www.icg.com and click on the investor relations tab. Then click the link for the fourth quarter and full year conference call webcast. Please log on to the website approximately ten minutes prior to the call to register and download and install any necessary audio software. The conference call is also accessible through listen-only mode at 866-831-6247. The international dial-in number is 617-213-8856. The pass code is 42656308.
For those unable to participate in the conference call, a replay will be available from February 24, 2011 at 1:00 p.m. ET until March 3, 2011 at 11:59 p.m. ET. To access the replay, dial 888-286-8010 (domestic) or 617-801-6888 (international). The pass code is83619482. The replay and slide presentation also can be accessed in the investor relations section of the ICG website at www.icg.com/investors/events-and-presentations/.
About ICG
ICG (Nasdaq:ICGE) identifies, capitalizes and grows companies in the SaaS, tech-enabled BPO and Internet marketing sectors. These partner companies transform the way business is done by enabling enterprises to increase efficiencies and improve critical processes. ICG leverages its unique expertise to carefully identify companies based on their potential to become market changers and market leaders. ICG focuses on building successful businesses in the SaaS, tech-enabled BPO and Internet marketing sectors by providing them with access to management expertise and strategic and operational guidance, as well as growth capital.
The Internet Capital Group, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7794
Safe Harbor Statement under Private Securities Litigation Reform Act of 1995
The statements contained in this press release that are not historical facts are forward-looking statements that involve certain risks and uncertainties, including, but not limited to, risks associated with the effect of economic conditions generally, capital spending by our partner companies' customers, our partner companies' ability to compete successfully against their respective competitors, our partner companies' ability to timely and effectively respond to technological developments, our and our partner companies' collective ability to retain key personnel, our ability to have continued access to capital and to deploy capital effectively and on acceptable terms, our ability to maximize value in connection with divestitures, and other risks and uncertainties detailed in ICG's filings with the Securities and Exchange Commission. These and other factors may cause actual results to differ materially from those projected.
| Internet Capital Group, Inc. | ||||
| Consolidated Statements of Operations | ||||
| (In thousands, except per share data) | ||||
| Three Months Ended | Twelve Months Ended | |||
| December 31, | December 31, | |||
| 2010 | 2009 | 2010 | 2009 | |
| Revenue | $ 33,076 | $ 23,951 | $ 115,710 | $ 90,252 |
| Operating Expenses | ||||
| Cost of revenue | 18,669 | 14,715 | 71,050 | 56,920 |
| Selling, general and administrative | 10,995 | 7,857 | 42,206 | 34,578 |
| Research and development | 2,846 | 1,597 | 10,644 | 9,015 |
| Amortization of intangibles | 337 | -- | 1,357 | 205 |
| Impairment related and other | 10 | 128 | 1,182 | 5,192 |
| Total operating expenses | 32,857 | 24,297 | 126,439 | 105,910 |
| Operating income (loss) | 219 | (346) | (10,729) | (15,658) |
| Other income (loss), net | 28 | 5,353 | 74,147 | 16,578 |
| Interest income | 75 | 108 | 330 | 446 |
| Interest expense | (174) | (10) | (366) | (216) |
| Income (loss) before income taxes and equity loss | 148 | 5,105 | 63,382 | 1,150 |
| Income tax benefit (expense) | 2,811 | 40,394 | (254) | 39,510 |
| Equity loss | (2,155) | (1,493) | (16,022) | (12,131) |
| Income (loss) from continuing operations | 804 | 44,006 | 47,106 | 28,529 |
| Income (loss) on discontinued operations | -- | -- | 802 | -- |
| Net income (loss) | 804 | 44,006 | 47,908 | 28,529 |
| Less: Net income (loss) attributable to the noncontrolling interest | 538 | 11,989 | 1,319 | 12,995 |
| Net income (loss) attributable to ICG | $ 266 | $ 32,017 | $ 46,589 | $ 15,534 |
| Amounts attributable to ICG common shareholders: | ||||
| Net income (loss) from continuing operations | $ 266 | $ 32,017 | $ 45,977 | $ 15,534 |
| Net income (loss) on discontinued operations | -- | -- | 612 | -- |
| Net income (loss) attributable to ICG common shareholders | $ 266 | $ 32,017 | $ 46,589 | $ 15,534 |
| Basic net income (loss) per share: | ||||
| Income (loss) from continuing operations attributable to ICG common shareholders | $ 0.01 | $ 0.87 | $ 1.26 | $ 0.42 |
| Income (loss) on discontinued operations attributable to ICG common shareholders | -- | -- | 0.02 | -- |
| $ 0.01 | $ 0.87 | $ 1.28 | $ 0.42 | |
|
Shares used in computation of basic net income (loss) per common share attributable to ICG common shareholders |
36,684 | 36,623 | 36,427 | 36,660 |
| Diluted net income (loss) per share: | ||||
| Income (loss) from continuing operations attributable to ICG common shareholders | $ 0.01 | $ 0.87 | $ 1.24 | $ 0.42 |
| Income (loss) on discontinued operations attributable to ICG common shareholders | -- | -- | 0.02 | -- |
| Income (loss) attributable to ICG common shareholders | $ 0.01 | $ 0.87 | $ 1.26 | $ 0.42 |
|
Shares used in computation of diluted net income (loss) per common share attributable to ICG common shareholders |
37,875 | 36,692 | 37,064 | 36,705 |
| Internet Capital Group, Inc. | ||
| Condensed Consolidated Balance Sheets | ||
| (In thousands) | ||
| December 31, | December 31, | |
| 2010 | 2009 | |
| ASSETS | ||
| Cash and cash equivalents | $ 92,639 | $ 55,528 |
| Accounts receivable, net | 25,705 | 19,120 |
| Deferred tax asset | 6,792 | 8,147 |
| Income tax receivable | 6,314 | 11,071 |
| Prepaid expenses and other current assets | 2,507 | 2,146 |
| Assets of discontinued operations | -- | 1,750 |
| Total current assets | 133,957 | 97,762 |
| Marketable securities | -- | 73,512 |
| Fixed assets, net | 5,991 | 4,179 |
| Ownership interests in partner companies | 83,829 | 97,777 |
| Goodwill | 20,317 | 20,317 |
| Intangibles, net | 13,832 | 14,789 |
| Deferred tax asset | 21,288 | 20,724 |
| Other assets, net | 1,904 | 1,027 |
| Total assets | $ 281,118 | $ 330,087 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current maturities of other long-term debt | $ 4,546 | $ 381 |
| Accounts payable | 1,973 | 1,590 |
| Accrued expenses | 3,033 | 4,463 |
| Accrued compensation and benefits | 15,327 | 12,218 |
| Deferred revenue | 10,226 | 5,668 |
| Liabilities of discontinued operations | -- | 320 |
| Total current liabilities | 35,105 | 24,640 |
| Long-term debt | 15,535 | 645 |
| Other non-current liabilities | 867 | 1,640 |
| Total liabilities | 51,507 | 26,925 |
| Redeemable noncontrolling interest | 1,182 | 1,420 |
| Equity: | ||
| Controlling (ICG) equity | 223,780 | 280,665 |
| Noncontrolling interest | 4,649 | 21,077 |
| Total stockholders' equity | 228,429 | 301,742 |
| Total liabilities and stockholders' equity | $ 281,118 | $ 330,087 |
| ICG | ||||||||
| Non-GAAP Reconciliation | ||||||||
| (In thousands) | ||||||||
| The following table is a reconciliation of non-GAAP financial measures to GAAP results. | ||||||||
| Quarter Ended December 31, | Year Ended December 31, | |||||||
| 2010 | 2009 | 2010 | 2009 | |||||
| Reconciliation of GAAP revenue to core consolidated revenue (A) | ||||||||
| GAAP revenue | $ 33,076 | $ 23,951 | $ 115,710 | $ 90,252 | ||||
| GovDelivery revenue for periods prior to acquisition | -- | 2,074 | -- | 7,031 | ||||
| Deferred revenue not recorded in purchase accounting | 38 | -- | 1,955 | -- | ||||
| Vcommerce revenue to exclude periods while consolidated | -- | -- | -- | (4,610) | ||||
| Core consolidated revenue | $ 33,114 | $ 26,025 | $ 117,665 | $ 92,673 | ||||
| Reconciliation of GAAP Net income attributable to ICG to adjusted operating income (loss) and core consolidated EBITDA (A) | ||||||||
| GAAP Net income (loss) attributable to ICG: | $ 266 | $ 32,017 | $ 46,589 | $ 15,534 | ||||
| Net income attributable to non-controlling interests | 538 | 11,989 | 1,319 | 12,995 | ||||
| Discontinued operations | -- | -- | (802) | -- | ||||
| Equity loss (income) | 2,155 | 1,493 | 16,022 | 12,131 | ||||
| Income tax expense (benefit) | (2,811) | (40,394) | 254 | (39,510) | ||||
| Interest (income) expense, net | 99 | (98) | 36 | (230) | ||||
| Other (income) loss, net | (28) | (5,353) | (74,147) | (16,578) | ||||
| Consolidated operating income (loss) | 219 | (346) | (10,729) | (15,658) | ||||
| Depreciation - corporate | 13 | 15 | 58 | 90 | ||||
| Intangibles amortization resulting from acquisitions - corporate | 337 | -- | 1,357 | 205 | ||||
| Depreciation and amortization - core consolidated | 721 | 379 | 2,490 | 1,281 | ||||
| Stock-based compensation - corporate | 582 | 257 | 2,345 | 2,888 | ||||
| Stock-based compensation - core consolidated | 147 | 228 | 682 | 791 | ||||
| Impairment related and other - corporate | -- | -- | 796 | 4,876 | ||||
| Impairment related and other - core consolidated | 10 | -- | 386 | -- | ||||
| Adjusted operating income (loss) | 2,029 | 533 | (2,615) | (5,527) | ||||
| Corporate: | ||||||||
| Operating expenses | 3,631 | 3,628 | 14,766 | 13,279 | ||||
| Core Consolidated Companies: | ||||||||
| Deferred revenue not recorded in purchase accounting | 38 | -- | 1,955 | -- | ||||
| Other income (loss), net | (100) | (185) | (360) | 602 | ||||
| Proforma: | ||||||||
| GovDelivery results of operations for periods prior to acquisition | -- | 38 | -- | (342) | ||||
| Vcommerce results of operations to exclude periods while consolidated | -- | -- | -- | 1,301 | ||||
| Core consolidated EBITDA | $ 5,598 | $ 4,014 | $ 13,746 | $ 9,313 | ||||
| (A) Core consolidated revenue, core consolidated EBITDA and adjusted operating income (loss) are non-GAAP financial measures and have no standardized measurement prescribed by GAAP. Core consolidated revenue is the sum of the revenue of ICG's three core consolidated companies. Core consolidated EBITDA is the sum of the earnings (losses) before interest, taxes, depreciation and amortization, stock-based compensation and unusual items of ICG's three core consolidated companies. ICG's management considers charges unusual when they are transactional-driven or non-recurring. Adjusted operating income (loss) is operating income (loss), adjusted for depreciation and amortization, stock-based compensation, and impairment related and other amounts of ICG's three core consolidated companies. ICG's management believes these non-GAAP financial measures provide useful information to investors, potential investors, securities analysts and others that enables each such group to evaluate core consolidated companies' current and future prospects in a similar manner as ICG's management and review results on a comparable basis for all periods presented. | ||||||||