Tucows Reports Earnings: Revenue Up 19% & Yummynames.com Sells $1.65 Million In Domains in 4th Q

After the Market closed today Tucows (AMEX:TCX, TSX:TC) reported earnings for the fourth quarter ended December 31, 2011.

Revenue was up 19%.

YummyNames.com sold another $1.65 million in domain names in the 4th Q and Tucows ended the 4th Q with 11.8 domain names under management, up 16% from a year earlier.

Here is the full report

All figures are in U.S. dollars.

You can also read the earnings report transcript by clicking here.

Summary Financial Results
(Numbers in Thousands of US Dollars, Except Per Share Data)

	3 Months Ended December 31, 2011 (unaudited)	3 Months Ended December 31, 2010 (unaudited)	12 Months Ended December 31, 2011 (unaudited)	12 Months Ended December 31, 2010 (unaudited)
Net revenue	26,370	22,077	97,065	84,579
Income before provision for income taxes and change in fair value of forward exchange contracts	1,745	611	3,986	1,455
Net income (loss) for the period	6,055	1,237	6,170	2,117
Net earnings (loss) per common share*	0.11	0.02	0.12	0.04
Net cash provided by operating activities	2,683	2,341	5,885	6,769

* 2011 results include a tax benefit of $0.06 per share related to the release of deferred tax asset valuation allowances.

Summary of Revenues and Cost of Revenues
(Numbers in Thousands of US Dollars)

	Revenue		Cost of Revenue
	3 Months Ended December 31, 2011 (unaudited)	3 Months Ended December 31, 2010 (unaudited)	3 Months Ended December 31, 2011 (unaudited)	3 Months Ended December 31, 2010 (unaudited)
OpenSRS:
Domain Service	20,743	17,308	17,347	14,565
Email Service	653	529	41	104
Other services	1,136	1,104	385	366
Total OpenSRS services	22,532	18,941	17,773	15,035
YummyNames	1,648	1,531	182	181
Hover	1,432	1,172	548	398
Butterscotch	759	433	6	9
Network, other costs	–	–	1,146	1,148
Network, depreciation and amortization costs	–	–	177	313
Total revenue/cost of revenue	26,370	22,077	19,833	17,084

“Our strong performance in the fourth quarter, highlighted by 19% year-over-year revenue growth to a record $26.4 million – our seventh consecutive quarter of record revenue – and solid cash flow from operations, concluded a year that was indicative of the consistency and reliability of our business, as well as our ability to efficiently deliver growth,” said Elliot Noss, President and Chief Executive Officer, Tucows Inc.

“As a result, we also delivered our best year ever in terms of revenue at just over $97 million.”

“Looking ahead, this efficiency, combined with what we believe is the best distribution channel in the Internet economy, firmly positions us to continue to consistently generate cash flow, while introducing new services with minimal capital investment or impact on operating expenses. Ting, our recently launched US mobile phone service, is a testament to our capabilities in this regard.”

“Net revenue for the fourth quarter of 2011 increased 19% to a record $26.4 million from $22.1 million for the fourth quarter of 2010 and was driven by growth in each of the Company’s business groups.”

“Net income for the fourth quarter of 2011 was $6.1 million, or $0.11 per share, compared with net income for the fourth quarter of 2010 of $1.2 million, or $0.02 per share. Net income per share for the fourth quarter of 2011 includes a tax benefit of $0.06 per share related to the release of deferred tax asset valuation allowances during that quarter.”

“Deferred revenue at the end of the fourth quarter of 2011 was $69.2 million, an increase of 11% from $62.6 million at the end of the fourth quarter of 2010 and relatively unchanged from the end of the third quarter of 2011.”

Cash and cash equivalents at the end of the fourth quarter of 2011 were $6.4 million compared with $4.2 million at the end of the fourth quarter of 2010 and $4.7 million at the end of the third quarter of 2011.”

“As previously announced, subsequent to the end of the fourth quarter the Company completed the repurchase of 7.6 million of its shares at a purchase price of $0.77 per share for a total of $5.8 million under its modified “Dutch auction” tender announced on December 15, 2011.  Since initiating its first share buyback program in February 2007, the Company has repurchased a total of 30.8 million shares through its buyback programs, representing 40.5% of the Company’s total shares outstanding at the end of January 2007.”