Neustar Reports: Revenue Up 40% & Has $235 Million In the Bank

Neustar, Inc. (NYSE: NSR), announced results for the quarter ended June 30, 2012 and increased its guidance for full-year 2012.

Neustar operates several TLD’s including .biz and .Us and was the back end provider with the most number of new gTLD applications:

GAAP Results for Second Quarter 2012 Compared to Second Quarter 2011

  • Revenue increased 40% to $206.5 million
  • Income from continuing operations increased 15% to $38.6 million
  • Income from continuing operations per diluted share increased 27% to $0.57
  • Cash, cash equivalents and investments totaled $235.0 million
  • Share repurchases totaled $25.0 million or 742,000 shares

Non-GAAP Results for Second Quarter 2012 Compared to Second Quarter 2011

  • Adjusted net income from continuing operations increased 33% to $51.2 million
  • Adjusted earnings per diluted share increased 47% to $0.75

Discussion of Second Quarter Results

Consolidated revenue totaled $206.5 million, a 40% increase from $147.7 million in the second quarter of 2011. This increase included revenue of $38.0 million from our Information Services operating segment. In particular:

  • Carrier Services revenue totaled $126.3 million, a 14% increase from $110.8 million in 2011. This increase was primarily due to an $11.0 million increase in NPAC Services revenue and a $2.1 million increase in Order Management Services revenue.
  • Enterprise Services revenue totaled $42.1 million, a 14% increase from $36.8 million in 2011. This increase was due to higher revenue in Registry Services and Internet Infrastructure Services; and
  • Information Services revenue totaled $38.0 million comprised of $23.0 million in Identification Services, $9.8 million in Verification & Analytics Services, and $5.2 million in Local Search & Licensed Data Services.

Operating expense totaled $138.1 million, a 49% increase from $92.4 million in the second quarter of 2011. This increase was primarily driven by the addition of $37.1 million in operating expense from the Company’s recent acquisitions as it continues to diversify its portfolio of services. The remaining $8.6 million of the increase was primarily driven by the growth in the Company’s operations. In particular, personnel and personnel-related expense increased $3.4 million due to increased headcount in the areas of sales and marketing, technology and operations.

Cash, cash equivalents and investments totaled $235.0 million as of June 30, 2012, compared to $188.7 million as of March 31, 2012 and compared to $135.3 million as of December 31, 2011.

During the second quarter, the Company repurchased approximately 742,000 shares of common stock at an average price of $33.67 per share, for a total purchase price of approximately $25.0 million.

Business Outlook for 2012

The Company increased the full-year guidance for revenue and adjusted net income from continuing operations that was provided on February 2, 2012 and affirmed on April 26, 2012:

  • Revenue to range from $825 to $835 million. Prior revenue guidance was between $810 and $830 million
  • Adjusted net income to range from $189 to $197 million. Prior adjusted net income guidance was $178 to $190 million
  • Adjusted earnings per diluted share to range from $2.78 to $2.90. Prior adjusted earnings per diluted share was $2.66 to $2.84

 

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