Marchex Reports Earnings & Sells 2.6 Million in Domains

Marchex, Inc. (NASDAQ:MCHX) today reported its results for the quarter ended March 31, 2012 and reported that year to date, including April 2012 has sold $2.6 Million in domains.

According to the earnings report Marches sold $1.5 Million January-March and another $1.1 Million in April.

Overall Marchex basically matched there year ago results which were in line with market expections and the stock remained basically unchanged in trading right about at its 52 week low

Here are the rest of the results

First Quarter 2012 Consolidated Financial Results:

Revenue was $35.5 million for the first quarter of 2012, compared to $29.1 million for the same period of 2011.

GAAP net loss applicable to common stockholders was $788,000 for the first quarter of 2012 or $0.02 per diluted share. This compares to GAAP net income applicable to common stockholders of $513,000 or $0.01 per diluted share for the same period of 2011.

Adjusted operating income before amortization was $3.3 million for the first quarter of 2012, compared to $3.2 million for the same period of 2011.

Adjusted EBITDA was $4.3 million in the first quarter of 2012, compared to $4.2 million for the same period of 2011.

“We believe the growth of the mobile marketplace will change how advertisers buy and measure new customer phone calls as a lead source,” said Russell C. Horowitz, Marchex Chairman and CEO. “We are focused on the primary drivers of long-term growth in our business, including building a unique technology platform centered on call analytics and performance advertising solutions that can support the needs of our advertiser and publisher partners. We will continue focusing on adding new advertising and publishing partners, as well as deepening our relationships with existing ones.”

Recent Highlights:

1. Call-Driven Revenues: For the first quarter of 2012, revenue from call advertising products was $26.4 million.

2. During the first quarter, Marchex sold a small number of domains that yielded $1.5 million. Including April 2012, year to date domain sales totaled $2.6 million.

3. Marchex also purchased 136,000 shares of its outstanding Class B common stock for a total price of $682,000. This brings Marchex’s total shares repurchased under its stock repurchase program to 11 million shares, or 30% of its outstanding common stock.

4. Today, Russell C. Horowitz, Chairman and CEO, Michael Arends, Chief Financial Officer, John Keister, Executive Vice Chairman and Ethan Caldwell, General Counsel and Chief Administrative Officer, announced they intend to purchase shares of the Company’s Class B common stock in open market transactions over the balance of the year. Mr. Horowitz intends to purchase up to an aggregate total of $1 million worth of the Company’s Class B common stock and the other executive officers intend to purchase shares in varying amounts. The share purchases will be executed in accordance with applicable securities laws, rules and regulations.

Marchex Guidance:

The following forward-looking statements reflect Marchex’s expectations as of May 3, 2012.
Financial guidance for the fiscal year ending December 31, 2012:

Revenue: $144 million to $152 million

Adjusted Operating Income Before Amortization: More than $14.5 million

Adjusted EBITDA: Estimated add-backs of approximately $4.5 million in additional depreciation and amortization to adjusted operating income before amortization, implying an adjusted EBITDA of more than $19 million

Long Term Adjusted EBITDA Margin Target: 20% or more

2012 GAAP income (loss) from operations is expected to be ($5.4) million or better, assuming stock-based compensation between $15 million and $16 million and amortization of intangible assets from acquisitions between $4.7 million and $5.5 million. This estimate excludes any prospective gain or loss on sales and disposals of intangible assets.
Financial guidance for the Second Quarter ending June 30, 2012:

Revenue: $34.5 million to $36 million

Adjusted Operating Income Before Amortization: $3.3 million

Adjusted EBITDA: Estimated add-backs of approximately $1 million in additional depreciation and amortization to adjusted operating income before amortization, implying an adjusted EBITDA of $4.3 million

Long Term Adjusted EBITDA Margin Target: 20% or more

Second quarter GAAP income (loss) from operations is expected to be ($3.2) million or better, assuming stock-based compensation between $3.5 million and $4.5 million and amortization of intangible assets from acquisitions between $1.5 million and $2 million. This estimate excludes any prospective gain or loss on sales and disposals of intangible assets.

“While we expect to see mobile performance and call advertising budgets ramp up in the latter half of the year based on our current pipeline and outlook, our decline in non-call driven revenue is impacting overall near term growth. Secondarily, we see budget variability in the second quarter with a small number of our larger call advertisers for a variety of reasons, including seasonality. Overall we are winning new customers for our mobile performance and call advertising products, so we feel good about what this means as an indicator of our long-term growth prospects. At the same time, we know that execution here will be key. We need to remain focused on replicating the successful advertiser and publisher relationships that we have more broadly, and continuing to add experienced people as we grow the business. As we move forward, we are managing our investments in the mobile performance and call advertising opportunity such that as we grow, a portion of the incremental contribution will be allocated to support our growth initiatives, including investments in our products, people and customers. The rest will flow through to contribute to expanding contribution margins,” said Michael Arends, Marchex Chief Financial Officer.