QuinStreet, Inc. (QNST), hit an all time low this morning after issuing its earnings report for the quarter ending September 30, 2012
The stock traded as low as $5.66 today and is current trading as of time of publication at $6 a share.
At $6 a share the company has a market cap of just $255 million dollars, which is not great for a company with $103 million in cash.
Shares of QuinStreet hit an all time high of $23.86 back in Feburary of 2011
QuinStreet bought Insurance.com and CarInsurance.com for around $50 million dollars each and has spent a lot of money in the domain sector over the years in the insurance and educational verticals.
As far as the earnings report the Company reported total revenue of $78.6 million. Adjusted EBITDA was $12.0 million, or 15% of revenue.
The Company reported GAAP net loss of $137 thousand, or $(0.00) per share, for the quarter. Adjusted net income for the quarter was $6.2 million, or $0.14 per diluted share. Adjusted net income excludes stock-based compensation expense and amortization of intangible assets, net of estimated tax.
Revenue for the Education client vertical was $34.6 million.
Revenue for the Financial Services client vertical was $30.3 million.
Revenue for Other client verticals was $13.7 million.
The Company generated $9.7 million of normalized free cash flow and closed the quarter with $103.6 million in cash and marketable securities.
Reconciliations of adjusted net income to net (loss) income, adjusted EBITDA to net (loss) income, and normalized free cash flow to net cash provided by operating activities are included in the accompanying tables.
“We continue to work through challenges and transitions in our core Financial Services and Education verticals,” commented Doug Valenti, QuinStreet CEO. “We are encouraged by our progress on key initiatives that we believe better position us for a return to growth. We also continue to manage the Company with characteristic financial discipline, generating attractive EBITDA and free cash flow margins, with minimal demands for capital.”
“Visibility remains limited. We expect revenue for the current or second fiscal quarter to be in the range of $75 to $80 million.
Adjusted EBITDA margin will likely be in the mid-to-high teens. We continue to target 20% adjusted EBITDA margin for the full fiscal year,” concluded Valenti.
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|September 30,||June 30,|
|Cash and cash equivalents||$ 64,448||$ 68,531|
|Accounts receivable, net||44,912||52,830|
|Deferred tax assets||7,662||7,665|
|Prepaid expenses and other assets||7,783||7,774|
|Total current assets||163,950||173,536|
|Property and equipment, net||8,430||8,755|
|Other intangible assets, net||65,645||72,444|
|Deferred tax assets, noncurrent||8,446||8,446|
|Other assets, noncurrent||878||930|
|Total assets||$ 490,304||$ 507,160|
|Liabilities and Stockholders’ Equity|
|Accounts payable||$ 20,074||$ 22,870|
|Total current liabilities||58,264||70,314|
|Other liabilities, noncurrent||7,001||6,322|
|Additional paid-in capital||217,299||220,552|
|Accumulated other comprehensive loss||(1,726)||(1,439)|
|Total stockholders’ equity||335,859||338,357|
|Total liabilities and stockholders’ equity||$ 490,304||$ 507,160|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|(In thousands, except per share data)|
|Three Months Ended|
|Net revenue||$ 78,626||$ 101,224|
|Cost of revenue (1)||65,190||75,748|
|Operating expenses: (1)|
|Sales and marketing||3,691||4,034|
|General and administrative||3,926||5,217|
|Other income (expense), net||46||(31)|
|Income before income taxes||(12)||9,075|
|Provision for taxes||(125)||(3,581)|
|Net (loss) income||$ (137)||$ 5,494|
|Net (loss) income per share|
|Basic||$ (0.00)||$ 0.12|
|Diluted||$ (0.00)||$ 0.11|
|Weighted average shares used in computing net income per share|
|(1) Cost of revenue and operating expenses include stock-based compensation expense as follows:|
|Cost of revenue||$ 923||$ 1,179|
|Sales and marketing||765||779|
|General and administrative||389||756|
|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS|
|Three Months Ended|
|Cash Flows from Operating Activities|
|Net (loss) income||$ (137)||$ 5,494|
|Adjustments to reconcile net income to net cash provided by operating activities:|
|Depreciation and amortization||8,279||7,108|
|Provision for sales returns and doubtful accounts receivable||(316)||36|
|Excess tax benefits from stock-based compensation||(24)||(35)|
|Other non-cash adjustments, net||75||243|
|Changes in assets and liabilities, net of effects of acquisitions:|
|Prepaid expenses and other assets||(9)||3,155|
|Other assets, noncurrent||57||29|
|Other liabilities, noncurrent||342||519|
|Net cash provided by operating activities||10,371||10,677|
|Cash Flows from Investing Activities|
|Business acquisitions, net of notes payable and cash acquired||—||(30,204)|
|Internal software development costs||(651)||(559)|
|Purchases of marketable securities||(14,862)||(9,610)|
|Proceeds from sales and maturities of marketable securities||12,145||5,433|
|Other investing activities||4||28|
|Net cash used in investing activities||(3,655)||(35,665)|
|Cash Flows from Financing Activities|
|Proceeds from exercise of common stock options||236||1,817|
|Proceeds from bank debt||—|
|Principal payments on bank debt||(1,250)||(1,313)|
|Payment of bank loan upfront fees||—|
|Principal payments on acquisition-related notes payable||(3,568)||(1,213)|
|Excess tax benefits from stock-based compensation||24||35|
|Withholding taxes related to restricted stock net share settlement||(101)||(184)|
|Repurchases of common stock||(6,157)||—|
|Net cash used in financing activities||(10,816)||(858)|
|Effect of exchange rate changes on cash and cash equivalents||17||25|
|Net decrease in cash and cash equivalents||(4,083)||(25,821)|
|Cash and cash equivalents at beginning of period||68,531||132,290|
|Cash and cash equivalents at end of period||$ 64,448||$ 106,469|