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Press release from GlobeNewswire (a Nasdaq OMX company)

Kayak Reports Q2 2012 Financial Results

Wednesday, August 22, 2012

Kayak Reports Q2 2012 Financial Results13:01 EDT Wednesday, August 22, 2012NORWALK, Conn., Aug. 22, 2012 (GLOBE NEWSWIRE) -- KAYAK Software Corporation (Nasdaq:KYAK) today announced financial results for the second quarter ended June 30, 2012. "We're off to a strong start as a public company, with record revenues and adjusted EBITDA," said Steve Hafner, KAYAK Chief Executive Officer and Cofounder. "Our focus remains on ensuring that KAYAK is the best place to plan and book travel globally."Second Quarter 2012 Financial Results Total Revenue: $76.9 million, a 36% year-over-year increase from $56.8 million in the second quarter of 2011.Adjusted EBITDA: $20.6 million, an 85% year-over-year increase from $11.1 million in the second quarter of 2011.Net Income: $7.3 million, a 93% year-over-year increase from $3.8 million in the second quarter of 2011.GAAP EPS: $0.19, as compared to $0.10 in the second quarter of 2011. GAAP EPS is calculated based on GAAP net income divided by 38.6 million and 37.4 million weighted average diluted shares outstanding.Second Quarter 2012 Operating MetricsTotal Queries: We processed 304 million queries, a 33% year-over-year increase from 229 million in the second quarter of 2011. Queries refer to user requests for travel information we process through our websites and mobile applications.RPM: Revenue per thousand queries, or RPM, was $253, a 2% year-over-year increase from $248 in the second quarter of 2011.Mobile: We processed 57 million queries through our mobile applications, a 95% year-over-year increase from the second quarter of 2011. Revenue per thousand mobile queries, or mobile RPM of $46, increased 42% year-over-year from $33 in the second quarter of 2011. Mobile RPM figures are KAYAK's best estimation of revenue per thousand mobile queries based on data provided by those travel partners that delineate between mobile and website travel bookings.Second Quarter 2012 Financial Results Conference Call: KAYAK will webcast a conference call today at 5 p.m. ET to discuss the second quarter 2012 financial results. The webcast can be accessed on the KAYAK Investor Relations website at http://ir.kayak.com, along with the company's earnings press release, financial tables and accompanying slide presentation. A live domestic dial-in is available at (877) 293-5492 or internationally at (720) 545-0007, using passcode 16409129. A domestic replay will be available at (855) 859-2056 or (404) 537-3406 internationally, using passcode 16409129. Following the call, a replay of the webcast will be available at the same website until September 5, 2012.About KAYAK KAYAK allows people to easily compare hundreds of travel sites at once when searching for flights, hotels, and rental cars, and gives travelers choices on where to book. The company processes over 100 million user queries each month and operates websites in 18 countries including the U.S., Germany, the United Kingdom, France, Spain, Italy, Russia and Brazil. KAYAK also offers a leading travel app with over 17 million downloads, available for free on iPhone, iPad, Android, Windows Mobile 7 and Nokia devices.Use of Forward-Looking Statements: This press release contains forward looking statements regarding our management's future expectations, beliefs, intentions, goals, strategies, plans and prospects. Such statements constitute "forward-looking" statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The achievement of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any of these risks or uncertainties materialize or if any of the assumptions prove incorrect, our actual results, performance or achievements could be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, but are not limited to, the matters set forth in the filings that we make with the Securities and Exchange Commission from time to time, including those set forth in the section entitled "Risk Factors" in the company's Prospectus filed on July 20, 2012 and additional information that will be set forth in our Form 10-Q that will be filed for the quarter ended June 30, 2012, which should be read in conjunction with these financial results. These documents are available on the SEC Filings section of the Investor Relations section of our website at http://ir.kayak.com/. Please also note that forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information, becomes available in the future.Use of Non-GAAP Financial Measures Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States, or GAAP. Earnings Before Interest, Taxes, Depreciation and Amortization, or EBITDA, is a metric used by management to measure operating performance. Adjusted EBITDA represents EBITDA excluding the impact of stock-based compensation expense and other income (expense), net. We present Adjusted EBITDA as a supplemental performance measure because we believe it facilitates operating performance comparisons from period to period and company to company by backing out potential differences caused by variations in capital structures (affecting other income (expense), net), tax positions (such as the impact on periods or companies of changes in effective tax rates), the age and book depreciation of fixed assets (affecting relative depreciation expense), the impact of acquisitions and the impact of stock-based compensation expense. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to performance measures derived in accordance with GAAP. See "Schedule of Non-GAAP Reconciliations" below for a reconciliation of income (loss) from operations to Adjusted EBITDA.          KAYAK Software Corporation and Subsidiaries   Consolidated Statements of Operations (Unaudited, in thousands, except share and per share amounts)  Three Months Ended June 30,Six Months Ended June 30,  2012201120122011 Revenues  $ 76,938  $ 56,753  $ 150,276  $ 109,427 Cost of revenues (excludes depreciation and amortization)  4,807  4,684  9,992  9,629 Selling, general and administrative expenses:         Marketing  39,409  30,025  80,658  58,482 Personnel, includes stock-based compensation of $2,669 and $3,054 for three months ended June 30, 2012 and 2011 respectively and $5,667 and $6,191 for the six months ended June 30, 2012 and 2011 respectively  11,306  9,800  23,219  19,839 Other general and administrative expenses, includes stock-based compensation of $173 and $0 for three months ended June 30, 2012 and 2011 respectively and $173 and $0 for the six months ended June 30, 2012 and 2011 respectively  3,615  4,164  8,447  8,381 Total selling, general and administrative expenses (excludes depreciation and amortization)  54,330  43,989  112,324  86,702 Depreciation and amortization  2,050  2,341  4,100  4,402 Impairment of intangible assets  --   --   --   14,980 Income (loss) from operations  15,751  5,739  23,860  (6,286) Other income (expense)         Interest income  47  24  68  45 Other income (expense)  (613)  306  (809)  917 Total other income (expense)  (566)  330  (741)  962 Income (loss) before taxes  15,185  6,069  23,119  (5,324) Income tax expense (benefit)  7,897  2,293  11,686  (2,186) Net income (loss)  7,288  3,776  11,433  (3,138) Redeemable convertible preferred stock dividends declared  (2,936)  (2,936)  (5,872)  (5,872) Deemed dividend resulting from modification of redeemable convertible preferred stock  (2,929)  --   (2,929)  --  Net income (loss) attributed to common stockholders  $ 1,423  $ 840  $ 2,632  $ (9,010)Net income (loss) per common share         Basic  $ 0.20  $ 0.11  $ 0.37  $ (1.21) Diluted  $ 0.19  $ 0.10  $ 0.30  $ (1.21)Weighted average common shares         Basic  7,049,863  7,505,505  7,043,571  7,451,737 Diluted  38,620,694  37,391,530  37,959,369  7,451,737            KAYAK Software Corporation and Subsidiaries  Condensed Balance Sheets (Unaudited, in thousands, except share and per share amounts)      June 30,December 31,   20122011Assets     Current assets     Cash and cash equivalents  $ 54,550  $ 35,127 Marketable securities  10,912  11,198 Accounts receivable, net of allowance for doubtful accounts  50,247  37,332 Deferred tax asset  2,212  2,212 Prepaid expenses and other current assets  5,826  5,425 Total current assets  123,747  91,294 Property and equipment, net  5,268  5,474 Intangible assets, net  14,563  17,684 Goodwill  155,244  155,677 Deferred tax asset  9,441  7,488 Other assets  248  331 Total assets  $ 308,511  $ 277,948Liabilities and stockholders' equity (deficit)     Current liabilities     Accounts payable  $ 16,212  $ 9,514 Accrued expenses and other current liabilities  24,760  16,220 Total current liabilities  40,972  25,734 Warrant liability  1,319  1,150 Deferred tax liability  3,241  4,202 Other long-term liabilities  799  1,092 Total liabilities  46,331  32,178 Redeemable convertible preferred stock  256,295  247,494 Commitments and contingencies     Stockholders' equity (deficit)     Common Stock  7  7 Class A common stock  --   --  Class B common stock, 33,864,565 issued and outstanding, on a pro forma basis  --   --  Additional paid-in capital  6,575  3,296 Cumulative translation adjustment  (2,215)  (977) Accumulated earnings (deficit)  1,518  (4,050) Total stockholders' equity (deficit)  5,885  (1,724) Total liabilities and stockholders' equity (deficit)  $ 308,511  $ 277,948            KAYAK Software Corporation and Subsidiaries   Consolidated Statements of Cash Flows (Unaudited, in thousands)  Six Months Ended June 30,  20122011  (unaudited)Cash flows from operating activities     Net income (loss)  $ 11,433  $ (3,138) Adjustments to reconcile net income to net cash from operating activities:     Depreciation and amortization  4,100  4,402 Stock-based compensation expense  5,840  6,191 Excess tax benefits from exercise of stock options  (73)  (226) Deferred taxes  (2,819)  (9,811) Mark to market adjustments  169  (916) Impairment of intangible assets  --   14,980 Other  --   121 Changes in assets and liabilities, net of effect of acquisitions:     Accounts receivable, net  (13,277)  (8,901) Prepaid expenses and other current assets  461  2,989 Accounts payable  6,871  5,870 Accrued liabilities and other liabilities  8,171  (3,061) Net cash from operating activities  20,876  8,500Cash flows from investing activities     Capital expenditures  (1,162)  (1,068) Purchase of marketable securities  (7,481)  (18,182) Maturities of marketable securities  7,651  6,699 Exercise of put options  --   --  Cash paid for business combinations, net of cash acquired  --   (9,194) Net cash from investing activities  (992)  (21,745)Cash flows from financing activities     Proceeds from exercise of stock options  302  682 Tax benefits realized from exercise of stock options  73  226 Cash paid for expenses in connection with initial public offering  (411)  (1,118) Net cash from financing activities  (36)  (210) Effect of exchange rate changes on cash and cash equivalents  (425)  467 Increase (decrease) in cash and cash equivalents  19,423  (12,990) Cash and cash equivalents, beginning of period  35,127  34,966 Cash and cash equivalents, end of period  $ 54,550  $ 21,976Supplemental disclosures of cash flow information     Cash paid during the period for:     Interest  $ --   $ --  Income taxes  $ 11,040  $ 7,331                    Key Operating Metrics (Unaudited, in thousands, except RPM)        Three months ended June 30,Six months ended June 30,  2012201120122011 Mobile Queries  57,103  29,291  109,464  54,697 Website Queries  246,936  199,457  504,890  388,270 Total Queries 304,039 228,748 614,354 442,967                      Three months ended June 30,Six months ended June 30,  2012201120122011 Mobile RPM (Estimate)  $ 46  $ 33  $ 40  $ 31 Website RPM (Estimate)  $ 301  $ 278  $ 289  $ 277 Total RPM  $ 253  $ 248  $ 245  $ 247  Schedule of Non-GAAP Reconciliations (Unaudited, in thousands)    Three months ended June 30,Six months ended June 30,  2012201120122011 Income (loss) from operations  $ 15,751  $ 5,739  $ 23,860  $ (6,286) Other income (expense), net  (613)  306  (809)  917 Depreciation and amortization  2,050  2,341  4,100  4,402 Impairment of intangible assets  --   --   --   14,980 EBITDA  17,188  8,386  27,151  14,013 Stock-based compensation  2,842  3,054  5,840  6,191 Other (income) expense, net  613  (306)  809  (917) Adjusted EBITDA  $ 20,643  $ 11,134  $ 33,800  $ 19,287CONTACT: Investor Relations: Denise Garcia 203-682-8335 IR@kayak.com Media Relations: Jessica Casano-Antonellis prcontact@kayak.com