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Neustar Reports 1Q RevenueApr 26, 2011 (Close-Up Media via COMTEX) -- Neustar, a provider of directory services, announced results for the quarter ended March 31, and affirmed guidance for full-year 2011. In a release dated April 21, the Company said in connection with its continued efforts to exit the Converged Messaging Services business, the Company recorded a $41.9 million income tax benefit in the first quarter of 2011, primarily associated with a worthless stock deduction for the common stock of Neustar NGM Services. "Our strong first quarter results reflect the combination of a sharpened strategic focus and excellent execution," said Lisa Hook, Neustar's president and chief executive officer. "In addition, we continue to make good progress in leveraging our established assets and capabilities to build new revenue streams in attractive spaces adjacent to our core business." Paul Lalljie, Neustar's chief financial officer, said, "Our first quarter results demonstrate our Company's ability to effectively grow the top line while investing in new initiatives capable of fueling future growth. We are particularly pleased with the 14 percent year-over-year revenue growth and the strong profit margins this quarter, establishing strong momentum for attaining our 2011 guidance." Discussion of First Quarter Results Consolidated revenue totaled $146.5 million, a 14 percent increase from $129.0 million in the first quarter of 2010. This increase was driven by growth in both the Carrier Services and Enterprise Services business segments. In particular: -Carrier Services revenue totaled $110.0 million, a 10 percent increase from $99.8 million in the first quarter of 2010. This increase is primarily due to a $10.9 million increase in the established fixed fee under the Company's contracts to provide NPAC Services, included in our Numbering Services revenue. Additionally, Order Management Services revenue increased by $2.6 million, primarily due to greater demand and usage from existing customers and the addition of new customers. Partially offsetting these revenue increases was a $1.1 million decrease in revenue from IP Services, resulting from the sale of certain assets associated with the continued wind down of our Converged Messaging Services business; and -Enterprise Services revenue totaled $36.5 million, a 25 percent increase from $29.2 million in the first quarter of 2010. This increase is primarily due to a $5.0 million increase in Internet Infrastructure Services revenue due to greater demand and usage from existing customers and the addition of new customers utilizing the Company's expansive DNS solutions, including IP geolocation services. Additionally, Registry Services revenue increased by $2.3 million due to a greater number of common short codes and domain names under management. Total operating expense increased 8 percent to $94.1 million from $87.0 million in the first quarter of 2010. The $7.2 million increase was primarily due to additional personnel and personnel-related expense to support expansion of the Company's operations and new services, including increased stock-based compensation expense of $1.2 million attributable to the change in employment status of certain former executives. Cash, cash equivalents and investments totaled $392.2 million as of March 31, compared to $382.4 million as of Dec. 31, 2010. During the first quarter, the Company purchased approximately 712,000 shares of its Class A common stock at an average price of $25.95 per share, for a total purchase price of $18.5 million. Business Outlook for 2011 The Company affirmed revenue and EBITDA guidance previously provided on February 2,: -Revenue to range from $585 million to $600 million -EBITDA to range from $244 million to $254 million To provide additional insight into the Company's outlook for 2011, the Company provided the following guidance for net income and earnings per diluted share: -Net income to range from $165 million to $171 million, or between $2.19 and $2.26 per diluted share. Excluding the impact of the $41.9 million discrete income tax benefit, adjusted net income to range from $123 million to $129 million, or between $1.63 and $1.71 per diluted share. Per share calculations are based on an estimated 75.5 million diluted weighted average shares outstanding Reconciliation of Non-GAAP Financial Measures In this press release and in other public statements, Neustar presents certain non-GAAP financial data. To place this data in an appropriate context, the following is a reconciliation of net income to EBITDA for the three months ended March 31, 2010 and 2011 and the year ended Dec. 31, 2010. Also provided is a reconciliation of projected net income to projected EBITDA for the year ending Dec. 31. ((Comments on this story may be sent to [email protected])) |