Attached files
| file | filename |
|---|---|
| 8-K - 8-K - WebMD Health Corp. | d250011d8k.htm |
| EX-99.4 - EX-99.4 - WebMD Health Corp. | d250011dex994.htm |
| EX-99.3 - EX-99.3 - WebMD Health Corp. | d250011dex993.htm |
| EX-99.1 - EX-99.1 - WebMD Health Corp. | d250011dex991.htm |
Exhibit 99.2
WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| Revenue |
$ | 135,138 | $ | 135,305 | $ | 408,116 | $ | 366,042 | ||||||||
| Cost of operations |
49,097 | 47,610 | 148,698 | 135,972 | ||||||||||||
| Sales and marketing |
29,597 | 28,957 | 94,161 | 86,789 | ||||||||||||
| General and administrative |
22,787 | 22,964 | 67,614 | 62,350 | ||||||||||||
| Depreciation and amortization |
6,781 | 6,935 | 19,929 | 20,268 | ||||||||||||
| Interest income |
21 | 21 | 88 | 3,850 | ||||||||||||
| Interest expense |
5,862 | 1,797 | 14,836 | 10,106 | ||||||||||||
| Loss on convertible notes |
— | 2,232 | — | 16,970 | ||||||||||||
| Gain (loss) on investments |
(1,150 | ) | (131 | ) | 14,679 | (22,977 | ) | |||||||||
| Other income (expense), net |
— | 107 | (53 | ) | (92 | ) | ||||||||||
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| Income from continuing operations before income tax provision (benefit) |
19,885 | 24,807 | 77,592 | 14,368 | ||||||||||||
| Income tax provision (benefit) |
8,645 | 10,193 | 32,606 | (4,140 | ) | |||||||||||
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| Income from continuing operations |
11,240 | 14,614 | 44,986 | 18,508 | ||||||||||||
| Income (loss) from discontinued operations, net of tax |
2,994 | (1,024 | ) | 10,388 | (1,024 | ) | ||||||||||
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| Net income |
$ | 14,234 | $ | 13,590 | $ | 55,374 | $ | 17,484 | ||||||||
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| Basic income (loss) per common share: |
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| Income from continuing operations |
$ | 0.19 | $ | 0.25 | $ | 0.77 | $ | 0.33 | ||||||||
| Income (loss) from discontinued operations |
0.06 | (0.02 | ) | 0.18 | (0.01 | ) | ||||||||||
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| Net income |
$ | 0.25 | $ | 0.23 | $ | 0.95 | $ | 0.32 | ||||||||
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| Diluted income (loss) per common share: |
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| Income from continuing operations |
$ | 0.19 | $ | 0.24 | $ | 0.75 | $ | 0.31 | ||||||||
| Income (loss) from discontinued operations |
0.05 | (0.02 | ) | 0.17 | (0.02 | ) | ||||||||||
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| Net income |
$ | 0.24 | $ | 0.22 | $ | 0.92 | $ | 0.29 | ||||||||
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| Weighted-average shares outstanding used in computing income (loss) per common share: |
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| Basic |
57,461 | 58,095 | 57,913 | 54,602 | ||||||||||||
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| Diluted |
58,698 | 61,435 | 59,882 | 58,660 | ||||||||||||
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WEBMD HEALTH CORP.
CONSOLIDATED SUPPLEMENTAL FINANCIAL INFORMATION
(In thousands, unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| Revenue |
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| Public portal advertising and sponsorship |
$ | 115,033 | $ | 113,078 | $ | 346,504 | $ | 299,927 | ||||||||
| Private portal services |
20,105 | 22,227 | 61,612 | 66,115 | ||||||||||||
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| $ | 135,138 | $ | 135,305 | $ | 408,116 | $ | 366,042 | |||||||||
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| Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (a) |
$ | 43,465 | $ | 44,578 | $ | 126,612 | $ | 104,536 | ||||||||
| Interest, taxes, non-cash and other items (b) |
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| Interest income |
21 | 21 | 88 | 3,850 | ||||||||||||
| Interest expense |
(5,862 | ) | (1,797 | ) | (14,836 | ) | (10,106 | ) | ||||||||
| Income tax (provision) benefit |
(8,645 | ) | (10,193 | ) | (32,606 | ) | 4,140 | |||||||||
| Depreciation and amortization |
(6,781 | ) | (6,935 | ) | (19,929 | ) | (20,268 | ) | ||||||||
| Non-cash stock-based compensation |
(9,808 | ) | (8,804 | ) | (28,969 | ) | (23,605 | ) | ||||||||
| Loss on convertible notes |
— | (2,232 | ) | — | (16,970 | ) | ||||||||||
| Gain (loss) on investments |
(1,150 | ) | (131 | ) | 14,679 | (22,977 | ) | |||||||||
| Other income (expense), net |
— | 107 | (53 | ) | (92 | ) | ||||||||||
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| Income from continuing operations |
11,240 | 14,614 | 44,986 | 18,508 | ||||||||||||
| Income (loss) from discontinued operations, net of tax |
2,994 | (1,024 | ) | 10,388 | (1,024 | ) | ||||||||||
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| Net income |
$ | 14,234 | $ | 13,590 | $ | 55,374 | $ | 17,484 | ||||||||
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| (a) | See Annex A-Explanation of Non-GAAP Financial Measures. |
| (b) | Reconciliation of Adjusted EBITDA to net income (loss). |
WEBMD HEALTH CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
| September 30, 2011 | December 31, 2010 | |||||||
| Assets |
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| Cash and cash equivalents |
$ | 1,101,286 | $ | 400,501 | ||||
| Accounts receivable, net |
117,938 | 134,448 | ||||||
| Prepaid expenses and other current assets |
13,172 | 12,161 | ||||||
| Deferred tax assets |
21,204 | 23,467 | ||||||
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| Total current assets |
1,253,600 | 570,577 | ||||||
| Property and equipment, net |
58,064 | 61,516 | ||||||
| Goodwill |
202,104 | 202,104 | ||||||
| Intangible assets, net |
20,656 | 22,626 | ||||||
| Deferred tax assets |
62,613 | 71,125 | ||||||
| Other assets |
32,318 | 14,254 | ||||||
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| Total Assets |
$ | 1,629,355 | $ | 942,202 | ||||
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| Liabilities and Stockholders’ Equity |
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| Accrued expenses |
$ | 51,141 | $ | 53,181 | ||||
| Deferred revenue |
90,673 | 97,043 | ||||||
| Liabilities of discontinued operations |
1,810 | 17,327 | ||||||
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| Total current liabilities |
143,624 | 167,551 | ||||||
| 2.25% convertible notes due 2016 |
400,000 | — | ||||||
| 2.50% convertible notes due 2018 |
400,000 | — | ||||||
| Other long-term liabilities |
22,403 | 21,756 | ||||||
| Stockholders’ equity |
663,328 | 752,895 | ||||||
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| Total Liabilities and Stockholders’ Equity |
$ | 1,629,355 | $ | 942,202 | ||||
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WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
| Nine Months Ended September 30, |
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| 2011 | 2010 | |||||||
| Cash flows from operating activities: |
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| Net income |
$ | 55,374 | $ | 17,484 | ||||
| Adjustments to reconcile consolidated net income to net cash provided by operating activities: |
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| (Income) loss from discontinued operations, net of tax |
(10,388 | ) | 1,024 | |||||
| Depreciation and amortization |
19,929 | 20,268 | ||||||
| Non-cash interest, net |
2,702 | 4,862 | ||||||
| Non-cash stock-based compensation |
28,969 | 23,605 | ||||||
| Deferred income taxes |
5,378 | (17,260 | ) | |||||
| Loss on convertible notes |
— | 16,970 | ||||||
| (Gain) loss on investments |
(14,679 | ) | 22,977 | |||||
| Changes in operating assets and liabilities: |
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| Accounts receivable |
16,510 | (2,206 | ) | |||||
| Prepaid expenses and other, net |
1,238 | (3,006 | ) | |||||
| Accrued expenses and other long-term liabilities |
(176 | ) | 1,695 | |||||
| Deferred revenue |
(6,370 | ) | 3,413 | |||||
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| Net cash provided by continuing operations |
98,487 | 89,826 | ||||||
| Net cash used in discontinued operations |
(136 | ) | (17,082 | ) | ||||
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| Net cash provided by operating activities |
98,351 | 72,744 | ||||||
| Cash flows from investing activities: |
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| Proceeds from sales of available-for-sale securities |
— | 361,852 | ||||||
| Proceeds received from ARS option |
16,561 | 407 | ||||||
| Purchases of property and equipment |
(16,061 | ) | (20,329 | ) | ||||
| Finalization of sale price of discontinued operations |
— | (1,430 | ) | |||||
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| Net cash provided by investing activities |
500 | 340,500 | ||||||
| Cash flows from financing activities: |
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| Proceeds from exercise of stock options |
26,435 | 57,168 | ||||||
| Cash used for withholding taxes due on stock-based awards |
(6,730 | ) | (76,559 | ) | ||||
| Net proceeds from issuance of the 2.50% Notes and 2.25% Notes |
774,745 | — | ||||||
| Repurchases of 1.75% Notes and 3 1/8% Notes |
— | (94,475 | ) | |||||
| Purchases of treasury stock |
(217,427 | ) | (420,948 | ) | ||||
| Excess tax benefit on stock-based awards |
24,911 | 14,003 | ||||||
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| Net cash provided by (used in) financing activities |
601,934 | (520,811 | ) | |||||
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| Net increase in cash and cash equivalents |
700,785 | (107,567 | ) | |||||
| Cash and cash equivalents at beginning of period |
400,501 | 459,766 | ||||||
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| Cash and cash equivalents at end of period |
$ | 1,101,286 | $ | 352,199 | ||||
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WEBMD HEALTH CORP.
NET INCOME PER COMMON SHARE
(In thousands, except per share data, unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| Numerator: |
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| Income from continuing operations |
$ | 11,240 | $ | 14,614 | $ | 44,986 | $ | 18,508 | ||||||||
| Effect of participating non-vested restricted stock |
(70 | ) | (152 | ) | (320 | ) | (222 | ) | ||||||||
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| Income from continuing operations- Basic and Diluted |
$ | 11,170 | $ | 14,462 | $ | 44,666 | $ | 18,286 | ||||||||
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| Income (loss) from discontinued operations, net of tax |
$ | 2,994 | $ | (1,024 | ) | $ | 10,388 | $ | (1,024 | ) | ||||||
| Effect of participating non-vested restricted stock |
(19 | ) | 12 | (74 | ) | 12 | ||||||||||
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| Income (loss) from discontinued operations, net of tax - Basic and Diluted |
$ | 2,975 | $ | (1,012 | ) | $ | 10,314 | $ | (1,012 | ) | ||||||
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| Denominator: |
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| Weighted-average shares — Basic |
57,461 | 58,095 | 57,913 | 54,602 | ||||||||||||
| Employee stock options and restricted stock |
1,237 | 3,340 | 1,969 | 4,058 | ||||||||||||
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| Adjusted weighted-average shares after assumed conversions — Diluted |
58,698 | 61,435 | 59,882 | 58,660 | ||||||||||||
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| Basic income (loss) per common share: |
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| Income from continuing operations |
$ | 0.19 | $ | 0.25 | $ | 0.77 | $ | 0.33 | ||||||||
| Income (loss) from discontinued operations |
0.06 | (0.02 | ) | 0.18 | (0.01 | ) | ||||||||||
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| Net income |
$ | 0.25 | $ | 0.23 | $ | 0.95 | $ | 0.32 | ||||||||
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| Diluted income (loss) per common share: |
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| Income from continuing operations |
$ | 0.19 | $ | 0.24 | $ | 0.75 | $ | 0.31 | ||||||||
| Income (loss) from discontinued operations |
0.05 | (0.02 | ) | 0.17 | (0.02 | ) | ||||||||||
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| Net income |
$ | 0.24 | $ | 0.22 | $ | 0.92 | $ | 0.29 | ||||||||
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