FOSTER CITY, Calif.,
May 6, 2020 /PRNewswire/
-- QuinStreet, Inc. (Nasdaq: QNST), a leader in performance
marketplace products and technologies, today announced financial
results for the third quarter ended March
31, 2020.
For the third quarter, the Company reported record quarterly
revenue of $128.7 million, an
increase of 11% year-over-year. During the third quarter, the
Company successfully divested its B2B client vertical and
Brazil operations.
Revenue in the third quarter, excluding divested businesses, was
$126.3 million, representing an
increase of 15% year over year.
GAAP net income was $13.9 million,
or $0.26 per diluted share.
Adjusted net income for the third quarter was $7.0 million, or $0.13 per diluted share.
Adjusted EBITDA for the third quarter was $9.3 million, or 7% of revenue.
During the third quarter, the Company generated $15.2 million in operating cash flow and closed
the period with $97.1 million in cash
and equivalents.
"QuinStreet business fundamentals and financial position remain
strong and resilient, despite coronavirus," stated Doug Valenti, CEO of QuinStreet. "We remain
highly confident in our business opportunity, strategies and
initiatives. We are also confident in our ability to navigate
near-term disruptions caused by coronavirus. Our recent execution
has been outstanding. And our balance sheet is strong, with cash
approaching $100 million and no bank
debt."
"Fiscal Q3 results were impacted by coronavirus-related drops in
client marketing budgets and consumer traffic. Those effects
accelerated during the quarter. Year-over-year growth in revenue
excluding divested businesses went from 20% in January to 9% in
March. Adjusted EBITDA margin similarly softened from 10% in
January to an average of 6% in February and March, due to the same
effects."
"Our Insurance client vertical has been performing best in the
face of coronavirus. Auto insurance, our biggest business, grew 30%
year-over-year."
"QRP also continues to progress well, and promises to be one of
the most exciting business opportunities in the history of the
Company, with a strong value proposition for agency clients, and
big scale and SaaS-like margins for QuinStreet. Among its many
advantages, QRP increases agent productivity, and helps agencies
more effectively work remotely and serve consumers online. Launched
QRP clients already represent over $6
million dollars in estimated annual revenue opportunity once
fully ramped. Signed and near-signed clients (not yet launched)
represent $12 million of additional
estimated annual revenue opportunity. The balance of clients in the
advanced pipeline (not yet at signing stage) represent $36 million more of estimated annual revenue
opportunity. That means we believe we already have line-of-sight to
over $50 million of estimated annual
QRP revenue. We believe the full pipeline and market represent an
estimated revenue opportunity of well over $100 million per year."
"We made good progress on strategic initiatives in the quarter,
narrowing our business footprint by successfully divesting our B2B
client vertical in a sale to TechnologyAdvice, a B2B
technology-focused firm headquartered in Nashville, Tennessee, and by also selling or
spinning off all of our Brazil
operations. As you would probably expect, the Goldman Sachs-led
process to review strategic alternatives has paused due to current
market uncertainties."
"Our main focus areas and objectives during the pandemic period
include: best serving the needs of clients and media partners to
maintain long-term market position and share; making progress on
key new product, media and business expansion initiatives;
preserving cash and cash flow; and finally, but second to none of
the others, protecting our employees from health risks and economic
uncertainty."
"Turning to our outlook, we expect revenue growth and EBITDA to
continue to be impacted by coronavirus-related disruption and
uncertainty. We expect continued volatility in client budgets and
media, particularly in non-Insurance client verticals. Forecasting
specifics in these uncertain and unprecedented times is
challenging. Our current estimate is for fiscal Q4 revenue
excluding divested businesses to be down between 5% and 10%
year-over-year. Adjusted EBITDA and cash flow margins are expected
to be in the lower single-digits as we absorb full quarter effects
of coronavirus-related drops in top-line leverage and media
efficiency. We will look to avoid layoffs during this pandemic that
would be required to offset those drops. It seems unjust and bad
corporate citizenship to layoff productive employees just to
increase already positive profits and cash flow, especially given
our strong balance sheet, not to mention the fact that those
layoffs would also have the effect of slowing progress on important
longer-term initiatives."
"Looking post-coronavirus, we are confident and enthusiastic
about our strategy to narrow and focus our efforts on a smaller
number of our biggest and best long-term business opportunities.
Those opportunities will include a heavier mix of QRP and likely
other high-margin technology products, with deeper integrations
into clients and networks. We still expect annual revenue of well
over $400 million in the new format,
even before our plan to aggressively invest in the remaining
businesses. We also expect revenue and EBITDA growth to be more
predictable and even faster than our pre-coronavirus footprint,
which in turn we expect to drive greater shareholder value.
Trailing twelve-months revenue for our go-forward core financial
services and home services businesses was $414 million through March
31, representing a three-year compound annual growth rate of
34%."
Conference Call Today at 2:00 p.m.
PT
The Company will host a conference call and
corresponding live webcast at 2:00 p.m.
PT. To access the conference call dial +1
800-458-4121 (domestic) or +1 323-794-2597 (international
callers) using passcode #7941495. A replay of the conference call
will be available beginning approximately two hours after the
completion of the call by dialing +1 888-203-1112 (domestic)
or +1 719-457-0820 (international callers) and using passcode
#7941495. The webcast of the conference call will be available live
and via replay on the investor relations section of the Company's
website at http://investor.quinstreet.com.
About QuinStreet
QuinStreet,
Inc. (Nasdaq: QNST) is a pioneer in delivering online
marketplace solutions to match searchers with brands in digital
media. QuinStreet is committed to providing consumers and
businesses with the information and tools they need to research,
find and select the products and brands that meet their
needs.
Non-GAAP Financial Measures
This release and the
accompanying tables include a discussion of adjusted EBITDA,
adjusted net income, adjusted diluted net income per share and free
cash flow and normalized free cash flow, all of which are non-GAAP
financial measures that are provided as a complement to results
provided in accordance with accounting principles generally
accepted in the United States of
America ("GAAP"). The term "adjusted EBITDA" refers to a
financial measure that we define as net income less provision for
(benefit from) taxes, depreciation expense, amortization expense,
stock-based compensation expense, interest and other expense
(income), net, acquisition costs, gain on divestitures of
businesses, net, strategic review costs, contingent consideration
adjustment, litigation settlement expense, and restructuring costs
disclosed in our Annual Report on Form 10-K. The term "adjusted net
income" refers to a financial measure that we define as net income
adjusted for amortization expense, stock-based compensation
expense, acquisition costs, gain on divestitures of businesses,
net, strategic review costs, contingent consideration adjustment,
litigation settlement expense, and restructuring costs disclosed in
our Annual Report on Form 10-K, and release of deferred tax
valuation allowance, net of estimated taxes. The term "adjusted
diluted net income per share" refers to a financial measure that we
define as adjusted net income divided by weighted average diluted
shares outstanding. The term "free cash flow" refers to a financial
measure that we define as net cash provided by operating
activities, less capital expenditures and internal software
development costs. The term "normalized free cash flow" refers to
free cash flow less changes in operating assets and liabilities.
These non-GAAP measures should be considered in addition to results
prepared in accordance with GAAP, but should not be considered a
substitute for, or superior to, GAAP results. In addition, our
definition of adjusted EBITDA, adjusted net income,adjusted diluted
net income per share and free cash flow and normalized free cash
flow may not be comparable to the definitions as reported by other
companies.
We believe adjusted EBITDA, adjusted net income and adjusted
diluted net income per share are relevant and useful information
because they provide us and investors with additional measurements
to analyze the Company's operating performance.
Adjusted EBITDA is useful to us and investors because
(i) we seek to manage our business to a level of adjusted
EBITDA as a percentage of net revenue, (ii) it is used
internally by us for planning purposes, including preparation of
internal budgets; to allocate resources; to evaluate the
effectiveness of operational strategies and capital expenditures as
well as the capacity to service debt, (iii) it is a key basis upon
which we assess our operating performance, (iv) it is one of
the primary metrics investors use in evaluating Internet marketing
companies, (v) it is a factor in determining compensation,
(vi) it is an element of certain financial covenants under our
historical borrowing arrangements, and (vii) it is a factor that
increases transparency and assists investors in the analysis of
ongoing operating trends. In addition, we believe adjusted EBITDA
and similar measures are widely used by investors, securities
analysts, ratings agencies and other interested parties in our
industry as a measure of financial performance, debt-service
capabilities and as a metric for analyzing company valuations.
We use adjusted EBITDA as a key performance measure because we
believe it facilitates operating performance comparisons from
period to period by excluding potential differences caused by
variations in capital structures (affecting interest expense), tax
positions (such as the impact of changes in effective tax rates or
fluctuations in permanent differences or discrete quarterly items),
non-recurring charges, certain other items that we do not believe
are indicative of core operating activities (such as
litigation settlement expense, acquisition costs, gain or loss
on divestitures of businesses, contingent consideration adjustment,
strategic review costs, restructuring costs and other income and
expense) and the non-cash impact of depreciation expense,
amortization expense and stock-based compensation expense.
With respect to our Adjusted EBITDA guidance, the Company is not
able to provide a quantitative reconciliation without unreasonable
efforts to the most directly comparable GAAP financial measure due
to the high variability, complexity and low visibility with respect
to certain items such as taxes, and income and expense from changes
in fair value of contingent consideration from acquisitions. We
expect the variability of these items to have a potentially
unpredictable and potentially significant impact on future GAAP
financial results, and, as such, we also believe that any
reconciliations provided would imply a degree of precision that
would be confusing or misleading to investors.
Adjusted net income and adjusted diluted net income per share
are useful to us and investors because they present an additional
measurement of our financial performance, taking into account
depreciation, which we believe is an ongoing cost of doing
business, but excluding the impact of certain non-cash expenses
(stock-based compensation, amortization of intangible assets,
contingent consideration adjustment and release of deferred tax
valuation allowance), non-recurring charges and certain other items
that we do not believe are indicative of core operating activities.
We believe that analysts and investors use adjusted net income and
adjusted diluted net income per share as supplemental measures to
evaluate the overall operating performance of companies in our
industry.
Free cash flow is useful to investors and us because it
represents the cash that our business generates from operations,
before taking into account cash movements that are non-operational,
and is a metric commonly used in our industry to understand the
underlying cash generating capacity of a company's financial model.
Normalized free cash flow is useful as it removes the fluctuations
in operating assets and liabilities that occur in any given quarter
due to the timing of payments and cash receipts and therefore helps
investors understand the underlying cash flow of the business as a
quarterly metric and the cash flow generation potential of the
business model. We believe that analysts and investors use free
cash flow multiples as a metric for analyzing company valuations in
our industry.
We intend to provide these non-GAAP financial measures as part
of our future earnings discussions and, therefore, the inclusion of
these non-GAAP financial measures will provide consistency in our
financial reporting. A reconciliation of these non-GAAP measures to
GAAP is provided in the accompanying tables.
Legal Notice Regarding Forward Looking Statements
This
press release and its attachments contain forward-looking
statements within the meaning of Section 21E of the Securities
Exchange Act of 1934 that involve risks and uncertainties. Words
such as "estimate", "will", "believe", "expect", "intend",
"outlook", "potential", "promises" and similar expressions are
intended to identify forward-looking statements. These
forward-looking statements include the statements in quotations
from management in this press release, as well as any statements
regarding the Company's anticipated financial results, growth and
strategic and operational plans. The Company's actual results may
differ materially from those anticipated in these forward-looking
statements. Factors that may contribute to such differences
include, but are not limited to: the impact from risks and
uncertainties relating to a novel strain of the coronavirus
(COVID-19); the impact from risks and uncertainties relating to our
previously announced strategic alternatives; the impact of changes
in industry standards and government regulation including, but not
limited to investigation or enforcement activities of the
Department of Education, the Federal Trade Commission and other
regulatory agencies; the Company's ability to maintain and increase
client marketing spend; the Company's ability to maintain and
increase the number of visitors to its websites and to convert
those visitors and those to its third-party publishers' websites
into client prospects in a cost-effective manner; the impact of the
current economic climate on the Company's business; the Company's
ability to access and monetize Internet users on mobile devices;
the Company's ability to attract and retain qualified executives
and employees; the Company's ability to compete effectively against
others in the online marketing and media industry both for client
budget and access to third-party media; the Company's ability to
identify and manage acquisitions; and the impact and costs of any
alleged failure by the Company to comply with government
regulations and industry standards. More information about
potential factors that could affect the Company's business and
financial results are contained in the Company's annual report on
Form 10-K and quarterly reports on Form 10-Q as filed with the
Securities and Exchange Commission ("SEC"). Additional information
will also be set forth in the Company's quarterly report on Form
10-Q for the quarter ended March 31,
2020, which will be filed with the SEC. The Company does not
intend and undertakes no duty to release publicly any updates or
revisions to any forward-looking statements contained herein.
Investor Contact:
Erica Abrams
(415) 297-5864
eabrams@quinstreet.com
QUINSTREET,
INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In
thousands)
(Unaudited)
|
|
|
|
March
31,
|
|
|
June
30,
|
|
|
|
2020
|
|
|
2019
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
97,139
|
|
|
$
|
62,522
|
|
Receivable,
net
|
|
|
73,367
|
|
|
|
75,628
|
|
Prepaid expenses and
other assets
|
|
|
8,754
|
|
|
|
5,228
|
|
Total current
assets
|
|
|
179,260
|
|
|
|
143,378
|
|
Property and
equipment, net
|
|
|
5,748
|
|
|
|
5,410
|
|
Operating lease
right-of-use assets
|
|
|
10,113
|
|
|
|
—
|
|
Goodwill
|
|
|
81,179
|
|
|
|
82,544
|
|
Other intangible
assets, net
|
|
|
30,185
|
|
|
|
35,118
|
|
Deferred tax assets,
noncurrent
|
|
|
48,944
|
|
|
|
52,149
|
|
Other assets,
noncurrent
|
|
|
5,083
|
|
|
|
6,012
|
|
Total
assets
|
|
$
|
360,512
|
|
|
$
|
324,611
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
40,065
|
|
|
$
|
37,093
|
|
Accrued
liabilities
|
|
|
41,923
|
|
|
|
36,878
|
|
Deferred
revenue
|
|
|
100
|
|
|
|
761
|
|
Other
liabilities
|
|
|
8,808
|
|
|
|
8,967
|
|
Total current
liabilities
|
|
|
90,896
|
|
|
|
83,699
|
|
Operating lease
liabilities, noncurrent
|
|
|
9,758
|
|
|
|
—
|
|
Other liabilities,
noncurrent
|
|
|
10,651
|
|
|
|
18,083
|
|
Total
liabilities
|
|
|
111,305
|
|
|
|
101,782
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
52
|
|
|
|
50
|
|
Additional paid-in
capital
|
|
|
299,427
|
|
|
|
289,768
|
|
Accumulated other
comprehensive loss
|
|
|
(249)
|
|
|
|
(366)
|
|
Accumulated
deficit
|
|
|
(50,023)
|
|
|
|
(66,623)
|
|
Total stockholders'
equity
|
|
|
249,207
|
|
|
|
222,829
|
|
Total liabilities and
stockholders' equity
|
|
$
|
360,512
|
|
|
$
|
324,611
|
|
QUINSTREET,
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands,
except per share data)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net
revenue
|
|
$
|
128,663
|
|
|
$
|
116,225
|
|
|
$
|
373,378
|
|
|
$
|
333,190
|
|
Cost of revenue
(1)
|
|
|
114,210
|
|
|
|
98,350
|
|
|
|
332,717
|
|
|
|
286,078
|
|
Gross
profit
|
|
|
14,453
|
|
|
|
17,875
|
|
|
|
40,661
|
|
|
|
47,112
|
|
Operating expenses:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product
development
|
|
|
3,250
|
|
|
|
2,864
|
|
|
|
10,205
|
|
|
|
9,164
|
|
Sales and
marketing
|
|
|
2,116
|
|
|
|
2,019
|
|
|
|
7,071
|
|
|
|
6,346
|
|
General and
administrative
|
|
|
5,076
|
|
|
|
13,919
|
|
|
|
16,399
|
|
|
|
24,362
|
|
Operating income
(loss)
|
|
|
4,011
|
|
|
|
(927)
|
|
|
|
6,986
|
|
|
|
7,240
|
|
Interest
income
|
|
|
43
|
|
|
|
80
|
|
|
|
169
|
|
|
|
215
|
|
Interest
expense
|
|
|
(177)
|
|
|
|
(96)
|
|
|
|
(566)
|
|
|
|
(194)
|
|
Other income
(expense), net
|
|
|
10,491
|
|
|
|
(8)
|
|
|
|
10,225
|
|
|
|
40
|
|
Income (loss) before
income taxes
|
|
|
14,368
|
|
|
|
(951)
|
|
|
|
16,814
|
|
|
|
7,301
|
|
(Provision for)
benefit from income taxes
|
|
|
(449)
|
|
|
|
1,892
|
|
|
|
(214)
|
|
|
|
51,763
|
|
Net income
|
|
$
|
13,919
|
|
|
$
|
941
|
|
|
$
|
16,600
|
|
|
$
|
59,064
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.27
|
|
|
$
|
0.02
|
|
|
$
|
0.32
|
|
|
$
|
1.20
|
|
Diluted
|
|
$
|
0.26
|
|
|
$
|
0.02
|
|
|
$
|
0.31
|
|
|
$
|
1.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares used in computing net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
51,807
|
|
|
|
49,907
|
|
|
|
51,353
|
|
|
|
49,349
|
|
Diluted
|
|
|
53,439
|
|
|
|
52,932
|
|
|
|
53,416
|
|
|
|
52,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cost of revenue and operating
expenses include stock-based compensation expense as
follows:
|
|
Cost of
revenue
|
|
$
|
978
|
|
|
$
|
1,621
|
|
|
$
|
5,815
|
|
|
$
|
5,161
|
|
Product
development
|
|
|
185
|
|
|
|
319
|
|
|
|
1,187
|
|
|
|
1,147
|
|
Sales and
marketing
|
|
|
152
|
|
|
|
218
|
|
|
|
1,131
|
|
|
|
931
|
|
General and
administrative
|
|
|
554
|
|
|
|
792
|
|
|
|
3,084
|
|
|
|
2,701
|
|
QUINSTREET,
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
thousands)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
13,919
|
|
|
$
|
941
|
|
|
$
|
16,600
|
|
|
$
|
59,064
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
2,851
|
|
|
|
2,361
|
|
|
|
8,517
|
|
|
|
6,380
|
|
Provision for sales
returns and doubtful accounts receivable
|
|
|
29
|
|
|
|
8,842
|
|
|
|
179
|
|
|
|
9,267
|
|
Stock-based
compensation
|
|
|
1,869
|
|
|
|
2,950
|
|
|
|
11,217
|
|
|
|
9,940
|
|
Non-cash lease
expense
|
|
|
297
|
|
|
|
—
|
|
|
|
463
|
|
|
|
—
|
|
Deferred income
taxes
|
|
|
3,569
|
|
|
|
(1,982)
|
|
|
|
3,258
|
|
|
|
(52,021)
|
|
Gain on divestitures
of businesses, net
|
|
|
(10,819)
|
|
|
|
—
|
|
|
|
(10,819)
|
|
|
|
—
|
|
Other adjustments,
net
|
|
|
175
|
|
|
|
60
|
|
|
|
444
|
|
|
|
430
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(2,231)
|
|
|
|
(13,214)
|
|
|
|
3,634
|
|
|
|
(5,559)
|
|
Prepaid expenses and
other assets
|
|
|
(3,379)
|
|
|
|
(947)
|
|
|
|
(2,750)
|
|
|
|
(727)
|
|
Accounts
payable
|
|
|
5,901
|
|
|
|
382
|
|
|
|
3,292
|
|
|
|
2,520
|
|
Accrued
liabilities
|
|
|
3,211
|
|
|
|
6,544
|
|
|
|
430
|
|
|
|
(1,115)
|
|
Deferred
revenue
|
|
|
(202)
|
|
|
|
(44)
|
|
|
|
205
|
|
|
|
133
|
|
Other liabilities,
noncurrent
|
|
|
(35)
|
|
|
|
555
|
|
|
|
(35)
|
|
|
|
1,015
|
|
Net cash provided by
operating activities
|
|
|
15,155
|
|
|
|
6,448
|
|
|
|
34,635
|
|
|
|
29,327
|
|
Cash Flows from
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(373)
|
|
|
|
(541)
|
|
|
|
(1,321)
|
|
|
|
(1,193)
|
|
Internal software
development costs
|
|
|
(561)
|
|
|
|
(533)
|
|
|
|
(1,675)
|
|
|
|
(1,727)
|
|
Business
acquisitions, net
|
|
|
(2,000)
|
|
|
|
—
|
|
|
|
(2,000)
|
|
|
|
(22,156)
|
|
Proceeds from
divestitures of businesses, net of cash divested
|
|
|
11,105
|
|
|
|
—
|
|
|
|
11,105
|
|
|
|
—
|
|
Other investing
activities
|
|
|
—
|
|
|
|
36
|
|
|
|
25
|
|
|
|
206
|
|
Net cash provided by
(used in) investing activities
|
|
|
8,171
|
|
|
|
(1,038)
|
|
|
|
6,134
|
|
|
|
(24,870)
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
exercise of common stock options
|
|
|
678
|
|
|
|
508
|
|
|
|
3,830
|
|
|
|
5,714
|
|
Payment of
withholding taxes related to release of restricted stock, net of
share settlement
|
|
|
(1,227)
|
|
|
|
(1,365)
|
|
|
|
(5,413)
|
|
|
|
(8,783)
|
|
Post-closing payments
and contingent consideration related to acquisitions
|
|
|
(1,838)
|
|
|
|
—
|
|
|
|
(4,704)
|
|
|
|
—
|
|
Net cash used in
financing activities
|
|
|
(2,387)
|
|
|
|
(857)
|
|
|
|
(6,287)
|
|
|
|
(3,069)
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
|
|
76
|
|
|
|
5
|
|
|
|
135
|
|
|
|
42
|
|
Net increase in cash,
cash equivalents and restricted cash
|
|
|
21,015
|
|
|
|
4,558
|
|
|
|
34,617
|
|
|
|
1,430
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
|
|
76,138
|
|
|
|
62,460
|
|
|
|
62,536
|
|
|
|
65,588
|
|
Cash, cash
equivalents and restricted cash at end of period
|
|
$
|
97,153
|
|
|
$
|
67,018
|
|
|
$
|
97,153
|
|
|
$
|
67,018
|
|
Reconciliation of
cash, cash equivalents, and restricted cash to the condensed
consolidated balance sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
97,139
|
|
|
$
|
67,004
|
|
|
$
|
97,139
|
|
|
$
|
67,004
|
|
Restricted cash
included in other assets, noncurrent
|
|
|
14
|
|
|
|
14
|
|
|
|
14
|
|
|
|
14
|
|
Total cash, cash
equivalents and restricted cash
|
|
$
|
97,153
|
|
|
$
|
67,018
|
|
|
$
|
97,153
|
|
|
$
|
67,018
|
|
QUINSTREET,
INC.
RECONCILIATION OF
NET INCOME TO
ADJUSTED NET
INCOME
(In thousands,
except per share data)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net income
|
|
$
|
13,919
|
|
|
$
|
941
|
|
|
$
|
16,600
|
|
|
$
|
59,064
|
|
Amortization of
intangible assets
|
|
|
1,932
|
|
|
|
1,551
|
|
|
|
5,799
|
|
|
|
3,836
|
|
Stock-based
compensation
|
|
|
1,869
|
|
|
|
2,950
|
|
|
|
11,217
|
|
|
|
9,940
|
|
Acquisition
costs
|
|
|
40
|
|
|
|
161
|
|
|
|
351
|
|
|
|
535
|
|
Gain on divestitures
of businesses, net
|
|
|
(10,819)
|
|
|
|
—
|
|
|
|
(10,819)
|
|
|
|
—
|
|
Strategic review
costs
|
|
|
63
|
|
|
|
—
|
|
|
|
262
|
|
|
|
—
|
|
Litigation settlement
expense
|
|
|
80
|
|
|
|
—
|
|
|
|
80
|
|
|
|
23
|
|
Restructuring
costs
|
|
|
418
|
|
|
|
—
|
|
|
|
418
|
|
|
|
—
|
|
Release of deferred
tax valuation allowance
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(49,442)
|
|
Tax impact of non-GAAP
items
|
|
|
(545)
|
|
|
|
(2,631)
|
|
|
|
(4,372)
|
|
|
|
(7,450)
|
|
Adjusted net
income
|
|
$
|
6,957
|
|
|
$
|
2,972
|
|
|
$
|
19,536
|
|
|
$
|
16,506
|
|
Adjusted
diluted net income per share
|
|
$
|
0.13
|
|
|
$
|
0.06
|
|
|
$
|
0.37
|
|
|
$
|
0.31
|
|
Weighted
average shares used in computing adjusted diluted net income per
share
|
|
|
53,439
|
|
|
|
52,932
|
|
|
|
53,416
|
|
|
|
52,681
|
|
QUINSTREET,
INC.
RECONCILIATION OF
NET INCOME TO
ADJUSTED
EBITDA
(In
thousands)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net income
|
|
$
|
13,919
|
|
|
$
|
941
|
|
|
$
|
16,600
|
|
|
$
|
59,064
|
|
Interest and other
expense (income), net
|
|
|
462
|
|
|
|
24
|
|
|
|
991
|
|
|
|
(61)
|
|
Provision for (benefit
from) income taxes
|
|
|
449
|
|
|
|
(1,892)
|
|
|
|
214
|
|
|
|
(51,763)
|
|
Depreciation and
amortization
|
|
|
2,851
|
|
|
|
2,361
|
|
|
|
8,517
|
|
|
|
6,380
|
|
Stock-based
compensation
|
|
|
1,869
|
|
|
|
2,950
|
|
|
|
11,217
|
|
|
|
9,940
|
|
Acquisition
costs
|
|
|
40
|
|
|
|
161
|
|
|
|
351
|
|
|
|
535
|
|
Gain on divestitures
of businesses, net
|
|
|
(10,819)
|
|
|
|
—
|
|
|
|
(10,819)
|
|
|
|
—
|
|
Strategic review
costs
|
|
|
63
|
|
|
|
—
|
|
|
|
262
|
|
|
|
—
|
|
Litigation settlement
expense
|
|
|
80
|
|
|
|
—
|
|
|
|
80
|
|
|
|
23
|
|
Restructuring
costs
|
|
|
418
|
|
|
|
—
|
|
|
|
418
|
|
|
|
—
|
|
Adjusted
EBITDA
|
|
$
|
9,332
|
|
|
$
|
4,545
|
|
|
$
|
27,831
|
|
|
$
|
24,118
|
|
QUINSTREET,
INC.
RECONCILIATION OF
CASH PROVIDED BY
OPERATING
ACTIVITIES TO FREE CASH FLOW
AND NOMALIZED FREE
CASH FLOW
(In
thousands)
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
March
31,
|
|
|
March
31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net cash provided by
operating activities
|
|
$
|
15,155
|
|
|
$
|
6,448
|
|
|
$
|
34,635
|
|
|
$
|
29,327
|
|
Capital
expenditures
|
|
|
(373)
|
|
|
|
(541)
|
|
|
|
(1,321)
|
|
|
|
(1,193)
|
|
Internal software
development costs
|
|
|
(561)
|
|
|
|
(533)
|
|
|
|
(1,675)
|
|
|
|
(1,727)
|
|
Free cash
flow
|
|
$
|
14,221
|
|
|
$
|
5,374
|
|
|
$
|
31,639
|
|
|
$
|
26,407
|
|
Changes in operating
assets and liabilities
|
|
|
(6,834)
|
|
|
|
(1,942)
|
|
|
|
(8,034)
|
|
|
|
(4,933)
|
|
Normalized free cash
flow
|
|
$
|
7,387
|
|
|
$
|
3,432
|
|
|
$
|
23,605
|
|
|
$
|
21,474
|
|
View original
content:http://www.prnewswire.com/news-releases/quinstreet-reports-third-quarter-fiscal-year-2020-financial-results-301054217.html
SOURCE QuinStreet, Inc.