EX-99.2 3 c84553exv99w2.htm EXHIBIT 99.2 Exhibit 99.2
Exhibit 99.2
(LOGO)
FINANCIAL SUPPLEMENT
March 31, 2009
Monster Worldwide, Inc. (together with its consolidated subsidiaries, the “Company,” “Monster,” “we,” “our” or “us”) provides this supplement to assist investors in evaluating our Company’s financial and operating metrics. We suggest that the notes to this supplement are read in conjunction with the financial tables. The financial information included in this supplement contains certain non-GAAP financial measures. These measures should be considered in addition to results prepared in accordance with GAAP, but are not a substitute for, or superior to, GAAP results. The non-GAAP measures included in this supplement have been reconciled to the most comparable GAAP measure. The Company intends to update the financial supplement on a quarterly basis.

 

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(LOGO)
Notes to Financial Supplement
Presentation
Provision for Legal Settlements, net
On July 30, 2008, Monster entered into a Memorandum of Understanding (“MOU”) with the class representative and the individual defendants in the shareholder securities class action that memorializes the terms pursuant to which the parties intend, subject to Court approval, to settle the securities class action. As full settlement of the claims asserted in the securities class action, the MOU provides for a payment to the class of $47.5 million the cost of which to the Company will be approximately $25.1 million net of its insurance recovery and a payment by another defendant. Also recorded in the provision for legal settlements, net in the second quarter of 2008, was approximately $15.0 million for estimated expenses relating to the other outstanding litigation in connection with Monster’s historical stock option grant practices. On October 2, 2008, the Supreme Court of the State of New York, New York County, granted final approval of the settlement agreement.
Professional Fees
For the three months ended March 31, 2009 and 2008, we recorded approximately $3.0 million of professional fees relating to our historical stock option grant practices, respectively. These costs primarily relate to legal fees and are a component of “office and general” in our consolidated statement of operations. In addition, we have incurred costs related to litigation, an informal investigation by the SEC and an investigation by the United States Attorney for the Southern District of New York.
We expect to continue to incur significant professional fees related to ongoing matters relating to our historical stock option grant practices. While we cannot quantify or estimate the timing of these costs throughout 2009, we expect to continue to incur significant professional fees related to legal fees paid on behalf of former employees and former members of senior management in connection with ongoing matters relating to our historical stock option grant practices.
Restructuring Actions
On July 30, 2007, we announced a series of strategic restructuring actions that are intended to position us for sustainable long-term growth in the rapidly evolving global online recruitment advertising industry.
The restructuring plan included an anticipated reduction in the current workforce by approximately 800 associates, or 15% of our full-time staff. Subsequent to the announcement of this plan, the Company made a strategic decision to in-source customer service and therefore the current reduction will be approximately 700 associates. The plan also included fixed asset write-offs, accelerated depreciation for assets to be phased out, costs relating to the consolidation of certain office facilities, contract termination costs, relocation costs and professional fees. The restructuring plan arose out of a review commencing in the second quarter of 2007 by our current executive management team of our cost structure and organizational structure. The restructuring is intended to realign the structure to permit investment in key areas that will improve the customer experience and foster revenue growth and long-term operating margin expansion. The majority of the initiatives of the restructuring plan have been completed as of March 31, 2009; however, the Company will continue to incur charges through the first half of 2009 to complete the plan.

 

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For the three months ended March 31, 2009 and 2008, we recorded $11.0 million and $6.9 million of restructuring costs, respectively, primarily related to severance, fixed asset write-offs and office consolidations.
Deferred revenue related to acquisitions
During the fourth quarter of 2008, we completed the acquisition of ChinaHR. In accordance with existing purchase accounting rules, we are required to write down a portion of ChinaHR’s deferred revenue to its fair value. Consequently, in post acquisition periods, we do not recognize the full amount of this deferred revenue. When measuring the performance of our business, however, we add back the revenue resulting from this fair value adjustment as we believe that the inclusion of this revenue provides useful information to our management, as well as to investors. For the three months ended March 31, 2009, the fair value adjustment to ChinaHR’s deferred revenue was $1.0 million.
Wind-down of Internet Advertising & Fees Tickle Business
In May 2008, we announced our intentions to wind-down the operations of Tickle, a business included in the Internet Advertising & Fees segment. As a result of this action, we have reclassified our quarterly financial information to reflect the wind-down as discontinued operations in all periods presented. The financial results from continuing operations, presented herein, reflect the results of the remaining and ongoing portion of our business.
Security Breach
In August 2007, we announced a security breach related to unauthorized access to our resume database. We took remediation measures, including the procurement of the capability to assist any potentially affected customers. For the three months ended March 31, 2008, we recorded $0.5 million related to the breach, which was recorded as a component of office and general in the consolidated statement of operations.
Reclassifications
Certain reclassifications of prior year amounts have been made for consistent presentation.
Non-GAAP financial measures
Monster Worldwide, Inc. (the “Company”) has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or an alternative for, generally accepted accounting principles (“GAAP”) and may be different from non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations.
Non-GAAP revenue, operating expenses, operating income, operating margin, income from continuing operations and diluted earnings per share all exclude certain pro forma adjustments including: deferred revenue fair value purchase accounting adjustment related to ChinaHR, ongoing costs associated with the stock option investigations, related litigation and potential fines or settlements; severance costs for former executive officers incurred in the second quarter of 2007; costs related to the measures taken by the Company in response to a security breach in August 2007; and the strategic restructuring actions initiated in the third quarter of 2007. The Company uses these non-GAAP measures for reviewing the ongoing results of the Company’s core business operations and in certain instances, for measuring performance under certain of the Company’s incentive compensation plans. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

 

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Operating income before depreciation and amortization (“OIBDA”) is defined as income from operations before depreciation, amortization of intangible assets, amortization of stock based compensation and non-cash costs incurred in connection with the Company’s restructuring program. The Company considers OIBDA to be an important indicator of its operational strength. This measure eliminates the effects of depreciation, amortization of intangible assets, amortization of stock based compensation and non-cash restructuring costs from period to period, which the Company believes is useful to management and investors in evaluating its operating performance. OIBDA is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies.
Free cash flow is defined as cash flow from operating activities less capital expenditures. Free cash flow is considered a liquidity measure and provides useful information about the Company’s ability to generate cash after investments in property and equipment. Free cash flow reflected herein is a non-GAAP measure and may not be comparable to similarly titled measures reported by other companies. Free cash flow does not reflect the total change in the Company’s cash position for the period and should not be considered a substitute for such a measure.
Net cash and securities is defined as cash and cash equivalents plus short-term and long-term marketable securities, less total debt. The Company considers net cash and securities to be an important measure of liquidity and an indicator of its ability to meet its ongoing obligations. The Company also uses net cash and securities, among other measures, in evaluating its choices for capital deployment. Net cash and securities presented herein is a non-GAAP measure and may not be comparable to similarly titled measures used by other companies.
Selected financial ratios
We have included selected financial ratios in this financial supplement in order to assist investors to further evaluate our business. Our definitions and calculations are as follows:
Annualized return on equity
Annualized return on equity measures our effectiveness and ability to generate future profitability on the earnings that we retain. In addition, the ratio is a strong indicator of how well we utilize shareholders’ investments in our business. We calculate annualized return on equity as follows:
Annualized net income / Average stockholders’ equity
Book value per share
Book value per share is a market value indicator that we utilize when analyzing our stockholders’ equity. We calculate book value per share as follows:
Stockholders’ equity / Total shares outstanding
Cash and marketable securities per share
We calculate cash and marketable securities per share as follows:
(Cash and cash equivalents + Current marketable securities + Non-current marketable securities) / Total shares outstanding
Net cash and securities
We calculate cash and marketable securities per share as follows:
(Cash and cash equivalents + available-for-sale securities, current, + available-for-sale securities, non-current — borrowings on credit facility short-term — current portion of long-term debt — long-term debt, less current portion)

 

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Monster Worldwide, Inc.
Statements of Operations
(unaudited, in thousands, except per share amounts)
                                                                         
    Trended Quarterly Data  
Summary P&L Information   Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
 
                                                                        
Monster Careers
   $ 290,223     $ 291,326     $ 296,996     $ 316,877     $ 336,810     $ 320,953     $ 297,606     $ 257,931     $ 222,849  
Internet Advertising & Fees
     31,607       32,659       33,146       30,970       29,662       33,341       34,583       32,741       31,554  
 
                                                      
Revenue
     321,830       323,985       330,142       347,847       366,472       354,294       332,189       290,672       254,403  
 
                                                                        
Salary and related
     117,002       127,839       123,965       127,666       135,115       127,346       128,904       123,211       112,037  
Office and general
     58,750       51,856       57,621       56,708       61,710       61,754       57,124       44,091       45,793  
Marketing and promotion
     72,509       73,568       71,584       76,818       111,854       68,976       57,684       52,684       73,691  
Provision for legal settlements, net
     —       —       —       —       —       40,100       —       —       —  
Restructuring and other special charges
     —       —       11,155       5,442       6,927       2,732       3,592       3,156       11,008  
Depreciation expense
     7,860       9,350       10,408       10,589       10,803       12,330       13,336       14,761       13,769  
Amortization of restricted stock and RSU Plan
     4,176       17,069       2,871       3,623       5,206       8,351       7,437       7,046       10,149  
Non-cash stock option expense
     186       47       104       105       127       182       165       178       199  
Amortization of intangibles
     1,394       1,413       1,437       1,457       1,386       1,274       1,374       2,756       2,551  
 
                                                      
Operating expenses
     261,877       281,142       279,145       282,408       333,128       323,045       269,616       247,883       269,197  
 
                                                                        
Operating (loss) income
     59,953       42,843       50,997       65,439       33,344       31,249       62,573       42,789       (14,794 )
Interest and other, net
     5,413       6,903       6,507       6,799       7,383       3,057       5,283       1,560       1,203  
 
                                                      
Income (loss) from cont. operations, pre-tax
     65,366       49,746       57,504       72,238       40,727       34,306       67,856       44,349       (13,591 )
 
                                                                        
Income taxes
     23,090       17,587       20,474       25,310       15,143       12,153       22,734       14,880       (4,489 )
Losses in equity interests, net
     (1,420 )     (2,966 )     (3,074 )     (838 )     (1,822 )     (3,592 )     (2,086 )     (339 )     (1,239 )
 
                                                      
Income (loss) from continuing operations
     40,856       29,193       33,956       46,090       23,762       18,561       43,036       29,130       (10,341 )
 
                                                                        
Income (loss) from disc. operations, net of tax(1)
     (1,374 )     (577 )     (655 )     (1,090 )     (1,171 )     12,269       (258 )     (536 )     —  
 
                                                      
 
                                                                        
Net income (loss)
   $ 39,482     $ 28,616     $ 33,301     $ 45,000     $ 22,591     $ 30,830     $ 42,778     $ 28,594     $ (10,341 )
 
                                                      
 
                                                                        
Basic earnings (loss) per share:
                                                                        
Income (loss) from continuing operations
   $ 0.32     $ 0.22     $ 0.26     $ 0.37     $ 0.19     $ 0.15     $ 0.36     $ 0.25     $ (0.09 )
 
                                                      
Net income (loss)
   $ 0.30     $ 0.22     $ 0.26     $ 0.36     $ 0.18     $ 0.26     $ 0.36     $ 0.24     $ (0.09 )
 
                                                      
 
                                                                        
Diluted earnings (loss) per share:
                                                                        
Income (loss) from continuing operations
   $ 0.31     $ 0.22     $ 0.26     $ 0.36     $ 0.19     $ 0.15     $ 0.36     $ 0.24     $ (0.09 )
 
                                                      
Net income (loss)
   $ 0.30     $ 0.21     $ 0.25     $ 0.36     $ 0.18     $ 0.25     $ 0.35     $ 0.24     $ (0.09 )
 
                                                      
 
                                                                        
Weighted avg. shares outstanding:
                                                                        
Basic shares
     129,653       130,542       129,499       125,504       122,711       120,885       120,057       118,601       118,855  
Diluted shares
     132,464       133,121       130,757       126,704       123,332       121,541       120,722       119,380       118,855  
 
                                                                        
Global employees (ones)
     5,285       5,442       5,116       5,112       5,164       5,396       5,669       6,961       6,295  
Annualized revenue per average employee
   $ 255.0     $ 241.6     $ 250.2     $ 272.1     $ 285.3     $ 268.4     $ 240.2     $ 184.1     $ 153.5  
     
(1)  - 
Loss from discontinued operations, net of tax in the second quarter of 2008 includes tax benefits of $29.4 million and long-lived asset write-offs of $13.1 million related to the wind-down of the Tickle business included in our Internet Advertising & Fees business segment.

 

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Monster Worldwide, Inc.
Trailing Twelve Months Statistics — Statements of Operations
(unaudited, in thousands, except per share amounts)
                                                                         
Summary P&L Information   Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
 
                                                                        
Monster Careers
   $ 1,029,965     $ 1,084,101     $ 1,136,805     $ 1,195,422     $ 1,242,009     $ 1,271,636     $ 1,272,246     $ 1,213,300     $ 1,099,339  
Internet Advertising & Fees
     122,785       127,303       128,505       128,382       126,437       127,119       128,556       130,327       132,219  
 
                                                      
Revenue
     1,152,750       1,211,404       1,265,310       1,323,804       1,368,446       1,398,755       1,400,802       1,343,627       1,231,558  
 
                                                                        
Salary and related
     424,621       458,256       479,579       496,472       514,585       514,092       519,031       514,576       491,498  
Office and general
     181,079       200,719       217,151       224,935       227,895       237,793       237,296       224,679       208,762  
Marketing and promotion
     262,872       269,446       278,594       294,479       333,824       329,232       315,332       291,198       253,035  
Provision for legal settlements, net
     —       —       —       —       —       40,100       40,100       40,100       40,100  
Restructuring and other special charges
     —       —       11,155       16,597       23,524       26,256       18,693       16,407       20,488  
Depreciation expense
     30,449       31,595       35,066       38,207       41,150       44,130       47,058       51,230       54,196  
Amortization of restricted stock and RSU Plan
     12,913       26,612       26,540       27,739       28,769       20,051       24,617       28,040       32,983  
Non-cash stock option expense
     239       233       337       442       383       518       579       652       724  
Amortization of intangibles
     6,692       5,838       5,812       5,701       5,693       5,554       5,491       6,790       7,955  
 
                                                      
Operating expenses
     918,865       992,699       1,054,234       1,104,572       1,175,823       1,217,726       1,208,197       1,173,672       1,109,741  
 
                                                                        
Operating income
     233,885       218,705       211,076       219,232       192,623       181,029       192,605       169,955       121,817  
Interest and other, net
     21,095       23,943       25,327       25,622       27,592       23,746       22,522       17,283       11,103  
 
                                                      
Income from continuing operations, pre-tax
     254,980       242,648       236,403       244,854       220,215       204,775       215,127       187,238       132,920  
 
                                                                        
Income taxes
     89,289       85,246       83,458       86,461       78,514       73,080       75,340       64,910       45,278  
Losses in equity interests, net
     (7,275 )     (7,957 )     (8,977 )     (8,298 )     (8,700 )     (9,326 )     (8,338 )     (7,839 )     (7,256 )
 
                                                      
Income from continuing operations
     158,416       149,445       143,968       150,095       133,001       122,369       131,449       114,489       80,386  
 
                                                                        
Income (loss) from disc. operations, net of tax (1)
     (124,059 )     (126,089 )     (3,494 )     (3,696 )     (3,493 )     9,353       9,750       10,304       11,475  
 
                                                      
 
                                                                        
Net income
   $ 34,357     $ 23,356     $ 140,474     $ 146,399     $ 129,508     $ 131,722     $ 141,199     $ 124,793     $ 91,861  
 
                                                      
 
                                                                        
Basic earnings (loss) per share:
                                                                        
Income (loss) from continuing operations
   $ 1.23     $ 1.16     $ 1.11     $ 1.17     $ 1.05     $ 0.98     $ 1.07     $ 0.95     $ 0.67  
 
                                                      
Net income (loss)
   $ 0.27     $ 0.18     $ 1.08     $ 1.14     $ 1.02     $ 1.06     $ 1.15     $ 1.04     $ 0.77  
 
                                                      
 
                                                                        
Diluted earnings (loss) per share:
                                                                        
Income (loss) from continuing operations
   $ 1.20     $ 1.13     $ 1.09     $ 1.15     $ 1.04     $ 0.97     $ 1.07     $ 0.94     $ 0.67  
 
                                                      
Net income (loss)
   $ 0.26     $ 0.18     $ 1.07     $ 1.12     $ 1.01     $ 1.05     $ 1.15     $ 1.03     $ 0.76  
 
                                                      
 
                                                                        
Weighted avg. shares outstanding:
                                                                        
Basic shares
     128,794       129,292       129,546       128,785       127,064       124,650       122,289       120,557       119,600  
Diluted shares
     131,627       131,905       131,888       130,755       128,479       125,584       123,075       121,167       120,125  
     
(1)  - 
Loss from discontinued operations, net of tax in the third quarter of 2006 includes the write-off of $133.0 million of goodwill related to our former TMP Worldwide Advertising & Communications business in North America.

 

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Monster Worldwide, Inc.
Statements of Cash Flows
(unaudited, in thousands, except per share amounts)
                                                                         
    Trended Quarterly Data  
    Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
Cash flows provided by (used for) operating activities:
                                                                        
Net income (loss)
   $ 39,482     $ 28,616     $ 33,301     $ 45,000     $ 22,591     $ 30,830     $ 42,778     $ 28,594     $ (10,341 )
 
                                                      
Adjustments to reconcile net income (loss) to cash provided by operating activities:
                                                                        
(Income) loss from discontinued operations, net of tax
     1,374       577       655       1,090       1,171       (12,269 )     258       536       —  
Depreciation and amortization of intangibles
     9,254       10,763       11,845       12,046       12,189       13,604       14,710       17,517       16,320  
Provision for legal settlements, net
     —       —       —       —       —       40,100       —       —       —  
Receipts and payments for legal settlements, net
     —       —       —       —       —       —       5,700       (35,587 )     —  
Provision for doubtful accounts
     2,483       2,630       3,340       4,453       3,564       3,207       4,403       5,057       4,072  
Non-cash compensation
     4,362       17,116       2,975       3,728       6,495       8,533       7,602       7,223       10,348  
Deferred income taxes
     2,100       (7,605 )     2,808       (2,762 )     (7,319 )     (12,263 )     12,440       14,572       (2,488 )
Non-cash restructuring write-offs and (gain) loss on disposal of assets
     —       (572 )     (2 )     3       1,649       436       924       924       3,690  
Loss in equity interests
     1,420       2,966       3,074       838       1,822       3,592       2,086       339       1,239  
Changes in assets and liabilities, net of business combinations:
                                                                        
Accounts receivable
     25,170       (4,804 )     13,699       (101,843 )     37,848       44,812       49,231       (19,371 )     72,347  
Prepaid and other
     (2 )     (4,202 )     (8,007 )     (12,766 )     1,025       18,073       2,522       1,548       3,246  
Deferred revenue
     5,691       2,360       (17,515 )     89,650       (2,458 )     (51,465 )     (58,644 )     (5,732 )     (63,383 )
Accounts payable, accrued expenses and other liabilities
     (8,950 )     7,163       26,536       27,091       (289 )     (13,308 )     8,673       (27,790 )     (21,237 )
Net cash provided by (used for) operating activities of discontinued operations
     (3,385 )     (1,847 )     126       (2,344 )     (560 )     (2,569 )     (962 )     (2,758 )     (77 )
 
                                                      
Total adjustments
     39,517       24,545       39,534       19,184       55,137       40,483       48,943       (43,522 )     24,077  
 
                                                      
Net cash provided by (used for) operating activities
     78,999       53,161       72,835       64,184       77,728       71,313       91,721       (14,928 )     13,736  
 
                                                      
 
                                                                        
Cash flows provided by (used for) investing activities:
                                                                        
Capital expenditures
     (21,449 )     (15,515 )     (10,596 )     (16,240 )     (20,559 )     (29,654 )     (21,011 )     (22,403 )     (14,922 )
Purchase of marketable securities
     (365,031 )     (317,555 )     (327,250 )     (415,025 )     (149,249 )     (7,633 )     (25,265 )     (1,785 )     (992 )
Sale and maturities of marketable securities
     311,662       277,903       446,418       478,068       414,453       21,852       66,000       36,981       1,425  
Payments for acquisitions and intangible assets, net of cash acquired
     (1,664 )     (142 )     (133 )     (610 )     (61,567 )     —       (64,628 )     (166,641 )     —  
Dividends received from unconsolidated investee
     —       —       —       —       —       1,011       —       —       —  
Cash funded to equity investee
     (2,500 )     (1,600 )     (5,900 )     —       (5,000 )     —       —       (1,402 )     (1,428 )
Net cash used for investing activities of discontinued operations
     (163 )     (87 )     (5 )     —       —       —       —       —       —  
 
                                                      
Net cash provided by (used for) investing activities
     (79,145 )     (56,996 )     102,534       46,193       178,078       (14,424 )     (44,904 )     (155,250 )     (15,917 )
 
                                                      
 
                                                                        
Cash flows provided by (used for) financing activities:
                                                                        
Proceeds from borrowings on credit facilities short-term
     —       —       —       —       —       —       247,000       4,971       199,203  
Payments on borrowings on credit facilities short-term
     —       —       —       —       —       —       —       (197,893 )     —  
Repurchase of common stock
     (3,326 )     (6,716 )     (154,692 )     (97,761 )     (79,469 )     (6,858 )     (41,806 )     (32 )     (1,907 )
Net borrowings (payments) under capital lease obligations and other debt
     —       —       (58 )     (42 )     (80 )     (67 )     (9 )     (15 )     (5 )
Payments on acquisition debt
     (16,310 )     (5,552 )     —       (1,500 )     —       —       —       —       —  
Proceeds from the exercise of employee stock options
     43,395       10,006       651       838       418       628       110       305       9  
Excess tax benefits from (provisions for) stock-based compensation
     6,486       5,857       1,611       (155 )     61       59       861       22       4  
 
                                                      
Net cash provided by (used for) financing activities
     30,245       3,595       (152,488 )     (98,620 )     (79,070 )     (6,238 )     206,156       (192,642 )     197,304  
 
                                                      
 
                                                                        
Effects of exchange rates on cash
     963       1,037       3,795       772       10,256       (1,933 )     (13,303 )     (20,044 )     (6,327 )
 
                                                                        
Net increase (decrease) in cash and cash equivalents
     31,062       797       26,676       12,529       186,992       48,718       239,670       (382,864 )     188,796  
Cash and cash equivalents, beginning of period
     58,680       89,742       90,539       117,215       129,744       316,736       365,454       605,124       222,260  
 
                                                      
Cash and cash equivalents, end of period
   $ 89,742     $ 90,539     $ 117,215     $ 129,744     $ 316,736     $ 365,454     $ 605,124     $ 222,260     $ 411,056  
 
                                                      
Non — GAAP Free cash flow (1):
                                                                        
Net cash provided by operating activities
   $ 78,999     $ 53,161     $ 72,835     $ 64,184     $ 77,728     $ 71,313     $ 91,721     $ (14,928 )   $ 13,736  
Less: Capital expenditures
     (21,449 )     (15,515 )     (10,596 )     (16,240 )     (20,559 )     (29,654 )     (21,011 )     (22,403 )     (14,922 )
 
                                                      
Free cash flow
   $ 57,550     $ 37,646     $ 62,239     $ 47,944     $ 57,169     $ 41,659     $ 70,710     $ (37,331 )   $ (1,186 )
 
                                                      
     
(1)  - 
See notes to financial supplement for further explanation of non-GAAP measures.

 

7

 

Monster Worldwide, Inc.
Consolidated Condensed Balance Sheets
(unaudited, in thousands, except selected financial ratios)
                                                                         
    Trended Quarterly Data  
ASSETS
 		   Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
Current assets:
                                                                        
Cash and cash equivalents
   $ 89,742     $ 90,539     $ 117,215     $ 129,744     $ 316,736     $ 365,454     $ 605,124     $ 222,260     $ 411,056  
Available-for-sale securities, current
     591,262       630,914       511,746       448,703       79,236       68,579       33,823       1,425       992  
Net Accounts Receivable
     417,329       419,033       401,994       499,854       458,447       410,427       358,214       376,720       294,449  
Prepaid and other
     89,650       100,233       101,950       106,664       97,929       121,093       111,754       82,415       82,710  
 
                                                      
Total current assets
     1,187,983       1,240,719       1,132,905       1,184,965       952,348       965,553       1,108,915       682,820       789,207  
 
                                                      
 
                                                                        
Available-for-sale securities, non-current
     —       —       —       —       102,716       99,330       93,728       90,347       89,196  
Property and equipment, net
     110,875       117,613       117,802       123,397       138,182       149,048       152,352       161,282       154,559  
Goodwill
     590,553       595,850       614,437       615,334       702,598       690,161       707,164       894,546       886,970  
Intangibles, net
     38,191       37,012       36,804       35,351       34,308       32,696       36,694       52,335       49,533  
Investment in unconsolidated affiliates
     57,748       54,782       51,708       50,871       49,049       44,446       42,360       1,843       1,315  
Other assets
     55,540       48,360       52,513       53,162       67,218       70,475       61,761       33,417       33,314  
Non-current assets of discontinued operations
     16,925       16,233       15,461       14,730       13,959       —       —       —       —  
 
                                                      
Total assets
   $ 2,057,815     $ 2,110,569     $ 2,021,630     $ 2,077,810     $ 2,060,378     $ 2,051,709     $ 2,202,974     $ 1,916,590     $ 2,004,094  
 
                                                      
 
                                                                        
LIABILITIES AND STOCKHOLDERS’ EQUITY
                                                                        
 
                                                                        
Current liabilities:
                                                                        
Accounts payable, accrued expenses and other
   $ 279,032     $ 278,553     $ 298,023     $ 304,146     $ 297,932     $ 321,077     $ 328,546     $ 254,407     $ 225,630  
Deferred revenue
     449,836       452,196       434,682       524,331       521,873       470,408       411,764       414,312       344,905  
Borrowings on credit facility short-term
     —       —       —       —       —       —       247,000       54,971       254,174  
Current portion of long-term debt
     7,074       1,660       1,684       184       158       142       26       18       27  
 
                                                      
Total current liabilities
     735,942       732,409       734,389       828,661       819,963       791,627       987,336       723,708       824,736  
 
                                                      
 
                                                                        
Non-current income taxes payable
     84,480       89,910       94,418       111,108       116,376       119,360       115,318       119,951       123,385  
Other liabilities
     34,985       25,785       25,574       17,264       16,254       17,449       23,699       25,658       29,838  
Non-current liabilities of discontinued operations
     4,906       4,696       4,486       4,276       4,067       —       —       —       —  
 
                                                      
Total liabilities
     860,313       852,800       858,867       961,309       956,660       928,436       1,126,353       869,317       977,959  
 
                                                      
 
                                                                        
Common stock and class B common stock
     131       131       131       133       133       134       134       133       134  
Additional paid-in capital
     1,687,407       1,713,670       1,562,646       1,468,808       1,395,991       1,397,281       1,363,655       1,367,373       1,374,049  
Accumulated other comprehensive (loss) income
     87,708       93,096       115,813       118,387       155,830       143,264       87,460       25,801       8,327  
Retained deficit
     (577,744 )     (549,128 )     (515,827 )     (470,827 )     (448,236 )     (417,406 )     (374,628 )     (346,034 )     (356,375 )
 
                                                      
Total stockholders’ equity
     1,197,502       1,257,769       1,162,763       1,116,501       1,103,718       1,123,273       1,076,621       1,047,273       1,026,135  
 
                                                      
 
                                                                        
Total liabilities and stockholders’ equity
   $ 2,057,815     $ 2,110,569     $ 2,021,630     $ 2,077,810     $ 2,060,378     $ 2,051,709     $ 2,202,974     $ 1,916,590     $ 2,004,094  
 
                                                      
 
                                                                        
Selected Financial Ratios(1)
                                                                        
- Annualized return on equity
     13.7 %     9.3 %     11.0 %     15.8 %     8.1 %     11.1 %     15.6 %     10.8 %     -4.0 %
- Book value per share
   $ 9.19     $ 9.60     $ 9.19     $ 9.02     $ 9.13     $ 9.30     $ 9.08     $ 8.83     $ 8.61  
- Cash and marketable securities per share
   $ 5.23     $ 5.51     $ 4.97     $ 4.67     $ 4.13     $ 4.42     $ 6.18     $ 2.65     $ 4.20  
- Net cash and securities
   $ 673,535     $ 719,481     $ 627,016     $ 578,032     $ 498,353     $ 533,095     $ 485,632     $ 259,033     $ 247,038  
     
(1)  - 
See notes to financial supplement for definitions and calculations of selected financial ratios.

 

8

 

Monster Worldwide, Inc.
Segment Information and Margin Analysis — Non-GAAP
(unaudited, in thousands)
                                                                         
    Trended Quarterly Data  
    Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
 
                                                                        
Segment OIBDA(1):
                                                                        
Careers — North America
   $ 71,150     $ 60,845     $ 57,589     $ 60,410     $ 47,602     $ 67,636     $ 52,516     $ 44,138     $ 12,272  
Careers — International
     12,594       17,362       12,896       29,980       16,662       40,361       39,060       23,833       10,749  
 
                                                      
Careers OIBDA (1)
     83,744       78,207       70,485       90,390       64,264       107,997       91,576       67,971       23,021  
 
                                                                        
Internet Advertising & Fees OIBDA(1)
     7,470       7,438       5,316       3,118       792       7,508       7,425       6,293       6,364  
 
                                                      
 
                                                                        
Total Monster OIBDA(1)
   $ 91,214     $ 85,645     $ 75,801     $ 93,508     $ 65,056     $ 115,505     $ 99,001     $ 74,264     $ 29,385  
 
                                                      
 
                                                                        
Corporate expenses before D&A(1)
   $ (17,645 )   $ (14,923 )   $ (9,917 )   $ (11,032 )   $ (12,104 )   $ (61,196 )   $ (13,192 )   $ (5,810 )   $ (13,843 )
 
                                                      
 
                                                                        
Proforma operating income(1):
                                                                        
Careers — North America
   $ 65,878     $ 55,029     $ 59,430     $ 56,482     $ 42,955     $ 59,335     $ 43,771     $ 34,314     $ 3,100  
Careers — International
     7,961       12,055       13,589       28,699       12,945       33,316       32,467       17,711       7,413  
 
                                                      
Careers Proforma operating income(1)
     73,839       67,084       73,019       85,181       55,900       92,651       76,238       52,025       10,513  
 
                                                                        
Internet Advertising & Fees ProForma operating income (loss)(1)
     6,062       5,679       5,404       2,658       (609 )     4,994       4,977       3,745       4,003  
 
                                                      
 
                                                                        
Total Monster Proforma income(1)
   $ 79,901     $ 72,763     $ 78,423     $ 87,839     $ 55,291     $ 97,645     $ 81,215     $ 55,770     $ 14,516  
 
                                                      
 
                                                                        
Corporate Proforma expenses(1)
   $ (10,121 )   $ (8,778 )   $ (8,046 )   $ (12,177 )   $ (11,586 )   $ (19,308 )   $ (11,175 )   $ (14,294 )   $ (14,288 )
 
                                                      
 
                                                                        
Segment operating income (loss):(1)
                                                                        
Careers — North America
   $ 65,878     $ 54,579     $ 51,455     $ 52,950     $ 39,701     $ 58,409     $ 43,120     $ 34,025     $ 828  
Careers — International
     7,961       12,055       7,344       24,753       9,643       31,916       30,230       12,938       (671 )
 
                                                      
Careers operating income (loss)
     73,839       66,634       58,799       77,703       49,344       90,325       73,350       46,963       157  
 
                                                                        
Internet Advertising & Fees operating income (loss)
     6,062       5,679       3,487       1,383       (1,431 )     4,656       4,726       3,715       3,557  
 
                                                      
 
                                                                        
Total Monster operating income (loss)
   $ 79,901     $ 72,313     $ 62,286     $ 79,086     $ 47,913     $ 94,981     $ 78,076     $ 50,678     $ 3,714  
 
                                                      
 
                                                                        
Corporate expenses
   $ (19,948 )   $ (29,470 )   $ (11,289 )   $ (13,647 )   $ (14,569 )   $ (63,732 )   $ (15,503 )   $ (7,889 )   $ (18,508 )
 
                                                      
 
                                                                        
Margin Analysis:
                                                                        
 
                                                                        
Careers — North America OIBDA margin
     38.7 %     34.9 %     32.8 %     34.8 %     25.9 %     41.2 %     33.8 %     32.7 %     10.3 %
Careers — North America Proforma operating margin
     35.8 %     31.5 %     33.9 %     32.5 %     23.4 %     36.1 %     28.2 %     25.4 %     2.6 %
Careers — North America operating margin
     35.8 %     31.3 %     29.4 %     30.5 %     21.6 %     35.6 %     27.8 %     25.2 %     0.7 %
 
                                                                        
Careers — International OIBDA margin
     11.9 %     14.9 %     10.6 %     20.9 %     10.9 %     25.8 %     27.4 %     19.4 %     10.4 %
Careers — International Proforma operating margin
     7.5 %     10.3 %     11.2 %     20.0 %     8.4 %     21.3 %     22.8 %     14.2 %     7.1 %
Careers — International operating margin
     7.5 %     10.3 %     6.0 %     17.3 %     6.3 %     20.4 %     21.2 %     10.5 %     -0.6 %
 
                                                                        
Careers OIBDA margin
     28.9 %     26.8 %     23.7 %     28.5 %     19.1 %     33.6 %     30.8 %     26.4 %     10.3 %
Careers Proforma operating margin
     25.4 %     23.0 %     24.6 %     26.9 %     16.6 %     28.9 %     25.6 %     20.0 %     4.7 %
Careers operating margin
     25.4 %     22.9 %     19.8 %     24.5 %     14.7 %     28.1 %     24.6 %     18.2 %     0.1 %
 
                                                                        
Internet Advertising & Fees OIBDA margin
     23.6 %     22.8 %     16.0 %     10.1 %     2.7 %     22.5 %     21.5 %     19.2 %     20.2 %
Internet Advertising & Fees Proforma operating margin
     19.2 %     17.4 %     16.3 %     8.6 %     -2.1 %     15.0 %     14.4 %     11.4 %     12.7 %
Internet Advertising & Fees operating margin
     19.2 %     17.4 %     10.5 %     4.5 %     -4.8 %     14.0 %     13.7 %     11.3 %     11.3 %
     
(1)  - 
See notes to financial supplement for further explanation of non-GAAP measures.

 

9

 

Monster Worldwide, Inc.
Statements of Operations
(unaudited)
                                                                         
    Trended Quarterly Data  
Summary P&L Information   Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
 
                                                                        
Monster Careers
     90.2 %     89.9 %     90.0 %     91.1 %     91.9 %     90.6 %     89.6 %     88.7 %     87.6 %
Internet Advertising & Fees
     9.8 %     10.1 %     10.0 %     8.9 %     8.1 %     9.4 %     10.4 %     11.3 %     12.4 %
 
                                                      
Revenue
     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %
 
                                                                        
Salary and related
     36.4 %     39.5 %     37.5 %     36.7 %     36.9 %     35.9 %     38.8 %     42.4 %     44.0 %
Office and general
     18.3 %     16.0 %     17.5 %     16.3 %     16.8 %     17.4 %     17.2 %     15.2 %     18.0 %
Marketing and promotion
     22.5 %     22.7 %     21.7 %     22.1 %     30.5 %     19.5 %     17.4 %     18.1 %     29.0 %
Provision for legal settlements, net
     0.0 %     0.0 %     0.0 %     0.0 %     0.0 %     11.3 %     0.0 %     0.0 %     0.0 %
Restructuring and other special charges
     0.0 %     0.0 %     3.4 %     1.6 %     1.9 %     0.8 %     1.1 %     1.1 %     4.3 %
Depreciation expense
     2.4 %     2.9 %     3.2 %     3.0 %     2.9 %     3.5 %     4.0 %     5.1 %     5.4 %
Amortization of restricted stock and RSU Plan
     1.3 %     5.3 %     0.9 %     1.0 %     1.4 %     2.4 %     2.2 %     2.4 %     4.0 %
Non-cash stock option expense
     0.1 %     0.0 %     0.0 %     0.0 %     0.0 %     0.1 %     0.0 %     0.1 %     0.1 %
Amortization of intangibles
     0.4 %     0.4 %     0.4 %     0.4 %     0.4 %     0.4 %     0.4 %     0.9 %     1.0 %
 
                                                      
Operating expenses
     81.4 %     86.8 %     84.6 %     81.2 %     90.9 %     91.2 %     81.2 %     85.3 %     105.8 %
 
                                                                        
Operating income (loss)
     18.6 %     13.2 %     15.4 %     18.8 %     9.1 %     8.8 %     18.8 %     14.7 %     -5.8 %
Interest and other, net
     1.7 %     2.1 %     2.0 %     2.0 %     2.0 %     0.9 %     1.6 %     0.5 %     0.5 %
 
                                                      
Income (loss) from continuing operations, pre-tax
     20.3 %     15.4 %     17.4 %     20.8 %     11.1 %     9.7 %     20.4 %     15.3 %     -5.3 %
 
                                                                        
Income taxes
     7.2 %     5.4 %     6.2 %     7.3 %     4.1 %     3.4 %     6.8 %     5.1 %     -1.8 %
Losses in equity interests, net
     -0.4 %     -0.9 %     -0.9 %     -0.2 %     -0.5 %     -1.0 %     -0.6 %     -0.1 %     -0.5 %
 
                                                      
Income from continuing operations
     12.7 %     9.0 %     10.3 %     13.3 %     6.5 %     5.2 %     13.0 %     10.0 %     -4.1 %
 
                                                                        
Income (loss) from disc. operations, net of tax
     -0.4 %     -0.2 %     -0.2 %     -0.3 %     -0.3 %     3.5 %     -0.1 %     -0.2 %     0.0 %
 
                                                      
 
                                                                        
Net income (loss)
     12.3 %     8.8 %     10.1 %     12.9 %     6.2 %     8.7 %     12.9 %     9.8 %     -4.1 %
 
                                                      

 

10

 

Monster Worldwide, Inc.
Statements of Operations — Reconciliation of Non-GAAP Measures
(unaudited, in thousands, except per share amounts)
                                                                         
    Trended Quarterly Data  
Summary P&L Information   Q1 2007     Q2 2007     Q3 2007     Q4 2007     Q1 2008     Q2 2008     Q3 2008     Q4 2008     Q1 2009  
 
                                                                        
Proforma revenue (1)
   $ 321,830     $ 323,985     $ 330,142     $ 347,847     $ 366,472     $ 354,294     $ 332,189     $ 292,885     $ 255,397  
 
                                                                        
Deferred revenue related to acquisitions
     —       —       —       —       —       —       —       2,213       994  
 
                                                      
 
                                                                        
Revenue
   $ 321,830     $ 323,985     $ 330,142     $ 347,847     $ 366,472     $ 354,294     $ 332,189     $ 290,672     $ 254,403  
 
                                                      
 
                                                                        
OIBDA (1)
   $ 73,569     $ 70,722     $ 65,884     $ 82,476     $ 52,952     $ 54,309     $ 85,809     $ 68,454     $ 15,542  
 
                                                                        
Depreciation expense
     7,860       9,350       10,408       10,589       10,803       12,330       13,336       14,761       13,769  
Amortization of restricted stock and RSU Plan
     4,176       17,069       2,871       3,623       5,206       8,351       7,437       7,046       10,149  
Non-cash stock option expense
     186       47       104       105       127       182       165       178       199  
Restructuring non-cash compensation expense
     —       —       —       —       1,162       —       —       —       —  
Restructuring non-cash write-offs
     —       —       67       1,263       924       923       924       924       3,668  
Amortization of intangibles
     1,394       1,413       1,437       1,457       1,386       1,274       1,374       2,756       2,551  
 
                                                      
 
                                                                        
Operating income
   $ 59,953     $ 42,843     $ 50,997     $ 65,439     $ 33,344     $ 31,249     $ 62,573     $ 42,789     $ (14,794 )
 
                                                      
Proforma operating income (1)
   $ 69,780     $ 63,985     $ 70,377     $ 75,662     $ 43,705     $ 78,337     $ 70,040     $ 41,476     $ 228  
 
                                                                        
Executive Commitments
     —       15,811       —       —       —       —       —       —       —  
Provision for legal settlements, net
     —       —       —       —       —       40,100       —       —       —  
Stock option investigation
     9,827       5,331       2,571       1,392       2,983       4,256       3,875       (6,682 )     3,020  
Security breach
     —       —       5,654       3,389       451       —       —       —       —  
Deferred revenue related to acquisitions
     —       —       —       —       —       —       —       2,213       994  
Restructuring non-cash compensation expense
     —       —       —       —       1,162       —       —       —       —  
Restructuring program non-cash write-offs
     —       —       67       1,263       924       923       924       924       3,668  
Restructuring expenses, less non-cash items
     —       —       11,088       4,179       4,841       1,809       2,668       2,232       7,340  
 
                                                      
 
                                                                        
Operating income
   $ 59,953     $ 42,843     $ 50,997     $ 65,439     $ 33,344     $ 31,249     $ 62,573     $ 42,789     $ (14,794 )
 
                                                      
     
(1)  - 
See notes to financial supplement for further explanation of non-GAAP measures.

 

11