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IAC/INTERACTIVECORP

(IAC)
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IAC/InterActiveCorp : IAC Reports Q2 2021 Results

08/04/2021 | 04:07pm EDT

Page 1 of 16

IAC REPORTS Q2 2021 - Q2 REVENUE INCREASES 26% TO $830 MILLION

NEW YORK- August 4, 2021-IAC (NASDAQ: IAC) released its second quarter results today and separately posted a letter to shareholders from IAC CEO Joey Levin on the Investor Relations section of its website at ir.iac.com.

IAC SUMMARY RESULTS

($ in millions except per share amounts)

Q2 2021

Q2 2020

Growth

Revenue

$

829.5

$

659.0

26%

Operating loss

(28.4)

(97.4)

71%

Net earnings (loss)

194.8

(96.1)

NM

Diluted EPS

2.02

(1.13)

NM

Adjusted EBITDA

26.4

19.7

34%

See reconciliations of GAAP to non-GAAP measures beginning on page 11.

Q2 2021 HIGHLIGHTS

  • IAC completed the Spin-off of Vimeo on May 25, 2021 and, accordingly, the results of Vimeo are treated as discontinued operations.
  • The year-over-over improvement in Net earnings and Diluted EPS for Q2 2021 was due primarily to a $210 million after-tax unrealized gain related to our investment in MGM Resorts International.
  • Angi Inc. revenue increased 12% year-over-year to $421 million, the third consecutive quarter of double-digit growth.
    • Angi Services (pre-priced offerings) revenue was $73 million in Q2 2021, increasing 127% year- over-year.
    • Marketplace Transacting Service Professionals increased 16% year-over-year to a record high of 225,000. Marketplace Monetized Transactions increased 11% year-over-year to over 5 million.
  • Dotdash revenue increased 64% year-over-year to $73 million, accelerating from 48% in Q1 2021. Operating income increased 150% to $19 million and Adjusted EBITDA increased 70% to $21 million.
  • Search operating income and Adjusted EBITDA were $26 million.
  • Emerging & Other revenue increased 40% to $152 million, including $78 million from Care.com.

Page 2 of 16

DISCUSSION OF FINANCIAL AND OPERATING RESULTS

($ in millions, rounding differences may occur)

Q2 2021

Q2 2020

Growth

Revenue

Angi Inc.

$

421.0

$

375.1

12%

Dotdash

73.3

44.6

64%

Search

183.6

131.3

40%

Emerging & Other

151.7

108.1

40%

Inter-segment eliminations

(0.0)

(0.0)

15%

Total Revenue

$

829.5

$

659.0

26%

Operating(loss) income

Angi Inc.

$

(32.7)

$

17.6

NM

Dotdash

19.2

7.7

150%

Search

25.7

8.8

192%

Emerging & Other

(2.7)

(9.0)

70%

Corporate

(37.8)

(122.6)

69%

Total Operating loss

$

(28.4)

$

(97.4)

71%

Adjusted EBITDA

Angi Inc.

$

(4.4)

$

57.9

NM

Dotdash

20.5

12.1

70%

Search

25.7

9.4

172%

Emerging & Other

6.9

(2.6)

NM

Corporate

(22.3)

(57.2)

61%

Total Adjusted EBITDA

$

26.4

$

19.7

34%

Please refer to the IAC Q2 2021 shareholder letter for July 2021 monthly metrics.

Angi Inc.

Please refer to the Angi Inc. Q2 2021 earnings release for further detail.

Dotdash

  • Revenue increased 64% to $73.3 million due to 69% higher Display Advertising revenue and 58% higher Performance Marketing revenue.
  • Operating income increased 150% to $19.2 million due primarily to Adjusted EBITDA increasing 70% to $20.5 million.

Page 3 of 16

Search

  • Revenue increased 40% to $183.6 million due to a 72% increase at Ask Media Group, partially offset by a 24% decrease at Desktop.
  • Operating income increased $16.9 million to $25.7 million due to Adjusted EBITDA increasing $16.2 million to $25.7 million driven by the higher Ask Media Group revenue and lower Desktop marketing.

Emerging & Other

  • Revenue increased to $151.7 million, a 40% increase year-over-year, due primarily to:
    • Care.com revenue increasing to $78.2 million from $48.0 million in Q2 2020 due partially to the addition of LifeCare (acquired in October 2020)
    • 6% growth at Mosaic Group to $51.7 million (ending Q2 2021 with 3.7 million subscribers)
    • Growth from Bluecrew, The Daily Beast and Vivian Health
  • Operating loss decreased $6.3 million to $2.7 million reflecting:
    • Adjusted EBITDA of $6.9 million as compared to a loss of $2.6 million in Q2 2020 due primarily to profits at Care.com (Q2 2020 results included $6.8 million of transaction-related items) as well as higher profits at IAC Films and Mosaic Group
    • Partially offset by a $2.6 million increase in amortization of intangibles due to LifeCare

Corporate

Operating loss decreased $84.7 million to $37.8 million due to:

  • $48.6 million lower stock-based compensation expense due primarily to $51.4 million in modification charges related to the Match Group separation in the prior year.
  • $34.9 million lower Adjusted EBITDA losses due primarily to the $25.0 million IAC Fellows endowment and $11.2 million in costs related to the Match Group separation in the prior year.

Page 4 of 16

Income Taxes

The Company recorded an income tax provision of $87.8 million in Q2 2021 for an effective tax rate of 30%, which is higher than the statutory rate due primarily to an increase in net deferred tax liabilities as a result of the Vimeo Spin-off. The Company recorded an income tax benefit of $34.4 million in Q2 2020 due primarily to excess tax benefits generated by the exercise and vesting of stock-based awards.

Free Cash Flow

For the six months ended June 30, 2021, net cash provided by operating activities attributable to continuing operations increased $110.7 million to $177.0 million and Free Cash Flow increased $98.3 million to $137.6 million due primarily to higher Adjusted EBITDA and favorable working capital, partially offset by higher capital expenditures.

Six Months Ended June 30,

($ in millions, rounding differences may occur)

2021

2020

Net cash provided by operating activities attributable to continuing operations

$

177.0

$

66.3

Capital expenditures

(39.4)

(27.0)

Free Cash Flow

$

137.6

$

39.3

VIDEO CONFERENCE CALL

IAC and Angi Inc. will live stream a joint video conference to answer questions regarding their second quarter results on Thursday, August 5, 2021, at 8:30 a.m. Eastern Time. This live stream will include the disclosure of certain information, including forward-looking information, which may be material to an investor's understanding of IAC and Angi Inc.'s business. The live stream will be open to the public at ir.iac.com or ir.angi.com.

Page 5 of 16

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2021:

  • IAC had 89.2 million common and Class B common shares outstanding.
  • The Company had $3.5 billion in cash and cash equivalents and marketable securities of which IAC held $2.9 billion and Angi Inc. held $584 million.
  • The Company had $500 million in long-term debt, all of which was held at ANGI Group, LLC (a subsidiary of Angi Inc.).
  • IAC's economic interest in Angi Inc. was 84.1% and IAC's voting interest was 98.1%. IAC held 424.6 million shares of Angi Inc.
  • IAC owned 59 million shares of MGM Resorts International (which is included in long-term investments).

ANGI Group, LLC had a $250 million revolving credit facility which was terminated on August 3, 2021 (no borrowings were then outstanding).

IAC has 8.0 million shares remaining in its stock repurchase authorization.

Between May 7, 2021 and August 3, 2021, Angi Inc. repurchased 0.7 million Class A common shares at an average

price of $11.71. Angi Inc. has 18.1 million shares remaining in its stock repurchase authorization.

IAC and Angi Inc. may purchase their shares over an indefinite period on the open market and in privately negotiated transactions, depending on those factors management deems relevant at any particular time, including, without limitation, market conditions, share price and future outlook.

Disclaimer

IAC/InterActiveCorp published this content on 04 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 August 2021 20:06:07 UTC.


© Publicnow 2021
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