Rentrak Reports Solid Fiscal 2009 Fourth Quarter and Full Year Financial Results
— Analysis and Testing Confirm the Ability of Rentrak's TV Essentials™ to Process
Linear TV Data from Approximately 100 Million Set Top Boxes on a Daily Basis —
— Company Continues to Generate Strong Earnings Growth
with Fourth Quarter EPS of $0.21, Including Favorable Tax Benefits —
PORTLAND, Ore., Jun 9, 2009 --
Rentrak Corporation (NASDAQ: RENT) today announced financial results for its fiscal fourth quarter and full year ended March 31, 2009.Consolidated revenues were $22.3 million for the fourth quarter of fiscal 2009, equal to the fourth quarter of fiscal 2008.
- Revenues in the company's Advanced Media Information (AMI) division increased more than 16 percent to $3.3 million from $2.8 million for the fiscal 2008 fourth quarter, principally reflecting incremental revenues generated from new and existing customers of the company's Essentials suite of multimedia measurement services. The AMI segment grew to approximately 15 percent of consolidated revenues and contributed approximately 27 percent of consolidated gross margin dollars in the fourth quarter of fiscal 2009.
- Revenues in the company's Pay-Per-Transaction® (PPT) division totaled $19.0 million, highly comparable to $19.5 million in the same quarter last year. The slight reduction in PPT division revenues resulted from shipping fewer guaranteed units in the fiscal 2009 fourth quarter.
Selling and administrative expenses were $6.7 million, or approximately 30 percent of revenues, for the fourth quarter of fiscal 2009, compared with $6.6 million, or approximately 30 percent of revenues, for last year's fiscal fourth quarter. The increase primarily reflects Rentrak's ongoing investment in its multi screen business development and implementation activities.
As a result, operating income grew to $1.8 million for the fiscal 2009 fourth quarter, compared with $1.6 million in the similar period last year.
Net income improved to $2.2 million, or $0.21 per diluted share, for the fourth quarter of fiscal 2009, including a tax benefit of approximately $866,000, or $0.08 per diluted share, primarily due to related adjustments as the result of completion of a federal tax audit. Net income was $1.7 million, or $0.15 per diluted share, for the fourth quarter of fiscal 2008, including favorable tax adjustments of approximately $560,000, or $0.05 per diluted share, mostly the result of cumulative tax research and experimentation credits available to Rentrak, primarily related to internally developed software for the company's Essentials multimedia measurement services.
The company generated adjusted EBITDA for the fiscal 2009 fourth quarter of $2.4 million, compared with $2.3 million in the fiscal 2008 same quarter. Rentrak calculates adjusted EBITDA by adjusting GAAP net income (loss) for the effects of taxes, interest, depreciation, amortization and non-cash expense for stock-based compensation. The reconciliation of adjusted EBITDA to net income (loss), the most comparable financial measure based upon generally accepted accounting principles (GAAP), as well as a further explanation about adjusted EBITDA, is included at the end of this earnings release.
Rentrak's cash, cash equivalents and marketable securities balance grew to $34.5 million at March 31, 2009, from $31.8 million at March 31, 2008.
Fiscal 2009 Full Year Financial Results
Consolidated revenues increased to $95.0 million for fiscal 2009 from $93.2 million for fiscal 2008. AMI division revenues rose approximately 22 percent to $12.6 million from $10.4 million for fiscal 2008, demonstrating continued growth of the company's Essentials suite of services. Revenues in the company's PPT division were $82.3 million, closely approximating $82.8 million for the last fiscal year, reflecting stabilization in the company's legacy business.
Operating income for fiscal 2009 was $5.2 million, compared with $5.6 million in fiscal 2008. Net income increased to $5.4 million, or $0.49 per diluted share, for fiscal 2009 from $4.6 million, or $0.41 per diluted share, last year. Adjusted EBITDA was $7.5 million for fiscal 2009, compared with $8.2 million for fiscal 2008.
The company generated $8.0 million in cash from operating activities in fiscal 2009, compared with $3.1 million in fiscal 2008.
Recent Operating Highlights
- Building on the successful commercial launch of its pioneering linear TV measurement service, TV Essentials, Rentrak entered into new relationships with multiple cable providers and networks, including Charter Communications, the Inspiration Network and HDNet. TV Essentials' comprehensive suite of research tools enables customers to analyze anonymous audience viewing of programming and advertising across video on demand, DVR, interactive and linear television across all three TV platforms -- cable, satellite and telco. Utilizing proprietary technology to process massive amounts of click-stream data, the TV Essentials system is able to aggregate and report second-by-second information from 100 million digital set-top boxes.
- Solidifying its position as the leader in video on demand (VOD) measurement services, Rentrak added nine new content partners to its OnDemand Essentials® roster of subscribers, including FX, InDemand Networks, Magnolia Pictures and Spike TV.
- Rentrak launched its Digital Download Essentials™ service, which collects, processes, audits and reports on paid entertainment content delivered over the Internet, with measurement partner NBC Universal (NBCU). Digital Download Essentials gives NBCU access to valuable reporting about what television content consumers are purchasing via the Internet as well as the data necessary to make strategic business choices across multiple platforms.
- Through a new partnership with SeaChange International, the leading provider of video on demand and IPTV software, Rentrak and SeaChange will provide a seamless process for dynamic video on demand ad insertion, verification and reporting. Together, the companies will integrate solutions to dramatically improve the ability of multiple system operators (MSOs), networks and advertisers to monetize VOD advertising on a regional and national basis.
“We posted solid results during the quarter in spite of an ongoing, challenging economy,” said Rentrak Chairman and Chief Executive Officer Paul Rosenbaum. “By continuing to successfully grow revenues and effectively manage costs, and by steadily generating cash and maintaining a strong and flexible balance sheet, we have been able to continue our investment in the company's future by actively pursuing our current and long-term business goals. Over the next 12 to 15 months, Rentrak will be intently focused on generating increasing revenue streams from our Essentials development activities while creating new and valuable products and services that best serve our customers and industry.”
“After spending the last two years attracting key data partners and developing relationships with the country's largest operators, we are now processing live, linear television data from more than 10 million set top boxes. Even more impressive, internal testing recently confirmed that our TV Essentials architecture is able to process 10 times that amount of data on a daily basis, giving us the unique ability to grow as the amount of available content and number of media distribution platforms also grow,” Rosenbaum continued. “We are just at the very beginning stages of monetizing and reaching the full potential of what we have created, and with the information and experience we've gained throughout the development process, we are confident in the company's ability to successfully market our innovative and pioneering products and services.”
Conference Call
Rentrak has scheduled a conference call for 2:00 p.m. (PT) June 9, 2009 to discuss the company's fourth quarter financial performance. Shareowners, members of the media and other interested parties may participate in the call by dialing 866-713-8310 from the U.S. or Canada, or 617-597-5308 from international locations, passcode 94631600. This call is being webcast and can be accessed at Rentrak's web site at www.rentrak.com where it will be archived through June 9, 2010. An audio replay of the conference call is available through midnight June 16, 2009 by dialing 888-286-8010 from the U.S. or Canada, or 617-801-6888 from international locations, passcode 57417123.
About Rentrak Corporation (Nasdaq: RENT)
Rentrak Corporation is an industry-advancing media measurement and research company, serving the most recognizable names in the entertainment industry. Reaching across numerous platforms including box office, home entertainment, on-demand and linear television, broadband and mobile, Rentrak provides unique and actionable insight for our clients and partners. From the introduction of our revolutionary Pay-Per-Transaction® distribution and revenue-sharing system, which equipped Rentrak with the intelligence and ability to deal with large, complex data streams, to the company's exclusive Essentials™ suite of services, Rentrak has redefined digital audience measurement. Rentrak is headquartered in Portland, Oregon, with additional offices in Los Angeles, New York City and Miami/ Ft. Lauderdale. For more information on any of Rentrak's services, please visit www.rentrak.com.
Safe Harbor Statement
When used in this discussion, the words “anticipates,” “expects,” “intends” and similar expressions are intended to identify forward-looking statements. Such statements relate to, among other things, the company's ability to successfully manage expenses and run its business as efficiently as possible; the ability to successfully grow revenues, effectively manage costs, steadily generate cash and maintain strong and flexible balance sheet; the ability for Rentrak to create new and valuable products and services that best serve the company's customers and industry; the company's ability to monetize and reach the full potential of its development activities; and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could affect Rentrak's financial results include customer demand for movies in various media formats subject to company guarantees, the company's ability to attract new revenue-sharing customers and retain existing customers, the company's success in maintaining its relationships with studios and other product suppliers, the company's ability to successfully develop and market new services to create new revenue streams, and Rentrak's customers continuing to comply with the terms of their agreements. Additional factors that could affect Rentrak's financial results are described in Rentrak's March 31, 2008 annual report on Form 10-K and subsequent quarterly reports filed with the Securities and Exchange Commission. Results of operations in any past period should not be considered indicative of the results to be expected for future periods.
