UPDATE: IAC/Interactive Swings To 3Q Profit, Beating Views
27 Octubre 2009 - 8:19AM
Noticias Dow Jones
Asset sales boosted IAC/InteractiveCorp. (IACI) to a
third-quarter profit, despite revenue declines that show Barry
Diller's digital media empire continuing to struggle through the
recession and advertising slump.
IAC, which split into five different companies just over a year
ago to slim down its sprawling portfolio, has swung to a profit in
three of the past four quarters following the restructuring,
although revenue has been falling in a weak advertising
environment.
The parent of properties like Ask.com and Match.com benefited in
the third quarter from the sale of its Match Europe unit and shares
in OpenTable Inc. (OPEN), along with year-ago write-downs. But its
underlying performance exceeded expectations as investors continue
to be lured by its $1.8 billion cash reserve.
Shares of IAC rose 4.1% to $20.15 in early trading Tuesday.
RBC Capital Markets analyst Ross Sandler noted that while IAC
repurchased 5.6 million shares in the quarter, its buyback slowed
over the summer as the company held talks with Liberty Media Corp.
(LCAPA, LINTA, LMDIA) about the repurchases. The media empire
controlled by John Malone has been selling part of its stake in
IAC.
"IAC stated that discussions have terminated, so we expect
buybacks to resume," said Sandler.
IAC posted earnings of $21.3 million, or 16 cents a share,
compared with a year-earlier loss of $15.2 million, or 11 cents a
share. The latest results included $35 million in gains tied to the
sale of OpenTable stock and the sale of Match Europe, while
year-earlier results included expenses tied to the company's
breakup.
Excluding items earnings were 34 cents a share, compared with a
year-ago loss of 14 cents a share. Analysts surveyed by Thomson
Reuters projected earnings of 13 cents a share.
Revenue decreased 8.9% to $336.6 million but also beat
expectations for revenue of $335 million.
Earnings before amortization in the media and advertising
segment, which includes Ask.com, fell 30% amid higher traffic
acquisition costs and an 11% drop in revenue.
The Match unit, known for Match.com and Chemistry.com dating
services, posted a 12% profit decline as revenue fell 13%.
Excluding Match Europe and PeopleMedia, revenue rose 5% during the
quarter driven by a 9% increase in U.S. subscribers.
-By Nat Worden, Dow Jones Newswires; 212-416-2472;
nat.worden@dowjones.com
(John Kell contributed to this story.)