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New York, February 1, 2006-- Monster Worldwide, Inc. (NASDAQ:MNST) today reported financial results for the fourth quarter and year ended December 31, 2005.
Fourth Quarter Results
Total revenue increased 24% to $266.6 million in the fourth quarter of 2005 from $215.0 million in last year's fourth quarter, while revenue at the Monster division grew 30% to $223.8 million over the $172.2 million recorded in the same period of 2004. The Company's Advertising & Communications business contributed $42.8 million to total revenue, essentially flat with last year's comparable quarter.
Organic revenue growth for the Company and the Monster division was 24% and 29%, respectively, compared to last year's fourth quarter. Income from continuing operations for the fourth quarter increased 63% to $35.3 million from $21.7 million in the comparable quarter in 2004. Net income was $36.5 million compared to $24.5 million in last year's fourth quarter, a 49% increase. Diluted earnings per share from continuing operations were $0.28, a 56% increase over $0.18 for the fourth quarter of 2004, and diluted earnings per share, including the results of discontinued operations, were $0.29, a 45% increase over $0.20 for the fourth quarter of 2004. The Monster division's deferred revenue balance at December 31, 2005 was $327.4 million, a 42% increase over last year's fourth quarter balance of $230.1 million.
Cash generated from operating activities in the fourth quarter of 2005 was $60.9 million compared with $44.1 million for the comparable year ago quarter. Free cash flow (a non-GAAP measure), defined as cash flow from operating activities less capital expenditures, increased to $45.2 million, a 9.5% increase, compared to $41.3 million in the fourth quarter of 2004. At the end of the fourth quarter of 2005, Monster Worldwide's net cash position, defined as cash and cash equivalents plus marketable securities, less total debt, totaled $273.3 million, compared to $134.9 million at December 31, 2004 and $269.0 million at September 30, 2005. During the fourth quarter of 2005, the Company used $89.6 million, net of cash and marketable securities acquired, to purchase JobKorea, the leading online recruitment company in South Korea; and also used $7.9 million on share repurchases. Stock option exercises generated an additional $57.3 million of cash for the Company in the fourth quarter.
"We are very pleased to report a strong finish to another outstanding year for Monster Worldwide. Our solid financial performance for the fourth quarter and throughout the year directly reflects our ability to deliver effective and innovative solutions for a growing list of small, medium and global customers and job seekers," said Andrew J. McKelvey, Chairman and Chief Executive Officer, of Monster Worldwide. "The combination of Monster's talented, experienced sales force worldwide and the Company's expanding presence in overseas markets contributed to our strong revenue growth. Overseas, Monster's organic revenue growth rate improved for the second quarter in a row, with International growing 46% year to year. In North America, we continued to attract thousands of new customers each month, while deepening our relationships with the nation's largest employers. Our singular focus is on continuing to develop and expand our industry while delivering strong, consistent financial results that drive shareholder value. We are confident that our industry knowledge and operational expertise will enable us to build on our leadership position this year and in the years ahead."
Full Year Results
Monster Worldwide reported total revenue of $986.9 million for the year ended December 31, 2005 compared to $756.1 million last year, a 31% increase. Monster division revenue grew 38% to $818.3 million compared with $593.9 million in 2004. Income from continuing operations was $115.1 million, or $0.92 per diluted share compared to $64.9 million, or $0.54 per diluted share in the prior year. Net income for 2005 was $107.4 million up from $73.1 million in 2004. Diluted earnings per share, including the results of discontinued operations, were $0.86 compared to $0.61 reported in 2004. For 2005, Monster Worldwide generated $221.6 million in cash flow from operating activities, and free cash flow was $181.8 million, up from $75.9 million in 2004.
Recent Developments
Monster #1 Job Site in Europe
" A study done by Web research firm Neilsen//NetRatings in November 2005 ranked Monster the #1 most visited job site in Europe with 5.2 million unique visitors in the third quarter of 2005. The study found that one in every four web users, or 29 million Europeans, visited job sites between July and September 2005, a 25% increase over the same period in the prior year.
Stock Repurchase Program
" On November 10, 2005, the Company's Board of Directors approved a share repurchase plan. Under terms of the plan, Monster Worldwide is authorized to purchase up to $100 million of its shares of common stock in the open market or otherwise from time to time over a 30-month period as conditions warrant. The Company repurchased 200,000 shares at a total cost of $7.9 million in the fourth quarter of 2005.
Monster Employment Index
" The Monster Employment Index U.S. increased 32 points, or 28% over last year. The Index showed strong, steady growth in online recruitment activity compared to the prior year with particular strength in construction, retail and military. Launched in April 2004 with data collected since October 2003, the Index culls over 1500 Web sites including a variety of corporate career sites and job boards to present a snapshot of U.S. online job demand.
The Monster Employment Index Europe, which represents the first ongoing analysis of European online hiring activity, was up slightly in December 2005 having risen to an all time high of 112. Since its inception in June 2005, with data collected since December 2004, the Index has exhibited a generally upward growth trend, showing a 29 point, or a 35% increase in online job demand year over year.
NASDAQ 100
" On December 19, 2005, Monster Worldwide rejoined the NASDAQ-100 Index - one of the world's most widely followed barometers of stock market activity.
Supplemental Financial Information
The Company has made available certain supplemental financial information, in a separate document that can be accessed directly at http://www.monsterworldwide.com/Q405.pdf or through the Company's Investor Relations website at http://ir.monsterworldwide.com.
Business Outlook
The following forward-looking statements reflect Monster Worldwide's expectations as of February 1, 2006. These expectations do not include the effect of any future acquisitions or dispositions, or factors outside of our control, which may have an impact on future financial results and are subject to the Special Note regarding forward-looking statements elsewhere in this release.
$'s in millions, except per share amounts First
Quarter 2006 Full Year 2006
Total revenue $278 - $285 $1,165 - $1,215
Monster division revenue $239- $244 $1,005- $1,045
Diluted EPS from continuing operations $0.26 - $0.27 $1.21 - $1.26
The 2006 earnings per share outlook includes an anticipated cost of approximately $0.05 per diluted share for new long term (non-cash) stock compensation grants which will be expensed ratably over the year.
Conference Call Information
Fourth quarter 2005 results will be discussed on Monster Worldwide's quarterly conference call taking place on February 1, 2006 at 10:00 AM EST. To join the conference call, please dial in on 888-551-5973 at 9:50 AM EST with the password "Monster." For those outside the United States, please call in on 706-643-3467 using the same password. The call will begin promptly at 10:00 AM EST. Individuals can also access Monster Worldwide's quarterly conference call online through the investor information section of the Company's website at www.monsterworldwide.com. For a replay of the call, please dial (800) 642-1687 or for outside the US dial (706) 645-9291 and use reference ID # 4395460. This number is valid until midnight on February 9, 2006.
Contacts
Investors: Robert Jones, (212) 351-7032, bob.jones[at]monsterworldwide.com
Media: David Rosa, (212) 351-7067, david.rosa[at]monsterworldwide.com
About Monster Worldwide
Founded in 1967, Monster Worldwide, Inc. is the parent company of Monster(R), the leading global online careers property. The company also owns TMP Worldwide, one of the world's largest Recruitment Advertising agency networks. Headquartered in New York with approximately 4,800 employees in 26 countries. Monster Worldwide (NASDAQ: MNST) is a member of the S&P 500 Index and NASDAQ 100. More information about Monster Worldwide is available at www.monsterworldwide.com.
Monster is the leading global online careers property. A division of Monster Worldwide, Monster works for everyone by connecting quality job seekers at all levels with leading employers across all industries. Founded in 1994 and headquartered in Maynard, Mass., Monster has 26 local language and content sites in 24 countries worldwide. More information is available at www.monster.com or by calling 1-800-MONSTER. To learn more about Monster's industry-leading employer products and services, please visit http://recruiter.monster.com.
Note on Discontinued Operations
On June 1, 2005, the Company disposed of its Directional Marketing segment. As a result, substantially all the operating results of such businesses have been reclassified to discontinued operations for all periods presented. Entities that were retained are now included with the results of the Company's Advertising & Communications international business for all periods presented.
Notes Regarding the Use of 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, such as operating income before depreciation and amortization and free cash flow, provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company's management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes.
Operating income before depreciation and amortization is defined as income from operations before depreciation, amortization of intangible assets and amortization of stock based compensation. The Company considers operating income before depreciation and amortization to be an important indicator of its operational strength. This measure eliminates the effects of depreciation, amortization of intangible assets and amortization of stock based compensation from period to period, which the Company believes is useful to management and investors in evaluating its operating performance. Operating income before depreciation and amortization 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.
Special Note: Except for historical information contained herein, the statements made in this release constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve certain risks and uncertainties, including statements regarding the Company's strategic direction, prospects and future results. Certain factors, including factors outside of our control, may cause actual results to differ materially from those contained in the forward-looking statements, including economic and other conditions in the markets in which we operate, risks associated with acquisitions, competition, seasonality and the other risks discussed in our Form 10-K and our other filings made with the Securities and Exchange Commission, which discussions are incorporated in this release by reference.
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