OREANDA-NEWS.  Actua Corporation (Nasdaq:ACTA) (“Actua”) today reported its results for the second quarter ended June 30, 2016.

Revenue was $36.7 million for the second quarter of 2016, up from $33.5 million for the second quarter of 2015.  Net loss attributable to Actua for the second quarter of 2016 was $(12.7) million, or $(0.35) per diluted share, compared to net loss attributable to Actua of $(15.3) million, or $(0.41) per diluted share, for the second quarter of 2015.  Non-GAAP net loss for the second quarter of 2016 was $(3.6) million, or $(0.10) per diluted share, compared to a non-GAAP net loss of $(2.5) million, or $(0.07) per diluted share, for the comparable prior year quarter.  Cash flows from operations for the second quarter of 2016 was $1.5 million, compared to $1.0 million for the comparable prior year quarter.  Non-GAAP cash flows from operations for the second quarter of 2016 was $2.6 million, compared to $1.2 million for the comparable prior year quarter.

Revenue was $71.3 million for the first half of 2016, up from $64.1 million for the first half of 2015.  Net loss attributable to Actua for the first half of 2016 was $(27.1) million, or $(0.73) per diluted share, compared to net loss attributable to Actua of $(30.0) million, or $(0.81) per diluted share, for the first half of 2015.  Non-GAAP net loss for the first half of 2016 was $(7.9) million, or $(0.21) per diluted share, compared to a non-GAAP net loss of $(6.3) million, or $(0.17) per diluted share, for the first half of 2015. Cash flows from operations for the first half of 2016 was $(11.7) million, compared to $(3.4) million for the first half of 2015.  Non-GAAP cash flows from operations for the first half of 2016 was $(10.2) million, compared to $(3.1) million for the first half of 2015.

“We continue to be pleased with the bookings momentum we are seeing across the businesses,” said Walter Buckley, CEO of Actua. “As a result of the investments we have made in talent, sales and marketing, and product development, we are ahead of our bookings expectations for the first half of the year, particularly at Bolt.  This positions us well for future revenue and earnings growth."

2016 Guidance

Actua continues to expect (1) annual GAAP revenue in the range of between $155.0 million and $160.0 million, representing growth in the range of between 16% and 20% compared to 2015, (2) positive annual non-GAAP cash flows from operations in the range of between $3.0 million and $8.0 million, and (3) non-GAAP net loss per share in the range of between $(0.35) and $(0.40) per diluted share.  After taking into account its repurchase of 1 million shares of its common stock for $9.5 million this year, Actua now expects diluted shares outstanding of 37.0 million shares for the full year 2016.

A reconciliation of the non-GAAP financial measures used above with the most comparable GAAP financial measures is included with the financial tables at the end of this release.

Please see Actua’s website at www.actua.com for more information on Actua, its businesses and its second quarter 2016 results.

Actua will host a webcast at 10:00 a.m. ET today to discuss its financial results.  As part of the live webcast for this call, Actua will post a slide presentation to accompany the prepared remarks.  To access the webcast, go to www.actua.com/investors/events-presentations/ and click on the webcast link.  Please log on to the website approximately ten minutes prior to the call to register and download and install any necessary audio software.  The conference call is also accessible through listen-only mode by dialing 800.708.4539 or 847.619.6396.  The passcode is 42981974.

For those unable to participate in the conference call, a replay will be available from August 4, 2016 at 12:30 p.m. ET until August 11, 2016 at 11:59 p.m. ET.  To access the replay, dial 888.843.7419 or 630.652.3042.  The passcode is 42981974#.  The replay and slide presentation also can be accessed in the investor relations section of the Actua website at www.actua.com/investors/events-presentations/. 

About Actua
Actua Corporation (Nasdaq:ACTA), the multi-vertical cloud company, brings the power of the cloud to vertical markets and processes.  Actua is pioneering the second wave of the SaaS revolution - the vertical wave - by growing cloud businesses that are transforming their markets.  With over 900 employees delivering unrivaled domain knowledge, agility and responsiveness to our customers, Actua’s rapidly growing vertical cloud businesses are positioned to lead this wave.  For the latest information about Actua and its brands, please go to www.actua.com.

Safe Harbor Statement under Private Securities Litigation Reform Act of 1995

The statements contained in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements involve certain risks and uncertainties, including, but not limited to, risks associated with our ability to compete successfully in highly-competitive, rapidly-developing markets, the valuation of public and private cloud-based businesses by analysts, investors and other market participants, the effect of economic conditions generally, capital spending by our customers, our ability to retain existing customer relationships and revenue streams and secure new ones, developments in the markets in which we operate and our ability to respond to those changes in a timely and effective manner, the availability, performance and security of our cloud-based technology, particularly in light of increased cybersecurity risks and concerns, our ability to retain key personnel, our ability to deploy capital effectively and on acceptable terms, our ability to successfully integrate any acquired business, the impact of any potential acquisitions, dispositions or other strategic transactions, our ability to have continued access to capital and to manage capital resources effectively, and other risks and uncertainties detailed in Actua's filings with the U.S. Securities and Exchange Commission. These and other factors may cause actual results to differ materially from those projected.

       
 Actua Corporation      
 Consolidated Statements of Operations      
(In thousands, except per share data)      
(Unaudited)      
                       
          Three Months Ended
 June 30,		   Six Months Ended
 June 30,
          2016   2015   2016   2015
                       
Revenue       $ 36,709     $ 33,536     $ 71,319     $ 64,128  
                       
Operating Expenses                  
  Cost of revenue (a)     10,840     9,783     21,032     19,515  
  Sales and marketing (a)     13,808     12,163     26,967     23,399  
  General and administrative (a)     13,561     15,966     28,057     31,402  
  Research and development (a)     7,653     7,373     15,203     14,466  
  Amortization of intangible assets     4,108     3,706     8,172     7,722  
  Impairment related and other     117     489     348     835  
   Total operating expenses     50,087     49,480     99,779     97,339  
  Operating income (loss)     (13,378 )   (15,944 )   (28,460 )   (33,211 )
                       
Other income (expense):                  
  Other income (loss), net     (67 )   (102 )   (223 )   1,435  
  Interest income     39     35     87     54  
  Interest expense     (71 )   (31 )   (117 )   (68 )
                       
Income (loss) before income taxes   (13,477 )   (16,042 )   (28,713 )   (31,790 )
                       
Income tax benefit (expense)     (81 )   (1 )   (228 )   (178 )
                       
Net income (loss)     (13,558 )   (16,043 )   (28,941 )   (31,968 )
  Less: Net income (loss) attributable to the noncontrolling interests   (817 )   (761 )   (1,869 )   (1,921 )
Net income (loss) attributable to Actua     $ (12,741 )   $ (15,282 )   $ (27,072 )   $ (30,047 )
                       
                       
Basic and diluted net income (loss) per share:                
Income (loss) attributable to Actua common shareholders   $ (0.35 )   $ (0.41 )   $ (0.73 )   $ (0.81 )
                       
Shares used in computation of basic and diluted net income (loss) per common share attributable to Actua common shareholders   36,760     37,123     37,027     36,983  
                       
(a) Includes equity-based compensation of:                
  Cost of revenue     $ 31     $ 29     $ 72     $ 55  
  Sales and marketing     88     79     192     137  
  General and administrative     3,851     6,887     8,625     13,980  
  Research and development     112     126     236     171  
          $ 4,082     $ 7,121     $ 9,125     $ 14,343  
 
 Actua Corporation
 Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
                   
                   
          June 30,   December 31,    
          2016   2015    
                   
 ASSETS              
  Cash and cash equivalents     $ 43,222     $ 76,313      
  Restricted cash     1,669     2,206      
  Accounts receivable, net     21,921     19,902      
  Prepaid expenses and other current assets   6,484     4,876      
    Total current assets     73,296     103,297      
  Fixed assets, net     10,627     8,781      
  Goodwill     226,189     226,034      
  Intangible assets, net     83,782     89,395      
  Cost method investments     18,646     18,146      
  Deferred tax asset     2,848     2,900      
  Other assets, net     1,618     1,591      
    Total Assets     $ 417,006     $ 450,144      
                   
 LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND EQUITY        
  Short-term debt     $ 1,320     $ 1,320      
  Accounts payable     9,569     11,301      
  Accrued expenses     11,076     10,979      
  Accrued compensation and benefits     8,063     12,251      
  Deferred revenue     45,861     40,282      
    Total current liabilities     75,889     76,133      
  Deferred tax liability     266     266      
  Deferred revenue     1,353     2,038      
  Other liabilities     7,282     3,230      
    Total Liabilities     84,790     81,667      
  Redeemable noncontrolling interest     6,362     10,506      
  Total Equity     325,854     357,971      
    Total Liabilities, Redeemable noncontrolling interest and Equity $ 417,006     $ 450,144      
                   
 
ACTUA CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
                 
    Three Months Ended
June 30, 2016		   Six Months Ended
 June 30, 2016
    2016   2015   2016   2015
OPERATING ACTIVITIES                
Net income (loss)   $ (13,558 )   $ (16,043 )   $ (28,941 )   $ (31,968 )
Adjustments to reconcile net loss to cash provided by (used in) operating activities:                
Depreciation and amortization   5,117     4,829     10,059     10,069  
Equity-based compensation   4,082     7,121     9,125     14,343  
Impairment related and other   179     166     394     340  
Other (income) loss   67     102     223     (1,435 )
Deferred tax asset   57     89     52     76  
Contingent consideration   16     324     32     496  
Changes in operating assets and liabilities - net of acquisitions:                
Accounts receivable, net   6,559     1,676     (2,100 )   1,014  
Prepaid expenses and other assets   (1,609 )   (121 )   (1,590 )   (757 )
Accounts payable   (299 )   (952 )   (2,751 )   (1,503 )
Accrued expenses   (1,219 )   (416 )   (1,012 )   473  
Accrued compensation and benefits   1,327     1,634     (4,331 )   (396 )
Deferred revenue   (1,100 )   2,030     5,091     4,785  
Other liabilities   1,839     555     4,043     1,051  
Cash flows provided by (used in) operating activities   1,458     994     (11,706 )   (3,412 )
INVESTING ACTIVITIES                
Capital expenditures   (770 )   (1,579 )   (1,765 )   (3,919 )
Change in restricted cash   699     (72 )   551     68  
Proceeds from other distributions   —     —     46     1,415  
Ownership acquisition, net of cash acquired   (303 )   (700 )   (2,471 )   (1,957 )
Cash flows provided by (used in) investing activities   (374 )   (2,351 )   (3,639 )   (4,393 )
FINANCING ACTIVITIES                
Acquisition of noncontrolling interest in subsidiary equity   —     —     (5,515 )   (3,952 )
Payments of contingent consideration   (1,464 )   (1,870 )   (1,464 )   (1,870 )
Borrowings of short-term debt and notes payable   900     —     5,574     820  
Repayment of notes payable and capital lease obligations   (5,096 )   —     (5,241 )   (24 )
Purchase of treasury stock   (5,485 )   —     (9,533 )   (1,704 )
Tax withholdings related to equity-based awards   (7 )   (364 )   (1,536 )   (3,858 )
Other financing activities   36     (73 )   36     (8 )
Cash flows provided by (used in) financing activities   (11,116 )   (2,307 )   (17,679 )   (10,596 )
Effect of exchange rate on cash flows and cash equivalents   (38 )   6     (67 )   (111 )
Net increase (decrease) in cash and cash equivalents   (10,070 )   (3,658 )   (33,091 )   (18,512 )
Cash and cash equivalents at beginning of period   53,292     88,280     76,313     103,134  
Cash and cash equivalents at end of period   $ 43,222     $ 84,622     $ 43,222     $ 84,622  
 
Actua Corporation
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
(In thousands, except per share data)
(Unaudited)
                       
      2015 2016      
      Q1 Q2 Q3 Q4 Q1 Q2      
GAAP net income (loss) attributable to Actua:     $ (14,765 ) $ (15,282 ) $ (13,882 ) $ (52,151 ) $ (14,331 ) $ (12,741 )      
Add back:                      
Share-based compensation     7,222   7,121   6,661   $ 6,030   5,043   4,082        
Amortization of intangibles     4,016   3,706   3,728   3,801   4,064   4,108        
Impairment related and other costs     532   663   228   39,155   231   117        
Transaction expenses     70   180   108   —   92   209        
Other (income) loss, net     (1,537 ) 425   144   (204 ) 156   67        
Acquired businesses' deferred revenue     677   678   557   505   476   483        
Impact of non-cash income tax benefit items     34   —   —   —   —   88        
Non-GAAP net income (loss)     $ (3,751 ) $ (2,509 ) $ (2,456 ) $ (2,864 ) $ (4,269 ) $ (3,587 )      
                       
                       
GAAP net income (loss) per diluted share:     $ (0.40 ) $ (0.41 ) $ (0.37 ) $ (1.40 ) $ (0.38 ) $ (0.35 )      
Add back:                      
Share-based compensation     0.20   0.19   0.18   0.16   0.14   0.11        
Amortization of intangibles     0.11   0.10   0.10   0.10   0.11   0.11        
Impairment related and other costs     0.01   0.02   0.01   1.05   0.01   0.01        
Transaction expenses     —   —   —   —   —   0.01        
Other (income) loss, net     (0.04 ) 0.01   —   (0.01 ) —   —        
Acquired businesses' deferred revenue     0.02   0.02   0.01   0.01   0.01   0.01        
Impact of non-cash income tax benefit items     —   —   —   —   —   —        
Non-GAAP net income (loss) per diluted share     $ (0.10 ) $ (0.07 ) $ (0.07 ) $ (0.08 ) $ (0.11 ) $ (0.10 )      
                       
Shares used in calculation of GAAP net income (loss) per share attributable to Actua:                      
Basic     36,842   37,123   37,146   37,190   37,293   36,760        
Diluted     36,842   37,123   37,146   37,190   37,293   36,760        
                       
Shares used in calculation of non-GAAP net income (loss) per share attributable to Actua:                      
Basic     36,842   37,123   37,146   37,190   37,293   36,760        
Diluted     36,842   37,123   37,146   37,190   37,293   36,760        
 
Actua Corporation
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures (Continued)
(In thousands, except per share data)
(Unaudited)
                     
      2015 2016    
      Q1 Q2 Q3 Q4 Q1 Q2    
GAAP net income (loss) attributable to Actua:     $ (14,765 ) $ (15,282 ) $ (13,882 ) $ (52,151 ) $ (14,331 ) $ (12,741 )    
Add back:                    
Share-based compensation     7,222   7,121   6,661   $ 6,030   5,043   4,082      
Amortization of intangibles     4,016   3,706   3,728   3,801   4,064   4,108      
Impairment related and other costs     532   663   228   39,155   231   117      
Transaction expenses     70   180   108   —   92   209      
Other (income) loss, net     (1,537 ) 425   144   (204 ) 156   67      
Acquired businesses' deferred revenue     677   678   557   505   476   483      
Impact of non-cash income tax benefit items     34   —   —   —   —   88      
Interest expense (income), net     18   (4 ) 2   2   (2 ) 32      
Income tax expense (current/cash only)     143   1   41   41   3   137      
Depreciation     1,224   1,123   1,076   1,072   878   1,009      
Adjusted EBITDA     $ (2,366 ) $ (1,389 ) $ (1,337 ) $ (1,749 ) $ (3,390 ) $ (2,409 )    
                     
GAAP Cost of revenue     $ 9,732   $ 9,783   $ 9,627   $ 10,087   $ 10,192   $ 10,840      
Share-based compensation     26   $ 29   $ 48   $ 54   41   31      
Adjusted Cost of revenue     $ 9,706   $ 9,754   $ 9,579   $ 10,033   $ 10,151   $ 10,809      
                     
GAAP Sales and marketing     $ 11,236   $ 12,163   $ 12,945   $ 12,070   $ 13,159   $ 13,808      
Share-based compensation     58   79   173   118   104   88      
Adjusted Sales and marketing     $ 11,178   $ 12,084   $ 12,772   $ 11,952   $ 13,055   $ 13,720      
                     
GAAP General and administrative     $ 15,436   $ 15,966   $ 14,440   $ 16,015   $ 14,496   $ 13,561      
Share-based compensation     7,093   6,887   6,270   5,717   4,774   3,851      
Adjusted General and administrative     $ 8,343   $ 9,079   $ 8,170   $ 10,298   $ 9,722   $ 9,710      
                     
GAAP Research and development     $ 7,093   $ 7,373   $ 7,612   $ 7,090   $ 7,550   $ 7,653      
Share-based compensation     45   126   170   141   124   112      
Adjusted Research and development     $ 7,048   $ 7,247   $ 7,442   $ 6,949   $ 7,426   $ 7,541      
                     
GAAP Cash flows provided by (used in) operating activities     $ (4,406 ) $ 994   $ (1,687 ) $ 4,539   $ (13,164 ) $ 1,458      
Impairment related and other costs     26   127   36   108   275   955      
Transaction expenses     81   125   52   94   —   232      
Adjusted Cash flows provided by (used in) operating activities     $ (4,299 ) $ 1,246   $ (1,599 ) $ 4,741   $ (12,889 ) $ 2,645