YNOT – Within 24 hours after FriendFinder Networks released its second quarter earnings statement, shares plunged 70 cents to $3.30 before rallying to close Tuesday at $3.37 — a daily loss of 63 cents, or 15.75 percent. Analysts blame the tumble on what several called “disappointing” earnings during the company’s first quarter on the NASDAQ. FFN’s initial public offering opened in May at $10 per share, generating $50 million.
On Monday, the company posted Q2 revenue of $83.37 million and a loss of $11.9 million, or 55 cents per share. FFN attributed a $7.3 million chunk of the loss to early retirement of debt and $5 million in legal settlement expenses. Analysts had predicted revenues of $87.1 million and a profit of 14 cents per share.
Instead, Q2 revenue slipped slightly from the $84.6 million the company reported for the same period in 2010, pre-IPO.
In a prepared statement, FFN noted income from operations increased 15.2 percent year-over-year to $18 million. Adjusted income before interest, taxes, depreciation and amortization (EBITDA) increased 14.5 percent year-over-year to $27.0 million, the statement indicated.
“We are pleased with our second quarter financial performance and our ability to increase income from operations and adjusted EBITDA,” FFN Chief Executive Officer Marc Bell said. “Additionally, we achieved free cash flow per common share of 72 cents in the second quarter. We continued to seek efficiencies in our affiliate spending, which resulted in gross profit margin of 70 percent, an increase from 66.7 percent in the same period in 2010. We increased the average monthly revenue per user 4.2 percnt and the average lifetime net revenue per user 10.6 percent. In addition, we have paid down $58.2 million in debt since the end of the first quarter.
“In August we announced our first acquisition as a public company, PerfectMatch.com, which provides us with an opportunity to increase our presence in the general audience networking arena,” Bell added. “We remain committed to focusing our efforts on revenue growth, both organically and through acquisitions. Organically, we are working on solutions that will increase our subscriber base in an economically viable way and continuing to pursue strategic acquisitions that complement our already substantial user base.”
For more about FriendFinder Networks Inc., parent company of Penthouse Media Group and other adult operating units, visit FFN.com.
