Bankrate.com Financial Info [UPDATE]
- This was for the second quarter of 2009.
- Overall revenue was down 23 percent, from $40.2 million to $31.0 million. Online revenue was down 23 percent to $29.0 million, which also shows that the bulk of its money -- 93.5 percent -- comes from online.
- Net income was down even more sharply, from $4.1 million to $1.9 million, or roughly 53.7 percent.
- Company CEO Thomas Evans blamed it on "macroeconomic conditions." Translated, it means that financial advertising, particularly in the banking, mortgage, and credit card channels, is still way off of normal. The question is whether this is the new normal.
- There is cash or cash equivalents of over $55 million and quarterly expenses run around $15 million. Normally you'd want to see a much bigger amount of money tucked away so the company could ride out longer than, say, a year, but there is still plenty of cash to pay people, so seeing delays in payment wouldn't be reasonable. (And to be clear, I'm not suggesting that anyone is reporting delayed payment. But it's good information to keep in your back pocket in any negotiation.)
The acquisition also shows the value of intellectual property (IP) like copyright and why companies push so hard to own it. The IP because a major asset that is worth money. In this case, the Bankrate.com shareholders are going to get $28.50 a share in cash, or $571 million it total. Companies know damned well what they're asking for when they want articles under a WMFH basis. They're taking the value out of your pocket so they can put it in theirs. Don't forget that when you're negotiating price.
[Update: Check the comments on this post. One reader pointed out that according to the SEC documents about the deal, much of the cash on hand will go to fees incurred to conduct the deal. That would have some predictable ramifications for the time it will take to get paid.]