"Return to positive cash flow from operations in the second quarter, and steady cash flow growth through the remainder of the year. We expect at least $5 million in Adjusted Net Income for 2013,” added Ken Cragun, Local Corporation chief financial officer."
Sentiment: Strong Buy
"As a result of cost cutting in Jannuary and improving margins, we expect to swing to adjusted net inocme in the first quarter, followed by a return to positive cash flow in the second quarter of 2013 and steady cash flow growth troughout geh remainder of the year.
Source: Transcript of Conference Calll on Seeeking Alpha - Read more on this source.
shame he didn't figure out the cost of a direct sales force before he hired them and then had to fire them and pay them severance. OTJ training on Flanky's dime (or $1 million per year in the case of Heath, counting his "retention bonus").
= 50% Organic Traffic
= 50% Organic Revenue
Development of Organic Traffic/Monthly Unique Visitors (MUVs):
2010: 88 million = 31% of total traffic
2011: 117 million = 33% of total traffic
2012: 155 million = 37% of total traffic
Goal: 50% of total traffic
Development of Organic Revenues
2010: 17 million = 20% of total revenues
2011: 22 million = 28% of total revenues
2012: 29 million = 30% of total revenues
Goal: 50% of total revenues
Net Income-Driver in 2013: Progress on the way to 50/50 - More than doubling of Launch by Local-Subscriptions: After my esttimates the subscritptions of Lauch by Local for $249/month (Propel-Package) will increase from 31/12/2012 to 31/12/2013 from 1,100 to 3,000. And the Ignite-Package for $99 will reach 2,000 subsricbers.
Estimated Proforma Margin Impact (Source: Last Presentation IV/2012)
70% SEM/Third Party advertiser revenue and 30% Organic/Direct Revenue
Results: Gross Margin = 30% of revenues, Adjusted Net Income = 4% of revenues
50% SEM/Third Party advertiser revenue and 50% Organic/Direct Revenue
Results: Gross Margin = 44% of revenues, Adjusted Net Income = 17% of revenues
Net Income-Driver Verticals: Advertisers will pay premium rates to get in front of this targeted audience: Local Corp is leveraging its core business of reaching a million local Internet users per day, by launching a series of different trade websites that help people find information on a specific topic or local business to meet their needs. The first one recently launched is in auto insurance. Consumers will be happy with the abundance of information they find. Advertisers, who spend a reported $5.3 billion in the auto insurance category, will pay premium rates to get in front of this targeted audience
Full Year 2010 Results Highlights:
- Revenue - Revenue was $84.1 million for the year ended December 31, 2010, which represents a 49.5% increase over $56.3 million in 2009.
- GAAP Net Income (Loss) - GAAP net income was $4.2 million or $0.25 per diluted share for the year ended December 31, 2010. This compares to a GAAP net loss of $6.3 million or ($0.44) per diluted share for the year ended December 31, 2009. Fiscal year 2010 and 2009 GAAP net income (loss) included a gain (loss) on warrant revaluation of $887,000 and ($3.0) million or $0.05 and ($0.21) per diluted share, respectively.
- Adjusted Net Income - Adjusted Net Income was $13.8 million or $0.82 per diluted share for the year ended December 31, 2010. This compares to Adjusted Net Income of $3.0 million or $0.21 per diluted share for the year ended December 31, 2009.
Material challenges over past 2 years in 2011 and 2012 after a good 2009 (Adjusted Net Income was $ 3.0 million) and an excellent 2010 (Adjusted Net Income was $13.8 million) - And Local Corp posted two weeks ago an overview to the SEC, where Local Corp reported, that they believe the Inflection Point is now:
•Five material challenges in 24 months withstood
»Significant cost to the company in revenue and earnings
•Highest revenue per employee ever
»Projected growth to about $900k per employee by EOY 2013
•Returning to profit
»Significant cost savings starting 1Q13
»Projecting 1Q13 Adjusted Net Income
»Forecasting positive cash from operations from 2Q13 onwards
Sentiment: Strong Buy
This strategy reduce the riscs, but reduce the chance for a 20-bagger - but Flankenking is happy about a 10-bagger and a share-price of $16 in 12 month, too.
By a share-price of $16 the 70,650 shares of Flankenking would have a value of $1,130,400.
Sentiment: Strong Buy