Release Details

NEW YORK, Feb. 21, 2013 /PRNewswire/ -- Shutterstock, Inc. (NYSE: SSTK) a leading global provider of commercial digital imagery, today announced financial results for the fourth quarter and full year ended December 31, 2012.  

(Logo: http://photos.prnewswire.com/prnh/20120514/NY06418LOGO )

"Our fourth quarter results capped a very strong year for Shutterstock," said Founder and CEO Jon Oringer. "We are very pleased with our progress on product innovation, global market penetration and financial performance over the course of 2012."

Operating Metrics

Revenue

Revenue for the fourth quarter was $49.2 million, a 42% increase from the fourth quarter of 2011.  Revenue for the full year was $169.6 million, a 41% increase from 2011. 

Net Income

Net income for the fourth quarter of 2012 was $29.0 million as compared to $5.8 million in the fourth quarter of 2011. Net income available to common shareholders/members for the fourth quarter of 2012 was $28.7 million or $0.88 per share on a fully diluted basis as compared to $4.3 million or $0.21 per share on a fully diluted basis in the fourth quarter of 2011.

Net income for the full year 2012 was $47.5 million as compared to $21.9 million in 2011.  Net income available to shareholders/common members for the full year was $42.6 million or $1.79 per share on a fully diluted basis as compared to $13.4 million or $0.64 per share on a fully diluted basis in 2011.

Both net income and net income available to common shareholders/members for the fourth quarter and the full year include a one-time tax benefit of $28.8 million related to the Company's reorganization from an LLC to a C-corporation on October 5, 2012.

Non-GAAP net income for the fourth quarter of 2012 was $6.6 million as compared to $6.5 million in the fourth quarter of 2011. Non-GAAP net income for the full year of 2012 was $28.0 million as compared to $23.9 million in 2011.

Non-GAAP net income excludes a one-time tax benefit related to the Company's reorganization from an LLC to a C-corporation on October 5, 2012, non-cash equity based compensation expense and the tax benefit for deductible non-cash equity based compensation. 

Adjusted EBITDA

Adjusted EBITDA for the fourth quarter of 2012 was $11.3 million as compared to $7.3 million in the fourth quarter of 2011.  Adjusted EBITDA for the full year 2012 was $34.9 million as compared to $26.5 million in 2011.

Cash

The Company's cash balance was $102.1 million at December 31, 2012 as compared to $14.1 million as of December 31, 2011.  The Company also had short-term debt of $6.0 million and no long-term debt as of December 31, 2012.  The Company generated $12.6 million of cash from operations in the fourth quarter of 2012 and $45.5 million of cash from operations in the full year 2012. 

Also, during the fourth quarter, the Company incurred planned capital expenditures related primarily to the purchase of computer servers and networking equipment, and to a lesser extent leasehold improvements and patent acquisitions, resulting in a cash outlay of approximately $0.6 million. Cash outlays in this category for the full year of 2012 totaled $4.1 million.

Free cash flow for the fourth quarter of 2012 was $12.1 million as compared to $9.4 million in the fourth quarter of 2011.  Free cash flow for the full year of 2012 was $41.5 million as compared to $36.1 million in 2011.

On October 16, 2012, the Company completed an initial public offering that resulted in net proceeds to the Company of $81.8 million after deducting underwriting discounts and commissions. 

Financial Outlook

The Company's current financial and operating expectations for the first quarter of 2013 and full year 2013 are as follows:

First Quarter 2013

• Revenue of $48.5 - $50.5 million
• Adjusted EBITDA of $9.0 - $10.0 million
• Non-cash equity-based compensation expense of approximately $2 million
• An effective tax rate of approximately 40%

Full Year 2013

• We are increasing our expectations for revenue to $213 - $219 million
• We are increasing our expectations for adjusted EBITDA to $44.0 - $46.5 million
• Non-cash equity-based compensation expense of approximately $8 million
• An effective tax rate of approximately 40%
• Capital expenditures related to network servers and technology of approximately $5 million
• Capital expenditures for leasehold improvements related to a headquarters office expansion/relocation of approximately $6 million

Earnings Teleconference Information

The Company will discuss its fourth quarter and full year 2012 financial results during a teleconference today, February 21, 2013, at 5:00 PM ET.  The conference call can be accessed at (888) 396-2298 or (617) 847-8708 (outside the US), conference ID# 220 161 30.  The call will also be broadcast simultaneously at http://investor.shutterstock.com.

Following completion of the call, a recorded replay of the webcast will be available on Shutterstock's website.  To listen to the telephone replay, call toll-free (888) 286-8010 or (617) 801-6888 (outside the US), conference ID# 854 040 29. The telephone replay will be available from 7:00 PM ET February 21 through March 7, 2013.  Additional investor information can be accessed at http://shutterstock.com.            

Non-GAAP Financial Measures

Shutterstock considers adjusted EBITDA, non-GAAP net income, and free cash flow to be important financial indicators of the Company's operational strength and the performance of its business. Shutterstock defines adjusted EBITDA as earnings adjusted for interest income/(expense), income taxes, depreciation, amortization and non-cash equity based compensation; non-GAAP net income is net income excluding a one-time tax benefit due to a reorganization to a corporation, non-cash equity based compensation and the tax benefit for deductible non-cash equity based compensation; and free cash flow as cash provided by (used in) operating activities adjusted for capital expenditures and interest income/(expense). These figures are non-GAAP financial measures and should be considered in addition to results prepared in accordance with generally accepted accounting principles (GAAP), and should not be considered as a substitute for, or superior to, GAAP results. In addition, adjusted EBITDA, non-GAAP net income, and free cash flow should not be construed as indicators of our operating performance, liquidity or cash flows generated by operating, investing and financing activities, as there may be significant factors or trends that they fail to address. We caution investors that non-GAAP financial information, by its nature, departs from traditional accounting conventions; accordingly, its use can make it difficult to compare our current results with our results from other reporting periods and with the results of other companies.

A reconciliation of the differences between adjusted EBITDA, non-GAAP net income, and free cash flow, and the most comparable financial measure calculated and presented in accordance with GAAP, is presented under the heading "Reconciliation of Non-GAAP Financial Information to GAAP" immediately following the  Consolidated Statements of Cash Flows included below.

Historical Operating Metrics

Non-Cash Equity Based Compensation

Included in the accompanying financial results are expenses related to non-cash equity based compensation, as follows (in thousands):

Amortization of Intangible Assets and Depreciation

Included in the accompanying financial results are expenses related to the amortization of intangible assets, as follows (in thousands):

Included in the accompanying financial results are expenses related to depreciation, as follows (in thousands):

About Shutterstock

Shutterstock is a leading global provider of high-quality licensed photographs, vectors, illustrations and videos to businesses, marketing agencies and media organizations around the world. Headquartered in New York City, Shutterstock works closely with its growing contributor community of photographers, videographers, illustrators and designers to curate a global marketplace for royalty-free imagery. Shutterstock adds tens of thousands of rights-cleared images each week, and with more than 23 million images currently available, the Company recently surpassed 250 million image downloads. Shutterstock also owns Bigstock, a value-oriented stock media agency.

For more information, please visit http://www.shutterstock.com, and follow Shutterstock on Twitter or on Facebook.

Safe Harbor Provision

The statements contained in this press release that are not purely historical are forward looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, including statements regarding the Company's expectations, predictions, beliefs, hopes, intentions or strategies regarding the future.  Forward looking statements include statements regarding the Company's business strategy, timing of, and plans for, the introduction of new products and enhancements, future sales, market growth and direction, competition, market share, revenue growth, operating margins and profitability.  All forward looking statements included in this document are based upon information available to the Company as of the date hereof.  Actual events or results could differ materially from those contained in the Company's current projections or forward-looking statements. It is routine for internal projections and expectations to change as the quarter progresses, and therefore it should be clearly understood that the internal projections and beliefs upon which the Company bases its expectations may change prior to the end of the quarter. Although these expectations may change, the Company assumes no obligation to update any such forward looking statement, whether as a result of new information, future developments or otherwise.  Factors that could cause or contribute to such differences include the Company's inability to continue to attract customers and contributors to its online marketplace for commercial digital imagery; a decrease in repeat customer purchases; a reduction in customer spending; a decrease in contributor participation in the Company's marketplace; the Company's inability to evaluate its future prospects; competitive factors; the Company's inability to prevent the misuse of its imagery; assertions by third parties of infringement or other violations of intellectual property rights by the Company; the Company's inability to increase market awareness of the Company and its services; the Company's inability to increase the percentage of its revenues that come from larger companies; the Company's inability to effectively manage its growth; the Company's inability to continue expansion into international markets; failure to respond to technological changes or upgrade the Company's website and technology systems; failure to adequately protect the Company's intellectual property; general economic conditions worldwide; and other factors and risks discussed in the section entitled "Risk Factors" in the Company's latest Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 20, 2012 and other reports filed by the Company from time to time with the Securities and Exchange Commission.  Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995.

 

 

 

SOURCE Shutterstock, Inc.

Meagan Kirkpatrick, Shutterstock, Inc., +1-646-402-2854, mkirkpatrick@shutterstock.com; or Denise Garcia, ICR, denise.garcia@icrinc.com