TORONTO, Wednesday, August 10, 2016 – Mood Media Corporation (“Mood Media,” “Mood” or “the Company”) (TSX:MM), the global leader in elevating Customer Experiences, today reported results for its second quarter of 2016 and provided an update on the Company’s progress executing against its strategic and operational plans.
Recent Highlights
- In the second quarter of 2016, Mood reported revenues of $119.7 million, up 1.7% relative to prior year’s second quarter. Mood reported revenue growth in its In-Store Media operations in North America and International, and at BIS.
- Mood recurring revenues reached $62.3 million in the second quarter, increasing relative to its first quarter results. Mood has grown its recurring revenues on a quarter over quarter basis in two of its most recent three quarters and its North American operation has grown recurring revenues sequentially in five its most recent six quarters. Relative to prior year, underlying recurring revenues remained relatively stable with the North American segment growing recurring revenue and International declining slightly.
- Mood’s key performance indicators show increasing traction from gains in sales and operating performance. Gross site additions in the second quarter rose by 18% relative to the same quarter of the prior year with North America recording its best second quarter gross addition performance since 2012 and International recording its best overall quarterly gross site addition result since 2012. Underlying blended ARPU declined by 1.3% relative to the prior year with North America core audio ARPU remaining stable and International ARPU declining slightly.
- Mood EBITDA in the second quarter remained essentially stable relative to the prior year at $24.9 million. Mood In-Store Media operations in North America, International and BIS each grew EBITDA. Technomedia EBITDA declined, although sales wins and cost savings are expected to improve its performance in the second half of 2016. In aggregate, the North American, International & BIS operations grew EBITDA by 3.5% relative to prior year on an underlying basis.
- The Company’s 2016 global transformation, integration and consolidation initiatives are on target, with Mood delivering incremental annualized efficiencies of more than $6 million from Wave 4 & 5 of its integration and synergy program. The Company has estimated the initial scope of estimated savings related to its Wave 6 activities to be approximately $3 million in 2017, raising the total annualized transformation savings delivered since the programs began in the fourth quarter of 2013 to more than $28 million.
- Mood reaffirms guidance for 2016. Mood expects to achieve stable 2016 EBITDA relative to 2015, and positive free cash flow generation. Mood’s first half results have been in line with its expectations. Second half 2016 free cash flow when compared to first half is expected to benefit from improvements in EBITDA reflecting sales and operating gains and improvements in working capital.
“Our second quarter recurring revenue momentum was the strongest Mood performance since our businesses were put together in 2012. Our key North American division grew recurring revenues on a year over year basis and has grown revenues on a sequential basis in five of the last six quarters, reflecting organizational, sales and operating enhancements. These improvements produced North America’s best second quarter gross site additions since 2012. Furthermore, Mood International sales and recurring revenue performance are also showing marked improvements. Mood International recorded
“Mood is making significant strides in its transformation, on key measures of ARPU stabilization, recurring and partnership revenues, equipment and labor revenue growth, gross site additions, margin protection, cost reductions, and cash flow enhancements”, said Steve Richards, President and CEO of Mood Media. “All of these steps give us great satisfaction as we move closer to the Mood goal of achieving overall recurring revenue growth as a total Mood enterprise.”
its best quarter gross site additions since 2012. Their accomplishments give us confidence that we will achieve our financial and operating goals for 2016, and they present a strong foundation for further expected gains in 2017 and beyond.”
“Our transformation and investment activities are making a tangible positive impact on our growth momentum through enhanced Local inside and field sales, acceleration in Premier and System sales, as well as through encouraging progress with partner and marketing initiatives. The wide array of improvements and consistent positive momentum are very encouraging. We continue to achieve process efficiency gains and are finalizing our 2017 Wave 6 plans that target $3 million in incremental reductions.”
We will not relent in improving all facets of business results, to further cement our position as the unquestionable global leader across this industry. Mood’s transformation is tracking nicely, and gives us great confidence for incremental gains, reduced costs, increased efficiencies, and future enhancements to Mood stakeholder value”, concluded Mr. Richards.