Company News

Dex Media Announces Second Quarter 2013 Earnings

By Thryv Contributor | 08.07.13 | 9 min read

DALLAS, Aug. 7, 2013 – Dex Media, Inc. (NASDAQ:DXM), one of the largest national providers of social, local and mobile marketing solutions through direct relationships with local businesses, today announced financial results for the second quarter and year to date ending June 30, 2013. Dex Media was formed through the merger of Dex One Corporation (“Dex One”) and SuperMedia, Inc. (“SuperMedia”), completed on April 30, 2013. “As we integrate operations, we are implementing best practices to improve our long-term relationships with clients by providing a full range of local marketing solutions,” said Peter McDonald, president and CEO of Dex Media. “Improving revenue performance by providing more value for existing and new clients is a key priority.”

2013 Second Quarter and Year to Date Results 

$ in millions
GAAP Reporting


YTD ’13

Operating Revenue

$ 345

$ 633

Operating (Loss)

$ (136)

$ (117)

Net (Loss)

$ (68)

$ (127)

Non-GAAP Reporting


YTD ’13

Pro-forma Operating Revenue¹

$ 568

$ 1,149

Adjusted Pro forma EBITDA¹

$ 224

$ 454

Adjusted Pro forma EBITDA margin¹



Advertising Sales²









¹These represent non-GAAP measures. Pro forma Operating Revenue includes Dex One and SuperMedia operating revenue as if the merger had occurred prior to 2012 and excludes the impact of acquisition accounting, as required by U.S. GAAP. Adjusted Pro forma EBITDA represents earnings before interest; taxes; depreciation and amortization; gains on early extinguishment of debt; and other nonrecurring items, including reorganization items, merger transaction costs, merger integration costs, severance costs, and the amortization of other post-employment benefits. Adjusted Pro forma EBITDA includes Dex One and SuperMedia EBITDA as if the merger had occurred prior to 2012; and excludes the impact of acquisition accounting, as required by U.S. GAAP. Adjusted Pro forma EBITDA margin is calculated by dividing Adjusted Pro forma EBITDA by Pro forma Operating Revenue. ² Advertising sales is an operating measure which represents the annual contract value of print directories published and digital contracts sold. It is important to distinguish advertising sales from revenue, which under U.S. GAAP are recognized under the deferral and amortization method. Advertising sales are a leading indicator of revenue recognition and are presented on a combined basis, including both Dex One and SuperMedia, for the three and six months ended June 30, 2013 and 2012. Pro-forma free cash flow, a non-GAAP measure, was $176 million for the six months ended June 30. These results are net of $20 million integration costs and $30 million of merger transaction costs. Dex Media and its predecessor companies have repaid $209 million of debt year to date through the second quarter. The company had a cash balance of $244 million as of June 30.

Acquisition Accounting Statement

On April 30, 2013, the merger of Dex One and SuperMedia was consummated, with 100% of the equity of SuperMedia being exchanged for equity in Dex Media. We accounted for the business combination using the acquisition method of accounting, with Dex One identified as the acquiring entity for accounting purposes. As a result of the acquisition of SuperMedia, our U.S. GAAP results for the three and six months ended June 30, 2013 include the operating results of SuperMedia from May 1, 2013 through June 30, 2013. The historical results of SuperMedia for April 2013 and prior periods have not been included. Prior to the merger with Dex One, SuperMedia had deferred revenue and deferred directory costs on its consolidated balance sheet. These amounts represented future revenue and cost that would have been amortized by SuperMedia from May 2013 through April 2014 that will not be recognized by Dex Media. As a result of acquisition accounting, the fair value of deferred revenue and deferred directory costs was determined to have no future value, thus were not recognized in the operating results of Dex Media. The exclusion of these items from our operating results did not have any impact on the cash flows of Dex Media. See the attached schedules and our quarterly filing on Form 10-Q for additional information on the merger and the financial impacts on our results.

Earnings Call and Webcast Information

Dex Media will host an investor call at 10 a.m. EDT today. Individuals within the United States can access today’s call by dialing 888-603-6873. International participants should dial 973-582-2706. The pass code for the call is: 19149862. In order to ensure a prompt start time, please dial into the call by 9:50 a.m. EDT. A replay of the teleconference will be available at 800-585-8367. International callers can access the replay by calling 404-537-3406. The replay pass code is: 19149862. The replay will be available through Aug 21, 2013. In addition, a live Web cast will be available on Dex Media’s Web site in the Investor Relations section at

Basis of Presentation and Non-GAAP Financial Measures

The financial information accompanying this release provides a reconciliation of U.S. GAAP to non-GAAP and adjusted pro-forma non-GAAP results. Dex Media believes that the use of non-GAAP financial measures provides useful information to investors to gain an overall understanding of its current financial performance. Specifically, Dex Media believes the non-GAAP results provide useful information to management and investors by excluding certain nonrecurring items that Dex Media believes are not indicative of its core operating results. In addition, non-GAAP financial measures are used by management for budgeting and forecasting as well as subsequently measuring Dex Media’s performance, and Dex Media believes that non-GAAP results provide investors with financial measures that most closely align to its internal financial measurement processes.

Forward-Looking Statements

Some statements included in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the federal securities laws. Statements that include the words “may,” “will,” “could,” “should,” “would,” “believe,” “anticipate,” “forecast,” “estimate,” “expect,” “preliminary,” “intend,” “plan,” “project,” “outlook” and similar statements of a future or forward-looking nature identify forward-looking statements. You should not place undue reliance on these statements. These forward-looking statements include statements that reflect the current views of our senior management with respect to our financial performance and future events with respect to our business and industry in general. Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the risks related to the following:

  • the risk that anticipated cost savings, growth opportunities and other financial and operating benefits as a result of the merger of Dex One and SuperMedia may not be realized or may take longer to realize than expected;
  • the risk that benefits from the transaction may be significantly offset by costs incurred in integrating SuperMedia and Dex One operations;
  • difficulties with the process of integrating the operations of SuperMedia and Dex One, including: coordinating geographically separate organizations; integrating business cultures, which could prove to be incompatible; difficulties and costs of integrating information technology systems; and the potential difficulty in retaining key officers and personnel;
  • our inability to provide assurance for the long-term continued viability of our business;
  • reduced advertising spending and increased contract cancellations by our clients, which causes reduced revenue;
  • declining use of print yellow pages directories by consumers;
  • competition from other yellow pages directory publishers and other traditional and new media including increased competition from existing and emerging digital technologies;
  • our ability to collect trade receivables from customers to whom we extend credit;
  • our ability to anticipate or respond to changes in technology and user preferences;
  • changes in our operating performance;
  • limitations on our operating and strategic flexibility and the ability to operate our business, finance our capital needs or expand business strategies under the terms of our credit facilities;
  • failure to comply with the financial covenants and other restrictive covenants in our credit facilities;
  • limited access to capital markets and increased borrowing costs resulting from our leveraged capital structure and debt ratings;
  • changes in our credit rating;
  • changes in the availability and cost of paper and other raw materials used to print our directories;
  • our reliance on third-party providers for printing, publishing and distribution services;
  • our ability to maintain agreements with major internet search and local media companies;
  • credit risk associated with our reliance on small- and medium-sized businesses as clients;
  • our ability to attract and retain qualified key personnel;
  • our ability to maintain good relations with our unionized employees;
  • changes in labor, business, political and economic conditions;
  • changes in governmental regulations and policies and actions of federal, state and local municipalities impacting our businesses;
  • the outcome of pending or future litigation and other claims; and
  • other events beyond our control that may result in unexpected adverse operating results.

The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in periodic reports we file with the Securities and Exchange Commission, including the information and risk factors in “Item 1A. Risk Factors” in Part I of the Annual Report on Form 10-K for the year ended December 31, 2012 filed by Dex One. If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. All forward-looking statements included in this release are expressly qualified in their entirety by these cautionary statements. The forward-looking statements speak only as of the date made and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Dex Media

Dex Media (NASDAQ: DXM) provides local, social and mobile marketing solutions to businesses in communities across the U.S. under the Dex One and SuperMedia brands. The company’s widely used consumer services include the®® online and mobile search portals and applications and local print directories.

Source: Dex Media, Inc.