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LendingTree Reports Second Quarter 2020 Results | News

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CHARLOTTE, N.C., Aug. 4, 2020 /PRNewswire/ — LendingTree, Inc. (NASDAQ: TREE), operator of LendingTree.com, the nation’s leading online financial services marketplace, today announced results for the quarter ended June 30, 2020.

The company has posted a letter to shareholders on the company’s website at investors.lendingtree.com.

“Despite the challenging backdrop, our team executed incredibly well in the second quarter,” said Doug Lebda, Chairman & CEO.  “While our business has not been immune to effects of the current environment, it has certainly proven resilient.  We believe times like these tend to separate the leaders from the pack, and we’re confident that our market-leading position should enable to us to reap the benefits of an accelerating digital transformation in consumer finance.”

J.D. Moriarty, CFO, added, “Our second quarter results are a testament to the durability of our business.  While some of our businesses are being tested, others are thriving and we continue to generate significant cash flows.  In addition, our balance sheet is incredibly healthy, and we remain focused on leveraging our market-leading position to propel the company forward.”

Second Quarter 2020 Business Highlights 

  • Home segment revenue of $74.1 million and segment profit of $38.7 million grew 3% and 60%, respectively, over second quarter 2019.
    • Within Home, mortgage products revenue grew 22% over the prior year period.
  • Insurance revenue of $72.9 million grew 1% over second quarter 2019 and translated into Insurance segment profit of $30.1 million, up 5% over the same period.
  • Consumer segment revenue of $37.1 million decreased 71% over second quarter 2019, driven by the impact of COVID-19, the ensuing economic recession, and the corresponding tightening of credit among our lender partners.
    • Within Consumer, credit card revenue of $7.2 million decreased 87% year-over-year.
    • Personal loans revenue of $8.8 million decreased 79% year-over-year.
    • Small business revenue declined 82% year-over-year.
  • Through June 30, 15.2 million consumers have signed up for My LendingTree.

 

LendingTree Summary Financial Metrics

(In millions, except per share amounts)

Three Months Ended
June 30,

Y/Y

Three Months Ended
March 31,

Q/Q

2020

2019

% Change

2020

% Change

Total revenue

$

184.3

$

278.4

(34)

%

$

283.1

(35)

%

(Loss) income before income taxes

$

(12.5)

$

7.3

(271)

%

15.9

(179)

%

Income tax benefit

3.9

5.7

(32)

%

3.1

26

%

Net (loss) income from continuing
operations

$

(8.6)

$

13.0

(166)

%

$

19.0

(145)

%

Net (loss) income from continuing
operations % of revenue

(5)

%

5

%

7

%

(Loss) income per share from continuing
operations

Basic

$

(0.66)

$

1.01

(165)

%

$

1.46

(145)

%

Diluted

$

(0.66)

$

0.87

(176)

%

$

1.34

(149)

%

Variable marketing margin

Total revenue

$

184.3

$

278.4

(34)

%

$

283.1

(35)

%

Variable marketing expense (1) (2)

$

(101.8)

$

(184.6)

(45)

%

$

(184.9)

(45)

%

Variable marketing margin (2)

$

82.5

$

93.8

(12)

%

$

98.2

(16)

%

Variable marketing margin % of revenue (2)

45

%

34

%

35

%

Adjusted EBITDA (2)

$

30.8

$

46.3

(33)

%

$

44.9

(31)

%

Adjusted EBITDA % of revenue (2)

17

%

17

%

16

%

Adjusted net income (2)

$

6.4

$

17.6

(64)

%

$

17.1

(63)

%

Adjusted net income per share (2)

$

0.46

$

1.18

(61)

%

$

1.20

(62)

%

(1)

Represents the portion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing and related
expenses. Also includes the portion of cost of revenue attributable to costs paid for advertising re-sold to third parties. Excludes
overhead, fixed costs and personnel-related expenses.

(2)

Variable marketing expense, variable marketing margin, variable marketing margin % of revenue, adjusted EBITDA, adjusted
EBITDA % of revenue, adjusted net income and adjusted net income per share are non-GAAP measures. Please see “LendingTree’s
Reconciliation of Non-GAAP Measures to GAAP” and “LendingTree’s Principles of Financial Reporting” below for more information.

 

 

LendingTree Segment Results

(In millions)

Three Months Ended
June 30,

Y/Y

Three Months Ended
March 31,

Q/Q

2020

2019

% Change

2020

% Change

Home (1)

Revenue

$

74.1

$

71.8

3

%

$

79.2

(6)

%

Segment profit

$

38.7

$

24.2

60

%

$

35.9

8

%

Segment profit % of revenue

52

%

34

%

45

%

Consumer (2)

Revenue

$

37.1

$

129.0

(71)

%

$

119.9

(69)

%

Segment profit

$

19.4

$

50.8

(62)

%

$

43.1

(55)

%

Segment profit % of revenue

52

%

39

%

36

%

Insurance (3)

Revenue

$

72.9

$

71.9

1

%

$

82.7

(12)

%

Segment profit

$

30.1

$

28.8

5

%

$

30.5

(1)

%

Segment profit % of revenue

41

%

40

%

37

%

Other (4)

Revenue

$

0.2

$

5.8

(97)

%

$

1.2

(83)

%

Profit (loss)

$

0.1

$

0.3

(67)

%

$

(0.3)

(133)

%

Total revenue

$

184.3

$

278.4

(34)

%

$

283.1

(35)

%

Total segment profit

$

88.3

$

104.1

(15)

%

$

109.2

(19)

%

     Brand marketing expense (5)

$

(5.8)

$

(10.3)

(44)

%

$

(11.0)

(47)

%

Variable marketing margin

$

82.5

$

93.8

(12)

%

$

98.2

(16)

%

Variable marketing margin % of revenue

45

%

34

%

35

%

(1)

The Home segment includes the following products: purchase mortgage, refinance mortgage, home equity loans and lines of credit,
reverse mortgage loans, and real estate.

(2)

The Consumer segment includes the following products: credit cards, personal loans, small business loans, student loans, auto loans,
deposit accounts, and other credit products such as credit repair and debt settlement.

(3)

The Insurance segment consists of insurance quote products.

(4)

The Other category primarily includes revenue from the resale of online advertising space to third parties and revenue from home
improvement referrals, and the related variable marketing and advertising expenses.

(5)

Brand marketing expense represents the portion of selling and marketing expense attributable to variable costs paid for advertising,
direct marketing and related expenses that are not assignable to the segments’ products. This measure excludes overhead, fixed costs
and personnel-related expenses.

Business Outlook

On April 14, LendingTree withdrew its full-year 2020 guidance due to economic uncertainty related to COVID-19. Today, the company is providing revenue, variable marketing margin and adjusted EBITDA guidance for the third quarter of 2020, as follows:

For third quarter 2020:

  • Revenue is expected in the range of $200$215 million.
  • Variable marketing margin is expected in the range of $72$80 million.
  • Adjusted EBITDA is expected in the range of $16$21 million.

LendingTree is not able to provide a reconciliation of projected variable marketing margin or adjusted EBITDA to the most directly comparable expected GAAP results due to the unknown effect, timing and potential significance of the effects of legal matters, tax considerations, and income and expense from changes in fair value of contingent consideration from acquisitions. Expenses associated with legal matters, tax consequences, and income and expense from changes in fair value of contingent consideration from acquisitions have in the past, and may in the future, significantly affect GAAP results in a particular period.

Quarterly Conference Call

A conference call to discuss LendingTree’s second quarter 2020 financial results will be webcast live today, August 4, 2020 at 9:00 AM Eastern Time (ET). The live audiocast is open to the public and will be available on LendingTree’s investor relations website at investors.lendingtree.com. The call may also be accessed toll-free via phone at (877) 606-1416. Callers outside the United States and Canada may dial (707) 287-9313. Following completion of the call, a recorded replay of the webcast will be available on LendingTree’s investor relations website until 12:00 PM ET on Wednesday, August 12, 2020. To listen to the telephone replay, call toll-free (855) 859-2056 with passcode #5265009. Callers outside the United States and Canada may dial (404) 537-3406 with passcode #5265009.

 

LENDINGTREE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2020

2019

2020

2019

(in thousands, except per share amounts)

Revenue

$

184,326

$

278,421

$

467,410

$

540,811

Costs and expenses:

Cost of revenue (exclusive of depreciation and amortization shown
separately below)
(1)

13,464

16,310

27,716

33,980

Selling and marketing expense (1)

113,921

191,629

309,459

366,520

General and administrative expense (1)

28,489

27,951

60,571

59,068

Product development (1)

10,812

10,175

21,775

20,341

Depreciation

3,550

2,559

6,928

5,041

Amortization of intangibles

13,756

14,280

27,513

27,707

Change in fair value of contingent consideration

9,175

2,790

1,053

17,382

Severance

32

403

190

457

Litigation settlements and contingencies

(1,325)

8

(996)

(199)

Total costs and expenses

191,874

266,105

454,209

530,297

Operating (loss) income

(7,548)

12,316

13,201

10,514

Other (expense) income, net:

Interest expense, net

(4,955)

(5,095)

(9,789)

(10,563)

Other income

7

71

7

139

(Loss) income before income taxes

(12,496)

7,292

3,419

90

Income tax benefit

3,880

5,689

6,941

13,441

Net (loss) income from continuing operations

(8,616)

12,981

10,360

13,531

Loss from discontinued operations, net of tax

(21,141)

(763)

(25,716)

(1,825)

Net (loss) income and comprehensive (loss) income

$

(29,757)

$

12,218

$

(15,356)

$

11,706

Weighted average shares outstanding:

Basic

12,984

12,805

12,971

12,762

Diluted

12,984

14,908

13,954

14,622

(Loss) income per share from continuing operations:

Basic

$

(0.66)

$

1.01

$

0.80

$

1.06

Diluted

$

(0.66)

$

0.87

$

0.74

$

0.93

Loss per share from discontinued operations:

Basic

$

(1.63)

$

(0.06)

$

(1.98)

$

(0.14)

Diluted

$

(1.63)

$

(0.05)

$

(1.84)

$

(0.12)

Net (loss) income per share:

Basic

$

(2.29)

$

0.95

$

(1.18)

$

0.92

Diluted

$

(2.29)

$

0.82

$

(1.10)

$

0.80

(1) Amounts include non-cash compensation, as follows:

Cost of revenue

$

333

$

197

$

575

$

350

Selling and marketing expense

1,597

2,283

2,753

4,032

General and administrative expense

9,729

11,686

18,852

21,907

Product development

1,499

1,816

2,895

3,746

 

 

 

LENDINGTREE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)

June 30,
 2020

December 31,
 2019

(in thousands, except par value
and share amounts)

ASSETS:

Cash and cash equivalents

$

101,764

$

60,243

Restricted cash and cash equivalents

94

96

Accounts receivable, net

77,037

113,487

Prepaid and other current assets

25,654

15,516

Current assets of discontinued operations

84

84

Total current assets

204,633

189,426

Property and equipment, net

34,735

31,363

Operating lease right-of-use assets

87,892

25,519

Goodwill

420,139

420,139

Intangible assets, net

154,067

181,580

Deferred income tax assets

84,160

87,664

Equity investment

80,000

Other non-current assets

5,192

4,330

Non-current assets of discontinued operations

16,759

7,948

Total assets

$

1,087,577

$

947,969

LIABILITIES:

Revolving credit facility

$

130,000

$

75,000

Accounts payable, trade

8,792

2,873

Accrued expenses and other current liabilities

88,569

112,755

Current contingent consideration

19,029

9,028

Current liabilities of discontinued operations

63,006

31,050

Total current liabilities

309,396

230,706

Long-term debt

271,378

264,391

Operating lease liabilities

86,649

21,358

Non-current contingent consideration

9,488

24,436

Other non-current liabilities

4,689

4,752

Total liabilities

681,600

545,643

SHAREHOLDERS’ EQUITY:

Preferred stock $.01 par value; 5,000,000 shares authorized; none issued or outstanding

Common stock $.01 par value; 50,000,000 shares authorized; 15,730,643 and 15,676,819 shares
issued, respectively, and 13,089,325 and 13,035,501 shares outstanding, respectively

157

157

Additional paid-in capital

1,196,990

1,177,984

Accumulated deficit

(608,009)

(592,654)

Treasury stock; 2,641,318 shares

(183,161)

(183,161)

Total shareholders’ equity

405,977

402,326

Total liabilities and shareholders’ equity

$

1,087,577

$

947,969

 

 

 

LENDINGTREE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

Six Months Ended June 30,

2020

2019

(in thousands)

Cash flows from operating activities attributable to continuing operations:

Net (loss) income and comprehensive (loss) income

$

(15,356)

$

11,706

Less: Loss from discontinued operations, net of tax

25,716

1,825

Income from continuing operations

10,360

13,531

Adjustments to reconcile income from continuing operations to net cash provided by operating
activities attributable to continuing operations:

Loss (gain) on impairments and disposal of assets

552

(1,729)

Amortization of intangibles

27,513

27,707

Depreciation

6,928

5,041

Non-cash compensation expense

25,075

30,035

Deferred income taxes

(7,000)

(13,624)

Change in fair value of contingent consideration

1,053

17,382

Bad debt expense

949

1,282

Amortization of debt issuance costs

1,158

970

Amortization of convertible debt discount

6,250

5,929

Reduction in carrying amount of ROU asset, offset by change in operating lease liabilities

1,956

184

Changes in current assets and liabilities:

Accounts receivable

35,501

(48,396)

Prepaid and other current assets

1,369

(190)

Accounts payable, accrued expenses and other current liabilities

(19,134)

28,105

Current contingent consideration

(2,670)

(3,000)

Income taxes receivable

63

4,388

Other, net

(2,007)

260

Net cash provided by operating activities attributable to continuing operations

87,916

67,875

Cash flows from investing activities attributable to continuing operations:

Capital expenditures

(9,108)

(9,769)

Proceeds from sale of fixed assets

24,062

Equity investment

(80,000)

Acquisition of ValuePenguin, net of cash acquired

(105,578)

Acquisition of QuoteWizard, net of cash acquired

447

Net cash used in investing activities attributable to continuing operations

(89,108)

(90,838)

Cash flows from financing activities attributable to continuing operations:

Payments related to net-share settlement of stock-based compensation, net of proceeds from exercise of stock
options

(6,068)

(7,646)

Contingent consideration payments

(3,330)

(3,000)

Net proceeds from (repayment of) revolving credit facility

55,000

(10,000)

Payment of debt issuance costs

(306)

(31)

Purchase of treasury stock

(3,976)

Other financing activities

(14)

Net cash provided by (used in) financing activities attributable to continuing operations

45,282

(24,653)

Total cash provided by (used in) continuing operations

44,090

(47,616)

Discontinued operations:

Net cash used in operating activities attributable to discontinued operations

(2,571)

(6,152)

Total cash used in discontinued operations

(2,571)

(6,152)

Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents

41,519

(53,768)

Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period

60,339

105,158

Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period

$

101,858

$

51,390

Non-cash investing activities:

Capital additions from tenant improvement allowance

$

$

1,111

 

LENDINGTREE’S RECONCILIATION OF NON-GAAP MEASURES TO GAAP

Variable Marketing Expense

Below is a reconciliation of selling and marketing expense to variable marketing expense. See “Lending Tree’s Principles of Financial Reporting” for further discussion of the Company’s use of this non-GAAP measure.

Three Months Ended

June 30,
 2020

March 31,
 2020

June 30,
 2019

(in thousands)

Selling and marketing expense

$

113,921

$

195,538

$

191,629

Non-variable selling and marketing expense (1)

(12,091)

(11,772)

(12,079)

Cost of advertising re-sold to third parties (2)

1,086

5,053

Variable marketing expense

$

101,830

$

184,852

$

184,603

(1)

Represents the portion of selling and marketing expense not attributable to variable costs paid for advertising, direct
marketing and related expenses. Includes overhead, fixed costs and personnel-related expenses.

(2)

Represents the portion of cost of revenue attributable to costs paid for advertising re-sold to third parties. Excludes
overhead, fixed costs, and personnel-related expenses.

 

LENDINGTREE’S RECONCILIATION OF NON-GAAP MEASURES TO GAAP

Variable Marketing Margin

Below is a reconciliation of net (loss) income from continuing operations to variable marketing margin and net (loss) income from continuing operations % of revenue to variable marketing margin % of revenue. See “LendingTree’s Principles of Financial Reporting” for further discussion of the Company’s use of these non-GAAP measures.

Three Months Ended

June 30,
 2020

March 31,
 2020

June 30,
 2019

(in thousands, except percentages)

Net (loss) income from continuing operations

$

(8,616)

$

18,976

$

12,981

Net (loss) income from continuing operations % of revenue

(5)

%

7

%

5

%

Adjustments to reconcile to variable marketing margin:

Cost of revenue

13,464

14,252

16,310

Cost of advertising re-sold to third parties (1)

(1,086)

(5,053)

Non-variable selling and marketing expense (2)

12,091

11,772

12,079

General and administrative expense

28,489

32,082

27,951

Product development

10,812

10,963

10,175

Depreciation

3,550

3,378

2,559

Amortization of intangibles

13,756

13,757

14,280

Change in fair value of contingent consideration

9,175

(8,122)

2,790

Severance

32

158

403

Litigation settlements and contingencies

(1,325)

329

8

Interest expense, net

4,955

4,834

5,095

Other income

(7)

(71)

Income tax benefit

(3,880)

(3,061)

(5,689)

Variable marketing margin

$

82,496

$

98,232

$

93,818

Variable marketing margin % of revenue

45

%

35

%

34

%

(1)

Represents the portion of cost of revenue attributable to costs paid for advertising re-sold to third parties. Excludes overhead, fixed costs,
and personnel-related expenses.

(2)

Represents the portion of selling and marketing expense not attributable to variable costs paid for advertising, direct marketing and
related expenses. Includes overhead, fixed costs and personnel-related expenses.

 

LENDINGTREE’S RECONCILIATION OF NON-GAAP MEASURES TO GAAP

Adjusted EBITDA

Below is a reconciliation of net (loss) income from continuing operations to adjusted EBITDA and net (loss) income from continuing operations % of revenue to adjusted EBITDA % of revenue. See “LendingTree’s Principles of Financial Reporting” for further discussion of the Company’s use of these non-GAAP measures.

 

Three Months Ended

June 30,
 2020

March 31,
 2020

June 30,
 2019

(in thousands, except percentages)

Net (loss) income from continuing operations

$

(8,616)

$

18,976

$

12,981

Net (loss) income from continuing operations % of revenue

(5)

%

7

%

5

%

Adjustments to reconcile to adjusted EBITDA:

Amortization of intangibles

13,756

13,757

14,280

Depreciation

3,550

3,378

2,559

Severance

32

158

403

Loss (gain) on impairments and disposal of assets

22

530

(2,196)

Non-cash compensation

13,158

11,917

15,982

Change in fair value of contingent consideration

9,175

(8,122)

2,790

Acquisition expense

20

2,180

60

Litigation settlements and contingencies

(1,325)

329

8

Interest expense, net

4,955

4,834

5,095

Income tax benefit

(3,880)

(3,061)

(5,689)

Adjusted EBITDA

$

30,847

$

44,876

$

46,273

Adjusted EBITDA % of revenue

17

%

16

%

17

%

 

LENDINGTREE’S RECONCILIATION OF NON-GAAP MEASURES TO GAAP

Adjusted Net Income

Below is a reconciliation of net (loss) income from continuing operations to adjusted net income and net (loss) income per diluted share from continuing operations to adjusted net income per share. See “LendingTree’s Principles of Financial Reporting” for further discussion of the Company’s use of these non-GAAP measures.

Three Months Ended

June 30,
 2020

March 31,
 2020

June 30,
 2019

(in thousands, except per share amounts)

Net (loss) income from continuing operations

$

(8,616)

$

18,976

$

12,981

Adjustments to reconcile to adjusted net income:

Non-cash compensation

13,158

11,917

15,982

Loss (gain) on impairments and disposal of assets

22

530

(2,196)

Acquisition expense

20

2,180

60

Change in fair value of contingent consideration

9,175

(8,122)

2,790

Severance

32

158

403

Litigation settlements and contingencies

(1,325)

329

8

Income tax benefit from adjusted items

(5,357)

(1,760)

(4,663)

Excess tax benefit from stock-based compensation

(753)

(1,054)

(7,723)

Income tax benefit from CARES Act

(6,104)

Adjusted net income

$

6,356

$

17,050

$

17,642

Net (loss) income per diluted share from continuing operations

$

(0.66)

$

1.34

$

0.87

Adjustments to reconcile net (loss) income from continuing operations to
adjusted net income

1.15

(0.14)

0.31

Adjustments to reconcile effect of dilutive securities

(0.03)

Adjusted net income per share

$

0.46

$

1.20

$

1.18

Adjusted weighted average diluted shares outstanding

13,814

14,158

14,908

Effect of dilutive securities

830

Weighted average diluted shares outstanding

12,984

14,158

14,908

Effect of dilutive securities

1,201

2,103

Weighted average basic shares outstanding

12,984

12,957

12,805

 

LENDINGTREE’S PRINCIPLES OF FINANCIAL REPORTING

LendingTree reports the following non-GAAP measures as supplemental to GAAP:

  • Variable marketing margin, including variable marketing expense
  • Variable marketing margin % of revenue
  • Earnings Before Interest, Taxes, Depreciation and Amortization, as adjusted for certain items discussed below (“Adjusted EBITDA”)
  • Adjusted EBITDA % of revenue
  • Adjusted net income
  • Adjusted net income per share

Variable marketing margin is a measure of the efficiency of the Company’s operating model, measuring revenue after subtracting variable marketing and advertising costs that directly influence revenue. The Company’s operating model is highly sensitive to the amount and efficiency of variable marketing expenditures, and the Company’s proprietary systems are able to make rapidly changing decisions concerning the deployment of variable marketing expenditures (primarily but not exclusively online and mobile advertising placement) based on proprietary and sophisticated analytics. Variable marketing margin and variable marketing margin % of revenue are primary metrics by which the Company measures the effectiveness of its marketing efforts.

Adjusted EBITDA and adjusted EBITDA % of revenue are primary metrics by which LendingTree evaluates the operating performance of its businesses, on which its marketing expenditures and internal budgets are based and, in the case of adjusted EBITDA, by which management and many employees are compensated.

Adjusted net income and adjusted net income per share supplement GAAP income from continuing operations and GAAP income per diluted share from continuing operations by enabling investors to make period to period comparisons of those components of the nearest comparable GAAP measures that management believes better reflect the underlying financial performance of the Company’s business operations during particular financial reporting periods. Adjusted net income and adjusted net income per share exclude certain amounts, such as non-cash compensation, non-cash asset impairment charges, gain/loss on disposal of assets, severance, litigation settlements and contingencies, acquisition and disposition income or expenses including with respect to changes in fair value of contingent consideration, one-time items which are recognized and recorded under GAAP in particular periods but which might be viewed as not necessarily coinciding with the underlying business operations for the periods in which they are so recognized and recorded, the effects to income taxes of the aforementioned adjustments and any excess tax benefit or expense associated with stock-based compensation recorded in net income in conjunction with FASB pronouncement ASU 2016-09. LendingTree believes that adjusted net income and adjusted net income per share are useful financial indicators that provide a different view of the financial performance of the Company than adjusted EBITDA (the primary metric by which LendingTree evaluates the operating performance of its businesses) and the GAAP measures of net income from continuing operations and GAAP income per diluted share from continuing operations.

These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. LendingTree provides and encourages investors to examine the reconciling adjustments between the GAAP and non-GAAP measures set forth above.

Definition of LendingTree’s Non-GAAP Measures

Variable marketing margin is defined as revenue less variable marketing expense. Variable marketing expense is defined as the expense attributable to variable costs paid for advertising, direct marketing and related expenses, including the portion of cost of revenue attributable to costs paid for advertising re-sold to third parties, and excluding overhead, fixed costs and personnel-related expenses. The majority of these variable advertising costs are expressly intended to drive traffic to our websites and these variable advertising costs are included in selling and marketing expense on the company’s consolidated statements of operations and consolidated income. When advertising inventory is re-sold to third parties, the proceeds of such transactions are included in revenue for the purposes of calculating variable marketing margin, and the costs of such re-sold advertising are included in cost of revenue in the company’s consolidated statements of operations and consolidated income and are included in variable marketing expense for purposes of calculating variable marketing margin.

EBITDA is defined as net income from continuing operations excluding interest, income taxes, amortization of intangibles and depreciation.

Adjusted EBITDA is defined as EBITDA excluding (1) non-cash compensation expense, (2) non-cash impairment charges, (3) gain/loss on disposal of assets, (4) restructuring and severance expenses, (5) litigation settlements and contingencies, (6) acquisitions and dispositions income or expense (including with respect to changes in fair value of contingent consideration), and (7) one-time items.

Adjusted net income is defined as net income (loss) from continuing operations excluding (1) non-cash compensation expense, (2) non-cash impairment charges, (3) gain/loss on disposal of assets, (4) restructuring and severance expenses, (5) litigation settlements and contingencies, (6) acquisitions and dispositions income or expense (including with respect to changes in fair value of contingent consideration), (7) one-time items, (8) the effects to income taxes of the aforementioned adjustments, and (9) any excess tax benefit or expense associated with stock-based compensation recorded in net income in conjunction with FASB pronouncement ASU 2016-09.

Adjusted net income per share is defined as adjusted net income divided by the adjusted weighted average diluted shares outstanding. For periods which the Company reports GAAP loss from continuing operations, the effects of potentially dilutive securities are excluded from the calculation of net loss per diluted share from continuing operations because their inclusion would have been anti-dilutive. In periods where the Company reports GAAP loss from continuing operations but reports positive non-GAAP adjusted net income, the effects of potentially dilutive securities are included in the denominator for calculating adjusted net income per share.

LendingTree endeavors to compensate for the limitations of these non-GAAP measures by also providing the comparable GAAP measures with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measures. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.

One-Time Items

Adjusted EBITDA and adjusted net income are adjusted for one-time items, if applicable. Items are considered one-time in nature if they are non-recurring, infrequent or unusual, and have not occurred in the past two years or are not expected to recur in the next two years, in accordance with SEC rules. For the periods presented in this report, there are no adjustments for one-time items, except for the $6.1 million income tax benefit from the CARES Act in Q1 2020.

Non-Cash Expenses That Are Excluded From LendingTree’s Adjusted EBITDA and Adjusted Net Income

Non-cash compensation expense consists principally of expense associated with the grants of restricted stock, restricted stock units and stock options. These expenses are not paid in cash and LendingTree includes the related shares in its calculations of fully diluted shares outstanding. Upon settlement of restricted stock units, exercise of certain stock options or vesting of restricted stock awards, the awards may be settled on a net basis, with LendingTree remitting the required tax withholding amounts from its current funds. Cash expenditures for employer payroll taxes on non-cash compensation are included within adjusted EBITDA and adjusted net income.

Amortization of intangibles are non-cash expenses relating primarily to acquisitions. At the time of an acquisition, the intangible assets of the acquired company, such as purchase agreements, technology and customer relationships, are valued and amortized over their estimated lives.  Amortization of intangibles are only excluded from adjusted EBITDA.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

The matters contained in the discussion above may be considered to be “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations or anticipations of LendingTree and members of our management team. Factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following: uncertainty regarding the duration and scope of the coronavirus referred to as COVID-19 pandemic; actions governments and businesses take in response to the pandemic, including actions that could affect levels of advertising activity; the impact of the pandemic and actions taken in response to the pandemic on national and regional economies and economic activity; the pace of recovery when the COVID-19 pandemic subsides; adverse conditions in the primary and secondary mortgage markets and in the economy, particularly interest rates; default rates on loans, particularly unsecured loans; demand by investors for unsecured personal loans; the effect of such demand on interest rates for personal loans and consumer demand for personal loans; seasonality of results; potential liabilities to secondary market purchasers; changes in the Company’s relationships with network lenders, including dependence on certain key network lenders; breaches of network security or the misappropriation or misuse of personal consumer information; failure to provide competitive service; failure to maintain brand recognition; ability to attract and retain consumers in a cost-effective manner; the effects of potential acquisitions of other businesses, including the ability to integrate them successfully with LendingTree’s existing operations; accounting rules related to contingent consideration and excess tax benefits or expenses on stock-based compensation that could materially affect earnings in future periods; ability to develop new products and services and enhance existing ones; competition; allegations of failure to comply with existing or changing laws, rules or regulations, or to obtain and maintain required licenses; failure of network lenders or other affiliated parties to comply with regulatory requirements; failure to maintain the integrity of systems and infrastructure; liabilities as a result of privacy regulations; failure to adequately protect intellectual property rights or allegations of infringement of intellectual property rights; and changes in management. These and additional factors to be considered are set forth under “Risk Factors” in our Annual Report on Form 10-K for the period ended December 31, 2019, in our Form 10-Q for the period ended March 31, 2020, and in our other filings with the Securities and Exchange Commission. LendingTree undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results or expectations.

About LendingTree, Inc.

LendingTree, Inc. is the parent of LendingTree, LLC and several companies owned by LendingTree, LLC (collectively, “LendingTree” or the “Company”).

LendingTree operates what it believes to be the leading online consumer platform that connects consumers with the choices they need to be confident in their financial decisions. The Company offers consumers tools and resources, including free credit scores, that facilitate comparison-shopping for mortgage loans, home equity loans and lines of credit, reverse mortgage loans, auto loans, credit cards, deposit accounts, personal loans, student loans, small business loans, insurance quotes and other related offerings. The Company primarily seeks to match in-market consumers with multiple providers on its marketplace who can provide them with competing quotes for loans, deposit products, insurance or other related offerings they are seeking. The Company also serves as a valued partner to partners and other providers seeking an efficient, scalable and flexible source of customer acquisition with directly measurable benefits, by matching the consumer inquiries it generates with these providers.

LendingTree, Inc. is headquartered in Charlotte, NC. For more information, please visit www.lendingtree.com.

Investor Relations Contact:
Trent Ziegler
trent.ziegler@lendingtree.com
704-943-8294

Media Contact:
Megan Greuling
megan.greuling@lendingtree.com
704-943-8208

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Lashonda Nesmith Jackson, Bryan Braddock to speak at hip hop rally Saturday | Local News

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FLORENCE, S.C. — Two candidates running for Florence City Council will speak at an event scheduled for Saturday afternoon. 

Lashonda Nesmith Jackson, one of five candidates running for the Democratic nomination in the District 1 special election, and Bryan Braddock, one of four Republicans running in the District 3 special election, will speak at the Stop the Violence Hip Hop Rally.

The rally is scheduled for 1 to 3 p.m. Saturday at Northwest Community Park, located at 801 Clement St in Florence. It will also feature music, a clinic on expungements and pardons, a credit repair service and free food. 

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California Announces Plans for Reviewing Consumer Complaints

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California Announces Plans for Reviewing Consumer Complaints

California’s Consumer Financial Protection Law is in effect and the Department of Financial Protection and Innovation (DFPI) announced plans for reviewing consumer complaints in its monthly bulletin for January.

California Gov. Gavin Newsom approved the California Consumer Financial Protection Law (AB 1864), which creates a state consumer protection agency before the end of the state’s 2020 legislative session. The law also expands the state’s power to target unfair, deceptive and abusive acts and practices by financial service providers, ACA International previously reported.

Effective immediately, according to the DFPI bulletin, it will “review and investigate consumer complaints against previously unregulated financial products and services, including debt collectors, credit repair and consumer credit reporting agencies, debt relief companies, rent to own contractors, private school financing, and more.”

 Under the consumer financial protection law, the DFPI will also:

  • Significantly expand the state’s consumer protection capacity by adding dozens of investigators and attorneys to supervise financial institutions.
  • Create a team to monitor markets to proactively identify emerging risks to consumers.
  • Create a team dedicated to consumer education and outreach, listening and responding to consumers in specific communities, including veterans, immigrants and older Californians.
  • Create a new Office of Financial Technology and Innovation, which will cultivate financial technology to serve consumers.

This spring, the DFPI will launch a statewide campaign to educate California consumers on how the department can support and protect consumers, according to its bulletin.

Licensing Requirements in the Works

Under a law passed last year, California is now one of 35 states to require a license for debt collection. Agencies have one year to apply.

The Debt Collection Licensing Act (SB 908), from California State Sen. Bob Wieckowski, D-Fremont, was signed into law by Newsom in September 2020.

It was welcome news for the accounts receivable management (ARM) industry and ACA that the governor approved both these measures, allowing for a separate licensing process outside of the DFPI.

With the governor’s signature on the licensing bill, the commissioner of the Department of Business oversight shall take all actions necessary to prepare to be able to fully enforce the licensing and regulatory provisions of this division, including, but not limited to, adoption of all necessary regulations by Jan. 1, 2022.

The California Association of Collectors (CAC) advocated to ensure workable options for consumers and the ARM industry in the licensing bill. And the Collectors Insurance Agency (CIA) licensing team had a seat at the table to negotiate the best licensing legislation possible for the ARM industry.

While a license will not be required until 2022, the state has indicated the application and its checklist should be submitted as soon as they are live in 2021. The law permits the state to use the electronic Nationwide Multistate Licensing System (NMLS) for the licensing process. There will also be a bonding requirement as part of the licensing process.

License applications will be due by Dec. 31, 2021, and the DFPI expects to begin the licensing process in late summer or fall next year. Debt collectors that apply for a license before the deadline next year would be allowed to operate pending the approval or denial of the application.

Under the law, the DFPI will also appoint a seven-member Debt Collection Advisory committee.

Even though the application is not available yet, ACA members and ARM industry professionals can contact the CIA licensing team to be added to the Licensing Service List. When the application and list of requirements is available, the team will provide more information on the service.

For more information on how the ACA licensing staff can assist with your licensing application completion needs in California as well as other states, please email licensing@acainternational.org or call (952) 926-6547.

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Industry Disruptor Curtis Ray Launches Retirement Planning and Saving Service, MPI™ UNLIMITED

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GILBERT, Ariz., Jan. 14, 2021 /PRNewswire/ — Curtis Ray, retirement planning expert and creator of the patent-pending Maximum Premium Indexing (MPI™) Plan, announced today his newest company, MPI™ UNLIMITED. The company’s proprietary technology utilizes the security guarantee of permanent life insurance, the growth potential of the stock market and the power of compound interest to provide enhanced retirement income, tax-free.

“I am thrilled to announce the official launch of MPI™ UNLIMITED,” said Ray. “After years of research in the financial planning space, I realized that traditional strategies, like the 401(k) and IRA, are not providing enough income throughout retirement years. I’m looking forward to teaching hardworking people, from all walks of life, how to utilize secure compound interest to maximize their savings and achieve their dream retirement. Always Be Compounding!”

The MPI™ plan is an advanced cash-value life insurance plan specifically designed as a max-funded, increasing death benefit contract. The plan provides holistic benefits to clients which include mitigation against market risk, enhanced compound interest returns, increased retirement income, tax-free distribution and more.

Ray’s passion for retirement planning goes beyond MPI™ UNLIMITED; a best-selling author, Ray tackled the challenges of consistent underperformance in the current retirement planning industry in his 2018 book Everyone Ends Up Poor. In his most recent book, The Lost Science of Compound Interest, Ray deconstructs the phenomenon of compound interest, teaching readers to harness its power through small and simple actions.

“Learning about MPI™ and compound interest has been one of the most valuable things I’ve learned in my life. I have a master’s degree in engineering, yet I have never seen anything like this before,” said Angie Merget, Financial Engineer and MPI™ UNLIMITED client. “Taking the time to understand MPI™ is without a doubt the best thing you can do for yourself and your family.”

The purpose of MPI™ UNLIMITED is to provide services focused on the phenomenon of compounding. Within the next five years, Ray plans to expand their offerings into mortgage, credit repair, personal tax filing and other financial services to give every American the best path to financial freedom.

To learn more about MPI™ UNLIMITED and its retirement planning options, visit www.mympi.com.

About MPI™ UNLIMITED
Founded in 2020 by Curtis Ray, MPI™ UNLIMITED works to provide simplified financial education that addresses complex money topics, so that the public can understand and implement the full potential of Secure Compound Interest in their life. Ray, best-selling author and MPI™ UNLIMITED’s CEO, invented and developed the patent pending MPI™ (Maximum Premium Indexing) Secure Compound Interest Account, in order to help people maximize their retirement savings.

Media Contact:
Heather Tidwell
949-777-1333
[email protected]

SOURCE MPI UNLIMITED

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