Market Overview

DexYP™ Announces Second Quarter 2018 Financial Results


DexYP™, a leading small business software provider, announced today
financial results for second quarter 2018.

This press release features multimedia. View the full release here:

Key highlights for DexYP:

  • Delivered EBITDA growth over Q2 2017 – the second straight quarter of
    comparative growth
  • Increased EBITDA margin to 30.7%, a 6.4 percentage point increase over
    Q2 2017
  • Generated $59 million of Free Cash Flow, reducing Net Debt to $700

"Thryv℠, our all-in-one management software, is selling briskly to small
businesses across America," said Joe Walsh, DexYP CEO and
president. "With Thryv, businesses can modernize essential business
functions by enabling them to create customer databases, communicate
effectively with customers, provide scheduling tools and allows them to
collect payments. We are becoming a leader in small business software."

Second Quarter 2018 Pro Forma Results

        Q2       YTD

(in thousands)

(in thousands)

    Variance     Variance
2018   2017   Fav (Unfav)   % 2018   2017   Fav (Unfav)   %

Pro Forma Net Revenue

(a), (b)
Print $ 223,526 $ 285,583 $ (62,056 ) -21.7 % $ 466,446 $ 604,413 $ (137,967 ) -22.8 %
Digital 245,170 300,535 (55,365 ) -18.4 % 497,911 596,523 (98,612 ) -16.5 %
Other   1,984       1,969      


    0.8 %   4,016       4,099       (83 )   -2.0 %
Total Pro Forma Net Revenue $ 470,680     $ 588,087     $ (117,407 )   -20.0 % $ 968,372     $ 1,205,035     $ (236,663 )   -19.6 %
Adjusted Pro Forma EBITDA (a), (c) $ 144,725     $ 143,017     $ 1,708     1.2 % $ 290,832     $ 279,840     $ 10,991     3.9 %
Adjusted Pro Forma EBITDA Margin % 30.7 % 24.3 % 6.4 % 30.0 % 23.2 % 6.8 %
Free Cash Flow (a), (d), (e) $ 59,069     $ 3,558     $ 55,511     1560.1 % $ 112,548     $ 114,617     $ (2,069 )   -1.8 %


Term Note $ 546,000 $ 780,000 $ 234,000 30.0 %
ABL   164,861       174,079       9,219     5.3 %
Total Outstanding Debt $ 710,861 $ 954,079 $ 243,219 25.5 %
Cash (10,701 ) (18,437 ) (7,736 ) -42.0 %
Net Debt (e) $ 700,160     $ 935,642     $ 235,483     25.2 %


(a)       All 2018 figures presented are preliminary, subject to change, and
unaudited. Material changes may result from audit procedures.
(b) Pro Forma Net Revenue for 2018 and 2017 is presented on a
consolidated pro forma basis as a result of acquisition accounting
and fresh start accounting. DexYP's net revenue has been adjusted to
reflect proper recognition of contracts with both print and digital
advertising components.
(c) Adjusted Pro Forma EBITDA excludes interest, taxes, depreciation and
amortization, and other non-cash/non-recurring expenses, including
acquisition and fresh start accounting, pension, long-term incentive
compensation, costs to achieve, business transformation, YP
acquisition transaction fees, YP integration related one time
severance costs and other pro forma adjustments.
(d) Free Cash Flow reflects cash generated from operating activities,
less capital expenditures and interest payments.
(e) Net debt excludes YP related financing obligations. These
obligations, which primarily relate to leased land and building in
Tucker, GA totaled $57.8 million and $67.5 million as of June 30,
2018 and June 30, 2017, respectively. The cash portion of this
financing obligation, which will be paid out between 2018 and 2022
is approximately $2.2 million. Upon completion of the lease
agreement in August 2022, the Company will write off the remaining
residual value of the financing obligation against the remaining net
book value of the land and building, and the difference will be
recognized as a gain on completion of financing obligations.

Earnings Conference Call Information

DexYP will host an investor conference call at 9 a.m. CDT on August 1,
2018. Individuals within the United States can access the conference
call by dialing (888) 603-6873. International participants should dial
(973) 582-2706. The passcode is: 7579555.

Basis of Presentation and Non-GAAP Financial Measures

The financial information accompanying this release provides a
reconciliation of GAAP to non-GAAP and adjusted pro forma non-GAAP
results. DexYP 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, DexYP
believes the non-GAAP results provide useful information to management
and investors by excluding certain nonrecurring items that DexYP
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 DexYP's performance, and
DexYP believes that non-GAAP results provide investors with financial
measures that most closely align to its internal financial measurement

About DexYP

provides small business software and marketing services to more than
500,000 local businesses across America that enable them to compete and
win in today's on-demand economy. We provide the digital tools and
management sophistication that big businesses utilize, arming local
businesses with the deep resources they need to survive and thrive. Our
flagship product—Thryv℠—provides small business owners with an
all-in-one software that allows them to modernize essential business
functions performed manually in the past, or never performed. These
include building a digital customer list, communicating with customers
via email and text, updating business listings across the internet,
accepting appointments, sending notifications and reminders, managing
ratings and reviews, generating estimates and invoices, processing
payments, and issuing invoices and coupons.

DexYP also provides consumer services through our market-leading search,
display and social products—and connects local businesses to the over 50
million monthly visitors of®,® and search portals; and local print directories The Real
Yellow Pages®. For more information about the company, visit

Forward-Looking Statements

Some statements included in this release constitute forward-looking
statements. 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, as they are not guarantees of future performance.
Forward-looking statements provide current expectations with respect to
our financial performance and future events with respect to our business
and industry in general. Forward-looking statements are based on certain
assumptions and include any statement that does not directly relate to
any historical or current fact. 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 Company's ability to maintain adequate liquidity to fund
operations; the Company's future operating and financial 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; our ability to
retain existing business and obtain and retain new business; general
economic or business conditions affecting the markets we serve;
declining use of print yellow page directories by consumers; our ability
to collect trade receivables from clients to whom we extend credit;
credit risk associated with our reliance on small and medium sized
businesses as clients; our ability to attract and retain key managers;
increased competition in our markets; our ability to obtain future
financing due to changes in the lending markets or our financial
position; our ability to maintain agreements with major Internet search
and local media companies; reduced advertising spending and increased
contract cancellations by our clients, which causes reduced revenue;
and, our ability to anticipate or respond effectively to changes in
technology and consumer preferences; and our ability to successfully
integrate the YP business with the Company's business. With respect to
the acquisition, important factors could cause actual results to differ
materially from those indicated by forward-looking statements and
projections included herein, including, but not limited to: the risk
that anticipated cost savings, growth opportunities and other financial
and operating benefits as a result of the transaction 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 the companies, 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. All subsequent written and oral
forward-looking statements attributable to us or persons acting on our
behalf are expressly qualified in their entirety by such cautionary

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 press release are expressly
qualified in their entirety by the foregoing cautionary statements.
These forward-looking statements speak only as of the date hereof 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.

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