j2 Global Inc.
) reported better-than-expected second-quarter 2012 financial
results yesterday, with a record high quarterly revenue. The Board
of Directors of j2 Global has hiked its quarterly dividend by 2.3%
from 21.5 cents per share to 22 cents per share, marking the
company's fourth consecutive quarterly dividend increase.
Quarterly GAAP net income came in at $31.2 million or 67 cents
per share compared with $28.6 million or 61 cents per share in the
year-ago quarter. Second-quarter adjusted earnings per share of 67
cents were well above the Zacks Consensus Estimate of 59 cents.
Total revenue was approximately $89.5 million, up 4.4% year over
year, and just managed to beat the Zacks Consensus Estimate of $89
million. Subscriber Usage revenue stood at $88.1 million, up 3.25%
year over year.
Quarterly gross margin was 81.9% compared with 82.3% in the
year-ago quarter. Operating expenses in the reported quarter were
$33.2 million compared with $32.6 million in the prior-year
quarter. Quarterly operating margin was 44.7% compared with 44.3%
in the prior-year quarter.
Churn rate in the second quarter of 2012 was a record low of
2.3%. In the previous quarter, j2 Global added a net 33,000 DIDs
(Dial In Demand).
In the first six month of fiscal 2012, j2 Global generated $85.3
million of cash from operations compared with $80.6 million in the
first six month of 2011. Free cash flow, in the first six month of
2012, was $79.8 million compared with $76.2 million in the first
six month of 2011.
At the end of the second quarter of 2012, j2 Global had
approximately $207.8 million in cash & marketable securities on
its balance sheet compared with $221 million at the end of 2011.
The company had no outstanding debt.
Future Financial Outlook
j2 Global maintained its fiscal 2012 financial outlook.
Management expects total revenue in the range of $345 million -
$365 million, while non-GAAP EPS is expected to remain same year
over year. Non-GAAP effective tax rate is estimated in the range of
24% - 26%.
Despite stiff competition from
Open Text Corp.
), we believe the company's strong financial position and
diversified product pipeline, as well as its long-term growth
prospects of outsourced value-added messaging services and
continuous subscriber growth will drive earnings higher in the near
We thus maintain our long-term Neutral recommendation on j2
Global. Currently, the company holds a short-term Zacks #3 Rank
(Hold) on the stock.
J2 GLOBAL INC (JCOM): Free Stock Analysis
OPEN TEXT CORP (OTEX): Free Stock Analysis
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