Local Corp needs only 14.6 million revenues in Q2/20155 to reach a positive cash flow from operations - I believe no problem by the published extreme positive numbers of the last days
Local Corporation Reports First Quarter 2015 Financial Results May 15, 2015 7:05 AM Revenue 13.1 million Cash Flow from operations - 1.8 million (maybe only 1.2 million after the CFO Cragun in CC) Estimates for revenues from Q2/15 - Q4/15 from stannguru Q2/2015: 15.2 million Q3/2015: 17.5 million Q4/2015: 19.2 million
The following cost-cutting lower the cost in Q2/2015 about 0.6 million: “Late in the first quarter, we had a reduction in force from about 70 people to 60 people and we have looked at other cost savings and we think that will contribute another approximate $2 million in savings to the $3 million in savings actions we took in the fourth quarter.”
Very important for a positive cash flow in the next quarters is the decouopling between the revenues and the cost of revenues in the last quarters: The decline of revenues in Q1/2015 took place by a decrease of the cost of revenues of less than 0.5 million. The result will be, that by an increase of revenues from 13.1 million to 14.6 million the increase of the cost of revenues will be only 0.3 million. Period Ending Mar 31, 2015 Dec 31, 2014 Total Revenue 13,087 16,285 Cost of Revenue 11,563 12,035
The math: -1.8 million Cash Flow in Q1 + 0.6 milllion Cost Cutting in Q2 - 0.3 million more cost of revenues by an increase of revenues of 1.5 million in Q2 = -1.5 Million Cash Flow by equal reveneus like in Q1 of 13.1 million. By an increase of revenues of 1,5 from 13.1 million to 14.6 million the Cash Flow from operations is flat. By my estimate of revenues of 15.2 million we should have a positive Cash Flow from operations of 0.6 million.
Four drivers of growth of the revenues of Local Corp
- nQuery carrier expansion
- Network programmatic media buying
- Programmatic audience extension
- Expansion of Q&Q category pages
Not big, but a first steps: During the first quarter of 2015, the average unique visitors per month for nQuery Mobile Search reached 3 million, representing approximately 400,000 daily search queries.
CEO Thiel: What I love about Local Corp is that the years of experience the company has in search have created a huge opportunity in two areas - One is in programmatic, the other is in mobile search
Local has an infrastructure in place to begin and had begun executing programmtic campaigns: Built a proprietary cross-platform data tracking tool and added third party media buying platforms to leverage and monetize first party search intent data 1. Step of Programmatic Workflow: Consumer visits publisher site 2, Step of Programmatic Workflow: Publisher Ad Server - Any premium buyers? - What is known about this consumers? 3. Step of Programmatic Workflow: SSP (Supply Side Platform) - Adds logic on consumer - What is known? - Has consumers been seen before? 4. Step: Ad Exchange - Looks for pre-cached bids - If no pre-cached bids exist, request for bids open on exchange's network of DSP's & other exchanges - Winning bid is selected and information to serve the ad is passed back to the publisher site
nQuery(TM) by Local provides a complete responsive solution to create powerful search experiences in a configuration that meets your brand’s needs. Our white-labeled, hosted search application incorporates the most essential features and functionality and is easy to integrate. - Plus, the search results page maintains the look and feel of your site, including the addition of your logo. nQuery also drives searches into existing apps, games and platforms to further drive brand engagement. - And, while you offer your users a high-quality search experience, you make money with search advertising. Ads are served automatically as part of the search results, so you don’t have to do anything extra. - Leverage our search technology to display quality results and ads, while offering users a superior user experience - Our data, your way: Industry leading, white label mobile search solution - Drive brand engagement: Seamlessly integrate your apps, games and custom con
First countable money will come in 2015 from the launch of the Mobile Pay-Per-Call Lead Generation Network
"Improved audience engagement with category pages driving more than 10% of Owned & Operated (O&O) traffic." Source: Report about Q1/2015
This is only a first step and the increase of category pages will drive the revenues of Local Corp.
New Category Pages of Local Corp - Improves user experience - Scalable template - Positive margin upside - Expands audience acquisition - First of many new verticals include: - Yellowpages - Movies - Homes for sale - Jobs - Weather - Coupons Source: Company Overview - January 2015
First Quarter 2015 Metric Review: Delivered revenue per thousand visitors of $186, stable compared to $186 in the fourth quarter of 2014. But nTegrity will lift this number over $200 again in the next quarters:
nTegrity by local = An advanced traffic quality platform that leverages a multitude of signals and data to detect, analyze and decide the most successful delivery of content and ads 5,103,354 MUV's in May after 4,129,220 MUV's in April and 3,636,658 MUV's in March after eight month with strong decreases are a strong Rebound#
Extreme Strong Rebound of Visitors in April and May by Compete: The math from more traffic and more quality of the traffic is very simple = higher revenues in Q2/2015.
The number of Compete are US Data Only: First increase by Compete in April 2015 after strong decreases over a lot of month through the use of nTegrity and additional 24% in May
The from Compete pubished MUV's decreased after the use of nTegruity from more than 20 million Monthly Uniqe Visitors to a low of 3,636,658 after eight month with strong decreases - but increased first in 04/15 to 4,129,220 and increased again to 5,103,354 MUV's for the Main-Site in May.
Former CEO Heath Clarke and especially former after my opinion criminal COO Sawtell tolerated fraud. The elimination of partners, who delivered only or in great parts fraud, lowered the revenues of Local Copr dramatically, but the cleaning from fraud is in the long run a big progress and will increase the revenues of Local Corp again.
nTegrity by local = An advanced traffic quality platform that leverages a multitude of signals and data to detect, analyze and decide the most successful delivery of content and ads: - Allows Network revenue to scale predictably - Proprietary technology ensures only real humans interact with our ads - Local Corp#s quality traffic based on: 100% of Network syndication feed is screened for quality - Increase in traffic quality scores from ad partners Source. LOCM Company Overview | March 2015
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