ValueClick Announces Fourth Quarter 2007 Results

Business Wire, Feb 13, 2008

Revenue and Adjusted-EBITDA Exceed Guidance; Company Provides 2008 Outlook

Company Announces Settlement with the U.S. Federal Trade Commission

WESTLAKE VILLAGE, Calif. -- ValueClick, Inc. (Nasdaq:VCLK) today reported financial results for the fourth quarter and fiscal year ended December 31, 2007. Highlights for the quarter included:

* Revenue of $183.1 million, which exceeded previously issued guidance and increased 14 percent from the fourth quarter of 2006;

* A settlement agreement with the U.S. Federal Trade Commission (FTC), subject to Department of Justice and presiding court approval, including a $2.9 million payment which the Company recorded in the fourth quarter of 2007;

* Diluted net income per common share of $0.18, which was at the high end of the previously issued guidance range; and

* Adjusted-EBITDA1 of $45.6 million, which exceeded previously issued guidance.

The charge associated with FTC settlement payment, which was not included in the Company's previously issued guidance, lowered diluted net income per common share by $0.03 and lowered adjusted-EBITDA by $2.9 million.

"We ended 2007 on a strong note and we are pleased to announce a settlement with the FTC," said Tom Vadnais, chief executive officer of ValueClick. "While macroeconomic uncertainties are a current industry concern, we believe we are positioned to generate growth and healthy margins in 2008. Our diversified offerings and scale make us a preferred partner for major digital marketers in the U.S. and abroad."

Fourth Quarter 2007 Results

Revenue for the fourth quarter of 2007 was $183.1 million, which exceeded the high end of the Company's previously issued guidance and increased $22.7 million, or 14 percent, from $160.4 million for the fourth quarter of 2006. Fourth quarter 2007 results include three months of operations from MeziMedia, which was acquired in July 2007, and Shopping.net, which was acquired in December 2006.

Income before income taxes for the fourth quarter of 2007 was $32.5 million compared to $38.5 million for the fourth quarter of 2006. General and administrative expenses for the fourth quarter of 2007 included a $2.9 million charge related to the Company's settlement with the FTC. Stock-based compensation expense and amortization of intangibles expense totaled $13.3 million for the fourth quarter of 2007, compared to $7.7 million for the fourth quarter of 2006.

Adjusted-EBITDA for the fourth quarter of 2007 was $45.6 million, which exceeded the high end of the Company's previously issued guidance and compared to $46.1 million for the fourth quarter of 2006. The charge related to the FTC investigation lowered adjusted-EBITDA by $2.9 million in the fourth quarter of 2007.

Net income for the fourth quarter of 2007 was $18.1 million, or $0.18 per diluted common share, at the high end of the Company's previously issued guidance and compared to $21.6 million, or $0.22 per diluted common share, for the fourth quarter of 2006. The charge related to the FTC investigation lowered diluted net income per common share by $0.03.

The consolidated balance sheet as of December 31, 2007 includes $287.5 million in cash, cash equivalents and marketable securities, more than $700 million in total stockholders' equity and no long-term debt. In fiscal year 2007, the Company repurchased 2.3 million shares of its outstanding common stock for $44.0 million. Year-to-date for 2008, the Company has repurchased approximately 288,000 shares for $5.4 million. ValueClick currently has $50.6 million of authorization remaining on it stock repurchase program.

Fiscal Year 2007 Results

For the fiscal year ended December 31, 2007, ValueClick reported revenue of $645.6 million, an increase of $100.0 million, or 18 percent, from revenue of $545.6 million for fiscal year 2006. Pro forma year-over-year revenue growth was 17 percent in 2007.

Fiscal year 2007 income before taxes was $123.3 million compared to $110.1 million for fiscal year 2006. General and administrative expenses for fiscal year 2007 included a $2.9 million charge related to the Company's preliminary settlement with the FTC. Stock-based compensation expense and amortization of intangibles expense totaled $44.4 million for fiscal year 2007, compared to $33.7 million for fiscal year 2006.

Fiscal year 2007 adjusted-EBITDA was $165.4 million compared to $145.1 million for fiscal year 2006. Net income for fiscal year 2007 was $71.2 million, or $0.71 per diluted common share, compared to $62.6 million, or $0.62 per diluted common share, for fiscal year 2006.

Federal Trade Commission Investigation Update

Today, the Company announced in a separate press release that it has reached a settlement agreement with the FTC, subject to Department of Justice and presiding court approval.

In an effort to settle this matter, ValueClick has agreed to a settlement payment of $2.9 million without an admission of liability or conceding that the Company violated any laws. The settlement agreement is based on the FTC's allegation that the Company utilized deceptive marketing practices to violate the CAN-SPAM Act and FTC Act, and relates solely to the past practices of the Company's Hi-Speed Media division and not to any past or present practices of WebClients or any other ValueClick subsidiary.