Velti Announces Fourth Quarter and Fiscal Year 2012 Results

Tue Mar 12, 2013 4:29pm EDT

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DUBLIN, Ireland and SAN FRANCISCO, March 12, 2013 (GLOBE NEWSWIRE) -- Velti plc (Nasdaq:VELT), the
leading global provider of mobile marketing and advertising technology and solutions, today
announced its financial results for the fourth quarter and fiscal year ended Dec. 31, 2012.

"Our full year 2012 results show a 43 percent increase in revenue over 2011, even though the
fourth quarter was a difficult quarter," said Alex Moukas, chief executive officer. "In the fourth
quarter, revenue came in at the low end of our expectations, which, in conjunction with higher
operating expenses, contributed to significantly lower adjusted EBITDA.

"Following the divestment announced in November, we continue to evaluate the customers and
opportunities that we are pursuing in various geographies. We decided not to pursue certain
business opportunities with customers or potential customers that did not meet our more rigorous
cash investment requirements, and requirements for improved cash collections and reductions in
business in economically challenged regions.

"At the same time, in the fourth quarter and beyond we are very pleased with the sales activity,
prospective customer engagements and revenue growth in key markets, including the U.S., Western
Europe, Brazil and India. We have built up dedicated sales teams and a complete portfolio of
products and services in each of these markets and are confident in our growth opportunities as we
gain momentum over the course of 2013 and into the future."

"We believe that 2013 will be a transitional year allowing us to deliver significant revenue
growth in our business in the key markets as well as significantly improved cash flow," added Jeff
Ross, chief financial officer. "We further believe that we will show sequential growth and
financial improvement throughout the year and beyond."

Fiscal Year 2012 Financial Highlights

* Revenue of $270.3 million, an increase of 43 percent from fiscal year 2011;
* Revenue less 3rd party costs of $178.9 million (resulting in a margin of 66 percent), an
increase of 32 percent compared with revenue less 3rd party costs from fiscal year 2011;
* Adjusted EBITDA of $42.6 million, which includes a $7.4 million allowance for doubtful accounts;
this is a decrease of 20 percent from fiscal year 2011;
* GAAP net loss attributable to Velti of $56.4 million and EPS of $(0.88) compared with a net loss
of $15.4 million and EPS of $(0.28) for fiscal year 2011, including $16.9 million related to the
write-off of certain capitalized software and;
* Adjusted net income of $22.2 million and adjusted diluted EPS of $0.34 compared with adjusted
net income of $29.0 million and adjusted diluted EPS of $0.50 for 2011.

Mobile Advertising and Marketing Revenues and Third Party Costs

* Mobile advertising revenue of $54.3 million, an increase of 82 percent from fiscal year 2011 and
mobile advertising 3rd party costs of $41.1 million; resultant mobile advertising revenue less 3rd
party costs of $13.3 million (resulting in a margin of 24 percent);
* Mobile marketing revenue of $216.0 million, an increase of 36 percent from fiscal year 2011 and
mobile marketing 3rd party costs of $50.3 million; resultant mobile marketing revenue less 3rd
party costs of $165.7 million (resulting in a margin of 77 percent).

Q4 2012 Financial Highlights

* Revenue of $97.5 million, an increase of 12 percent from Q4 2011;
* Revenue less 3rd party costs of $66.6 million (resulting in a margin of 68 percent), a decrease
of 2 percent compared with revenue less 3rd party costs from Q4 2011;
* Adjusted EBITDA of $25.1 million, compared with $43.1 million in Q4 2011, a decrease of 42
percent;
* GAAP net loss attributable to Velti of $5.2 million and diluted EPS of $(0.08) compared with net
income of $25.0 million and EPS of $0.40 for Q4 2011;
* Adjusted net income of $26.0 million and adjusted diluted EPS of $0.39 compared with adjusted
net income of $37.3 million and adjusted diluted EPS of $0.59 for Q4 2011;

Mobile Advertising and Marketing Revenues and Third Party Costs

* Mobile advertising revenue of $15.2 million, an increase of 53 percent from Q4 2011 and mobile
advertising 3rd party costs of $10.8 million; resultant mobile advertising revenue less 3rd party
costs of $4.5 million (resulting in a margin of 29 percent);
* Mobile marketing revenue of $82.2 million, an increase of 7 percent from Q4 2011 and mobile
marketing 3rd party costs of $20.1 million; resultant mobile marketing revenue less 3rd party
costs of $62.2 million (resulting in a margin of 76 percent).

Cash and Comprehensive DSOs

* Cash position of $36.6 million as of Dec. 31, 2012;
* Q4 operating cash flow of $7.3 million;
* Comprehensive DSOs of 311 days;
* Q4 free cash flow of ($5.0) million.

Please see the reconciliation of net income (loss) before non-controlling interest to adjusted
EBITDA later in this release.

Q4 Business Highlights

* Q4 customer engagements included such blue chip brands as American Express, Discover, eTrade,
Hertz, BBW, JCPenney, Subway, Armani Exchange, Bebe, Outback Steakhouse, and Academy.
* Velti partnered with Cancer Research UK and Channel 4 to fundraise through mobile donations
during the 'Stand Up to Cancer' campaign, garnering over 360,000 mobile interactions. The
partnership with Channel 4 marked a milestone for Velti, having now worked with every major UK
terrestrial broadcaster.
* Velti announced a partnership with Infinian, the leader in coupon redemption tracking, to
provide marketers a complete and seamless end-to-end mobile coupon solution. From coupon creation
and distribution tools, to in-store redemption and targeted marketing, the partnership is expected
to provide a marked increase in engagement between consumers and brands.

Transition to Key Growth Geographies and Products

As announced as part of the divestiture of selected Greek, Balkan and other assets in the third
quarter of 2012, Velti has made a strategic decision to forgo a significant amount of additional
business in these regions. Although this business has historically generated meaningful revenue
and EBITDA , it requires significant upfront cash investment and is characterized by long
collection cycles. Velti will instead focus more on customers in key markets such as the Americas,
Western Europe, Brazil, India and China in order to leverage growth opportunities and improve free
cash flow.

In conjunction with this transition, Velti expects to significantly decrease its capital
expenditures by more than 50%, which the company believes will meaningfully contribute to improved
cash flow. Additionally, the transition is expected to reduce overall DSOs as DSOs on new revenue
generated in 2013 are expected to be around 100 days.

In addition to its annual guidance provided below, Velti has developed longer term operating
assumptions for the years 2014 through 2016, detailed below, that highlight healthy, focused
growth and steady margin expansion:

* Revenue growth: 25 to 35 percent per year;
* Approximately one-third of total revenue from advertising with attendant margins of
approximately 30 percent;
* Approximately two-thirds of total revenue from mobile marketing with attendant margins of
approximately 62 percent;
* Adjusted EBITDA margin expansion of approximately 4 to 6.5 percent per year as operating
leverage increases;
* Free cash flow generation of approximately $40 million in 2014, growing at approximately 40
percent thereafter.

For additional information related to our fourth quarter 2012 results, please see the Q4 2012
Earnings Slide Deck available on the Events section of the investor website at

http://investors.velti.com/events.cfm
http://www.globenewswire.com/newsroom/ctr?d=10024902&l=17&u=http%3A%2F%2Finvestors.velti.com%2Fevents.cfm

.

Fiscal Year 2013 Outlook

Velti is announcing revenue, adjusted EBITDA and free cash flow guidance for the first quarter and
fiscal year ending Dec. 31st 2013 as follows:

                                                                                                           
 ($ in millions, excluding Spin-Off)                         Qtr. End. March 31st       FYE Dec. 31st      
                                                             Low          High         Low      High     
 Revenue Guidance                                            $40.0        $44.0        $255.0   $280.0   
 Adjusted EBITDA Guidance                                    $(17.0)      $(15.0)      $5.0     $15.0    
 Free Cash Flow Guidance, Exclusive of Acquisition Payments  N/A          N/A          $5.0     $15.0    


Conference Call 

The company will host a conference call today at 4:30 PM ET to discuss these results. The
conference call can be accessed at (877) 415-4117 or (708) 290-1138 (International), conference
ID# 17593110. The call will also be broadcast simultaneously at

http://investors.velti.com
http://www.globenewswire.com/newsroom/ctr?d=10024902&l=21&u=http%3A%2F%2Finvestors.velti.com

. Following completion of the call, a recorded replay of the webcast will be available for three
months on the Events section of the investor website at

http://investors.velti.com/events.cfm
http://www.globenewswire.com/newsroom/ctr?d=10024902&l=21&u=http%3A%2F%2Finvestors.velti.com%2Fevents.cfm

. To listen to the telephone replay, call toll-free (855) 859-2056 or (404) 537-3406
(International), conference ID# 17593110. The telephone replay will be available from 7:30 PM ET
March 12 through March 19, 2013. Additional investor information can be accessed at

http://velti.com
http://www.globenewswire.com/newsroom/ctr?d=10024902&l=21&u=http%3A%2F%2Fvelti.com

.

Use of Non-GAAP Measures

This press release includes non-GAAP financial measures such as adjusted EBITDA, adjusted net
income and adjusted earnings per share. These non-GAAP financial measures are not a measure of
financial performance or liquidity calculated in accordance with accounting principles generally
accepted in the U.S., referred to herein as GAAP, and should be viewed as a supplement to, not a
substitute for, our results of operations presented on the basis of GAAP. Reconciliation of these
non-GAAP financial measures to the most directly comparable GAAP financial measures is detailed in
the table below.

Our non-GAAP measures should be read in conjunction with the corresponding GAAP measures. These
non-GAAP financial measures have limitations as an analytical tool and you should not consider
them in isolation from, or as a substitute for, analysis of our results as reported in accordance
with GAAP.

We define adjusted net income (loss) by excluding foreign exchange gains or losses, share-based
compensation expense, non-recurring and acquisition related expenses, deferrals of net profits of
our equity method investments related to transactions with us, and acquisition-related
depreciation and amortization.

We define adjusted EBITDA by excluding from adjusted net income (loss), gains or losses from our
equity method investments, the remaining depreciation and amortization, the provision for income
taxes, net interest expense, and other income and expense.

Adjusted net income (loss) and adjusted EBITDA are not necessarily comparable to similarly-titled
measures reported by other companies.

Adjusted income (loss) per share is adjusted net income (loss) divided by diluted shares
outstanding.

We believe these non-GAAP financial measures are useful to management, investors and other users
of our financial statements in evaluating our operating performance because these financial
measures are additional tools to compare business performance across companies and across periods.
We believe that:

* these non-GAAP financial measures are often used by investors to measure a company's operating
performance without regard to items such as interest expense, taxes, depreciation and amortization
and foreign exchange gains and losses, which can vary substantially from company to company
depending upon accounting methods and book value of assets, capital structure and the method by
which assets were acquired; and
* investors commonly use these non-GAAP financial measures to eliminate the effect of
restructuring and share-based compensation expenses, one-time non-recurring expenses, and
acquisition-related expenses, which vary widely from company to company and impair comparability.

We use these non-GAAP financial measures:

* as a measure of operating performance to assist in comparing performance from period to period
on a consistent basis;
* as a measure for planning and forecasting overall expectations and for evaluating actual results
against such expectations;
* as a primary measure to review and assess the operating performance of our company and
management team in connection with our executive compensation plan incentive payments; and
* in communications with our board of directors, stockholders, analysts and investors concerning
our financial performance.

Note to Financial Statements

The financial information in this announcement does not constitute statutory financial statements
as defined in Article 102 of the Companies (Jersey) Law 1991. Copies of our annual report and
financial statements will be available at our registered office: First Floor, 28-32 Pembroke
Street Upper, Dublin 2, Republic of Ireland or can be downloaded at the company's website at

www.velti.com
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.

Forward-Looking Statements

"Safe harbor" statement under the Private Securities Litigation Reform Act of 1995: This press
release contains forward-looking statements including statements regarding revenue and adjusted
EBITDA guidance for fiscal year 2013, guidance related to 2013 free cash flow, and guidance
relating to operating assumptions for the years 2014 through 2016 relating to revenue growth,
margins, and adjusted EBITDA margin expansion; our expectations to execute on key business
opportunities in key markets such as the Americas, Western Europe, Brazil, India and China; our
ability to significantly decrease capital expenditures, and to reduce overall days sales
outstanding; and the impact of the divestment of Greek, Balkan and other assets. The achievement
or success of the matters covered by such forward-looking statements involve risks, uncertainties
and assumptions, and if any such risks or uncertainties materialize or if any of the assumptions
prove incorrect, the company's results could differ materially from the results expressed or
implied by the forward-looking statements. These risks and uncertainties include - but are not
limited to - our ability to collect on outstanding accounts receivable, manage our accounts
payable, and improve our comprehensive DSOs; generate sufficient cash and reduce expenses to meet
our tight cash flow requirements without raising additional funds; continue to expand as the
leading global provider of integrated, comprehensive mobile marketing and advertising technology;
expand our customer base; achieve the benefits of our acquisitions, and potential liability
resulting from pending or future litigation. Further information on these and other factors that
could affect the company's results is included in our Annual Report on Form 20-F and our current
reports on Form 6-K filed with the Securities and Exchange Commission and in other filings we may
make with the Securities and Exchange Commission from time to time. Velti assumes no obligation
and does not intend to update these forward-looking statements, except as required by law.

About Velti

Velti is a leading global provider of mobile marketing and advertising technology and solutions
that enable brands, advertising agencies, mobile operators and media to implement highly targeted,
interactive and measurable campaigns by communicating with and engaging consumers via their mobile
devices. The Velti platform, called Velti mGage, allows customers to use mobile and traditional
media to reach targeted consumers, engage the consumer through the mobile Internet and
applications, convert them into customers and continue to actively manage the relationship through
the mobile channel. Velti is a publicly-held corporation based in Jersey, and trades on the NASDAQ
Global Select Market under the symbol VELT. For more information, visit www.velti.com
http://www.globenewswire.com/newsroom/ctr?d=10024902&l=36&a=www.velti.com&u=http%3A%2F%2Fwww.velti.com
.

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                                                      For the Three Months       For the Twelve Months        
                                                      Ended December 31,         Ended December 31,           
                                                      2012         2011         2012          2011          
 Reconciliation to adjusted EBITDA:                   (in thousands except per share amounts)                  
 Net income (loss)                                    $ (5,064)    $ 25,187     $ (56,363)    $ (15,238)    
 Adjustments:                                                                                               
 Gain (loss) from foreign currency transactions       141          774          (1,995)       (6,200)       
 Non-cash share based compensation (1)                8,666        4,001        31,196        27,627        
 Non-recurring and acquisition-related expenses (2)   1,400        3,140        10,316        14,821        
 Impairment of intangible assets                      16,902       1,500        16,902        1,500         
 Loss from equity method investments (3)              45           490          596           1,888         
 Loss from disposal of assets                         906          -            10,532        -             
 Depreciation and amortization - acquisition related  3,031        2,220        10,972        4,607         
 Adjusted net income                                  $ 26,027     $ 37,312     $ 22,156      $ 29,005      
 Loss (gain) from equity method investments - other   531          (673)        3,159         (1,688)       
 Depreciation and amortization - other                6,917        5,030        22,974        16,293        
 Income tax (benefit) expense                         (8,832)      368          (7,646)       3,808         
 Interest expense, net                                414          1,026        1,830         5,610         
 Other expense                                        78           15           152           49            
 Adjusted EBITDA                                      $ 25,135     $ 43,078     $ 42,625      $ 53,077      
                                                                                                            
 Adjusted net income per share - basic                $ 0.40       $ 0.60       $ 0.35        $ 0.52        
                                                                                                            
 Adjusted net income per share - diluted              $ 0.39       $ 0.59       $ 0.34        $ 0.50        
                                                                                                            
 Basic shares                                         65,223       61,718       63,910        55,865        
                                                                                                            
 Diluted shares                                       65,995       62,921       65,475        58,071        
                                                                                                            
 (1)  The quarter and year ended December 31, 2012 include accrual of annual bonuses that are expected to be paid in stock. The year ended December 31, 2011 includes additional compensation expense of approximately $10.5 million relating to deemed modifications of performance based deferred share awards. 
                                                                                                            
 (2) Non-recurring and acquisition-related expenses in 2012 resulted primarily from re-measurement of contingent consideration for our Mobile Interactive Group acquisition, including locking of the contingent consideration, and for acquisition related expenses for completed acquisitions. These expenses were partially offset by a first quarter gain on re-measurement of our pre-acquisition ownership interest in CASEE to fair value. Non-recurring and acquisition-related expenses in 2011 included acquisition 
 related expenses related to our acquisition of Mobclix, interest expense to recognize the remaining discount upon repayment of certain loan facilities, interest expense related to a lender fee in connection with our IPO, and other non-recurring items offset by the reversal of a one time tax liability related to pre-IPO performance share awards that were released to employees in 2010. 
                                                                                                            
 (3) Loss from equity method investments represents deferral of our equity method investments' net profits related to transactions with Velti. 


                                                                                                                                                                                    
                                                                                                                                                                                    
 Share based expenses included in the condensed consolidated statements of operations for the quarters and years ended December 31, 2012 and 2011 were as follows:                  
                                                                                                                                                                                    
                                    For the Three Months                                                   For the Twelve Months                                                  
                                    Ended December 31,                                                     Ended December 31,                                                     
                                    2012                               2011                               2012                               2011                               
                                    (in thousands)                                                                                                                                       
 Datacenter and direct project      $ 1,196                            $ 568                              $ 3,721                            $ 3,549                            
 General and administrative         2,549                              1,516                              11,923                             11,734                             
 Sales and marketing                2,811                              1,266                              9,245                              8,288                              
 Research and development           2,110                              651                                6,307                              4,056                              
                                    $ 8,666                            $ 4,001                            $ 31,196                           $ 27,627                           
                                                                                                                                                                                            


 Velti plc                                                                                                                                          
 Condensed Consolidated Statements of Operations                                                                                                    
 (in thousands, except per share amounts)                                                                                                           
 (unaudited)                                                                                                                                        
                                                                                                                                                    
                                                                                          For the Three Months       For the Twelve Months        
                                                                                          Ended December 31,         Ended December 31,           
                                                                                          2012         2011         2012          2011          
 Revenue:                                                                                                                                       
 Software as a service (SaaS) revenue                                                     $ 59,956     $ 62,650     $ 204,210     $ 139,024     
 License and software revenue                                                             12,581       19,746       22,213        36,705        
 Managed services revenue                                                                 24,930       4,710        43,921        13,473        
 Total revenue                                                                            97,467       87,106       270,344       189,202       
 Cost and expenses:                                                                                                                             
 Third-party costs                                                                        30,862       18,805       91,404        53,901        
 Datacenter and direct project costs                                                      7,595        5,734        29,966        17,952        
 General and administrative expenses                                                      21,408       11,121       68,196        45,258        
 Sales and marketing expenses                                                             16,041       10,369       54,507        37,733        
 Research and development expenses                                                        6,492        3,853        21,236        13,060        
 Acquisition related and other charges                                                    -            1,287        9,950         8,890         
 Impairment of intangible assets                                                          16,902       1,500        16,902        1,500         
 Loss from disposal of assets                                                             906          -            10,532        -             
 Depreciation and amortization                                                            9,948        7,250        33,946        20,900        
 Total cost and expenses                                                                  110,154      59,919       336,639       199,194       
 Income (loss) from operations                                                            (12,687)     27,187       (66,295)      (9,992)       
 Interest expense, net                                                                    (414)        (1,026)      (1,830)       (7,389)       
 Gain (loss) from foreign currency transactions                                           (141)        (774)        1,995         6,200         
 Other income (expense)                                                                   (78)         (15)         5,876         (49)          
 Gain (loss) before income taxes, equity method investments and non-controlling interest  (13,320)     25,372       (60,254)      (11,230)      
 Income tax benefit (expense)                                                             8,832        (368)        7,646         (3,808)       
 Net gain (loss) from equity method investments                                           (576)        183          (3,755)       (200)         
 Net income (loss)                                                                        (5,064)      25,187       (56,363)      (15,238)      
 Net income attributable to non-controlling interest                                      119          205          53            130           
 Net income (loss) attributable to Velti                                                  $ (5,183)    $ 24,982     $ (56,416)    $ (15,368)    
                                                                                                                                                
 Net income (loss) per share attributable to Velti:                                                                                             
 Basic                                                                                    $ (0.08)     $ 0.40       $ (0.88)      $ (0.28)      
 Diluted                                                                                  $ (0.08)     $ 0.40       $ (0.88)      $ (0.28)      
 Weighted average number of shares outstanding for use in computing per share amounts:                                                          
 Basic                                                                                    65,223       61,718       63,910        55,865        
 Diluted                                                                                  65,223       62,921       63,910        55,865        
                                                                                                                                                


                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                              
 Velti plc                                                                                                                                                                                                                                      
 Condensed Consolidated Balance Sheets                                                                                                                                                                                                          
 (in thousands, except share and per share amounts)                                                                                                                                                                                             
 (unaudited)                                                                                                                                                                                                                                    
                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                
                                                                                                                                                                                                                  December 31,  December 31,  
                                                                                                                                                                                                                  2012          2011          
 ASSETS                                                                                                                                                                                                                                       
 Current assets:                                                                                                                                                                                                                              
 Cash and cash equivalents (includes $1.1 million from VIE as of December 31, 2012)                                                                                                                               $ 36,571      $ 75,765      
 Trade receivables, net of allowance for doubtful accounts of $7.0 million and $0.6 million as of December 31, 2012 and December 31,2011, respectively (includes $12.4 million from VIE as of December 31, 2012)  150,074       100,456       
 Accrued contract receivables, net of allowance for doubtful accounts of $1.0 million as of December 31, 2012 (includes $8.8 million from VIE as of December 31, 2012)                                            132,957       98,203        
 Prepayments                                                                                                                                                                                                      12,733        22,664        
 Other receivables and current assets (includes $1.3 million from VIE as of December 31, 2012)                                                                                                                    8,084         20,238        
 Total current assets                                                                                                                                                                                             340,419       317,326       
 Non-current assets:                                                                                                                                                                                                                          
 Property and equipment, net (includes $0.2 million from VIE as of December 31, 2012)                                                                                                                             13,073        5,922         
 Intangible assets, net (includes $2.9 million from VIE as of December 31, 2012)                                                                                                                                  93,982        91,192        
 Goodwill                                                                                                                                                                                                         70,498        52,956        
 Other assets (includes $1.5 million from VIE as of December 31, 2012)                                                                                                                                            6,301         14,135        
 Total non-current assets                                                                                                                                                                                         183,854       164,205       
 Total assets                                                                                                                                                                                                     $ 524,273     $ 481,531     
 LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                                                                                                                         
 Current liabilities:                                                                                                                                                                                                                         
 Accounts payable (includes $0.7 million from VIE as of December 31, 2012)                                                                                                                                        $ 37,786      $ 41,565      
 Accrued liabilities (includes $0.5 million from VIE as of December 31, 2012)                                                                                                                                     97,374        49,621        
 Deferred revenue and current portion of deferred government grant (includes $0.7 million from VIE as of December 31, 2012)                                                                                       12,626        6,217         
 Current portion of acquisition related liabilities                                                                                                                                                               33,352        26,900        
 Current portion of long-term debt and short-term financings                                                                                                                                                      851           2,881         
 Income tax liabilities (includes $0.9 million from VIE as of December 31, 2012)                                                                                                                                  6,327         9,883         
 Total current liabilities                                                                                                                                                                                        188,316       137,067       
 Non-current liabilities:                                                                                                                                                                                                                     
 Long-term debt                                                                                                                                                                                                   27,342        6,859         
 Deferred government grant - non-current                                                                                                                                                                          1,297         3,162         
 Acquisition related liabilities - non-current                                                                                                                                                                    2,221         18,772        
 Other non-current liabilities (includes $4.8 million from VIE as of December 31, 2012)                                                                                                                           8,577         18,180        
 Total liabilities                                                                                                                                                                                                227,753       184,040       
 Commitments and contingencies                                                                                                                                                                                                                
 Shareholders' equity:                                                                                                                                                                                                                        
 Share capital, nominal value £0.05, 100,000,000 ordinary shares authorized; 65,622,141 and 61,790,985 shares issued and outstanding as of December 31, 2012 and December 31, 2011, respectively                  5,462         5,148         
 Additional paid-in capital                                                                                                                                                                                       399,127       346,031       
 Accumulated deficit                                                                                                                                                                                              (91,142)      (34,726)      
 Accumulated other comprehensive loss                                                                                                                                                                             (17,051)      (19,046)      
 Total Velti shareholders' equity                                                                                                                                                                                 296,396       297,407       
 Non-controlling interests                                                                                                                                                                                        124           84            
 Total equity                                                                                                                                                                                                     296,520       297,491       
 Total liabilities and shareholders' equity                                                                                                                                                                       $ 524,273     $ 481,531     


                                                                                                                                                               
                                                                                                                                                               
 Velti plc                                                                                                                                                         
 Condensed Consolidated Statements of Cash Flows                                                                                                                   
 (in thousands)                                                                                                                                                    
 (unaudited)                                                                                                                                                       
                                                                                                                                                               
                                                                                                                                                                   
                                                                                 Three Months Ended                                   Twelve Months Ended        
                                                                                 December 31,                                         December 31,               
                                                                                 2012                                    2011        2012         2011         
                                                                                                                                                               
 Cash flows from operating activities:                                                                                                                         
 Net loss                                                                        $(5,064)                                $ 25,187    $(56,363)    $(15,238)    
 Adjustments to reconcile net loss to net cash used in operating activities:                                                                                    
 Depreciation and amortization                                                   9,948                                   7,250       33,946       20,900       
 Non-cash loss from disposal of assets                                           286                                     -           9,912        -            
 Change in fair value of contingent consideration                                -                                       981         9,179        2,155        
 Non-cash interest expense                                                       209                                     436         985          2,621        
 Share-based compensation                                                        5,748                                   4,001       27,456       27,627       
 Deferred income taxes and other tax liabilities                                 (8,250)                                 576         (9,227)      1,691        
 Impairment of Intangible Assets                                                 16,902                                  1,500       16,902       1,500        
 Foreign currency transactions and other                                         718                                     713         1,761        (5,878)      
 Provision for doubtful accounts                                                 6,377                                   220         7,420        642          
 Gain on previously held shares in CASEE                                         -                                       -           (6,028)      -            
 Change in operating assets and liabilities                                      (19,615)                                (52,498)    (24,487)     (103,341)    
 Net cash generated by (used in) operating activities                            7,259                                   (11,634)    11,456       (67,321)     
 Cash flow from investing activities:                                                                                                                          
 Purchase of property and equipment                                              (1,413)                                 (1,197)     (10,828)     (2,582)      
 Investments in software development and purchased software                      (10,832)                                (13,045)    (49,559)     (34,774)     
 Investment in subsidiaries and equity method investments, net of cash acquired  -                                       (34,221)    (9,507)      (43,489)     
 Net cash used in investing activities                                           (12,245)                                (48,463)    (69,894)     (80,845)     
 Cash flow from financing activities:                                                                                                                          
 Net proceeds from issuance of ordinary shares                                   60                                      44          1,393        273,824      
 Proceeds from borrowings and debt financing                                     14,293                                  -           27,575       917          
 Repayment of borrowings                                                         (1,933)                                 (1,984)     (11,447)     (65,704)     
 Net cash generated from financing activities                                    12,420                                  (1,940)     17,521       209,037      
 Effect of changes in foreign exchange rates                                     (360)                                   (2,587)     1,723        (2,460)      
 Net increase (decrease) in cash and cash equivalents                            7,074                                   (64,624)    (39,194)     58,411       
 Cash and cash equivalents at beginning of period                                29,497                                  140,389     75,765       17,354       
 Cash and cash equivalents at end of period                                      36,571                                  75,765      36,571       75,765       


CONTACT: Jeffrey G. Ross
         Chief Financial Officer
         jross@velti.com
         
         Leslie Green
         Investor Relations
         lgreen@velti.com

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