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UPDATE 2-Constant Contact says acquisition to hit FY earnings
June 13, 2012 / 12:41 PM / 5 years ago

UPDATE 2-Constant Contact says acquisition to hit FY earnings

* Co revises FY adj EBITDA down sharply

* Deal to add $10 million to 2013 rev

* Shares down more 5 pct

June 13 (Reuters) - Online marketing company Constant Contact Inc said it bought privately owned SinglePlatform for $65 million in cash and cut its full-year earnings forecast, sending its shares down 5 percent.

The company said its 2012 adjusted EBITDA will be lower than it expected as it invests to scale and take advantage of the growth potential of SinglePlatform, which helps small businesses promote their products and services online.

It now expects a full-year adjusted EBITDA of between $35.4 million and $36.7 million, down from its previous forecast of $45.8 million to $46.9 million.

Constant Contact, which provides online marketing tools and surveys, said it also granted an additional $5 million in cash and equity to help retain SinglePlatform employees.

The company does not expect the deal to have a material impact on its second-quarter revenue.

In April, it had forecast second-quarter revenue of between $61.7 million and $62.0 million.

However, the deal will add more than $10 million to its 2013 revenue, it said.

Constant Contact will provide free basic listings for small businesses through SinglePlatform’s publishing partner network.

Constant Contact shares were at $18.50 on Tuesday morning on the Nasdaq.

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