Leaf Group announces the third preliminary quarter of 2020
records the highest quarterly income Rate of growth Since the company’s IPO in 2011, Upper Quarterly Turnover since fiscal year 2013
Company6 Group To posts Record quarterly revenue and new customers
SANTA MONICA, Calif., Oct. 05, 2020 (GLOBE NEWSWIRE) – Leaf Group Ltd. (NYSE: LEAF), a diverse mainstream internet company, provided a financial update today. Leaf Group revenue in the third quarter of 2020 increased by more than 50% year-on-year, reflecting strong marketplace growth through September 2020, partially offset by lower media revenue. Leaf Group revenue in the third quarter of 2020 was the highest since fiscal 2013, thanks to its highest year-over-year revenue growth rate since the company went public in 2011.
- Society6 Group Gross Transaction Value (GTV) grew over 115% year-on-year in Q3 2020, driven by overall direct-to-consumer GTV growth of over 125%, including growth of over 140% % in the United States and more than 50% internationally. The Society6 group saw strong e-commerce demand across all of its major wall art, home decor and tech categories and GTV’s record quarter for Society6’s Business-to-Business segment. In addition, Society6 Group delivered a record number of new customers in the third quarter of 2020.
- Saatchi Art Group GTV grew by over 30% in the third quarter of 2020 thanks to the strength of the Saatchi Art online market with GTV growth of over 70% and the recently launched online studios The Other Art Fair, offset by the postponement or cancellation of its live fairs for the third quarter of 2020. In addition, the online market Saatchi Art hit a record high for quarterly GTV in the third quarter of 2020.
- Media revenue declined approximately 13% year-on-year in the third quarter of 2020, due to improved direct advertising sales trends compared to the second quarter of 2020.
- As of September 30, 2020, Leaf Group had more than $ 30 million in cash and cash equivalents.
“We are very proud that Leaf Group achieved another record quarter,” said Sean Moriarty, CEO of Leaf Group. “Our performance in the third quarter of 2020 underscores the sustainability of our portfolio strategy as we continue to deliver exceptional results in a volatile macroeconomic environment. Consumer behavior continues to change online, particularly in our core Home, Art & Design and Fitness & Wellness categories, positioning the Company for sustained growth and free cash flow generation. We reiterate our 2022 targets previously communicated in our second quarter 2020 letter to shareholders and our earnings conference call of over $ 250 million in revenue and $ 20 million in adjusted EBITDA as benchmarks for investors on the market. basis of increased confidence in the growth and strength of our key brands and our proven portfolio of operating leverage. We expect selective and strategic complementary acquisitions to complement these objectives. “
Leaf Group expects to report full third quarter financial results in the normal course.
About the Leaf Group
Leaf Group Ltd. (NYSE: LEAF) is a diverse consumer internet company that creates sustainable digital first brands that reach passionate audiences in broad and growing lifestyle categories, including Fitness & Wellness (Well + Good, Livestrong.com and MyPlate App), and Home, Art & Design (Saatchi Art, Society6 and Hunker). For more information on Leaf Group, visit www.leafgroup.com.
Caution regarding forward-looking statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. The forward-looking statements made in this press release include, among other things, statements regarding preliminary financial results, the future financial performance of the Company, the financial objectives of the Company for future periods and the commercial and operational strategy of the Company. In addition, statements containing words such as “may”, “believe”, “anticipate”, “expect”, “intend”, “plan”, “project”, “projections”, ” business outlook ”,“ estimate ”,“ ”targets”, “direction”, “benchmarks” or similar expressions constitute forward-looking statements. Actual results may differ materially from expected results, and reported results should not be taken as an indication of future performance. These forward-looking statements involve risks and uncertainties regarding the future financial performance of the Company; could cause actual results or developments to differ materially from those shown due to a number of factors affecting Leaf Group operations, markets, products and services; and are based on current expectations, estimates and projections regarding the industry, financial condition, operating performance and results of operations of the Company, including certain related assumptions. The potential risks and uncertainties that could affect the operational and financial results of the Company are described in the annual report of Leaf Group on Form 10-K for the year ended December 31, 2019 filed with the Securities and Exchange Commission (http : //www.sec. gov) on March 16, 2020, as these risks and uncertainties may be updated from time to time in Leaf Group quarterly reports on Form 10-Q filed with the Securities and Exchange Commission, including, without limitation, information under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. These risks and uncertainties include, among others: risks associated with political and economic instability at the national and international levels, including those resulting from the COVID-19 pandemic, which have caused and could cause fluctuations in the availability of credit , a decrease in business and consumer confidence and an increase in unemployment; the Company’s ability to execute its business plan to return to compliance with the New York Stock Exchange (“NYSE”) continuous listing criteria; the Company’s ability to continue to comply with applicable registration standards during the available processing period; changes made by the Small Business Administration or other government authorities regarding the Coronavirus Aid, Relief and Economic Security Act of 2020 (the “CARES Act”), the Paycheck Protection Program (“PPP”) or related administrative matters; the Company’s ability to comply with the terms of the PPP loan and the CARES Act, including using the proceeds of the PPP loan; the Company’s ability to successfully generate and increase traffic to its markets and media properties; changes in Internet search engine methodologies, including ongoing algorithmic changes made by Google, Bing, and Yahoo! ; the Company’s ability to attract new and regular clients and artists to its markets and to successfully develop its business in those markets; the potential impact on advertising revenue of lower ad unit prices, reduced online ad spending, loss of advertisers, lower ad returns, availability increased ad blocking software, particularly on mobile devices and / or continuous changes in ad unit formats; the Company’s dependence on various agreements with a specific business partner for a significant portion of its advertising revenues; the effects of shifting multimedia content consumption and online shopping from desktop computers to mobile devices and / or social media platforms; the Company’s history of net operating losses; the Company’s ability to obtain capital when it so wishes on favorable terms; impairments, reserves or potential impairments of assets, including receivables, goodwill, intangible assets (including multimedia content) or other assets; the Company’s ability to effectively integrate, manage, operate and develop the acquired businesses; the Company’s ability to retain key personnel; the Company’s ability to prevent any actual or perceived breach of security; the Company’s ability to develop its international activities; examining strategic alternatives; the Company’s ability to generate long-term value for its shareholders; and any future action that may be taken by activist shareholders. From time to time, the Company may consider acquisitions or disposals which, if completed, could be material. All forward-looking statements regarding financial measures are based on the assumption that no such acquisition or disposal will be made during the relevant periods. If an acquisition or disposal were to be completed, actual results could differ materially from any forward-looking statements. Any forward-looking statement made by the Company in this press release is based solely on information currently available to the Company and speaks only as of the date on which it is made. The Company assumes no obligation to revise or update any forward-looking information, whether written or oral, which may be made from time to time, whether as a result of new information, future developments or otherwise. , unless required by law, and may not provide this type of information in the future.
John Christiansen / Matt Reid
Sard Verbinnen & Co
415-618-8750 / 310-201-2040