Stock Quote

CoStar Group Second Quarter 2022 Net New Bookings Grew 66% and Net Income Increased 37% Year-over-Year

CoStar Group, Inc. (NASDAQ: CSGP), a leading provider of online real estate marketplaces, information and analytics in the property markets, announced today that revenue for the quarter ended June 30, 2022, was $536 million, an increase of 12% over revenue of $480 million for the second quarter of 2021.

Net income for the second quarter of 2022 was $83 million, an increase of 37% compared to net income of $61 million for the second quarter of 2021. EBITDA for the second quarter of 2022 was $140 million, an increase of 5% compared to EBITDA of $133 million for the second quarter of 2021.

“We delivered outstanding results in the second quarter of 2022,” said Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group. “With net new bookings of $84 million we easily surpassed the record sales results we set in the first quarter of this year. Our top three products, CoStar, Apartments.com and LoopNet, all achieved high double-digit sales increases over the second quarter of 2021. In addition, both revenue and profit in the second quarter of 2022 were ahead of forecast and we are raising our guidance for the year.”

“I am particularly encouraged by the strong sales growth in Apartments.com and LoopNet", continued Florance. "Net new bookings increased over 130% in Apartments.com and over 40% for LoopNet on a year-over-year basis. It is increasingly clear that Multifamily market conditions continue to be more favorable, and our work to build a dedicated LoopNet sales team is paying off. We are also making strong progress on our residential growth initiatives with the on-time launch of Citysnap in New York City at the end of June."

Year 2021-2022 Quarterly Results - Unaudited

(in millions, except per share data)

 

 

2021

 

 

2022

 

 

Q1

 

Q2

 

Q3

 

Q4

 

 

Q1

 

Q2

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$458

 

$480

 

$499

 

$507

 

 

$516

 

$536

Net income

 

74

 

61

 

64

 

93

 

 

89

 

83

Net income per share - diluted(1)

 

0.19

 

0.16

 

0.16

 

0.24

 

 

0.23

 

0.21

Weighted average outstanding shares - diluted(1)

 

394

 

394

 

394

 

395

 

 

394

 

394

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA

 

136

 

133

 

123

 

173

 

 

158

 

140

Adjusted EBITDA

 

160

 

150

 

144

 

193

 

 

178

 

159

Non-GAAP net income

 

108

 

103

 

99

 

138

 

 

123

 

112

Non-GAAP net income per share - diluted(1)

 

0.27

 

0.26

 

0.25

 

0.35

 

 

0.31

 

0.28

(1) Certain prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.

As of June 30, 2022, the Company had approximately $4.0 billion in cash, cash equivalents and restricted cash and outstanding debt of approximately $1.0 billion.

2022 Outlook

The Company is raising its revenue guidance to a range of $2.165 billion to $2.180 billion for the full year of 2022, an increase of $13 million at the midpoint of the range compared to the prior outlook. The Company expects revenue for the third quarter of 2022 in the range of $552 million to $557 million, representing revenue growth of approximately 11% over the third quarter of 2021 at the midpoint of the range.

The Company is raising its adjusted EBITDA guidance to a range of $610 million to $630 million for the full year of 2022, an increase of $20 million at the midpoint of the range compared to the prior outlook. For the third quarter of 2022, the Company expects adjusted EBITDA in a range of $130 million to $140 million.

The Company expects full year 2022 non-GAAP net income per diluted share in a range of $1.09 to $1.13 based on 395 million shares, an increase of $0.11 per diluted share compared to the prior outlook. For the third quarter of 2022, the Company expects non-GAAP net income per diluted share in a range of $0.23 to $0.25 based on 395 million shares. These ranges include an estimated non-GAAP tax rate of 26% for the full year and the third quarter of 2022.

The preceding forward-looking statements reflect CoStar Group’s expectations as of July 26, 2022, including forward-looking non-GAAP financial measures on a consolidated basis, based on current estimates, expectations, observations, and trends. Given the risk factors, rapidly evolving economic environment, and uncertainties and assumptions discussed in this release and in our quarterly reports on Form 10-Q and annual reports on Form 10-K, including uncertainties as a result of the COVID-19 pandemic and responses to it by, and the impact on, global economies and the real estate industry, actual results may differ materially. Other than in publicly available statements, the Company does not intend to update its forward-looking statements until its next quarterly results announcement.

Reconciliation of EBITDA, adjusted EBITDA, non-GAAP net income and non-GAAP net income per diluted share to their GAAP basis results are shown in detail below, along with definitions for those terms. A reconciliation of forward-looking non-GAAP guidance to the most directly comparable GAAP measure, net income, can be found within the tables included in this release.

Non-GAAP Financial Measures

For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this release and why management believes they provide useful information to investors regarding the Company’s financial condition and results of operations, please refer to the Company’s latest periodic report.

EBITDA is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before interest (expense) income and other (expense) income, loss on debt extinguishment, income taxes, depreciation and amortization.

Adjusted EBITDA is a non-GAAP financial measure that represents EBITDA before stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, and settlements and impairments incurred outside the Company’s normal course of business. Adjusted EBITDA margin represents adjusted EBITDA divided by revenues for the period.

Non-GAAP net income is a non-GAAP financial measure determined by adjusting GAAP net income attributable to CoStar Group for stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, settlement and impairment costs incurred outside the Company's normal course of business and loss on debt extinguishment, as well as amortization of acquired intangible assets and other related costs, and then subtracting an assumed provision for income taxes. In 2022, the Company is assuming a 26% tax rate in order to approximate its statutory corporate tax rate excluding the impact of discrete items.

Non-GAAP net income per diluted share is a non-GAAP financial measure that represents non-GAAP net income divided by the number of diluted shares outstanding for the period used in the calculation of GAAP net income per diluted share. For periods with GAAP net losses and non-GAAP net income, the weighted average outstanding shares used to calculate non-GAAP net income per share includes potentially dilutive securities that were excluded from the calculation of GAAP net income per share as the effect was anti-dilutive.

Operating Metrics

Net new bookings is calculated based on the annualized amount of change in the Company's sales bookings resulting from new subscription-based contracts and changes to existing subscription-based contracts for the period reported. Information regarding net new bookings is not comparable to, nor should it be substituted for, an analysis of the Company's revenues over time.

Earnings Conference Call

Management will conduct a conference call to discuss the second quarter 2022 results and the Company’s outlook at 5:00 PM EST on Tuesday, July 26, 2022. A live audio webcast of the conference will be available in listen-only mode through the Investors section of the CoStar Group website: https://investors.costargroup.com. A replay of the webcast audio will also be available in the Investors section of our website for a period of time following the call.

CoStar Group, Inc.

Condensed Consolidated Statements of Operations - Unaudited

(in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2022

 

2021

 

2022

 

2021

Revenues

 

$

536,308

 

 

$

480,333

 

 

$

1,052,133

 

 

$

938,030

 

Cost of revenues

 

 

100,971

 

 

 

89,566

 

 

 

196,450

 

 

 

178,314

 

Gross profit

 

 

435,337

 

 

 

390,767

 

 

 

855,683

 

 

 

759,716

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling and marketing (excluding customer base amortization)

 

 

181,344

 

 

 

164,612

 

 

 

325,341

 

 

 

303,299

 

Software development

 

 

51,587

 

 

 

48,573

 

 

 

105,608

 

 

 

95,357

 

General and administrative

 

 

77,345

 

 

 

58,226

 

 

 

155,306

 

 

 

122,076

 

Customer base amortization

 

 

14,878

 

 

 

18,345

 

 

 

30,970

 

 

 

36,764

 

 

 

 

325,154

 

 

 

289,756

 

 

 

617,225

 

 

 

557,496

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

110,183

 

 

 

101,011

 

 

 

238,458

 

 

 

202,220

 

Interest expense, net

 

 

(3,399

)

 

 

(7,877

)

 

 

(11,117

)

 

 

(15,755

)

Other income, net

 

 

1,343

 

 

 

847

 

 

 

2,207

 

 

 

797

 

Income before income taxes

 

 

108,127

 

 

 

93,981

 

 

 

229,548

 

 

 

187,262

 

Income tax expense

 

 

24,654

 

 

 

32,833

 

 

 

56,757

 

 

 

51,902

 

Net income

 

$

83,473

 

 

$

61,148

 

 

$

172,791

 

 

$

135,360

 

 

 

 

 

 

 

 

 

 

Net income per share - basic

 

$

0.21

 

 

$

0.16

 

 

$

0.44

 

 

$

0.35

 

Net income per share - diluted

 

$

0.21

 

 

$

0.16

 

 

$

0.44

 

 

$

0.34

 

 

 

 

 

 

 

 

 

 

Weighted-average outstanding shares - basic

 

 

393,342

 

 

 

392,306

 

 

 

393,119

 

 

 

391,942

 

Weighted-average outstanding shares - diluted

 

 

394,478

 

 

 

394,098

 

 

 

394,356

 

 

 

393,906

 

CoStar Group, Inc.

Reconciliation of Non-GAAP Financial Measures - Unaudited

(in thousands, except per share data)

 

Reconciliation of Net Income to Non-GAAP Net Income

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2022

 

2021

 

2022

 

2021

Net income

 

$

83,473

 

 

$

61,148

 

 

$

172,791

 

 

$

135,360

 

Income tax expense

 

 

24,654

 

 

 

32,833

 

 

 

56,757

 

 

 

51,902

 

Income before income taxes

 

 

108,127

 

 

 

93,981

 

 

 

229,548

 

 

 

187,262

 

Amortization of acquired intangible assets

 

 

22,815

 

 

 

25,293

 

 

 

46,005

 

 

 

51,120

 

Stock-based compensation expense

 

 

18,112

 

 

 

15,144

 

 

 

35,959

 

 

 

30,689

 

Acquisition and integration related costs

 

 

504

 

 

 

2,001

 

 

 

2,143

 

 

 

10,463

 

Other expense

 

 

2,063

 

 

 

786

 

 

 

4,099

 

 

 

1,857

 

Non-GAAP income before income taxes

 

 

151,621

 

 

 

137,205

 

 

 

317,754

 

 

 

281,391

 

Assumed rate for income tax expense(1)

 

 

26

%

 

 

25

%

 

 

26

%

 

 

25

%

Assumed provision for income tax expense

 

 

(39,421

)

 

 

(34,301

)

 

 

(82,616

)

 

 

(70,348

)

Non-GAAP net income

 

$

112,200

 

 

$

102,904

 

 

$

235,138

 

 

$

211,043

 

 

 

 

 

 

 

 

 

 

Net income per share - diluted

 

$

0.21

 

 

$

0.16

 

 

$

0.44

 

 

$

0.34

 

Non-GAAP net income per share - diluted

 

$

0.28

 

 

$

0.26

 

 

$

0.60

 

 

$

0.54

 

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - basic

 

 

393,342

 

 

 

392,306

 

 

 

393,119

 

 

 

391,942

 

Weighted average outstanding shares - diluted

 

 

394,478

 

 

 

394,098

 

 

 

394,356

 

 

 

393,906

 

 

 

 

 

 

 

 

 

 

(1) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2022

 

2021

 

2022

 

2021

Net income

 

$

83,473

 

 

$

61,148

 

 

$

172,791

 

 

$

135,360

 

Amortization of acquired intangible assets in cost of revenues

 

 

7,937

 

 

 

6,948

 

 

 

15,035

 

 

 

14,356

 

Amortization of acquired intangible assets in operating expenses

 

 

14,878

 

 

 

18,345

 

 

 

30,970

 

 

 

36,764

 

Depreciation and other amortization

 

 

7,010

 

 

 

7,028

 

 

 

13,975

 

 

 

15,528

 

Interest expense, net

 

 

3,399

 

 

 

7,877

 

 

 

11,117

 

 

 

15,755

 

Other income, net

 

 

(1,343

)

 

 

(847

)

 

 

(2,207

)

 

 

(797

)

Income tax expense

 

 

24,654

 

 

 

32,833

 

 

 

56,757

 

 

 

51,902

 

EBITDA

 

$

140,008

 

 

$

133,332

 

 

$

298,438

 

 

$

268,868

 

Stock-based compensation expense

 

 

18,112

 

 

 

15,144

 

 

 

35,959

 

 

 

30,689

 

Acquisition and integration related costs

 

 

504

 

 

 

2,001

 

 

 

2,143

 

 

 

10,463

Adjusted EBITDA

 

$

158,624

 

 

$

150,477

 

 

$

336,540

 

 

$

310,020

 

CoStar Group, Inc.

Condensed Consolidated Balance Sheets - Unaudited

(in thousands)

 

 

 

 

 

 

 

June 30,

2022

 

December 31,

2021

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash, cash equivalents and restricted cash

 

$

3,964,116

 

 

$

3,827,126

 

Accounts receivable

 

 

161,811

 

 

 

138,191

 

Less: Allowance for credit losses

 

 

(9,638

)

 

 

(13,374

)

Accounts receivable, net

 

 

152,173

 

 

 

124,817

 

Income tax receivable

 

 

9,278

 

 

 

 

Prepaid expenses and other current assets

 

 

55,194

 

 

 

36,182

 

Total current assets

 

 

4,180,761

 

 

 

3,988,125

 

 

 

 

 

 

Deferred income taxes, net

 

 

5,034

 

 

 

5,034

 

Property and equipment, net

 

 

298,361

 

 

 

271,431

 

Lease right-of-use assets

 

 

98,495

 

 

 

100,680

 

Goodwill

 

 

2,314,176

 

 

 

2,321,015

 

Intangible assets, net

 

 

385,245

 

 

 

435,662

 

Deferred commission costs, net

 

 

119,778

 

 

 

101,879

 

Deposits and other assets

 

 

16,893

 

 

 

21,762

 

Income tax receivable

 

 

2,005

 

 

 

11,283

 

Total assets

 

$

7,420,748

 

 

$

7,256,871

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

32,132

 

 

$

22,244

 

Accrued wages and commissions

 

 

84,545

 

 

 

81,794

 

Accrued expenses

 

 

91,168

 

 

 

81,676

 

Income taxes payable

 

 

1,841

 

 

 

31,236

 

Lease liabilities

 

 

35,426

 

 

 

26,268

 

Deferred revenue

 

 

104,838

 

 

 

95,471

 

Total current liabilities

 

 

349,950

 

 

 

338,689

 

 

 

 

 

 

Long-term debt, net

 

 

988,572

 

 

 

987,944

 

Deferred income taxes, net

 

 

87,657

 

 

 

98,656

 

Income taxes payable

 

 

14,112

 

 

 

12,496

 

Lease and other long-term liabilities

 

 

96,104

 

 

 

107,414

 

Total liabilities

 

$

1,536,395

 

 

$

1,545,199

 

 

 

 

 

 

Total stockholders’ equity

 

 

5,884,353

 

 

 

5,711,672

 

Total liabilities and stockholders' equity

 

$

7,420,748

 

 

$

7,256,871

 

CoStar Group, Inc.

Condensed Consolidated Statements of Cash Flows - Unaudited

(in thousands)

 

 

 

Six Months Ended

June 30,

 

2022

 

2021

Operating activities:

 

 

 

Net income

$

172,791

 

 

$

135,360

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

64,127

 

 

 

68,516

 

Amortization of deferred commissions costs

 

35,996

 

 

 

30,847

 

Amortization of Senior Notes discount and issuance costs

 

1,178

 

 

 

1,159

 

Non-cash lease expense

 

15,080

 

 

 

13,136

 

Stock-based compensation expense

 

35,959

 

 

 

30,689

 

Deferred income taxes, net

 

(14,946

)

 

 

9,929

 

Credit loss expense

 

6,890

 

 

 

6,086

 

Other operating activities, net

 

(1,149

)

 

 

(24

)

 

 

 

 

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

Accounts receivable

 

(33,318

)

 

 

(8,526

)

Prepaid expenses and other current assets

 

3,152

 

 

 

(14,567

)

Deferred commissions

 

(54,155

)

 

 

(31,922

)

Accounts payable and other liabilities

 

14,098

 

 

 

(32,474

)

Lease liabilities

 

(15,932

)

 

 

(15,674

)

Income taxes payable

 

(27,770

)

 

 

9,415

 

Deferred revenue

 

8,520

 

 

 

16,148

 

Other assets

 

1,578

 

 

 

2,191

 

Net cash provided by operating activities

 

212,099

 

 

 

220,289

 

 

 

 

 

Investing activities:

 

 

 

Proceeds from sale of property and equipment and other assets

 

5,034

 

 

 

201

 

Purchase of Richmond assets and other intangibles

 

(25,664

)

 

 

(123,623

)

Purchases of property and equipment and other assets

 

(30,746

)

 

 

(13,093

)

Cash paid for acquisitions, net of cash acquired

 

(6,331

)

 

 

(148,275

)

Net cash used in investing activities

 

(57,707

)

 

 

(284,790

)

 

 

 

 

Financing activities:

 

 

 

Repayments of long-term debt assumed in acquisition

 

(2,155

)

 

 

 

Repurchase of restricted stock to satisfy tax withholding obligations

 

(19,755

)

 

 

(28,405

)

Proceeds from exercise of stock options and employee stock purchase plan

 

7,340

 

 

 

12,324

 

Other financing activities

 

 

 

 

(57

)

Net cash used in financing activities

 

(14,570

)

 

 

(16,138

)

 

 

 

 

Effect of foreign currency exchange rates on cash and cash equivalents

 

(2,832

)

 

 

(364

)

Net increase (decrease) in cash, cash equivalents and restricted cash

 

136,990

 

 

 

(81,003

)

Cash, cash equivalents and restricted cash at the beginning of period

 

3,827,126

 

 

 

3,755,912

 

Cash, cash equivalents and restricted cash at the end of period

$

3,964,116

 

 

$

3,674,909

 

CoStar Group, Inc.

Disaggregated Revenues - Unaudited

(in thousands)

 

 

 

Three Months Ended June 30,

 

2022

 

2021

 

North America

 

International

 

Total

 

North America

 

International

 

Total

CoStar

$

197,380

 

$

9,186

 

$

206,566

 

$

167,845

 

$

9,134

 

$

176,979

Information Services

 

30,511

 

 

7,991

 

 

38,502

 

 

28,096

 

 

7,061

 

 

35,157

Multifamily

 

182,359

 

 

 

 

182,359

 

 

171,357

 

 

 

 

171,357

LoopNet(1)

 

54,603

 

 

1,694

 

 

56,297

 

 

50,731

 

 

364

 

 

51,095

Residential(1)

 

20,154

 

 

 

 

20,154

 

 

18,087

 

 

 

 

18,087

Other Marketplaces(1)

 

32,430

 

 

 

 

32,430

 

 

27,658

 

 

 

 

27,658

Total revenues

$

517,437

 

$

18,871

 

$

536,308

 

$

463,774

 

$

16,559

 

$

480,333

 

 

 

 

 

 

 

 

 

 

(1) As of September 30, 2021, Commercial Property and Land revenue has been further disaggregated into LoopNet, Residential and Other Marketplaces. Prior period amounts have been adjusted to reflect this presentation.

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

2022

 

2021

 

North America

 

International

 

Total

 

North America

 

International

 

Total

CoStar

$

386,484

 

$

18,731

 

$

405,215

 

$

331,399

 

$

17,764

 

$

349,163

Information Services

 

60,782

 

 

14,935

 

 

75,717

 

 

55,782

 

 

14,071

 

 

69,853

Multifamily

 

357,836

 

 

 

 

357,836

 

 

337,504

 

 

 

 

337,504

LoopNet(1)

 

107,291

 

 

3,453

 

 

110,744

 

 

99,667

 

 

658

 

 

100,325

Residential(1)

 

38,214

 

 

 

 

38,214

 

 

29,192

 

 

 

 

29,192

Other Marketplaces(1)

 

64,407

 

 

 

 

64,407

 

 

51,993

 

 

 

 

51,993

Total revenues

$

1,015,014

 

$

37,119

 

$

1,052,133

 

$

905,537

 

$

32,493

 

$

938,030

 

 

 

 

 

 

 

 

 

 

(1) As of September 30, 2021, Commercial Property and Land revenue has been further disaggregated into LoopNet, Residential and Other Marketplaces. Prior period amounts have been adjusted to reflect this presentation.

CoStar Group, Inc.

Results of Segments - Unaudited

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2022

 

2021

 

2022

 

2021

EBITDA

 

 

 

 

 

 

 

 

North America

 

$

138,527

 

$

130,176

 

$

294,489

 

$

266,034

International

 

 

1,481

 

 

3,156

 

 

3,949

 

 

2,834

Total EBITDA

 

$

140,008

 

$

133,332

 

$

298,438

 

$

268,868 

CoStar Group, Inc.

Reconciliation of Non-GAAP Financial Measures with Quarterly Results - Unaudited

(in millions, except per share data)

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to Non-GAAP Net Income

 

 

 

 

 

 

 

 

 

 

 

2021

 

2022

 

 

Q1

Q2

Q3

Q4

 

Q1

Q2

 

 

 

 

 

 

 

 

 

Net income

 

$74.2

$61.1

$64.3

$92.9

 

$89.3

$83.5

Income tax expense

 

19.1

32.8

19.0

40.5

 

32.1

24.7

Income before income taxes

 

93.3

93.9

83.3

133.4

 

121.4

108.1

Amortization of acquired intangible assets

 

25.8

25.3

26.3

26.2

 

23.2

22.8

Stock-based compensation expense

 

15.5

15.1

16.3

16.7

 

17.8

18.1

Acquisition and integration related costs

 

8.5

2.0

5.0

3.2

 

1.6

0.5

Other expense

 

1.1

0.8

0.9

4.1

 

2.0

2.1

Non-GAAP income before income taxes(1)

 

144.2

137.1

131.8

183.6

 

166.1

151.6

Assumed rate for income tax expense (2)

 

25%

25%

25%

25%

 

26%

26%

Assumed provision for income tax expense

 

(36.0)

(34.3)

(33.0)

(45.9)

 

(43.2)

(39.4)

Non-GAAP net income(1)

 

$108.2

$102.8

$98.8

$137.7

 

$122.9

$112.2

 

 

 

 

 

 

 

 

 

Non-GAAP net income per share - diluted(3)

 

$0.27

$0.26

$0.25

$0.35

 

$0.31

$0.28

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - basic(3)

 

391.6

392.3

392.4

392.5

 

392.9

393.3

Weighted average outstanding shares - diluted(3)

 

393.7

394.1

394.3

394.5

 

394.2

394.5

__________________________

 

 

 

 

 

 

 

 

(1) Totals may not foot due to rounding.

(2) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

(3) Certain prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

2021

 

2022

 

 

Q1

Q2

Q3

Q4

 

Q1

Q2

 

 

 

 

 

 

 

 

 

Net income

 

$74.2

$61.1

$64.3

$92.9

 

$89.3

$83.5

Amortization of acquired intangible assets

 

25.8

25.3

26.3

26.2

 

23.2

22.8

Depreciation and other amortization

 

8.5

7.0

6.6

6.9

 

7.0

7.0

Interest expense, net

 

7.9

7.9

7.9

7.9

 

7.7

3.4

Other (income) expense, net

 

0.1

(0.8)

(1.5)

(0.9)

 

(0.9)

(1.3)

Income tax expense

 

19.1

32.8

19.0

40.5

 

32.1

24.7

EBITDA(1)

 

$135.6

$133.3

$122.6

$173.4

 

$158.4

$140.0

Stock-based compensation expense

 

15.5

15.1

16.3

16.7

 

17.8

18.1

Acquisition and integration related costs

 

8.5

2.0

5.0

3.2

 

1.6

0.5

Adjusted EBITDA(1)

 

$159.6

$150.4

$143.9

$193.4

 

$177.9

$158.6

__________________________

 

 

 

 

 

 

 

 

(1) Totals may not foot due to rounding.

CoStar Group, Inc.

Reconciliation of Forward-Looking Guidance - Unaudited

(in thousands, except per share data)

 

Reconciliation of Forward-Looking Guidance, Net Income to Non-GAAP Net Income

 

 

 

 

 

Guidance Range

 

Guidance Range

 

For the Three Months

 

For the Year Ending

 

Ending September 30, 2022

 

December 31, 2022

 

Low

 

High

 

Low

 

High

 

 

 

 

 

 

 

 

Net income

$

63,000

 

 

$

71,000

 

 

$

310,000

 

 

$

325,000

 

Income tax expense

 

22,000

 

 

 

24,000

 

 

 

104,000

 

 

 

109,000

 

Income before income taxes

 

85,000

 

 

 

95,000

 

 

 

414,000

 

 

 

434,000

 

Amortization of acquired intangible assets

 

21,000

 

 

 

21,000

 

 

 

88,000

 

 

 

88,000

 

Stock-based compensation expense

 

19,000

 

 

 

19,000

 

 

 

74,000

 

 

 

74,000

 

Acquisition and integration related costs

 

 

 

 

 

 

 

2,000

 

 

 

2,000

 

Other expense

 

 

 

 

 

 

 

4,000

 

 

 

4,000

 

Non-GAAP income before income taxes

 

125,000

 

 

 

135,000

 

 

 

582,000

 

 

 

602,000

 

Assumed rate for income tax expense(1)

 

26

%

 

 

26

%

 

 

26

%

 

 

26

%

Assumed provision for income tax expense

 

(32,500

)

 

 

(35,100

)

 

 

(151,300

)

 

 

(156,500

)

Non-GAAP net income

$

92,500

 

 

$

99,900

 

 

$

430,700

 

 

$

445,500

 

 

 

 

 

 

 

 

 

Net income per share - diluted

$

0.16

 

 

$

0.18

 

 

$

0.79

 

 

$

0.82

 

Non-GAAP net income per share - diluted

$

0.23

 

 

$

0.25

 

 

$

1.09

 

 

$

1.13

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - diluted

 

394,800

 

 

 

394,800

 

 

 

394,700

 

 

 

394,700

 

__________________________

 

 

 

 

 

 

 

(1) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

 

 

 

 

 

 

 

 

Reconciliation of Forward-Looking Guidance, Net Income to Adjusted EBITDA

 

 

 

 

 

Guidance Range

 

Guidance Range

 

For the Three Months

 

For the Year Ending

 

Ending September 30, 2022

 

December 31, 2022

 

Low

 

High

 

Low

 

High

Net income

$

63,000

 

 

$

71,000

 

 

$

310,000

 

 

$

325,000

 

Amortization of acquired intangible assets

 

21,000

 

 

 

21,000

 

 

 

88,000

 

 

 

88,000

 

Depreciation and other amortization

 

10,000

 

 

 

10,000

 

 

 

34,000

 

 

 

34,000

 

Interest expense, net

 

(5,000

)

 

 

(5,000

)

 

 

1,000

 

 

 

1,000

 

Other income, net

 

 

 

 

 

 

 

(3,000

)

 

 

(3,000

)

Income tax expense

 

22,000

 

 

 

24,000

 

 

 

104,000

 

 

 

109,000

 

Stock-based compensation expense

 

19,000

 

 

 

19,000

 

 

 

74,000

 

 

 

74,000

 

Acquisition and integration related costs

 

 

 

 

 

 

 

2,000

 

 

 

2,000

 

Adjusted EBITDA

$

130,000

 

 

$

140,000

 

 

$

610,000

 

 

$

630,000

 

About CoStar Group, Inc.

CoStar Group, Inc. (NASDAQ: CSGP) is a leading provider of online real estate marketplaces, information and analytics. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality industry. Ten-X provides a leading platform for conducting commercial real estate online auctions and negotiated bids. LoopNet is the most heavily trafficked commercial real estate marketplace online. Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Westside Rentals, AFTER55.com, CorporateHousing.com, ForRentUniversity.com and Apartamentos.com form the premier online apartment resource for renters seeking great apartment homes and provide property managers and owners a proven platform for marketing their properties. Homesnap is an industry-leading online and mobile software platform that provides user-friendly applications to optimize residential real estate agent workflow and reinforce the agent-client relationship. Homes.com offers real estate professionals advertising and marketing services for residential properties. Realla is the UK’s most comprehensive commercial property digital marketplace. BureauxLocaux is one of the largest specialized property portals for buying and leasing commercial real estate in France. CoStar Group’s websites attract tens of millions of unique monthly visitors. Headquartered in Washington, DC, CoStar Group maintains offices throughout the U.S., Europe, Canada and Asia. From time to time we plan to utilize our corporate website, www.costargroup.com, as a channel of distribution for material company information.

This news release and the Company’s earnings conference call contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about CoStar Group's plans, objectives, expectations, beliefs and intentions and other statements including words such as “hope,” “anticipate,” “may,” “believe,” “expect,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or other comparable terminology. Such statements are based upon the current beliefs and expectations of management of CoStar Group and are subject to many risks and uncertainties. Actual results may differ materially from the results anticipated in the forward-looking statements and the assumptions and estimates used as a basis for the forward-looking statements. The following factors, among others, could cause or contribute to such differences: the risk that the trends stated or implied by this release or in the earnings conference call cannot or will not be sustained at the current pace or may increase or decrease, including trends and expectations related to revenue, revenue growth, net income, non-GAAP net income, EBITDA, adjusted EBITDA, adjusted EBITDA margin, sales, net new bookings, site traffic and visitors, leads, and renewal rates; the risk that the Company is unable to sustain current Company-wide, CoStar, Apartments or LoopNet net new bookings and that Multifamily market conditions remain favorable; the risk that revenues for the third quarter and full year 2022 will not be as stated in this press release; the risk that net income for the third quarter and full year 2022 will not be as stated in this press release; the risk that EBITDA for the third quarter and full year 2022 will not be as stated in this press release; the risk that adjusted EBITDA for the third quarter and full year 2022 will not be as stated in this press release; the risk that non-GAAP net income and non-GAAP net income per diluted share for the third quarter and full year 2022 will not be as stated in this press release; the risk that the tax rate estimates stated in this press release may change; and potential declines in our revenues, revenue growth rates and profitability due to the impact of the COVID-19 pandemic on the commercial real estate industry and economic conditions on the real estate industry and our core customer base. More information about potential factors that could cause results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, those stated in CoStar Group’s filings from time to time with the Securities and Exchange Commission, including in CoStar Group’s Annual Report on Form 10-K for the year ended December 31, 2021 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, each of which is filed with the SEC, including in the “Risk Factors” section of those filings, as well as CoStar Group’s other filings with the SEC (including Current Reports on Form 8-K) available at the SEC’s website (www.sec.gov). All forward-looking statements are based on information available to CoStar Group on the date hereof, and CoStar Group assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contacts

Investor Relations:

Cyndi Eakin

Senior Vice President

CoStar Group Investor Relations

(202) 346-6784

ceakin@costar.com

News Media:

Matthew Blocher

Vice President

CoStar Group Corporate Marketing & Communications

(202) 346-6775

mblocher@costargroup.com

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