Groupon Results Top Estimates; Outlook Weak

(RTTNews) - Daily deals site Groupon Inc (GRPN) said Thursday after the markets closed that its swung to a fourth quarter profit, helped by higher revenue, an income tax benefit and the absence of a hefty impairment charge that it took last year.

The company's quarterly earnings per share, excluding item, also came in above analysts' expectations as did its quarterly revenue. At the same time, the company forecast first quarter revenue and earnings below analysts' current consensus estimate.

Groupon CEO Eric Lefkofsky said, "Global billings hit their highest level ever in the quarter, growing more than 30%, driven in part by our reignited North America Local business. We now turn our attention to further building out our marketplace to ensure that our more than 260 million subscribers have an amazing experience every time they use Groupon."

Groupon shares are currently losing 0.67% in after hours trading after closing the day's regular trading session at $7.46, down 12 cents or 1.58%. The shares trade in a 52-week range of $5.18 to $10.88.

Groupon also said that multiple parties have expressed preliminary interest in Ticket Monster, although it is too early to comment on structure, pricing or the likelihood of a deal, as the process is still underway.

Groupon acquired Ticket Monster, South Korea's No. 2 mobile commerce firm, from peer LivingSocial Inc for $260 million in November 2013. Groupon said in October that as growth opportunities exist for Ticket Monster, and broadly for the Asian business, it has hired financial advisers to evaluate financing and strategic alternatives for those businesses to unlock shareholder value.

Groupon informs consumers about deals of the day through emails. Having faced stiff competition, the company is transforming itself into a broader e-commerce player.

For the fourth quarter ended December 31, 2014, the Chicago, Illinois-based company reported net income of $8.8 million or $0.01 per share, compared to a net loss of $81.2 million or $0.12 per share for the year-ago quarter.

Excluding items, adjusted earnings for the latest quarter were $0.06 per share.

On average, 23 analysts polled by Thomson Reuters expected the company to earn $0.03 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Revenue for the fourth quarter rose 20% to $925.42 million from $768.45 million in the same quarter last year. Twenty-three analysts had a consensus revenue estimate of $908.38 million for the fourth quarter.

Active customers, or customers that have purchased a voucher or product within the last twelve months, grew 23% year-over-year, to 53.9 million at December 31, 2014.

Gross billings, which reflect the total dollar value of customer purchases of goods and services, increased 31% to $2.1 billion in the fourth quarter.

Looking forward to the first quarter, Groupon forecasts revenue of $790 million to $840 million and adjusted earnings of $0.00 to $0.02 per share. Analysts currently expect the company to earn $0.03 per share on revenue of $856.14 million for the first quarter.