RetailMeNot Plunges 21% On Weak Outlook, CFO Steps Down; Swings To Q3 Profit

(RTTNews) - Shares of RetailMeNot, Inc. (SALE) plummeted nearly 21 percent in extended trading on Monday after the digital coupon marketplace operator reported on weak outlook and the stepping down of Chief Financial Officer Douglas Jeffries.

However, the company reported a profit for the third quarter compared to a profit last year, reflecting double-digit revenue growth. Both adjusted earnings per share and quarterly revenues also topped analysts' expectations.

RetailMeNot operates a digital coupon marketplace, connecting consumers with retailers and brands. Its digital coupon websites include RetailMeNot.com and VoucherCodes.co.uk.

"I am pleased with the strong user engagement levels we have seen this quarter and am especially proud of the release of the redesigned RetailMeNot mobile app, which highlights an enhanced personalized and relevant savings experience for our users," Founder and CEO Cotter Cunningham said in a statement.

The Austin, Texas-based operator of the world's largest marketplace for digital offers reported net earnings attributable to common stockholders of $2.53 million or $0.05 per share for the third quarter, compared to a net loss of $2.16 million or $0.06 per share in the prior-year quarter.

Excluding items, adjusted earnings for the quarter was $0.16 per share, compared to $0.19 per share in the year-ago quarter.

On average, seven analysts polled by Thomson Reuters expected the company to report earnings of $0.13 per share for the third quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 19 percent to $56.47 million from $47.35 million in the same quarter last year, and topped seven Wall Street analysts' consensus estimate of $56.00 million.

Net revenues from international markets increased 37 percent to $13.2 million, representing 23 percent of total net revenues.

Mobile net revenues doubled to $11.7 million, representing 21 percent of total net revenues, and include net revenues from mobile websites, mobile applications and our in-store products.

Monthly mobile unique visitors for the quarter surged 81 percent to 14.5 million from the prior year. Global subscribers to email and store alerts totaled 25.8 million, up 87% year-over-year. Visits grew 22 percent to 161.5 million from last year.

Total costs and expenses for the quarter increased to $50.69 million from $37.94 million a year ago.

Looking ahead to the fourth quarter, the company expects revenues in a range of $84.7 million to $86.7 million, while analysts expect $90.9 million.

For fiscal 2014, the company now expects revenues between $262 million and $264 million. Street is currently looking for full-year 2014 revenues of $267.5 million.

"As we enter the holiday shopping season, we will continue to focus on broader consumer engagement through our mobile channel, and we look forward to offering retailers new opportunities to help build their brand, increase store traffic and grow sales," Cunningham added.

Additionally, the company announced CFO transition, with Douglas Jeffries deciding to step down, effective November 30, 2014 to return to his home on the west coast. Jeffries will remain with RetailMeNot to assist with the transition.

The company named Louis Agnese, General Counsel and Secretary, as interim CFO until a permanent replacement is found.

SALE closed Monday's regular trading session at $20.40, down $0.66 or 3.13% on a volume of 2.81 million shares. The stock plunged a further $4.21 or 20.64% in after-hours trading.