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|For Immediate Release||More information:|
|James Hart, 203.956.8746 (O) 203.339.2578 (M)|
|Todd Smith, 615.764.2598 (O) 615.202.7944 (M)|
AFFINION GROUP, INC. ANNOUNCES RESULTS FOR THE FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2007
MEETS HIGH END OF ANNUAL GUIDANCE AND ACHIEVES FOURTH QUARTER ADJUSTED EBITDA OF $78.1 MILLION
REAFFIRMS 2008 ADJUSTED EBITDA GUIDANCE OF $305-$315 MILLION
NORWALK, Conn., Feb. 28, 2008 Affinion Group, Inc. (Affinion or the Company), a leading global affinity marketer of value-added membership, insurance and package enhancement programs and services to consumers, today announced its financial results for the three and twelve month periods ended December 31, 2007 (fourth quarter and full year, respectively).
Affinion delivered a very solid fourth quarter, concluding a successful year in which we achieved the high end of our financial commitments and accomplished several operational milestones which will position us very well for accelerated growth in 2008, said Nathaniel J. Lipman, Affinions President and Chief Executive Officer. Commenting further on the results, Lipman added, In both the quarter and the year, our North American and International regions increased their profits, and we continued to see positive results from our strategy of increasing the lifetime value of our members, as evidenced by the ongoing growth in our net revenue per average member.
Note: readers are urged to review the section entitled Important Notes at the end of this release for the description of certain items affecting the results, including a definition of the term Transactions.
Net revenues for the fourth quarter of 2007 were $336.6 million as compared to $336.1 million for the fourth quarter of 2006.
The increase in net revenues was primarily attributable to an increase of $4.9 million for the quarter as compared to the fourth quarter in 2006 due to the decline in the impact of the non-cash reduction in purchase accounting as part of the Transactions.
Net revenues excluding the impact of the Transactions decreased $4.4 million.
The decrease in revenue was the result of lower sales in North America partially offset by higher sales in International. The decline in North America was primarily the result of lower revenue for Membership & Insurance and Package products.
Segment EBITDA was $74.3 million compared to $39.3 million; these results include a positive variance of $2.0 million of non-cash purchase accounting adjustments.
Excluding the impact of the Transactions, Segment EBITDA increased $33.0 million, primarily due to lower marketing and commission costs, and lower product and servicing costs in North America due to a lower member base, which more than offset lower net revenues. In addition, Segment EBITDA benefited from $8.4 million in International, primarily due to higher net revenues net of increased marketing costs, as well as the absence in 2007 of a goodwill impairment charge of $15.5 million recorded in 2006 against the Loyalty business.
Adjusted EBITDA (as defined in Note (c) of Table 7) was $78.1 million as compared to $63.5 million for the fourth quarter of 2006.
Net revenues for 2007 were $1,321.0 million as compared to $1,137.7 million for 2006.
The increase in net revenues was primarily attributable to an increase of $184.1 million for the full year as compared to 2006 principally due to the decline in the impact of the non-cash reduction in deferred revenue recorded in purchase accounting as part of the Transactions.
The following information was filed by Affinion Group, Inc. on Thursday, February 28, 2008 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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