BALTIMORE-May 9, 2007-- Vertis Communications, a leading provider of targeted advertising, media and marketing solutions, announced today results for the three months ended March 31, 2007.
Revenue for the first quarter of 2007 met expectations, at $330.7 million versus $348.1 million in the first quarter of 2006. This decrease of $17.4 million or 5.0 percent was primarily impacted by a decline in volume in Advertising Inserts and a decline in Premedia revenue, which contributed to the overall aggregate revenue decline in these businesses of $24.6 million. Revenue growth in the Direct Mail segment partially offset this decline.
Net loss during the quarter grew to $25.2 million from $21.5 million in the same quarter one year ago. Most of this decline is attributed to the revenue drop, but this was partially offset by lower spending levels.
Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA")
EBITDA in the first quarter of 2007 declined, as expected, to $21.3 million from $25.4 million for the same period in 2006. Adjusted EBITDA was $24.6 million in the first quarter of 2007, a decline of $10.8 million, or 31 percent, from Adjusted EBITDA of $35.4 million in the same quarter of 2006. This decline was largely because of the decrease in revenue.
Cash and Liquidity
The Company ended the quarter with $12.0 million in cash and debt of approximately $1,094.1 million. In addition, the off-balance sheet Accounts Receivable facility stood at $113.4 million. The Company ended the quarter with $121.6 million available on its $250 million senior credit facility. Last 12 month Adjusted EBITDA calculated for covenant purposes was $158.7 million or $33.7 million above the minimum requirement.
Additional information on the results is available in the Company's Form 10-Q filed with the SEC on May 9, 2007.
Mike DuBose, chairman and chief executive officer commented, "Our first quarter results were consistent with internal expectations and in line with our 2007 performance targets, which we outlined during last quarter's call. During the first quarter we successfully completed our assessment of the Company and launched our turnaround initiatives. We also completed the majority of our critical hires, filling organizational voids and strengthening the management team."
Mr. DuBose continued, "For the balance of 2007, our focus will remain on aggressive and continuous process improvements across the entire Company consistent with the turnaround plan we outlined last month. We continue to see significant additional opportunities to improve quality, efficiency, and customer satisfaction as well as driving higher levels of profitable growth."
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