Scot Melland Chairman, President & CEO Mike Durney SVP ......Financial Services Recruiting SlowsLook...
Transcript of Scot Melland Chairman, President & CEO Mike Durney SVP ......Financial Services Recruiting SlowsLook...
Scot MellandChairman, President & CEO
Mike DurneySVP, Finance & CFO
Look to Dice for Your Staffing SolutionsForward Looking Statement
This presentation and oral statements made from time to time by our representatives contains forward lookingstatements. You should not place undue reliance on those statements because they are subject tonumerous uncertainties and factors relating to our operations and business environment, all of which aredifficult to predict and many of which are beyond our control. Forward-looking statements includeinformation without limitation concerning our possible or assumed future results of operations, includingdescriptions of our business strategy. These statements often include words such as “may,” “will,” “should,”“believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements arebased on assumptions that we have made in light of our experience in the industry as well as our perceptionsof historical trends, current conditions, expected future developments and other factors we believe areappropriate under the circumstances. Although we believe that these forward-looking statements are based onreasonable assumptions, you should be aware that many factors could affect our actual financial results orresults of operations and could cause actual results to differ materially from those in the forward-lookingstatements. These factors include, but are not limited to, competition from existing and future competitors inthe highly competitive market in which we operate, failure to adapt our business model to keep pace withrapid changes in the recruiting and career services business, failure to maintain and develop our reputationand brand recognition, failure to increase or maintain the number of customers who purchase recruitmentpackages, cyclicality or downturns in the economy or industries we serve, failure to attract qualifiedprofessionals to our websites or grow the number of qualified professionals who use our websites, failure tosuccessfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet andtaxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness andrestrictions on our current and future operations under such indebtedness. These factors and others arediscussed in more detail in the Company's filings with the Securities and Exchange Commission, all of whichare available on the Investor Relations page of our website at www.diceholdingsinc.com, including theCompany's Annual Report on Form 10-K for the fiscal year ended December 31, 2011, under the headings“Risk Factors,” “Forward-Looking Statements” and “Management's Discussion and Analysis of FinancialCondition and Results of Operations.”
You should keep in mind that any forward-looking statement made by the Company or its representativesherein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come upfrom time to time, and it is impossible to predict these events or how they may affect us. We have noobligation to update any forward-looking statements after the date hereof, except as required by federalsecurities laws.
This presentation includes certain "Non-GAAP financial information." A reconciliation of such information to the most directly comparable GAAP data can be found in the Company’s most recent earnings release.
Look to Dice for Your Staffing SolutionsDice Holdings: Leading Specialty Career Sites
Global OnlineCompany withVertical Focus
TargetedRecruitment
Focused on Large, Diverse
Market
Traffic Rankingfor Key Dice
Brands
#1$4.7B
Look to Dice for Your Staffing SolutionsLeading Specialty Career Sites
67%
FY 2012GRevenue
Contribution
20%
11%
Technology & Clearance
Finance
Energy
U.S.
U.K. Base 19 Global Markets
U.S. & Dubai Bases
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$179.1
$129.0
$110.0
$67.0
$155.0$143.9
$104.4
$52.1$49.6$68.0$62.5
$37.7
$77.6
$21.5
$0 .0
$2 0 .0
$4 0 .0
$6 0 .0
$8 0 .0
$10 0 .0
$12 0 .0
$14 0 .0
$16 0 .0
$18 0 .0
$2 0 0 .0
2 0 0 5PF 2 0 0 6 PF 2 0 0 7 2 0 0 8 2 0 0 9 2 0 10 2 0 11
($mm)
Note: Includes eFinancialCareers pre-acquisition; not adjusted for Energy acquisitions.
Consistently Delivering Strong Profitability
Margin % 32% 36% 44% 45% 45% 40% 43% 41%
Adjusted EBITDARevenues
Look to Dice for Your Staffing SolutionsToday’s Agenda
Vertical Advantage
Solid Financial Model
Market Dynamics
2012 Initiatives
Look to Dice for Your Staffing Solutions
Post JobsSearch Resumes
AdvertiseNetwork
Recruiters & HR Vertical Focus
High ValueAudience
Pay-off
Strong ROI
Vertical Focus Leads to Superior Results
Efficient Reach
Fast Response
Look to Dice for Your Staffing SolutionsBuilding an Audience of Actionable Candidates
Tech Talent
Leave-alone contentsVery unlikely to leavecurrent positions
Silver platter passivesLeave if opportunitydropped in their lap
Career managersOpen to new opportunities andmanaging their careersActive seekers
Looking for a job – unfavorablework situation or betweenassignments
33%
13%
29%
30%
25% 27%Dice Sample
National Sample
8%
31%
Look to Dice for Your Staffing SolutionsToday’s Agenda
Vertical Advantage
Solid Financial Model
Market Dynamics
2012 Initiatives
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InternationalNorth AmericaNotes: Dice Estimates; International does not include Africa, Middle East.
Estimate of Global Online Recruiting Market(in billions)
Online Recruitment Market Growing
$1.7 $2.1 $2.1
$1.5 $1.7$2.3 $2.6
$1.8
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
$3.5
$4.0
$4.5
$5.0
2009 2010 2011 2012
$3.2$3.5 7%
$4.4$4.7
Look to Dice for Your Staffing Solutions27 Months of Private Sector Job Growth
-900
-450
0
450
900
Jan-
01
Jan-
03
Jan-
05
Jan-
07
Jan-
09
Jan-
11
Source: Bureau of Labor Statistics
(in thousands)Monthly Change in U.S. Private Sector Employment
Look to Dice for Your Staffing SolutionsBest Job Creating Category in Recovery
Source: BLS Employment Situation - Professional and Business Services
(in thousands)Professional and Business Services
Monthly Change in Employment
-200
-100
0
100
200
Jan-
01
Jan-
03
Jan-
05
Jan-
07
Jan-
09
Jan-
11
Look to Dice for Your Staffing SolutionsBut Turnover is the Driver!
Source: BLS Employment Situation - Professional and Business Services
(in thousands)Professional and Business Services
Monthly Change in Employment
-200
0
200
400
600
Jan-
01
Jan-
03
Jan-
05
Jan-
07
Jan-
09
Jan-
11
Level of Voluntary Quits
and BLS JOLTS Survey – Professional and Business Services Quits
average
Look to Dice for Your Staffing SolutionsTech & Finance are Tighter Labor Markets
Unemployment Rates
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12
OverallFinancialTechnology
Source: Bureau of Labor Statistics; overall unemployment rate is seasonally adjusted – Technology and Finance are not seasonally adjusted
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-100% +100%0%
Change in Dice Job Postings(Yr/Yr)
Tech Recruiting Good, Not Great
Note: Based on percentage change in Dice.com job postings by state measured at June 1, 2012
Seattle+20% yr/yr
Chicago+14% yr/yr
Atlanta+13% yr/yr
Dallas+14% yr/yr
New York-1% yr/yr
D.C.+9% yr/yr
Silicon Valley+15% yr/yr
Look to Dice for Your Staffing SolutionsFinancial Services Recruiting Slows
eFinancialCareers Job Postings
0
2,000
4,000
6,000
8,000
10,000
12,000S
ep-0
8
Dec
-08
Mar
-09
Jun-
09
Sep
-09
Dec
-09
Mar
-10
Jun-
10
Sep
-10
Dec
-10
Mar
-11
Jun-
11
Sep
-11
Dec
-11
Mar
-12
Jun-
12
Note: eFinancialCareers job postings by region measured 1st day of the month.
UK Continental Europe & Middle East Asia Pacific US
Look to Dice for Your Staffing SolutionsSolid Hiring in Oil & Gas
Change in U.S. Oil & Gas Employment
-60,000
-40,000
-20,000
0
20,000
40,000
60,000
80,00020
00
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
YTD
Note: Bureau of Labor Statistics combined categories of oil and gas extraction and support activities for oil and gas operations.
Look to Dice for Your Staffing SolutionsToday’s Agenda
Vertical Advantage
Solid Financial Model
Market Dynamics
2012 Initiatives
Look to Dice for Your Staffing Solutions2012 Investments by Key Verticals
Expanding AsiaNew Client Platform
Increasing Content, Features & FunctionalityUpdating Mobile
Introducing Talent Communities
Customer Penetration
Customer PenetrationRegional Sales
Editorial Coverage
Regionalizing Platform
Look to Dice for Your Staffing SolutionsIntroduced Dice Blog Network
~3,800 Articles Posted
Look to Dice for Your Staffing SolutionsLaunched Mobile Applications
Mobile: 10% of visits
Look to Dice for Your Staffing SolutionsIntroduced Talent Communities
Look to Dice for Your Staffing Solutions
2012 Actionable Candidates
Note: Rigzone registered users after combination of Rigzone/WorldwideWorker. The percentages may not total 100% due to rounding
11%
27%
27%22%
9%
2%
3%
Globalizing Rigzone: 1.2 mm Oil & Gas Pros
Look to Dice for Your Staffing SolutionsToday’s Agenda
Vertical Advantage
Solid Financial Model
Market Dynamics
2012 Initiatives
Look to Dice for Your Staffing Solutions
$18.5
$52.1
$0.0
$10.0
$20.0
Q1 2011 Q1 2012
Q1 2012: Solid Growth and Profitability
Revenue
$46.1
$40.1
$0.0
$25.0
$50.0
Q1 2011 Q1 2012
($mm)
Margin % 40% 40%
($mm) ($mm)
Adjusted EBITDA Free Cash Flow
$21.9
$14.1
$0.0
$12.5
$25.0
Q1 2011 Q1 2012
+16% +56%+15%
Look to Dice for Your Staffing SolutionsQ2: More Uncertain Environment
U.S. Employment Situation
Turnover
Uncertainty
Subpar
Category Indicator Comment
Job Postings Flattening
Resume Database Searches Still Positive
Customer Count Flattening
Revenue per Customer Positive
Look to Dice for Your Staffing SolutionsQ2: More Uncertain Environment
UK Hanging In
Continental Europe & ME Getting Worse
Asia-Pacific Global Impact
US Getting Worse
Career Center Expanding Globally
Advertising Strong
Look to Dice for Your Staffing SolutionsTraditional Sales & Marketing Expense: 35 – 40% of Revenue
Marketing
– Salespeople Compensation
– Other Selling Costs
– Marketing to Professionals
– Lead Generation and Marketing to Customers
– Marketing Personnel
Sales
Look to Dice for Your Staffing SolutionsTraditional Other Expenses: 20 – 25% of Revenue
– Customer Support
– Technology Infrastructure
– Executive
– Accounting & Finance
– Strategic Planning, Investor Relations, Legal, Insurance
– Office Leases & Support
– Audit
– Website/Mobile Development and Product Enhancement
– Editorial/Content Development
Cost of Revenue
ProductDevelopment
G&A
Look to Dice for Your Staffing SolutionsInvesting in Product Development
37% 37%
32%34%
33%
3% 3% 4%5% 6%
0%
10%
20%
30%
40%
2007 2008 2009 2010 2011
Expenses(% of Revenue)
Sales & Marketing Product Development
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Acquisitions
Cash Priorities
Share Repurchase
Investing for Organic Growth
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$0.0
$20.0
$40.0
$60.0
2006 2007 2008 2009 2010 2011 2012
Quarterly Free Cash Flow
Strong Free Cash Flow
1Q 2Q 3Q 4Q
$52.1
$38.1
$50.2
$19.8
$42.4
$61.4
$21.9
Look to Dice for Your Staffing SolutionsGrowth through Acquisitions
AcquisitionStrategy
Other VerticalsHighly Paid
Difficult/Costly to Recruit
Skill/Experience Specificity
Part of a Community
High Velocity of Change
InternationalOpens New Markets
Use Content Sites to Expand into Careers
Content/Information, Services, ToolsDrives Recurring Use for Communities
Service Creates Deeper Relationships
Expands Vertical Expertise
Look to Dice for Your Staffing SolutionsDice Holdings Highlights
Vertical Focus = Strong Competitive Advantage
Small Share of Large Global Market
Sizeable Long-term Growth Opportunities for Technology, Finance and Energy Verticals
Excellent Margins coupled with Strong Cash Generation
Q&AScot Melland
Chairman, President & CEO
Mike DurneySVP, Finance & CFO