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Constant Contact Q4 Profit Down 66%, But Beats View; Sees Loss In Q1

Constant Contact, Inc. (CTCT: Quote), a provider of email marketing services, reported a 66 percent plunge in profit for the fourth quarter from last year when results included a tax benefit. Adjusted earnings per share declined, but beat analysts' estimates, while revenues also beat their expectations.

Looking ahead, the company forecast a loss for the first quarter, while analysts expect the company to report a profit. Shares of the company declined more than 5 percent in extended trade.

Waltham, Massachusetts-based Constant Contact said it added 45,000 gross new unique customers in the quarter. The company ended the fourth quarter with 555,000 unique customers, up from 500,000 unique customers at the end of the year-ago quarter. This includes the approximately 10,000 existing SinglePlatform customers at the time of the acquisition in June 2012.

Average monthly revenue per unique customer or ARPU rose to $41.12 from $38.94 in the same period last year.

Constant Contact's fourth-quarter net income was $6.38 million or $0.21 per share, down from $18.90 million or $0.62 per share in the previous-year quarter.

The latest quarter's results included a non-cash benefit of $6.1 million or $0.20 per share from a change to the fair value of a contingent consideration liability associated with the acquisition of SinglePlatform. The prior-year quarter's results included a tax benefit of $13.78 million or $0.45 per share, primarily associated with the release of the deferred tax asset valuation allowance.

Adjusted net income was $5.11 million or $0.17 per share, compared to adjusted net income of $8.14 million or $0.27 per share in the same period last year. On average, seventeen analysts polled by Thomson Reuters expected the company to earn $0.16 per share for the quarter.

Revenue for the quarter grew 15 percent to $66.30 million from $57.53 million in the prior-year quarter and beat analysts' consensus estimate of $65.42 million.

For fiscal 2012, Constant Contact's net income declined to $12.76 million or $0.41 per share from $23.68 million or $0.77 per share in the previous year. Adjusted net income was $17.46 million or $0.56 per share, compared to adjusted net income of $21.79 million or $0.71 per share in the prior year.

Revenue for the year grew 18 percent to $252.15 million from $214.42 million last year.

Analysts expected the company to earn $0.55 per share for the year on revenues of $251.28 million.

Looking ahead to the first quarter, Constant Contact forecasts loss per share of $0.09 to $0.10, adjusted loss per share of $0.03 to $0.04, and revenue of $67.9 million to $68.2 million. Wall Street analysts expect the company to report earnings of $0.09 per share for the quarter on revenues of $67.85 million.

For fiscal 2013, Constant Contact now forecasts reported earnings of $0.10 to $0.13 per share, adjusted earnings of $0.62 to $0.69 per share, and revenue of $284 million to $289 million. Earlier, the company forecast revenue growth for the year of about 13 to 15 percent.

Street expects the company to report earnings of $0.68 per share for the year on revenues of $285.04 million.

CTCT closed Thursday's trading at $15.06, up $0.08 or 0.53 percent on a volume of 830,871 shares. In after-hours, the stock declined $0.76 percent or 5.05 percent to $14.30.

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by RTT Staff Writer

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