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Reis, Inc. Announces First Quarter 2011 Results

Reis Services Reports Revenue Growth of 10% and EBITDA Growth of 12.6% Over First Quarter 2010

NEW YORK, May 6, 2011: Reis, Inc. (NASDAQ:REIS) ("Reis" or the "Company"), a leading provider of commercial real estate market information and analytical tools, announced its financial results and operational achievements for the quarter ended March 31, 2011.

Results and Performance

Financial Results Summary

Consolidated revenue for the three months ended March 31, 2011 was $6,617,000 compared to $8,764,000 for the three months ended March 31, 2010. During the first quarter of 2011, revenue was comprised solely of subscription revenue from the Reis Services segment, whereas during the first quarter of 2010, revenue was comprised of subscription revenue (from the Reis Services segment) of $6,014,000 and revenue from sales of real estate (from the Residential Development Activities segment) of $2,750,000. Reis Services's revenue for the first quarter of 2011 is the highest amount reported by the Company in its history.

On a consolidated basis, the Company had net income of $10,000, or $0.00 per basic and diluted share, for the three months ended March 31, 2011. The Company reported a net loss of $(177,000), or $(0.02) per basic and diluted share, for the three months ended March 31, 2010.

Management uses other metrics such as EBITDA (earnings before interest, taxes, depreciation and amortization) to monitor and assess Reis Services's performance and believes it is helpful to investors in understanding Reis Services's business (see Reconciliations of Net Income to EBITDA and Adjusted EBITDA below for the Reis Services segment and on a consolidated basis).

Reis Services's EBITDA was $2,619,000 and the EBITDA margin was 39.6% during the first quarter of 2011. EBITDA increased 12.6% over the first quarter of 2010 total of $2,326,000. EBITDA for the first quarter of 2011 is also in excess of the fourth quarter 2010 amount of $2,407,000, representing growth on a consecutive quarter basis of 8.8%. The EBITDA margins were 38.7% and 39.0% for the first and fourth quarters of 2010, respectively.

Operational, Financial and Balance Sheet Highlights

Following are recent operational, financial and balance sheet highlights for Reis:

Lloyd Lynford, CEO of Reis stated, "Our financial results are not only a signal that Reis has successfully returned to growth. Our strong revenue and EBITDA gains testify to the cumulative impact of several years of investing in our core information and analytical products. These investments are now providing a return to Reis's stakeholders."

Reis Services Critical Metrics: Revenue, Deferred Revenue, Aggregate Revenue Under Contract and EBITDA

Reis Services's revenue for the three months ended March 31, 2011 of $6,617,000 is the highest for any quarter in the Company's history. Reis Services's revenue increased by approximately $603,000, or 10.0%, from the first quarter of 2010 to the first quarter of 2011. This revenue increase over the corresponding prior quarterly period is the fourth consecutive quarterly increase in revenue over the prior year's quarter. In addition, revenue increased by approximately $450,000, or 7.3%, from the fourth quarter of 2010 to the first quarter of 2011. In general, these revenue increases reflect (1) positive improvements in overall renewal rates as the trailing twelve month renewal rate improved to 90% at March 31, 2011 as compared to 87% for the trailing twelve months ended March 31, 2010, (2) the cumulative impact of the strength of contract signings throughout 2010, especially in the fourth quarter and into early 2011 and (3) additional new business.

As noted above, our overall trailing twelve month renewal rates improved from 87% at March 31, 2010 to 90% at March 31, 2011 and, for institutional subscribers, the renewal rates improved from 88% at March 31, 2010 to 93% at March 31, 2011. The fourth quarter and full year of 2010 were record periods for the Company for total contracts signed (based upon the value of annual contracts executed in those periods for both new and renewal business). The fourth quarter of 2010 also represented the best quarter for new business, based upon the value of annual contracts executed in that period, and the 2010 annual period was the second best annual period for new business (trailing only the 2007 annual period). The renewal rate improvements, coupled with new business from both existing and new subscribers, allowed revenue to stabilize in the first nine months of 2010 as older prior year contracts rolled out of the revenue base and a higher percentage of expiring contracts were renewed. The level of contract signings in 2010, and specifically in the fourth quarter of 2010, resulted in the revenue growth recorded during the fourth quarter of 2010 and continuing into the first quarter of 2011.

Two additional metrics management believes are critical in understanding the business and future performance are deferred revenue and Aggregate Revenue Under Contract. Analyzing these amounts can provide additional insight into Reis Services's financial performance. Deferred revenue, which is a GAAP basis accounting concept and is reported by the Company on the consolidated balance sheet, represents revenue from annual or longer term contracts for which we have billed and/or received payments from our subscribers related to services we will be providing over the period. It does not include future revenue under non-cancellable contracts for which we do not yet have the contractual right to bill; this aggregate number we refer to as Aggregate Revenue Under Contract. Deferred revenue will be recognized as revenue ratably over the life of a contract. The following table reconciles deferred revenue to Aggregate Revenue Under Contract at March 31, 2011 and 2010. A comparison of these balances at March 31 of each year is more meaningful than a comparison to the December 31, 2010 balances, as a greater percentage of renewals occur in the fourth quarter of each year and would distort the analysis.

The increases in both deferred revenue and Aggregate Revenue Under Contract are the result of an improved sales environment for renewals, increased new business, as described above in the revenue discussion, and the signing of more multi-year contracts.

EBITDA for the three months ended March 31, 2011 was $2,619,000, an increase of $293,000, or 12.6%, over the first quarter 2010 amount. On a consecutive quarter basis, EBITDA increased $212,000 or 8.8% in the first quarter 2011 over the fourth quarter 2010. These increases are directly impacted by the increases in revenue as described above while maintaining EBITDA margins in the 39% to 40% range.

EBITDA is defined as earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization and stock based compensation. Although EBITDA and Adjusted EBITDA are not measures of performance calculated in accordance with GAAP, senior management uses EBITDA and Adjusted EBITDA to measure operational and management performance. Management believes that EBITDA and Adjusted EBITDA are appropriate metrics that may be used by investors as supplemental financial measures to be considered in addition to the reported GAAP basis financial information to assist investors in evaluating and understanding (1) the performance of the Reis Services segment, the primary business of the Company and (2) the Company's consolidated results, from year to year or period to period, as applicable. Further, these measures provide the reader with the ability to understand our operational performance while isolating non-cash charges, such as depreciation and amortization expenses, as well as other non-operating items, such as interest income, interest expense and income taxes and, in the case of Adjusted EBITDA, isolates non-cash charges for stock based compensation. Management also believes that disclosing EBITDA and Adjusted EBITDA will provide better comparability to other companies in the information services sector. However, investors should not consider these measures in isolation or as substitutes for net income (loss), operating income (loss), or any other measure for determining operating performance that is calculated in accordance with GAAP. In addition, because EBITDA and Adjusted EBITDA are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. Reconciliations of EBITDA and Adjusted EBITDA to the most comparable GAAP financial measure, net income (loss), follow for each identified period:

Residential Development Activities

At March 31, 2011, the Company's residential development activities were comprised solely of The Orchards, a single family home development in East Lyme, Connecticut, upon which the Company could build 161 single family homes on 224 acres, which we refer to as East Lyme. An aggregate of 42 homes and lots (29 homes and 13 lots) were sold as of March 31, 2011 and the remaining inventory at that time included 119 lots. No home or lot sales occurred during the three months ended March 31, 2011 and 2010.

On April 25, 2011, the Company sold the East Lyme project in a bulk transaction for a gross sales price of $1,800,000 for the 119 lots, plus the release of approximately $792,000 of deposits and escrows held as restricted cash. Net cash received at closing, after selling expenses and closing adjustments, and including the cash received upon release of the deposits and escrows, aggregated approximately $2,600,000. As a result of this transaction, the Company expects to record a gain in the second quarter of 2011.

Investor Conference Call

The Company will host a conference call on Friday, May 6, 2011, at 11:00 AM (EDT). This call is for the benefit of existing and prospective stockholders, stock analysts, and other interested parties to discuss first quarter 2011 results and other matters. The Company has a policy of not providing quarterly or annual guidance.

The dial-in number from inside the U.S. or Canada for this teleconference is (877) 390-5537. The dial-in number for outside the U.S. and Canada is (760) 666-3763. The conference ID is 64398369 or "Reis". A replay of the conference call will be available from shortly after the conference call through midnight (EDT) on May 20, 2011 by dialing (800) 642-1687 from inside the U.S. or Canada or (706) 645-9291 from outside the U.S. and Canada, and referring to the conference ID: 64398369. An audio webcast of the conference call will also be available on Reis's website at www.reis.com/events and will remain on the website for a period of time following the call.

About Reis

The Company's primary business is providing commercial real estate market information and analytical tools for its subscribers, through its Reis Services subsidiary. Reis Services, including its predecessors, was founded in 1980. Reis maintains a proprietary database containing detailed information on commercial properties in metropolitan markets and neighborhoods throughout the U.S. The database contains information on apartment, office, retail and industrial properties and is used by real estate investors, lenders and other professionals to make informed buying, selling and financing decisions. In addition, Reis data is used by debt and equity investors to assess, quantify and manage the risks of default and loss associated with individual mortgages, properties, portfolios and real estate backed securities. Reis currently provides its information services to many of the nation's leading lending institutions, equity investors, brokers and appraisers.

Reis, through its flagship institutional product, Reis SE, and through its new small business product, ReisReports, provides online access to a proprietary database of commercial real estate information and analytical tools designed to facilitate debt and equity transactions as well as ongoing evaluations. Depending on the product, users have access to trend and forecast analysis at metropolitan and neighborhood levels throughout the U.S. and/or detailed building-specific information such as rents, vacancy rates, lease terms, property sales, new construction listings and property valuation estimates. Reis's products are designed to meet the demand for timely and accurate information to support the decision-making of property owners, developers, builders, banks and non-bank lenders, and equity investors. These real estate professionals require access to timely information on both the performance and pricing of assets, including detailed data on market transactions, supply, absorption, rents and sale prices. This information is critical to all aspects of valuing assets and financing their acquisition, development and construction.

For more information regarding Reis's products and services, visit www.reis.com and www.ReisReports.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to the Company's or management's outlook or expectations for earnings, revenues, expenses, asset quality, or other future financial or business performance, strategies, prospects or expectations, or the impact of legal, regulatory or supervisory matters on our business, operations or performance. Specifically, forward-looking statements may include:

Forward-looking statements reflect management's judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. With respect to these forward-looking statements, management has made certain assumptions. Future performance cannot be assured. Actual results may differ materially from those contemplated by the forward-looking statements. Some factors that could cause actual results to differ include:

You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this press release. Except as required by law, the Company undertakes no obligation to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

Press Contact:
Mark P. Cantaluppi
Vice President, Chief Financial Officer
Reis, Inc.
(212) 921-1122

Financial Information

The following financial information should be read in conjunction with Reis's consolidated financial statements and the notes thereto and Management's Discussion and Analysis of Financial Condition and Results of Operations, both of which are included in Reis's quarterly report on Form 10-Q for the three months ended March 31, 2011, which was filed with the Securities and Exchange Commission on May 6, 2011.

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