Angie's List Cuts Forecast

Angie's List Inc. on Wednesday cut its guidance for the year, even as the services marketplace and consumer-review site eked out a rare quarterly profit.

The company said it now expects revenue of $344 million to $348 million, down from its previous guidance of $357 million to $363 million in revenue.

The company also lowered its forecast for earnings before interest, taxes, depreciation and amortization to $27 million to $30 million from its prior guidance of $30 million to $32 million.

The company cited one-time expenses associated with the hiring of new chief executive Scott Durchslag, the former Best Buy Co. executive who took over in September.

Despite seeing revenue growth, Angie's List has posted mostly losses since going public in 2011, as expansion efforts have ratcheted up costs.

Mr. Durchslag said in a news release Wednesday that the company is focused on improving revenue growth and cash flow. He said the company has identified millions in cost cuts to be implemented next year.

In the most recent quarter, Angie's List booked a profit of $82,000, compared with a loss of $5.21 million in the prior year period. Angie's List said it was its first profitable third quarter in the company's history.

On a per-share basis, earnings were flat, compared with a loss of 9 cents a share a year earlier. Revenue grew 7% to $87 million.

Analysts polled by Thomson Reuters had expected the company to post a loss of 5 cents on $89.7 million in revenue.

Profit was helped by stabilizing operating expenses, which ticked up slightly to $86.2 million from $86 million in the prior-year period despite the revenue growth.

As of Sept. 30, total paid membership was 3.25 million, up 9% from the prior year. But the company added 298,922 gross paid members during the quarter, down 15% from a year earlier

Membership revenue slid 6% to $17.2 million.

Average renewal rates were flat at 77%.

The amount Angie's List spent on marketing per paid membership acquisition jumped 22% to $78.

Write to Chelsey Dulaney at [e-mail]

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(END) Dow Jones Newswires

October 21, 2015 08:05 ET (12:05 GMT)

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