WASHINGTON, July 27, 2016 (GLOBE NEWSWIRE) -- CoStar Group, Inc. (NASDAQ:CSGP), the leading provider of commercial real estate information, analytics and online marketplaces, announced today that revenue for the quarter ended June 30, 2016 was $207 million, an increase of 21% over revenue of $171 million for the second quarter of 2015. Cost of revenues and operating expenses were reduced by 6% in the second quarter of 2016 to $179 million versus $191 million in the second quarter of 2015.

“After a successful investment year in 2015, we have created a surge in profitability in the first half of 2016 as we continue to grow the top line impressively and deliver strong margin improvement,” said Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group. “We grew revenue by $36 million and cut expenses by $12 million in the second quarter of 2016 compared to the second quarter of 2015. CoStar Suite revenue growth accelerated to 14% in the second quarter of 2016 versus the second quarter of 2015 and multifamily revenue increased 58% with 24% pro-forma growth over the same period.”

Florance stated, “In the first half of 2016, Apartments.com continued to break away from the pack as the most trafficked apartment internet listing site. According to comScore, in June 2016 Apartments.com generated nearly 23 million visits, which is more than all other apartment internet listing sites. In the same month compared to last year, Apartments.com unique visitors grew 40%, while our two primary competitors saw decreases of 9% and 14%, respectively.”

Net income for the second quarter of 2016 increased to $16 million or $0.48 per diluted share compared to a net loss of $(15) million in the second quarter of 2015. EBITDA in the second quarter of 2016 was $46 million compared to $(1) million in the second quarter of 2015, an increase of $47 million.

Non-GAAP net income (defined below) for the quarter ended June 30, 2016 was $29 million or $0.91 per diluted share, an increase of $27 million compared to non-GAAP net income of $2 million in the second quarter of 2015. Adjusted EBITDA (which excludes stock-based compensation and other items as defined below) was $56 million for the second quarter of 2016 versus $11 million in the second quarter of 2015, which is an increase of 394% year-over-year.

As of June 30, 2016, the Company had approximately $475 million in cash, cash equivalents and investments, which is an increase of $38 million since December 31, 2015. Short and long-term debt outstanding, net of debt issuance costs, totaled approximately $337 million as of June 30, 2016.

2016 Outlook
“The Company continued to deliver strong revenue growth and better than expected earnings in the second quarter of 2016,” stated Scott Wheeler, Chief Financial Officer of CoStar Group. “With our continued focus on cost management, we are increasing our full-year earnings outlook and expect further margin expansion in the second half of the year.”

Wheeler continued, “In the second quarter of 2016, we achieved the second highest sales quarter in our history in both CoStar Suite and Multifamily. For the fifth consecutive quarter, we generated over $25 million in net bookings with $26 million in net bookings in the second quarter of 2016. Annualized net new sales on annual subscriptions were $23 million in the second quarter of 2016.”

The Company expects revenue of approximately $211 million to $213 million for the third quarter of 2016. Adjusting for the shut-down of non-core services at Apartment Finder in 2015, the current outlook anticipates pro-forma revenue growth (defined below) in the range of 13% to 14% for the third quarter of 2016 over the third quarter of 2015. For the full year of 2016, the Company reaffirms its revenue outlook of approximately $834 million to $840 million.

The Company exceeded its second quarter 2016 non-GAAP net income per share outlook by approximately $0.09 at the midpoint and expects to reinvest a portion of this favorability into growth initiatives in the third and fourth quarters of 2016. For the third quarter of 2016, the Company expects non-GAAP net income per diluted share (defined below) of approximately $1.00 to $1.04. For the full year of 2016, the Company expects non-GAAP net income per diluted share in a range of approximately $4.05 to $4.13, raising the midpoint by $0.04 from the prior outlook, and by $0.42 from the Company’s initial 2016 guidance.

The preceding forward-looking statements reflect CoStar Group’s expectations as of July 27, 2016, including forward-looking non-GAAP financial measures on a consolidated basis. We are not able to forecast with certainty whether or when certain events, such as acquisition-related costs, the exact amounts or timing of investments, transition, restructuring, settlements or impairments will occur in any given quarter. Given the risk factors, uncertainties and assumptions discussed above, actual results may differ materially. Other than in publicly available statements, the Company does not intend to update its forward-looking statements until its next quarterly results announcement.

Reconciliation of EBITDA, adjusted EBITDA, non-GAAP net income and non-GAAP net income per diluted share and all of the disclosed non-GAAP financial measures to their GAAP basis results are shown in detail below, along with definitions for those terms. A reconciliation of forward-looking non-GAAP guidance to the most directly comparable GAAP measure, net income, can be found within the tables included in this release.

Non-GAAP Financial Measures
For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this release and why management believes they provide useful information to investors regarding the Company’s financial condition and results of operations, please refer to the Company’s latest periodic report.

EBITDA is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before (i) interest income (expense), (ii) provision for income taxes, and (iii) depreciation and amortization.

Adjusted EBITDA is a non-GAAP financial measure that represents EBITDA before (i) stock-based compensation expense, (ii) acquisition and integration related costs, (iii) restructuring charges and related costs, and (iv) settlements and impairments incurred outside the Company’s normal business operations.

Non-GAAP net income is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before (i) purchase amortization and other related costs, (ii) stock-based compensation expense, (iii) acquisition and integration related costs, (iv) purchase accounting adjustments, (v) restructuring charges and related costs, and (vi) settlements and impairments. From this figure, we then subtract an assumed provision for income taxes to arrive at non-GAAP net income. The company assumes a 38% tax rate in order to approximate our long-term effective corporate tax rate.

Non-GAAP net income per diluted share (also referred to as non-GAAP EPS) is a non-GAAP financial measure that represents non-GAAP net income divided by the number of diluted shares outstanding for the period. For periods with GAAP net losses and non-GAAP net income, the weighted-average outstanding shares used to calculate non-GAAP net income per share includes potentially dilutive securities that were excluded from the calculation of GAAP net income per share as the effect was anti-dilutive.

Pro-forma Revenue Definition
Pro-forma revenue growth rates presented in this release include the addition of Apartment Finder core online marketplace revenue recognized prior to the June 1, 2015 acquisition date and exclude any pre- or post- acquisition revenue for discontinued Apartment Finder services such as Finder Social.

About CoStar Group, Inc.

CoStar Group, Inc. (NASDAQ:CSGP) is the leading provider of commercial real estate information, analytics and online marketplaces. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. LoopNet is the most heavily trafficked commercial real estate marketplace online with more than 10 million registered members. Apartments.com, ApartmentFinder.com and ApartmentHomeLiving.com form the premier online apartment resource for renters seeking great apartment homes and provide property managers and owners a proven platform for marketing their properties. Through an exclusive partnership with Move, a subsidiary of News Corporation, Apartments.com is the exclusive provider of apartment community listings across Move’s family of websites, which include realtor.com®, doorsteps.com and move.com. CoStar Group’s websites attracted an average of nearly 25 million unique monthly visitors in aggregate in the second quarter of 2016. Headquartered in Washington, DC, CoStar maintains offices throughout the U.S. and in Europe and Canada with a staff of approximately 2,700 worldwide, including the industry’s largest professional research organization. For more information, visit www.costargroup.com.