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Monday, Nov 28, 2022
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In Midst of Buyout, ReachLocal Improves

In what may be its final earnings report as a stand-alone company, ReachLocal on Friday announced a second-quarter net loss that was much narrower than a year ago. The Woodland Hills company, which helps small and medium-sized businesses buy advertisements on the Internet, is being acquired for $156 million by Gannett Co. Inc., the publisher of USA Today and more than 100 other daily newspapers. Gannett early this month launched a cash tender offer for all of ReachLocal’s outstanding stock at $4.60 a share, which was nearly triple the trading price before the buyout announcement. The offer will close on Aug. 5; the companies expect the buyout to be completed in the third quarter. ReachLocal on Friday reported a net loss of 14 cents a share, in line with analysts’ expectations and well below the 36-cent loss reported in the same quarter last year. Adjusted earnings grew to $5.5 million from $715,000 last year, and beat expectations of $3.7 million. The online marketer’s revenue of $81.5 million was down nearly 18 percent from a year ago, but the number beat expectations of $79.8 million. At quarter’s end, the company had 16,000 active clients, down from 19,500, and 27,700 active product units, down from 29,600. Founded in 2004 in Encino, ReachLocal later moved to the Warner Center in Woodland Hills. It went public in 2010 when it sold shares for $13 each. It made several fastest-growing lists, but it struggled a bit in more recent years as it faced stiffened competition.

Charles Crumpley
Charles Crumpley
Charles Crumpley has been the editor and publisher of the San Fernando Valley Business Journal since March 2016. In June 2021, it was named the best business journal of its size in the country – the fourth time in the last 5 years it won that honor. Crumpley was named best columnist – also for the fourth time in the last 5 years. He serves on two business-supporting boards and has won awards for his civic involvement. Crumpley, a former newspaper reporter, won several national awards and fellowships for his work, and he was a Fulbright scholar to Japan.
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