Slide 1: Corporate Overview Q1 2014
Slide 2: Forward looking statements
Forward looking statements Adjusted EBITDA , as defined above, is not a measurement under GAAP. Adjusted EBITDA is reconciled to net loss and loss per share, which we believe are the most comparable GAAP measures, at the end of this presentation. Management believes that Adjusted EBITDA provides use
Slide 3: Our mission
Making it easy for consumers to find and connect with the products and businesses they want and need. Our mission
Slide 4: Who we are
1999/2004 LOCM (NASDAQ) 31% from 2006 to 2013 27 million consumers/month Local.com – Top US Site ~ 1,600 sites 12 issued + applications pending Deloitte Fast 500 ™ 4 years in a row Irvine, CA ~90 Founded/IPO Ticker Revenue CAGR Reach Flagship Site Network Patents Recognition Headquarters Employees C
Slide 5: Structured for growth
Growing base of consumers and partners • 27 million consumers/month • 1,600 network sites Positioned to be leader in mobile • Mobile traffic up 24% Y/Y • Expanding mobile search landscape Multiple avenues to value • Display/pay-per-click/pay-per-call ads • Leverage Krillion data technology • IP mone
Slide 6: Enhancing the value of online search
Rich Content Basic Content Enhancing the value of online search TODAY KRILLION • What • Where • Product Information • Proximity • Price History • Price Alerts • In-stock Availability
Slide 7: Reaching consumers across desktop and mobile
Reaching consumers across desktop and mobile What we do
Slide 8: Owned and Operated sites
Owned and Operated sites Earns income from clicks on search ads and page views on display ads Ad types: • • • …plus our additional suite of vertical sites = Revenue source Display Video Business Search
Slide 9: Network of managed sites
Business Directory Shopping Directory Mobile Business Directory Network of managed sites Earns income from clicks on search ads and page views of display ads Ad types: • • • = Revenue source Business Search Product Search Display
Slide 10: Extended Network monetization
Extended Network monetization Earns income from clicks and impressions on search, pay-per-call and various display ads Ad types: • • • • • = Revenue source Display Business Search Product Search Pay-Per-Call Video
Slide 11: Partners and ad networks
Google YAHOO! dex media [¥p).com- yext VAUD Click" bING doubleclick ad exchange MARCHEX. casheall? @BidMonitor Delivering resus ftom search, 2 Client Connections x xAd.
Slide 12: Large market opportunity
Large market opportunity Total Online Advertising Spend in US Billions In online advertising spend expected over the next 5 years Source: Borrell Associates, Inc. 2014
Slide 13: Mobile-influenced in-store sales greater than online
Over the next three years: Mobile-influenced store sales are projected to reach $689 billion. 5x greater Addressable market is than everything sold online today. Source: Deloitte 2012 Mobile-influenced in-store sales greater than online Source: Forrester Research – Web-influenced retail sales foreca
Slide 14: Krillion drives local shopping
Our customer value proposition answers 3 key questions: • Is it carried near me ? • Is it available in - store ? • How much does it cost ? Krillion drives local shopping Krillion’s dynamic platform provides retailers & brands multiple channels to engage consumers wherever they research online. Retai
Slide 15: Krillion – the leading local shopping authority
Top priorities: Location of Retail Stores in the Krillion Database Broaden coverage with retailers & manufacturers Enable and expand monetization Secure additional distribution with publishers Krillion – the leading local shopping authority 3 Million Localized Products Over 120,000 National and Regi
Slide 16: Monetize IP portfolio
Monetize IP portfolio The patent descriptions herein do not constitute the legal opinion or advice of the patent owner or their counsel. The reader is encouraged to seek the advice of their own counsel regarding the scope of any domestic or foreign patents. Positive claim construction ruling Cascadi
Slide 17: Strong financial fundamentals
Notable Accomplishments: • • • • Positive cash flow from operating activities in 2013 Four consecutive quarters of Revenue and Adjusted EBITDA growth Reduced GAAP net loss year-over- year by more than 50% Largest year-over-year network revenue growth, up 141% in 2012 Strong financial fundamentals In
Slide 18: Record network revenue growth
$ in Millions Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Record network revenue growth Network Revenue $5.0 $5.0 $7.6 $8.3 $11.6 $14.5 $16.1 In the last seven quarters, Network revenue has Grown 4x
Slide 19: Plus exponential growth in mobile
Plus exponential growth in mobile Serving more consumers 209% CAGR Mobile Traffic over the past five years Mobile traffic represents 39% of total overall traffic
Slide 20: 2014 financial targets by business segment
Managed Sites (Directory) 2014 Revenue* % of 2014 Revenue Margin % Owned & Operated Extended Ad Network (Display/Search Ads/Pay-Per-Call) 2014 financial targets by business segment $50,000,000 48% 3,000,000 3% 35% 75% 52,000,000 50% 15% 53,000,000 50% 37% $105,000,000 100% 26% *Estimate
Slide 21: Evolving model remains strong
Stabilize Execute GROW Improving financials Investing for Growth (Adjusted EBITDA) Note: See reconciliation of Adjusted EBITDA to GAAP net income at presentation end. *Estimate Evolving model remains strong Multiple growth drivers
Slide 22: 4Q13 Balance Sheet & Cap. Table
Key Balance Sheet Items (In Thousands) Capitalization (In Thousands) 4Q13 Balance Sheet & Cap. Table 12/31/2013 Cash $5,069 Accounts Receivable 17,298 Total Assets 51,579 Total Debt 12,684 Total Liabilities 31,294 Stockholders Equity 20,285 12/31/2013 Common Stock 23,038 Convertible Debentures 2,488
Slide 23: Leadership team
Leadership team Ken Cragun CFO 25+ years experience CFO, Modtech SVP, MIVA CFO, ImproveNet CPA, Big 4 Exp. Michael Sawtell President & COO 25+ years experience Pres. / CEO, DigitalPost Interactive Pres. / COO , Interchange Corp. (now Local Corporation) COO, Informative Research Operations Director,
Slide 24: Structured for growth
Growing base of consumers and partners • 27 million consumers/month • 1,600 network sites Positioned to be leader in mobile • Mobile traffic up 24% Y/Y • Expanding mobile search landscape Multiple avenues to value • Display/pay-per-click/pay-per-call ads • Leverage Krillion data technology • IP mone
Slide 25: Thank You
Thank You Thank you Fred Thiel Fred@local.com 949.784.0800 Local Corporation | Irvine Center Drive | Irvine CA | 949.784.0800 www.localcorporation.com
Slide 26: Appendix
Thank You Appendix
Slide 27: Market Cap/Sales Valuation
Company Symbol Price Market Cap (MM) 2014E Sales (MM) 2014E Market Cap/Sales Market Cap/Sales Valuation Blucora, Inc. BCOR $ 20.04 $ 843.3 $ 223.0 3.8 ReachLocal, Inc. RLOC $ 10.69 $ 294.3 $ 590.0 0.5 Angie’s List, Inc. ANGI $ 13.84 $ 808.7 $ 325.0 2.5 Marchex, Inc. MCHX $ 12.27 $ 443.4 $ 177.0 2.5
Slide 28: Reconciliation: Adjusted EBITDA to GAAP Net Income
Description FY-09 FY-10 FY-11 FY-12 FY-13 FY-14* Reconciliation: Adjusted EBITDA to GAAP Net Income Adjusted EBITDA $3,041 $13,775 $3,247 $777 $4,533 $3,500 Less interest and other income (expense), net (27) (275) (413) (425) (2,321) (1,700) Less provision for income taxes (158) (102) (178) (111) (1
Slide 29: Use of non-GAAP measures
Use of non-GAAP measures This document includes the non-GAAP financial measure of “Adjusted EBITDA” which we define as net income (loss) excluding: provision for income taxes; interest and other income (expense), net; depreciation; amortization; stock based compensation charges; gain or loss on deri