United Online Reports Second Quarter 2013 Results

  United Online Reports Second Quarter 2013 Results

  *Spin Off of FTD Targeted to be Effective October 1, 2013
  *Recent Refinancing of FTD Credit Facilities Expected to Reduce Annual
    Interest Expense by Approximately $7 Million
  *NetZero Wireless Announces Mobile Broadband Wholesale Agreements with
    Verizon and Sprint, Significantly Expanding NetZero Wireless Coverage Area
  *Consolidated Revenues of $221.7 Million, Consolidated Operating Income of
    $14.0 Million and Consolidated Adjusted OIBDA of $34.7 Million

Business Wire

WOODLAND HILLS, Calif. -- July 31, 2013

United Online, Inc. (Nasdaq: UNTD), a leading provider of consumer products
and services over the Internet, today reported financial results for its
second quarter ended June 30, 2013.

“The planned tax-free spin off of FTD from United Online remains on track,”
said Mark R. Goldston, Chairman, President and Chief Executive Officer. “We
expect the spin-off transaction will be effected before the market opens on
October 1, 2013 and the proposed reverse stock split of United Online stock,
if approved by the stockholders and the Board of Directors, will take place
immediately prior to the spin off.”

“We recently completed the refinancing of FTD's credit facilities, an
important step as we progress toward the spin off,” Goldston said. “This new
credit agreement will reduce FTD's interest expense by approximately $7
million annually based on current LIBOR rates and will provide FTD with
substantial capital and financial flexibility going forward. We believe this
significant annual interest savings will more than offset the public company
costs and the incremental ongoing operating expenses that FTD anticipates it
will incur annually as a result of the separation once the spin off is
complete. The new credit agreement provides FTD with a $350 million five-year
secured revolving credit facility, of which $220 million was drawn at
closing.”

“We are pleased to announce two agreements that will significantly expand the
coverage and enhance the offerings of our NetZero Mobile Broadband service,”
added Goldston. “We have signed a three-year agreement with Verizon to offer
the NetZero Mobile Broadband service on Verizon's nationwide 3G network. When
the service is launched, we expect NetZero Mobile Broadband will be available
in approximately 500 markets and cover more than 300 million people, or
approximately 95% of the entire U.S. population. Also, we have signed a
five-year agreement with Sprint to offer the NetZero Mobile Broadband service
via Sprint’s 4G LTE and 3G networks. This agreement will allow us to expand
our NetZero Mobile Broadband coverage to a projected 200 million people in
2014 on the Sprint 4G LTE network.”

“Second quarter 2013 consolidated revenues of $221.7 million were slightly
below our guidance range, while adjusted OIBDA of $34.7 million exceeded our
guidance range by $2.2 million,” Goldston said. “FTD segment revenues
decreased 2% and segment adjusted OIBDA was relatively flat versus the
year-ago period. During the quarter, FTD results were unfavorably impacted by
the timing of the Easter Holiday. Approximately $3 million in revenues and
$0.4 million in segment adjusted OIBDA were recorded in the first quarter of
2013, which in the prior year were recorded in the second quarter. Adjusting
for the timing of the Easter Holiday and excluding the unfavorable impact of
foreign currency exchange rates, FTD segment revenues remained relatively flat
versus the year-ago quarter, while segment adjusted OIBDA increased 2%.”

“In our Content & Media segment, pay accounts declined by 66,000 during the
quarter, our lowest decline in pay accounts since the second quarter of 2010,”
Goldston continued. “The quarterly net decrease in segment pay accounts has
now improved for six consecutive quarters. Year over year, Content & Media
segment revenues and adjusted OIBDA declined 13% and 12%, respectively.
Content & Media segment revenues and adjusted OIBDA both increased on a
sequential quarter basis.”

“During the quarter, Communications segment revenues and adjusted OIBDA
declined 7% and 3%, respectively, compared to the year-ago quarter,” said
Goldston. “Communications segment revenues and adjusted OIBDA both increased
on a sequential quarter basis.”

“After the spin off of FTD, United Online will consist of its Content & Media
and Communications segments, which delivered $243 million in segment revenues
and $58 million in segment adjusted OIBDA during the last four quarters,” said
Neil P. Edwards, Executive Vice President and Chief Financial Officer. “Over
the last several quarters, the Content & Media segment’s net quarterly
subscriber loss has been reduced to less than 25% of its peak level and we
have created a new growth opportunity with the NetZero Mobile Broadband
service, which will now be enhanced with the new Verizon and Sprint
agreements.”

The completion of the spin off is subject to certain customary conditions,
including receipt of a ruling from the U.S. Internal Revenue Service as to the
tax-free nature of the spin off, effectiveness of appropriate filings with the
U.S. Securities and Exchange Commission, receipt of legal opinions, and final
approval of the transactions contemplated by the spin off. There can be no
assurance that the spin off will occur and, if it does occur, there can be no
assurance as to its terms or timing.

Summary Results for Second Quarter Ended June 30, 2013:

The following table summarizes key financial results for the second quarter
ended June 30, 2013:

                              (in millions, except per share amounts and
                                percentages)
Financial Highlights            Q2 2013          Q2 2012          % Change
FTD revenues                    $  164.3           $  167.5           (2   %)
Content & Media revenues           32.9               38.0            (13  %)
Communications revenues            24.9               26.8            (7   %)
Intersegment eliminations         (0.4   )          (0.5   )        18   %
Consolidated revenues           $  221.7          $  231.9          (4   %)
                                                                      
GAAP operating income           $  14.0            $  16.9            (17  %)
                                                                      
Adjusted OIBDA^(1)              $  34.7            $  35.2            (2   %)
                                                                      
GAAP net income
attributable to common          $  5.9             $  8.2             (29  %)
stockholders
GAAP diluted net income per     $  0.06            $  0.09            (33  %)
common share
                                                                      
Adjusted net income
attributable to common          $  15.7            $  16.0            (1   %)
stockholders^(2)
Adjusted diluted net income     $  0.17            $  0.18            (6   %)
per common share^(2)
                                                                      

  *Revenues were $221.7 million, a 4% decrease compared to the year-ago
    quarter.
  *GAAP operating income was $14.0 million compared to $16.9 million in the
    year-ago quarter.
  *Adjusted OIBDA was $34.7 million, a decrease of 2% versus the year-ago
    quarter.
  *Interest expense was $3.2 million, a decrease of 11% compared to the
    year-ago quarter.
  *The effective income tax rate was 45% versus 40% in the year-ago quarter.
  *GAAP diluted net income per common share was $0.06 versus $0.09 in the
    year-ago quarter.
  *Adjusted diluted net income per common share was $0.17 versus $0.18 in the
    year-ago quarter.

Cash Flows, Balance Sheet and Dividend Highlights:

  *Cash flows from operating activities and free cash flow^(3) for the
    quarter ended June 30, 2013 were $14.0 million and $12.1 million,
    respectively, decreases of 13% and 10%, respectively, compared to the
    year-ago quarter.
  *Cash and cash equivalents at June 30, 2013 were $122.4 million, compared
    to $132.3 million at March 31, 2013.
  *Net debt at June 30, 2013 was $111.0 million, compared to $111.8 million
    at March 31, 2013. The company defines net debt as total debt, net of
    discounts, less cash and cash equivalents.
  *The company paid $9.7 million in cash dividends during the quarter.
  *In July 2013, the company’s Board of Directors declared a quarterly cash
    dividend of $0.10 per share of common stock that is payable on August 30,
    2013 to stockholders of record on August 14, 2013.

Segment Results for Second Quarter Ended June 30, 2013:

FTD:
                              
                                 (in millions, except percentages and metrics)
Financial Highlights             Q2 2013          Q2 2012         % Change
Products revenues                $  129.1           $  132.0          (2   %)
Services revenues                  35.1             35.5          (1   %)
Segment revenues                 $  164.3          $  167.5         (2   %)
                                                                      
Segment income from              $  21.2            $  22.7           (6   %)
operations
Segment adjusted OIBDA^(1)       $  24.0            $  24.0           —
as a % of segment                   14.6   %           14.3   %
revenues^(1)
                                                                      
Metrics Highlights               Q2 2013            Q2 2012           % Change
Consumer orders^(4) (in             1,921              1,997          (4   %)
thousands)
Average order value^(4)          $  61.27           $  60.75          1    %
                                                                      
British Pound / U.S. Dollar         1.54               1.58           (3   %)
exchange rate (average)
                                                                           

  *Segment revenues were $164.3 million, a decrease of 2% versus the year-ago
    quarter. Adjusting for the timing of the Easter Holiday, segment revenues
    remained relatively flat versus the year-ago quarter.
  *Segment income from operations was $21.2 million, a decrease of 6% versus
    the year-ago quarter.
  *Segment adjusted OIBDA was $24.0 million, relatively flat versus the
    year-ago quarter. Adjusting for the timing of the Easter Holiday and
    excluding the unfavorable impact of foreign currency exchange rates,
    segment adjusted OIBDA increased 2% versus the year-ago quarter.
  *Consumer orders were 1.9 million, down 4% versus the year-ago quarter.
    Adjusting for the timing of the Easter Holiday, consumer orders decreased
    1%.
  *Average order value ^ (“AOV”) was $61.27, an increase of 1% compared to
    the year-ago quarter. Excluding the unfavorable impact of foreign currency
    exchange rates, AOV increased 2%.

Content & Media:
                              
                                 (in millions, except percentages and metrics)
Financial Highlights             Q2 2013          Q2 2012         % Change
Products revenues                $  1.0             $  0.9            17   %
Services revenues                   20.6               24.1           (14  %)
Advertising revenues               11.3             13.0          (13  %)
Segment revenues                 $  32.9           $  38.0          (13  %)
                                                                      
Segment income from              $  5.8             $  6.6            (13  %)
operations
Segment adjusted OIBDA           $  6.6             $  7.4            (12  %)
as a % of segment revenues          20.0   %           19.6   %
                                                                      
Metrics Highlights               Q2 2013            Q2 2012           % Change
Segment pay accounts^(5) (in        2,720              3,120          (13  %)
thousands)
Net quarterly decline in
segment pay accounts^(5) (in        (66    )           (173   )       62   %
thousands)
Segment active accounts^(5)         10.5               10.3           2    %
(in millions)
ARPU^(6)                         $  2.48            $  2.50           (1   %)
                                                                      
Euro / U.S. Dollar Exchange         1.31               1.28           2    %
Rate (average)
                                                                           

  *Segment revenues were $32.9 million, a decrease of 13% versus the year-ago
    quarter.
  *Segment income from operations was $5.8 million, compared to $6.6 million
    in the year-ago quarter.
  *Segment adjusted OIBDA was $6.6 million, a decrease of 12% versus the
    year-ago quarter.
  *Segment pay accounts ^ at June 30, 2013 were 2.7 million, a decrease of
    13% versus June 30, 2012.
  *Segment ARPU was $2.48, a decline of 1% versus the year-ago quarter.

Communications:

                               (in millions, except percentages and metrics)
Financial Highlights             Q2 2013         Q2 2012         % Change
Products revenues                $  0.7            $  0.9            (26   %)
Services revenues                   17.3              19.9           (13   %)
Advertising revenues               6.9             5.9           17    %
Segment revenues                 $  24.9          $  26.8          (7    %)
                                                                     
                                                                     
Segment income from              $  8.3            $  8.6            (3    %)
operations
Segment adjusted OIBDA           $  8.8            $  9.0            (3    %)
as a % of segment revenues          35.2  %           33.6  %
                                                                     
Metrics Highlights               Q2 2013           Q2 2012           % Change
Segment pay accounts (in            595               709            (16   %)
thousands)
ARPU                             $  9.34           $  8.97           4     %
                                                                           

  *Segment revenues were $24.9 million, a decrease of 7% versus the year-ago
    quarter.
  *Segment income from operations was $8.3 million, a decrease of 3% versus
    the year-ago quarter.
  *Segment adjusted OIBDA was $8.8 million, a decrease of 3% versus the
    year-ago quarter. The investment in the NetZero Mobile Broadband business
    resulted in a negative adjusted OIBDA impact of $1.8 million during the
    second quarter of 2013, compared to a negative adjusted OIBDA impact of
    $4.0 million in the year-ago quarter.
  *Segment pay accounts at June 30, 2013 were 0.6 million, a decrease of 16%
    versus June30, 2012.
  *Segment ARPU was $9.34, an increase of 4% versus the year-ago quarter.

Unallocated Corporate Expenses:

For the quarter ended June 30, 2013, the impact of unallocated corporate
expenses on consolidated adjusted OIBDA was $4.7 million, an 11% decrease
compared to the year-ago quarter.

Business Outlook:

The following forward-looking information includes certain of the projections
made by management as of the date of this press release. The company does not
intend to revise or update this information, except as required by law, and
may not provide this type of information in the future. Due to a variety of
factors, actual results may differ significantly from those projected. Factors
include, without limitation, the factors referenced later in this announcement
under the caption “Cautionary Information Regarding Forward-Looking
Statements.” These and other factors are discussed in more detail in the
company’s filings with the Securities and Exchange Commission. This guidance
assumes that the FTD segment remains part of the company through the end of
the third quarter of 2013.

Third Quarter 2013 Guidance:
                                        
Third Quarter 2013 (in millions)         Guidance
Revenues                                 $169 - $175
Adjusted OIBDA                           $22 - $26
                                                 

Third Quarter 2013 Supplemental Information (in millions)           Guidance
Net interest expense                                                $3.6
Shares used to calculate diluted net income per common share        92.6
Shares used to calculate adjusted diluted net income per common     92.9
share^(2)
                                                                   

The table below reconciles the company’s guidance for operating income, a GAAP
measure, to adjusted OIBDA.

Third Quarter 2013 (in millions)          Guidance
Operating Income                          $0.0 - $4.0
Depreciation                              $5.8
Amortization of intangible assets         $7.4
Stock-based compensation                  $3.4
Transaction-related costs                 $5.4
Adjusted OIBDA                            $22.0 - $26.0
                                         

Investor Conference Call on July 31, 2013 at 5:00 pm ET (2:00 pm PT):

The company will host a conference call to discuss the results at 5:00 pm ET
(2:00 pm PT) on Wednesday, July 31, 2013. The conference call dial-in number
is 888-359-3624 for U.S. and Canadian participants and 719-325-2448 for
participants outside the U.S. and Canada. The passcode is 3865986.
Alternatively, a live webcast of the conference call, along with a
presentation containing financial highlights for the second quarter ended June
30, 2013, is accessible within the Investor Relations section of the company’s
website at www.unitedonline.com.

The presentation and a replay of the broadcast will be available on the
company’s website for seven days following the call. A replay of the broadcast
will also be available for seven days following the call by dialing
888-203-1112 (or 719-457-0820 outside of the U.S. and Canada) and the replay
passcode, 3865986.

Non-GAAP Measures:

In evaluating the company’s performance, management uses one or more of the
following measures that are not determined in accordance with accounting
principles generally accepted in the United States of America (“GAAP”):
adjusted OIBDA, adjusted net income, adjusted basic and diluted net income per
common share, and free cash flow. These measures are adjusted to exclude
certain non-cash expenses such as depreciation, amortization, stock-based
compensation, and impairment of goodwill, intangible assets and long-lived
assets. In addition, these measures are adjusted to exclude the items
discussed below because such items are either operating expenses which would
not otherwise have been incurred by the company in the normal course of the
company’s business operations or are not reflective of the company’s core
results over time. These items may include recurring as well as non-recurring
items. These adjustments should not be construed as an inference that all of
these adjustments or costs are unusual, infrequent or non-recurring. For
example, certain restructuring and other exit costs may be considered
recurring given the company’s ongoing efforts to be more cost effective and
efficient, certain litigation or dispute settlement charges or gains may be
viewed as recurring given that the company is continually involved in, and
resolving, litigation, arbitration, investigations, disputes and similar
matters, and certain transaction-related costs may be deemed recurring given
the company's regular evaluation of potential transactions. Notwithstanding
that certain charges, costs or gains may be considered recurring, in order to
provide meaningful comparisons, the company believes that it is appropriate to
adjust for such charges, costs or gains because they are not reflective of the
company's core results and tend to vary based on timing, frequency and
magnitude.

Restructuring and Other Exit Costs — Restructuring and other exit costs
consist primarily of employee termination costs, facility closure and
relocation costs, and contract termination costs.

Litigation or Dispute Settlement Charges or Gains — These charges or gains
include estimated losses for which we have established a reserve, as well as
actual settlements, judgments, fines, penalties, assessments or other
resolutions against, or in favor of, the company related to litigation,
arbitration, investigations, disputes or similar matters. Insurance recoveries
received by the company related to such matters are also included in these
adjustments.

Transaction-Related Costs —The company excludes certain expense items
resulting from actual or potential transactions such as business combinations,
mergers, acquisitions, dispositions, spin offs, financing transactions, and
other strategic transactions, including, without limitation, (i) compensation
expenses and (ii) expenses for advisors and representatives such as investment
bankers, consultants, attorneys, and accounting firms. Transaction-related
costs may also include, without limitation, transition and integration costs
such as retention bonuses and acquisition-related milestone payments to
acquired employees.

Definitions of Non-GAAP Measures:

(1) Adjusted operating income before depreciation and amortization (“adjusted
OIBDA”) is defined by the company as operating income before depreciation;
amortization; stock-based compensation; restructuring and other exit costs;
litigation or dispute settlement charges or gains; transaction-related costs;
and impairment of goodwill, intangible assets and long-lived assets. The
company's definition of adjusted OIBDA has been modified from time to time.
Management believes that because adjusted OIBDA excludes (i) certain non-cash
expenses (such as depreciation, amortization, stock-based compensation, and
impairment of goodwill, intangible assets and long-lived assets) and (ii)
expenses that are not reflective of the company’s core operating results over
time (such as restructuring and other exit costs, litigation or dispute
settlement charges or gains, and transaction-related costs), this measure
provides investors with additional useful information to measure the company's
financial performance, particularly with respect to changes in performance
from period to period. Management uses adjusted OIBDA to measure the company’s
performance. The company’s board of directors has used this measure as a basis
in determining certain compensation incentives for certain members of the
company's management. Adjusted OIBDA is not determined in accordance with GAAP
and should be considered in addition to, not as a substitute for or superior
to, financial measures determined in accordance with GAAP. A limitation
associated with the use of adjusted OIBDA is that it does not reflect the
periodic costs of certain tangible and intangible assets used in generating
revenues in the company's business. Management evaluates the costs of such
tangible and intangible assets through other financial activities such as
evaluations of capital expenditures and purchase accounting. An additional
limitation associated with this measure is that it does not include
stock-based compensation expenses related to the company’s workforce.
Management compensates for this limitation by providing a summary of
stock-based compensation expenses within the accompanying tables and in the
footnotes accompanying its financial statements. A further limitation
associated with the use of this measure is that it does not reflect the costs
of restructuring and other exit costs, litigation or dispute settlement
charges or gains, transaction-related costs, and the impairment of goodwill,
intangible assets and long-lived assets. Management compensates for this
limitation by providing supplemental information about such charges, gains and
costs within its financial press releases and SEC filings, when applicable. An
additional limitation associated with the use of this measure is that the term
“adjusted OIBDA” does not have a standardized meaning. Therefore, other
companies may use the same or a similarly named measure but exclude different
items or use different computations, which may not provide investors a
comparable view of the company’s performance in relation to other companies.
Management compensates for this limitation by presenting the most comparable
GAAP measure, operating income, directly ahead of adjusted OIBDA within its
financial press releases and by providing a reconciliation that shows and
describes the adjustments made. A reconciliation to operating income is
provided in the accompanying tables. In addition, many of the adjustments to
our GAAP financial measures reflect the exclusion of items that are recurring
in nature and will be reflected in our financial results for the foreseeable
future.

Adjusted OIBDA for each of the company's segments is defined by the company as
segment income from operations, as set forth in the company’s Forms 10-K and
Forms 10-Q, before stock-based compensation, restructuring and other exit
costs, litigation or dispute settlement charges or gains, transaction-related
costs and the impairment of goodwill, intangible assets and long-lived assets.
The company’s definition of adjusted OIBDA for each of the company’s segments
has been modified from time to time. Management believes that because segment
adjusted OIBDA and segment adjusted OIBDA as a percentage of segment revenues
exclude (i) certain non-cash expenses (such as stock-based compensation, and
the impairment of goodwill, intangible assets and long-lived assets); and (ii)
expenses that are not reflective of the segment's core operating results over
time (such as restructuring and other exit costs, litigation or dispute
settlement charges or gains, and transaction-related costs), these measures
provide investors with additional useful information to evaluate the company’s
segment financial performance, particularly with respect to changes in
performance from period to period. Segment adjusted OIBDA and segment adjusted
OIBDA as a percentage of segment revenues are not determined in accordance
with GAAP and should be considered in addition to, not as a substitute for or
superior to, financial measures determined in accordance with GAAP. A
limitation associated with these measures is that they do not include
stock-based compensation expenses related to the company’s workforce.
Management compensates for this limitation by providing a summary of
stock-based compensation expenses within the accompanying tables and in the
footnotes accompanying its financial statements. A further limitation
associated with the use of these measures is that they do not reflect the
costs of restructuring and other exit costs, litigation or dispute settlement
charges or gains, transaction-related costs and impairment charges related to
an operating segment. Management compensates for this limitation by providing
supplemental information about such charges, gains and costs by segment within
its financial press releases and SEC filings, when applicable. A
reconciliation to segment income from operations, its most comparable GAAP
measure, is provided in the accompanying tables.

(2) Adjusted net income is defined by the company as net income before the
after-tax effect of: stock-based compensation; amortization of intangible
assets; impairment of goodwill, intangible assets and long-lived assets;
restructuring and other exit costs; litigation or dispute settlement charges
or gains; transaction-related costs; and the re-measurement of certain
deferred tax assets. Adjusted diluted net income per common share includes the
adjustment for shares resulting from the elimination of stock-based
compensation. Management believes that adjusted net income and adjusted
diluted net income per common share provide investors with additional useful
information to measure the company’s financial performance, particularly with
respect to changes in performance from period to period, because these
measures are exclusive of (i) certain non-cash expenses (such as stock-based
compensation, amortization of intangible assets, and the impairment of
goodwill, intangible assets and long-lived assets) and (ii) expenses that are
not reflective of the company’s core results over time (such as restructuring
and other exit costs, litigation or dispute settlement charges or gains, and
transaction-related costs). Management also uses adjusted net income and
adjusted diluted net income per common share for this purpose. Adjusted net
income and adjusted diluted net income per common share are not determined in
accordance with GAAP and should be considered in addition to, not as a
substitute for or superior to, financial measures determined in accordance
with GAAP. The limitations of adjusted net income and adjusted diluted net
income per common share are that, similar to adjusted OIBDA, they do not
include certain costs, and the terms “adjusted net income” and “adjusted
diluted net income per common share” do not have standardized meanings.
Therefore, other companies may use the same or similarly named measures but
exclude different items or use different computations, which may not provide
investors a comparable view of the company’s performance in relation to other
companies. Management compensates for this limitation by presenting the most
comparable GAAP measures, net income and diluted net income per common share,
directly ahead of adjusted net income and adjusted diluted net income per
common share within its financial press releases and by providing a
reconciliation of adjusted net income that shows and describes the adjustments
made. A reconciliation of adjusted net income to net income, its most
comparable GAAP measure, is provided in the accompanying tables.

(3) Free cash flow is defined by the company as net cash provided by operating
activities, less capital expenditures and cash received for litigation or
dispute settlement gains, and plus the excess tax benefits from equity awards,
cash paid for restructuring and other exit costs, cash paid for litigation or
dispute settlement charges, and cash paid for transaction-related costs.
Management believes that free cash flow provides investors with additional
useful information to measure operating liquidity because it reflects the
company’s operating cash flows after investing in capital assets and prior to
cash paid for restructuring and other exit costs, cash paid or received for
litigation or dispute settlement charges or gains, and cash paid for
transaction-related costs. It also fully reflects the tax benefits realized by
the company from stock-based compensation. This measure is used by management,
and may also be useful for investors, to assess the company’s ability to pay
its quarterly dividend, repay debt obligations, generate cash flow for a
variety of strategic opportunities, including reinvestment in the business,
and effect potential acquisitions and share repurchases. Free cash flow is not
determined in accordance with GAAP and should be considered in addition to,
not as a substitute for or superior to, measures determined in accordance with
GAAP. A limitation of free cash flow is that it does not represent the total
increase or decrease in cash during the period. An additional limitation
associated with the use of this measure is that the term “free cash flow” does
not have a standardized meaning. Therefore, other companies may use the same
or a similarly named measure but exclude different items or use different
computations, which may not provide investors a comparable view of the
company’s performance in relation to other companies. Management compensates
for this limitation by presenting the most comparable GAAP measure, net cash
provided by operating activities, directly ahead of free cash flow within its
financial press releases and by providing a reconciliation that shows and
describes the adjustments made. A reconciliation to net cash provided by
operating activities is provided in the accompanying tables.

(4) Consumer orders are orders delivered during the period that originated in
the U.S. and Canada, primarily from the www.ftd.com website and the
1-800-SEND-FTD telephone number, and in the U.K. and the Republic of Ireland,
primarily from the www.interflora.co.uk website and various telephone numbers.
The number of consumer orders is not adjusted for non-delivered orders that
are refunded after the scheduled delivery date. Orders originating with a
florist or other retail location for delivery to consumers are not included.

Average order value ("AOV") represents the average U.S. Dollar amount received
for consumer orders delivered during a period. For orders placed outside the
U.S. (principally in the U.K. and the Republic of Ireland), this average U.S.
Dollar amount is determined after translating the local currency amounts
received into U.S. Dollars. Average order value includes merchandise revenues
and shipping, handling and service fees paid by the consumer, less discounts
and refunds (net of refund-related fees charged to floral network members).

(5) A pay account is defined as a member who has paid for a subscription to a
Content & Media or Communications service, and whose subscription has not
terminated or expired. A subscription provides the member with access to our
service for a specific term (for example, a month or a year) and may be
renewed upon the expiration of each term. One-time purchases of our services,
with the exception of our free NetZero Mobile Broadband service, are not
considered subscriptions and thus, are not included in the pay accounts
metric. A pay account does not equate to a unique subscriber since one
subscriber could have several pay accounts. In addition, at any point in time,
our pay account base includes a number of accounts receiving a free period of
service as either a promotion or retention tool, such as the subscribers
receiving our free NetZero Mobile Broadband service, and a number of accounts
that have notified us that they are terminating their service but whose
service remains in effect.

Content & Media segment active accounts are defined as the sum of all pay
accounts as of the date presented; the monthly average for the period of all
free accounts who have visited our domestic or international online nostalgia
websites (excluding schoolFeed and The Names Database) at least once during
the period; and the monthly average for the period of all online loyalty
marketing members who have earned or redeemed points during such period.
Communications segment active accounts include all Communications segment pay
accounts as of the date presented combined with the number of free dial-up
Internet access and email accounts that logged on to our services at least
once during the preceding 31 days.

(6) ARPU is calculated by dividing services revenues generated from the pay
accounts of our Content & Media or Communications segment, as applicable, for
a period (after translation into U.S. Dollars) by the average number of
segment pay accounts for that period, divided by the number of months in that
period.

(7) Our average monthly churn rate is calculated as the total number of pay
accounts that terminated or expired in a period divided by the average number
of pay accounts for that period, divided by the number of months in that
period. Our average monthly churn percentage may fluctuate from period to
period due to our mix of subscription terms, which affects the timing of
subscription expirations, and other factors. We make certain normalizing
adjustments to the calculation of our churn percentage for periods in which we
add a significant number of pay accounts due to acquisitions. For our
Communications segment pay accounts, we do not include in our churn
calculation accounts canceled during the first 30 days of service, other than
dial-up accounts that have upgraded from free accounts. A number of such
accounts nevertheless will be included in our account totals at any given
measurement date. Subscribers who cancel one pay service but subscribe to
another pay service are not necessarily considered to have canceled a pay
account depending on the services and, as such, our segment churn rates are
not necessarily indicative of the percentage of subscribers canceling any
particular service.

About United Online^®:

United Online, Inc. (Nasdaq: UNTD), through its operating subsidiaries, is a
leading provider of consumer products and services over the Internet, where
their respective brands have attracted a large online audience that includes
more than 100 million registered accounts worldwide. The company's FTD segment
provides floral-related products and services (FTD, Interflora, Flying
Flowers, and Flowers Direct) for consumers and retail florists, as well as
other retail locations offering floral and related products and services. The
company's Content & Media segment provides online nostalgia products and
services (Classmates and StayFriends) and online loyalty marketing (MyPoints).
Its primary Communications segment service is Internet access (NetZero and
Juno), including NetZero Mobile Broadband (NetZero Wireless).

Cautionary Information Regarding Forward-Looking Statements:

This release contains forward-looking statements within the meaning of the
“safe harbor” provisions of the Private Securities Litigation Reform Act of
1995, as amended, based on our current expectations, estimates and projections
about our operations, industry, financial condition, performance, results of
operations, and liquidity. Statements containing words such as “may,”
“believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “projections,”
“business outlook,” “estimate,” or similar expressions constitute
forward-looking statements. These forward-looking statements include, but are
not limited to, statements about the proposed spin off of the FTD segment and
the proposed reverse stock split; potential benefits of the new credit
agreement, Verizon agreement and Sprint agreement; future financial
performance; revenues; operating expenses; operating income; capital
expenditures; depreciation and amortization; stock-based compensation; and
transaction-related costs. Potential factors that could cause actual results
to differ materially from those in the forward-looking statements include,
among others: the effects of the proposed spin off or other transactions on
our businesses; the effect of competition; the company’s inability to maintain
or increase its advertising revenues; risks associated with the integration or
commercialization of new businesses, products, services, applications or
features or the success of new business models; the severity and duration of
current economic conditions; the company’s inability to maintain or increase
the number of free and pay accounts, visitors to its websites, and members of
the floral network; risks associated with litigation and governmental
regulations or investigations, including reviews of business practices such as
marketing, billing, renewal, and post-transaction sales practices; problems
associated with the company’s operations, systems or technologies; changes in
marketing conditions and laws; potential write down, reserve against or
impairment of assets including receivables, goodwill, intangible assets or
other assets; the company’s inability to enforce or defend its ownership and
use of intellectual property; financial market risk resulting from
fluctuations in foreign currency exchange rates, particularly the British
Pound and Euro; changes in stock-based compensation due to future equity
issuances or other reasons; changes in amortization or depreciation due to a
variety of factors; changes in the floral industry; the company’s inability to
retain key customers, vendors and personnel; changes in tax laws, the
company’s business or other factors that would impact anticipated tax benefits
or the tax treatment of the proposed spin off transaction; the impact of, and
restrictions associated with, the company’s indebtedness; as well as the risk
factors disclosed in the company’s filings with the Securities and Exchange
Commission (www.sec.gov), including, without limitation, information under the
captions “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” and “Risk Factors.” Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect management’s
analysis only as the date hereof. Any such forward-looking statements are not
guarantees of future performance or results and involve risks and
uncertainties that may cause actual performance and results to differ
materially from those predicted. Reported results should not be considered an
indication of future performance. Except as required by law, the company
undertakes no obligation to publicly release the results of any revision to
these forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.


UNITED ONLINE, INC.
Unaudited Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)

                        Quarter Ended              Six Months Ended
                         June 30,                    June 30,
                         2013         2012          2013         2012
Revenues:
Products                 $ 130,866     $ 133,813     $ 285,953     $ 276,412
Services                  90,883      98,044      183,180     197,737 
Total revenues             221,749       231,857       469,133       474,149
Operating expenses:
Cost of                    100,317       102,826       219,508       211,834
revenues-products ^(a)
Cost of                    21,791        22,526        44,157        44,709
revenues-services ^(a)
Sales and                  41,545        46,800        87,506        93,559
marketing^(a)
Technology and             12,501        11,918        24,925        23,504
development^(a)
General and                23,833        23,249        50,395        47,536
administrative^(a)
Amortization of            7,757         7,537         15,504        14,846
intangible assets
Acquisition-related
contingent                 25            -             (5,124  )     -
consideration
Restructuring and         (62     )    85          2,227       14      
other exit costs
Total operating           207,707     214,941     439,098     436,002 
expenses
                                                                   
Operating income           14,042        16,916        30,035        38,147
                                                                   
Interest income            226           213           379           451
Interest expense           (3,191  )     (3,583  )     (6,383  )     (7,041  )
Other income, net         221         567         588         771     
                                                                   
Income before income       11,298        14,113        24,619        32,328
taxes
Provision for income      5,046       5,583       8,248       12,295  
taxes
Net income               $ 6,252      $ 8,530      $ 16,371     $ 20,033  
Income allocated to
participating             (400    )    (294    )    (636    )    (604    )
securities
Net income
attributable to common   $ 5,852      $ 8,236      $ 15,735     $ 19,429  
stockholders
                                                                   
Basic net income per     $ 0.06       $ 0.09       $ 0.17       $ 0.22    
common share
Shares used to
calculate basic net       92,386      90,478      91,985      90,136  
income per common
share
Diluted net income per   $ 0.06       $ 0.09       $ 0.17       $ 0.22    
common share
Shares used to
calculate diluted net     92,644      90,505      92,230      90,200  
income per common
share
                                                                   
Shares outstanding at     92,532      90,637      92,532      90,637  
end of period
                                                                   
(a) Stock-based
compensation was
allocated as follows:
Cost of                  $ 11          $ (2      )   $ 21          $ 6
revenues-products
Cost of                    41            31            82            125
revenues-services
Sales and marketing        623           559           1,258         1,142
Technology and             360           297           726           795
development
General and               2,066       2,148       4,060       4,419   
administrative
Total stock-based        $ 3,101      $ 3,033      $ 6,147      $ 6,487   
compensation



UNITED ONLINE, INC.
Unaudited Reconciliation of Operating Income to Adjusted OIBDA^(1)
(in thousands)

                            Quarter Ended            Six Months Ended
                             June 30,                  June 30,
                             2013        2012         2013        2012
                                                                    
Operating income             $ 14,042     $ 16,916     $ 30,035     $ 38,147
Depreciation                   6,167        6,620        12,312       13,095
Amortization of intangible    9,250      7,888      18,110     15,632 
assets
Operating income before
depreciation and               29,459       31,424       60,457       66,874
amortization
Stock-based compensation       3,101        3,033        6,147        6,487
Restructuring and other        (62    )     85           2,227        14
exit costs
Litigation or dispute          683          (396   )     878          (396   )
settlement charges
Transaction-related costs     1,470      1,040      (1,986 )    1,338  
Adjusted OIBDA               $ 34,651    $ 35,186    $ 67,723    $ 74,317 



UNITED ONLINE, INC.
Unaudited Reconciliation of Segment Income from Operations to Segment Adjusted
OIBDA^(1)
(in thousands)

                          Quarter Ended            Six Months Ended
                           June 30,                  June 30,
                           2013        2012         2013         2012
                                                                   
FTD:
Segment income from        $ 21,202     $ 22,661     $ 47,939      $ 46,741
operations
Stock-based compensation     1,007        1,028        1,903         2,134
Litigation or dispute        383          -            578           -
settlement charges
Transaction-related         1,373      302        1,373       600     
costs
Segment adjusted OIBDA     $ 23,965    $ 23,991    $ 51,793     $ 49,475  
                                                                   
                                                                   
                                                                   
Content & Media:
Segment income from        $ 5,780      $ 6,620      $ 11,574      $ 13,931
operations
Stock-based compensation     536          495          1,304         1,143
Restructuring and other      (62    )     (28    )     2,227         (91     )
exit costs
Litigation or dispute        300          (396   )     300           (396    )
settlement charges
Transaction-related         20         738        (5,108  )    738     
costs
Segment adjusted OIBDA     $ 6,574     $ 7,429     $ 10,297     $ 15,325  
                                                                   
                                                                   
                                                                   
Communications:
Segment income from        $ 8,288      $ 8,566      $ 14,918      $ 18,931
operations
Stock-based compensation     481          438          951           1,086
Restructuring and other     -          -          -           (8      )
exit costs
Segment adjusted OIBDA     $ 8,769     $ 9,004     $ 15,869     $ 20,009  
                                                                   
                                                                   
                                                                   
Unallocated corporate      $ (4,657 )   $ (5,238 )   $ (10,236 )   $ (10,492 )
expenses
                                                                   
Consolidated adjusted      $ 34,651    $ 35,186    $ 67,723     $ 74,317  
OIBDA



UNITED ONLINE, INC.
Unaudited Reconciliation of Net Income to Adjusted Net Income^(2)
(in thousands, except per share amounts)

                           Quarter Ended            Six Months Ended
                            June 30,                  June 30,
                            2013        2012         2013         2012
                                                                    
Net income                  $ 6,252      $ 8,530      $ 16,371      $ 20,033
Income allocated to          (400   )    (294   )    (636    )    (604   )
participating securities
Net income attributable       5,852        8,236        15,735        19,429
to common stockholders
                                                                    
Adjustments:
Stock-based compensation      3,101        3,033        6,147         6,487
Amortization of               9,250        7,888        18,110        15,632
intangible assets
Restructuring and other       (62    )     85           2,227         14
exit costs
Litigation or dispute         683          (396   )     878           (396   )
settlement charges
Transaction-related costs    1,470      1,040      (1,986  )    1,338  
                              20,294       19,886       41,111        42,504
                                                                    
Income tax effect of         (4,581 )    (3,936 )    (10,438 )    (7,392 )
adjusting entries
Adjusted net income
attributable to common      $ 15,713    $ 15,950    $ 30,673     $ 35,112 
stockholders
                                                                    
GAAP net income per
common share:
Basic net income per        $ 0.06      $ 0.09      $ 0.17       $ 0.22   
common share
Shares used to calculate
basic net income per         92,386     90,478     91,985      90,136 
common share
Diluted net income per      $ 0.06      $ 0.09      $ 0.17       $ 0.22   
common share
Shares used to calculate
diluted net income per       92,644     90,505     92,230      90,200 
common share
                                                                    
Adjusted net income per
common share:
Adjusted basic net income   $ 0.17      $ 0.18      $ 0.33       $ 0.39   
per common share
Shares used to calculate
adjusted basic net income    92,386     90,478     91,985      90,136 
per common share
Adjusted diluted net        $ 0.17      $ 0.18      $ 0.33       $ 0.39   
income per common share
Shares used to calculate
adjusted diluted net         92,902     90,768     92,468      90,434 
income per common share



UNITED ONLINE, INC.
Unaudited Condensed Consolidated Balance Sheets
(in thousands)

                                             June 30,    December 31,
                                               2013          2012
                                                             
ASSETS
Cash and cash equivalents                      $ 122,423     $   136,444
Accounts receivable, net                         36,606          43,721
Inventories, net                                 12,329          16,116
Deferred tax assets, net                         12,519          12,279
Property and equipment, net                      52,679          57,877
Goodwill and intangible assets, net              638,621         668,479
Other assets                                    27,047         28,503
Total assets                                   $ 902,224     $   963,419
                                                             
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable                               $ 54,243      $   80,543
Accrued liabilities                              41,617          45,253
Member redemption liability                      21,680          22,575
Deferred revenue                                 48,160          49,581
Debt, net of discounts                           233,410         244,000
Deferred tax liabilities, net                    28,939          31,896
Other liabilities                               8,813          14,485
Total liabilities                               436,862        488,333
                                                             
Stockholders' equity                             465,362         475,086
                                                            
Total liabilities and stockholders' equity     $ 902,224     $   963,419



UNITED ONLINE, INC.
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)

                        Quarter Ended              Six Months Ended
                         June 30,                    June 30,
                         2013         2012          2013         2012
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net income               $ 6,252       $ 8,530       $ 16,371      $ 20,033
Adjustments to
reconcile net income
to net cash provided
by operating
activities:
Depreciation,
amortization and           18,518        17,541        36,569        35,214
stock-based
compensation
Provision for doubtful     419           393           988           1,122
accounts receivable
Acquisition-related
contingent                 25            -             (5,124  )     -
consideration
Accretion of discounts
and amortization of        285           432           473           634
debt issue costs
Deferred taxes and         (1,304  )     (1,938  )     (3,296  )     (3,162  )
other, net
Tax benefits
(shortfalls) from          281           22            487           (252    )
equity awards
Excess tax benefits        (58     )     -             (271    )     (13     )
from equity awards
Change in operating
assets and liabilities
(excluding the effects
of acquisitions):
Accounts receivable,       5,255         2,811         5,835         5,888
net
Inventories, net           (256    )     (743    )     3,740         (2,357  )
Other assets               (192    )     632           2,540         6,915
Accounts payable and       (12,430 )     (5,785  )     (26,269 )     (24,558 )
accrued liabilities
Member redemption          (170    )     (344    )     (895    )     (845    )
liability
Deferred revenue           (2,172  )     (3,645  )     (1,067  )     (3,931  )
Other liabilities         (503    )    (1,933  )    (984    )    (1,840  )
Net cash provided by      13,950      15,973      29,097      32,848  
operating activities
                                                                   
CASH FLOWS FROM
INVESTING ACTIVITIES:
Purchases of property      (4,605  )     (4,235  )     (9,917  )     (8,447  )
and equipment
Purchases of rights,
content and                (315    )     (621    )     (602    )     (1,140  )
intellectual property
Purchases of               (22     )     (47     )     (33     )     (65     )
investments
Proceeds from sales of     154           285           210           374
investments
Cash paid for
acquisitions, net of      -           (11,355 )    -           (11,355 )
cash acquired
Net cash used for         (4,788  )    (15,973 )    (10,342 )    (20,633 )
investing activities
                                                                   
CASH FLOWS FROM
FINANCING ACTIVITIES:
Payments on term loan      (10,857 )     (17,000 )     (10,857 )     (17,663 )
Proceeds from
exercises of stock         -             1             -             5
options
Proceeds from employee     1,699         1,793         1,699         1,793
stock purchase plans
Repurchases of common      (70     )     (62     )     (3,342  )     (2,144  )
stock
Dividends and dividend
equivalents paid on        (9,651  )     (9,420  )     (19,089 )     (18,670 )
outstanding shares and
restricted stock units
Excess tax benefits       58          -           271         13      
from equity awards
Net cash used for         (18,821 )    (24,688 )    (31,318 )    (36,666 )
financing activities
                                                                   
Effect of foreign
currency exchange rate     (186    )     (1,536  )     (1,458  )     (218    )
changes on cash and
cash equivalents
                                                                   
Change in cash and         (9,845  )     (26,224 )     (14,021 )     (24,669 )
cash equivalents
Cash and cash
equivalents, beginning    132,268     137,660     136,444     136,105 
of period
Cash and cash
equivalents, end of      $ 122,423    $ 111,436    $ 122,423    $ 111,436 
period



UNITED ONLINE, INC.
Unaudited Reconciliation of Net Cash Provided by Operating Activities to Free
Cash Flow^(3)
(in thousands)

                            Quarter Ended            Six Months Ended
                             June 30,                  June 30,
                             2013        2012         2013        2012
Net cash provided by         $ 13,950     $ 15,973     $ 29,097     $ 32,848
operating activities
Adjustments:
Capital expenditures           (4,605 )     (4,235 )     (9,917 )     (8,447 )
Excess tax benefits from       58           -            271          13
equity awards
Cash paid for
restructuring and other        315          851          1,604        3,421
exit costs
Cash paid for litigation
or dispute settlement          259          6            830          108
charges
Cash paid for                 2,095      795        2,986      800    
transaction-related costs
Free cash flow               $ 12,072    $ 13,390    $ 24,871    $ 28,743 



UNITED ONLINE, INC.
Unaudited Segment Information
(in thousands)

                        Quarter Ended              Six Months Ended
                         June 30,                    June 30,
                         2013         2012          2013         2012
FTD
Revenues:
Products                 $ 129,145     $ 131,996     $ 282,347     $ 273,398
Services                  35,134      35,531      72,215      70,576  
Total revenues             164,279       167,527       354,562       343,974
                                                                   
Operating expenses:
Cost of revenues           103,227       106,387       225,477       219,642
Sales and marketing        27,723        28,668        58,010        57,407
Technology and             4,116         3,782         7,949         7,488
development
General and                10,191        8,483         19,613        17,665
administrative
Amortization of           6,396       6,383       12,803      12,661  
intangible assets
Total operating           151,653     153,703     323,852     314,863 
expenses
                                                                   
Operating income           12,626        13,824        30,710        29,111
                                                                   
Depreciation               2,180         2,454         4,426         4,969
Amortization of           6,396       6,383       12,803      12,661  
intangible assets
Segment income from        21,202        22,661        47,939        46,741
operations
Stock-based                1,007         1,028         1,903         2,134
compensation
Litigation or dispute      383           -             578           -
settlement charges
Transaction-related       1,373       302         1,373       600     
costs
Segment adjusted OIBDA   $ 23,965     $ 23,991     $ 51,793     $ 49,475  
                                                                   
Content & Media
Revenues:
Products                 $ 1,030       $ 881         $ 1,654       $ 1,781
Services                   20,594        24,067        41,755        49,853
Advertising and other     11,295      13,038      22,336      25,797  
Total revenues             32,919        37,986        65,745        77,431
                                                                   
Operating expenses:
Cost of revenues           10,559        10,591        21,058        20,681
Sales and marketing        10,156        12,919        21,546        27,261
Technology and             6,102         5,497         12,183        10,695
development
General and                4,893         5,580         10,784        11,233
administrative
Amortization of            1,361         1,154         2,701         2,185
intangible assets
Acquisition-related
contingent                 25            -             (5,124  )     -
consideration
Restructuring and         (62     )    (28     )    2,227       (91     )
other exit costs
Total operating           33,034      35,713      65,375      71,964  
expenses
                                                                   
Operating income           (115    )     2,273         370           5,467
(loss)
                                                                   
Depreciation               3,041         2,842         5,897         5,493
Amortization of           2,854       1,505       5,307       2,971   
intangible assets
Segment income from        5,780         6,620         11,574        13,931
operations
Stock-based                536           495           1,304         1,143
compensation
Restructuring and          (62     )     (28     )     2,227         (91     )
other exit costs
Litigation or dispute      300           (396    )     300           (396    )
settlement charges
Transaction-related       20          738         (5,108  )    738     
costs
Segment adjusted OIBDA   $ 6,574      $ 7,429      $ 10,297     $ 15,325  
                                                                   
Communications
Revenues:
Products                 $ 691         $ 936         $ 1,952       $ 1,233
Services                   17,321        19,945        35,155        41,013
Advertising               6,923       5,929       12,468      11,324  
Total revenues             24,935        26,810        49,575        53,570
                                                                   
Operating expenses:
Cost of revenues           8,432         8,534         17,322        16,506
Sales and marketing        3,940         5,519         8,507         9,431
Technology and             2,283         2,639         4,793         5,321
development
General and                2,851         2,815         5,879         5,899
administrative
Restructuring and         -           -           -           (8      )
other exit costs
Total operating           17,506      19,507      36,501      37,149  
expenses
                                                                   
Operating income           7,429         7,303         13,074        16,421
                                                                   
Depreciation              859         1,263       1,844       2,510   
Segment income from        8,288         8,566         14,918        18,931
operations
Stock-based                481           438           951           1,086
compensation
Restructuring and         -           -           -           (8      )
other exit costs
Segment adjusted OIBDA   $ 8,769      $ 9,004      $ 15,869     $ 20,009  
                                                                   
Total segment adjusted   $ 39,308     $ 40,424     $ 77,959     $ 84,809  
OIBDA
                                                                   
Reconciliation of
segment revenues to
consolidated revenues:
FTD                      $ 164,279     $ 167,527     $ 354,562     $ 343,974
Content & Media            32,919        37,986        65,745        77,431
Communications             24,935        26,810        49,575        53,570
Intersegment              (384    )    (466    )    (749    )    (826    )
eliminations
Consolidated revenues    $ 221,749    $ 231,857    $ 469,133    $ 474,149 
                                                                   
Reconciliation of
segment operating
expenses to
consolidated operating
expenses:
FTD                      $ 151,653     $ 153,703     $ 323,852     $ 314,863
Content & Media            33,034        35,713        65,375        71,964
Communications             17,506        19,507        36,501        37,149
Unallocated corporate      5,898         6,484         14,119        12,852
expenses
Intersegment              (384    )    (466    )    (749    )    (826    )
eliminations
Consolidated operating   $ 207,707    $ 214,941    $ 439,098    $ 436,002 
expenses
                                                                   
Reconciliation of
segment income from
operations to
consolidated operating
income:
FTD                      $ 21,202      $ 22,661      $ 47,939      $ 46,741
Content & Media            5,780         6,620         11,574        13,931
Communications            8,288       8,566       14,918      18,931  
Total segment income       35,270        37,847        74,431        79,603
from operations
Depreciation               (6,167  )     (6,620  )     (12,312 )     (13,095 )
Amortization of            (9,250  )     (7,888  )     (18,110 )     (15,632 )
intangible assets
Unallocated corporate
expenses, excluding       (5,811  )    (6,423  )    (13,974 )    (12,729 )
depreciation
Consolidated operating   $ 14,042     $ 16,916     $ 30,035     $ 38,147  
income
                                                                   
Reconciliation of
segment adjusted OIBDA
to consolidated
adjusted OIBDA:
FTD adjusted OIBDA       $ 23,965      $ 23,991      $ 51,793      $ 49,475
Content & Media            6,574         7,429         10,297        15,325
adjusted OIBDA
Communications            8,769       9,004       15,869      20,009  
adjusted OIBDA
Total segment adjusted     39,308        40,424        77,959        84,809
OIBDA
Unallocated corporate     (4,657  )    (5,238  )    (10,236 )    (10,492 )
expenses
Consolidated adjusted    $ 34,651     $ 35,186     $ 67,723     $ 74,317  
OIBDA



UNITED ONLINE, INC.
Unaudited Selected Quarterly Historical Key Metrics (a)


                 June 30,     March 31,    December     September    June 30,
                                              31,           30,
                  2013          2013          2012          2012          2012
                                                                          
Consolidated:
Revenues (in      $ 221,749     $ 247,384     $ 218,983     $ 177,751     $ 231,857
thousands)
                                                                          
                                                                          
FTD:
Segment
revenues (in      $ 164,279     $ 190,283     $ 153,178     $ 116,362     $ 167,527
thousands)
% of
consolidated        74      %     77      %     70      %     65      %     72      %
revenues
                                                                          
Consumer
orders^(4) (in      1,921         2,204         1,787         1,239         1,997
thousands)
Average order     $ 61.27       $ 61.01       $ 60.13       $ 61.06       $ 60.75
value^(4)
Average foreign
currency            1.54          1.54          1.61          1.58          1.58
exchange rate:
GBP to USD
                                                                          
Content &
Media:
Segment
revenues (in      $ 32,919      $ 32,826      $ 39,509      $ 36,556      $ 37,986
thousands)
% of
consolidated        15      %     13      %     18      %     21      %     16      %
revenues
                                                                          
Pay
accounts^(5)        2,720         2,786         2,864         2,987         3,120
(in thousands)
Segment             3.1     %     3.3     %     3.5     %     3.4     %     3.6     %
churn^(7)
ARPU^(6)          $ 2.48        $ 2.48        $ 2.52        $ 2.50        $ 2.50
Segment active
accounts^(5)        10.5          11.4          11.5          10.9          10.3
(in millions)
Currency
exchange rate:      1.31          1.32          1.30          1.25          1.28
EUR to USD
                                                                          
Communications:
Segment
revenues (in      $ 24,935      $ 24,640      $ 26,669      $ 25,203      $ 26,810
thousands)
% of
consolidated        11      %     10      %     12      %     14      %     12      %
revenues
                                                                          
Pay
accounts^(5)
(in thousands):
Access              378           404           421           440           467
Other              217         222         229         235         242     
Total
Communications     595         626         650         675         709     
pay accounts
                                                                          
Segment             3.0     %     3.0     %     2.9     %     3.1     %     3.2     %
churn^(7)
ARPU^(6)          $ 9.34        $ 9.21        $ 9.05        $ 8.97        $ 8.97
Segment active
accounts^(5)        1.2           1.3           1.3           1.4           1.4
(in millions)

(a) More information on the financial results for these quarters can be found in the
company's filings with the Securities and Exchange Commission.


Contact:

United Online, Inc.
Investors:
David Bigelow, 818-287-3560
dbigelow@corp.untd.com
or
Press:
Scott Matulis, 818-287-3388
pr@untd.com
 
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