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Last Update: 10-Jan-12 10:09 ET
WebMD Down 30%; Discussions On Transaction Terminated, CEO Resigns, Weak 2012 Outlook
WebMD (WBMD $25.93 -10.80) has lost 30% of its market value following a slew of negative news this morning.
The company announced that Wayne T. Gattinella has resigned from his position as Chief Executive Officer and President of the Company and as a member of its Board of Directors. Anthony Vuolo, currently serving as Chief Financial Officer and Chief Operating Officer, will serve as Interim CEO while the Board conducts a search to fill the position on a permanent basis.
WebMD expects that its financial results for the fourth quarter and full year 2011 will be consistent with the financial guidance it provided in its press release issued November 2, 2011 (Briefing.com note: Co guided Q4 revs of $147-157 mln at the time). Preliminarily, WebMD expects revenue and earnings to be between the low-end and midpoint of its financial guidance range. WebMD's preliminary outlook for 2012 is that revenue may be as much as 2% to 8% lower than 2011 revenue (consensus calls for revs to rise ~1%), with revenues declining more in the first half of the year and improving in the second half of the year.
WebMD's fourth quarter sales activity for advertising and sponsorship products was less than anticipated and reflects a challenging business environment for certain pharmaceutical company customers and a more competitive landscape in the consumer products markets. WebMD also announced today that, in late 2011, the independent directors of its Board of Directors commenced a process to consider strategic alternatives to enhance stockholder value. In connection with such process, the Board of Directors formed a Special Committee of independent directors, which was advised by independent financial and legal advisors.
The Special Committee, with its advisers, had discussions with several potential acquirers of the Company. The Company allowed such potential acquirers to conduct a due diligence investigation of the Company's business. The Special Committee has terminated these discussions with potential acquirers and its process to review a potential sale of the Company.
The company announced that Wayne T. Gattinella has resigned from his position as Chief Executive Officer and President of the Company and as a member of its Board of Directors. Anthony Vuolo, currently serving as Chief Financial Officer and Chief Operating Officer, will serve as Interim CEO while the Board conducts a search to fill the position on a permanent basis.
WebMD expects that its financial results for the fourth quarter and full year 2011 will be consistent with the financial guidance it provided in its press release issued November 2, 2011 (Briefing.com note: Co guided Q4 revs of $147-157 mln at the time). Preliminarily, WebMD expects revenue and earnings to be between the low-end and midpoint of its financial guidance range. WebMD's preliminary outlook for 2012 is that revenue may be as much as 2% to 8% lower than 2011 revenue (consensus calls for revs to rise ~1%), with revenues declining more in the first half of the year and improving in the second half of the year.
WebMD's fourth quarter sales activity for advertising and sponsorship products was less than anticipated and reflects a challenging business environment for certain pharmaceutical company customers and a more competitive landscape in the consumer products markets. WebMD also announced today that, in late 2011, the independent directors of its Board of Directors commenced a process to consider strategic alternatives to enhance stockholder value. In connection with such process, the Board of Directors formed a Special Committee of independent directors, which was advised by independent financial and legal advisors.
The Special Committee, with its advisers, had discussions with several potential acquirers of the Company. The Company allowed such potential acquirers to conduct a due diligence investigation of the Company's business. The Special Committee has terminated these discussions with potential acquirers and its process to review a potential sale of the Company.
