Angi : Reports Q2 2022 Results

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ANGI INC. REPORTS Q2 2022 - Q2 REVENUE INCREASES 23% TO $516 MILLION

DENVER- August 9, 2022-Angi Inc. (NASDAQ: ANGI) released its second quarter results today. Monthly metrics for Angi Inc. through July 2022 are included on page 3 of this release. A letter to IAC shareholders from Angi Inc. Chairman and IAC CEO Joey Levin is available on the Investor Relations section of IAC's website at ir.iac.com.

ANGI INC. SUMMARY RESULTS

($ in millions except per share amounts)

	Q2 2022		Q2 2021	Growth
Revenue	$ 515.8	$	421.0	23%
Gross profit	388.0		351.3	10%
Operating loss	(20.9)		(32.7)	36%
Net loss	(24.2)		(30.3)	20%
Diluted loss per share	(0.05)		(0.06)	20%
Adjusted EBITDA	9.7		(4.4)	NM

See reconciliations of GAAP to non-GAAP measures beginning on page 9.

Q2 2022 HIGHLIGHTS

• Revenue increased 23% year-over-year, the 7th consecutive quarter of double-digit growth (and the highest quarterly growth since 2018) reflecting:

• • 5% growth from Angi Ads and Leads, the first quarter of growth since Q2 2021
  • 107% growth from Angi Services to $151 million due to the acquisition of Angi Roofing on July 1, 2021 and continued investment
  • • Angi Services comprised 29% of total revenue as compared to 17% in Q2 2021
    • Angi Services revenue totaled $494 million over the trailing twelve months, up 120% year-over-year
  • 5% declines in Europe (6% growth in local currency)
• Operating loss improved to $21 million (compared to a loss of $33 million in Q2 2021) and Adjusted EBITDA improved to a profit of $10 million (compared to a loss of $4 million in Q2 2021).
• Transacting Service Professionals were 220,000 and Advertising Service Professionals were 37,000.
• Monetized Transactions were 4.7 million in Q2 2022 with over 17 million for the trailing twelve months.

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Revenue
	Q2 2022	Q2 2021		Growth
($ in millions; rounding differences may occur)
Angi Ads and Leads	$	344.9	$	327.1	5%
Angi Services		150.9		72.8		107%
Total North America		495.8		399.9	24%
Europe		20.0		21.0		-5%
Total Revenue	$	515.8	$	421.0	23%

Operating Loss and Adjusted EBITDA

		Q2 2022	Q2 2021	Growth
($ in millions; rounding differences may occur)
Operating loss
North America	$	(20.1)	$	(32.1)	38%
Europe			(0.8)		(0.6)	-37%
Total	$	(20.9)	$	(32.7)	36%
Adjusted EBITDA
North America	$	10.0	$	(5.3)	NM
Europe			(0.3)		0.9	NM
Total	$	9.7	$	(4.4)	NM

• Operating loss decreased $11.8 million to $20.9 million reflecting:

• Adjusted EBITDA of $9.7 million as compared to a loss of $4.4 million in Q2 2021 due to:
• • $2.3 million in one-time costs related to rationalizing the Company's real estate footprint as compared to $9.6 million in Q2 2021
  • Gross profit increasing 10% to $388.0 million
  • Lower selling and marketing expense as a percentage of revenue due to the anniversary of the consolidation under a single brand on March 17, 2021, which had adversely affected both free and paid search engine marketing efforts in the prior year
• $3.9 million higher stock-based compensation expense due primarily to new grants issued over the past year

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Income Taxes

The Company recorded an income tax benefit of $3.7 million in Q2 2022 for an effective tax rate of 13%, which is lower than the statutory rate due primarily to unbenefited foreign losses. The Company recorded an income tax benefit of $9.1 million in Q2 2021 for an effective tax rate of 23%, which is higher than the statutory rate due primarily to an adjustment to the forecasted annual effective tax rate, partially offset by nondeductible stock-based compensation expense.

Operating Metrics

	Q2 2022	Q2 2021	Growth
Angi Service Requests (in thousands)	8,498	9,419	-10%
Angi Monetized Transactions (in thousands)	4,740	5,006	-5%
Angi Transacting Service Professionals (in thousands)	220	225	-2%
Angi Advertising Service Professionals (in thousands)	37	40	-8%

Monthly Metrics (year-over-year growth trends) (a)

Apr '22 May '22 Jun '22 Jul '22

Angi Ads and Leads

Angi Services (b)

Total North America Revenue

Europe Revenue

Total Revenue

Angi Service Requests

Angi Monetized Transactions

Angi Transacting Service Professionals

Angi Advertising Service Professionals

-2%	8%	11%	7%
111%	108%	103%	18%
17%	26%	29%	10%
-7%	-6%	-1%	6%
16%	24%	27%	10%
-14%	-7%	-8%	-9%
-8%	-3%	-5%	-7%
-4%	-3%	-2%	-3%
-7%	-7%	-8%	-7%

(a) As of the date of this document, the Company has not yet completed its financial close process for July 2022. As a result, the information herein for

July 2022 is preliminary and based upon information available to the Company as of the date of this document. During the course of the financial close process, the Company may identify items that would require it to make adjustments, which may impact growth rates and be material to the information presented above.

(b) Includes revenue from Angi Roofing, which was acquired on July 1, 2021.

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Free Cash Flow

For the six months ended June 30, 2022, net cash from operations decreased $52.2 million to $7.1. million and Free Cash Flow decreased $78.6 million to negative $55.1 million due primarily to unfavorable working capital, higher capital expenditures and lower Adjusted EBITDA.

		Six Months Ended June 30,
($ in millions; rounding differences may occur)		2022		2021
Net cash provided by operating activities	$	7.1	$	59.3
Capital expenditures		(62.1)		(35.7)
Free Cash Flow	$	(55.1)	$	23.5

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2022:

• Angi Inc. had 502.7 million Class A and Class B common shares outstanding.
• IAC's economic interest in Angi Inc. was 84.5% and IAC's voting interest in Angi Inc. was 98.2%.
• Angi Inc. had $361 million in cash and cash equivalents and $500 million of debt (due August 15, 2028), which was held at ANGI Group, LLC (a subsidiary of Angi Inc.).

Angi Inc. has 15.0 million shares remaining in its stock repurchase authorization.

Angi Inc. may repurchase shares over an indefinite period on the open market and in privately negotiated transactions, depending on those factors management deems relevant at any particular time, including, without limitation, market conditions, share price and future outlook.

VIDEO CONFERENCE CALL

IAC and Angi Inc. will live stream a joint video conference call to answer questions regarding their second quarter results on Wednesday, August 10, 2022, at 8:30 a.m. Eastern Time. This live stream will include the disclosure of certain information, including forward-looking information, which may be material to an investor's understanding of IAC's and Angi Inc.'s businesses. The live stream will be open to the public at ir.angi.com and ir.iac.com.

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DILUTIVE SECURITIES

Angi Inc. has various dilutive securities. The table below details these securities as well as potential dilution at various stock prices (shares in millions; rounding differences may occur).

		Avg.
		Exercise		As of
	Shares	Price	8/5/22		Dilution at:
Share Price				$5.82	$6.00	$7.00	$8.00	$9.00
Absolute Shares as of 8/5/22	503.3			503.3	503.3	503.3	503.3	503.3
SARs	0.5	$	3.27	0.1	0.1	0.1	0.1	0.1
Options	0.6	$	13.36	0.0	0.0	0.0	0.0	0.0
RSUs and subsidiary denominated equity awards	25.0				6.6	6.6	6.6	6.6	6.6
Total Dilution				6.7	6.7	6.7	6.7	6.7
% Dilution				1.3%	1.3%	1.3%	1.3%	1.3%
Total Diluted Shares Outstanding				510.0	510.0	510.0	510.0	510.0

The dilutive securities presentation is calculated using the method and assumptions described below, which are different from those used for GAAP dilution, which is calculated based on the treasury stock method.

The Company currently settles all equity awards on a net basis; therefore, the dilutive effect is presented as the net number of shares expected to be issued upon exercise or vesting, and in the case of options, assuming no proceeds are received by the Company. Any required withholding taxes are paid in cash by the Company on behalf of the employees assuming a withholding tax rate of 50%. In addition, the estimated income tax benefit from the tax deduction received upon the exercise or vesting of these awards is assumed to be used to repurchase Angi Inc. shares. Assuming all awards were exercised or vested on August 5, 2022, withholding taxes paid by the Company on behalf of the employees upon net settlement would have been $67.5 million, assuming a stock price of $5.82 and a 50% withholding rate. The table above assumes no change in the fair value estimate of the non-publicly traded subsidiary denominated equity awards from the values used at June 30, 2022.