ReachLocal Posts Net Loss in Q1; Partners with Google

Online marketing company ReachLocal Inc. widened its net loss in the first quarter when compared with the same period from a year ago. The Woodland Hills-based company also announced a partnership with Google to accelerate its international expansion. “International markets now represent more than 20 percent of ReachLocal’s business, and we believe this partnership will be a significant contributor in our strategy to increase our presence overseas,” said President and CEO Zorik Gordon. For the quarter ending March 31, ReachLocal reported a net loss of $3.4 million, or $0.12 per diluted share, on revenues of $84 million. For the same period in 2010, the company had a net loss of $2.3 million, or $0.10 per diluted share, on revenues of $63.6 million. The combination of the first quarter results and the expected benefits from the partnership with Google led ReachLocal to raise its guidance of earning before interest, taxes and deprecation to between $9 million to $11 million from the prior guidance of $6 million to $8 million. Partnering with Google and its AdWords advertising program for local businesses will expand ReachLocal’s presence in the international markets in which it already operates (Canada, Australia, United Kingdom and Germany) and into new markets. “We strongly believe that having the support and backing of Google’s global AdWords team and brand, together with financial incentives, will be a significant contributor as we execute against that strategy,” Gordon said. Mark R. Madler