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Monster Buys Trovix And Beats The Street

by
John Zappe
Jul 31, 2008, 5:56 pm ET

Big news from Monster (profile; site) today. It bought jobmatcher Trovix (profile; site) for $72.5 million; settled that class action shareholder lawsuit over the stock options backdating for $25 million, and managed to beat Wall Street’s expectations for its 2nd quarter financial performance, earning 40 cents a share excluding one-time expenses. The Street consensus was the company would earn 37 cents a share.

Total revenue grew 9% to $354 million, from $324 million in the comparable quarter of 2007, boosted by a favorable exchange rate. Even without the benefit of the exchange rate Monster grew revenue by 4 percent. Wall Street analysts had estimated revenues would come in at $361 million.

International sales fueled the company’s growth during the quarter, as it has for the past year. While revenue from North American operations fell by $10 million during the quarter to $164 million. But sales elsewhere in the world jumped 34 percent (23 percent when you exclude the effect of currency exchange rates). International sales now account for 44 percent of company revenue.

Much of the financial news was expected by stock traders. Monster shares closed at $17.74, down 2.4 percent on the day, and rose slightly in after hours trading, when the numbers were released.

The company also reported settling a federal class action suit brought on behalf of shareholders who claimed they were mislead by the company’s practice of backdating stock options. That settlement and one previously announced resolves most of the shareholder litigation.

The Trovix acquisition was more of a surprise. Monster CEO Sal Iannuzzi called the purchase “a game-changing development.” “(It) complements nicely our ongoing investments in product, sales, and customer service, as well as the extension of our business into new areas and geographies,” he added.

Trovix launched as an ATS vendor in 2002, implementing artificial intelligence to analyze reqs and candidate resumes and match them in ranked order. The matching technology was refined over the years and in 2007 Trovix introduced its own jobboard where standard job postings and resumes and jobseeker information were matched.

In the announcement of the deal, Monster explained its rational for acquiring Trovix: “The combination of Monster and Trovix enhances Monster’s value proposition to employers by adding speed and efficiencies to the recruiting process, resulting in an improved return on investment for employers. The technology will also benefit job seekers, who will receive more relevant, targeted job postings.”

“The implementation of this technology will allow Monster to provide unparalleled match capabilities, taking us beyond keyword search into contextual search,” says Darko Dejanovic, Monster’s Global Chief Information Officer and Head of Product.

At least for now, Monster will continue to support existing Trovix customers.

Monster has also announced the acquisition of Armees.com, a French military site similar to Monster’s Military.com. No price was announced.

Finally, Monster said it has entered into arrangements with vendors Cornerstone OnDemand, a provider of on-demand, E-learning and training services, and HireRight (profile; site) an on-demand employment screening solutions provider.

Cornerstone will provide online courses in general business, desktop applications, and IT topic. HireRight will offer employers the opportunity to purchase background screening services as part of its current candidate management experience on Monster.com.

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  1. The Human Capitalist » News of the Week - August 1, 2008 - Taleo, Workday, Trovix and More…

    [...] acquires Trovix for $72.5 million.  Congrats to the Trovix team.  The move from eRecruiting to advanced [...]

  2. Gerald Marshall

    I predict the next 3 job sites to be aquired will be linkedin, realmatch and indeed. All three were recently added to About.com’s top 10 employment list

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    [...] More launches are coming. Next month — May 16th — Monster will roll out its Trovix-enhanced search to a select group of 150 customers. They’ll use the new system for several weeks providing feedback and suggestions before the new search backend becomes standard toward the end of the year. A seeker side rollout is planned for late summer. Monster acquired Trovix last year. [...]

  5. Sunita Sayana

    Congratualtions to Earl and the Trovix team!

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  7. Jim Coromel

    …And the funny thing is my clients tell me if I submit a Monster or Career Builder Candidate, they will not talk to them! Good old “Gum Shoe” searches for already employed people. That’s what they are paying for!

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