FTD Group, Inc. Reports Third Quarter Fiscal Year 2008 Results
 

DOWNERS GROVE, IL. – May 6, 2008 –  FTD Group, Inc. (NYSE:FTD), a leading international provider of floral related products and services, today announced third quarter fiscal year 2008 financial results for the period ended March 31, 2008.

THIRD QUARTER FISCAL YEAR 2008 RESULTS

Third quarter fiscal year 2008 consolidated revenue grew $9.1 million, or 5.0%, to $192.0 million, compared to consolidated revenue of $182.9 million for the same period of fiscal year 2007. The International segment contributed $7.4 million to this revenue growth. The Domestic businesses contributed the remaining $1.7 million to this revenue growth. The increase in the Domestic business revenue was primarily the result of the shift of Easter to the third quarter in fiscal year 2008, whereas it occurred during the fourth quarter of fiscal year 2007.

Resulting net income for the third quarter of fiscal year 2008 was $9.3 million, or $0.31 per diluted share. During the current year third quarter, the Company incurred $3.5 million in unusual expenses, which included $2.0 million of charges related to abandoned acquisition opportunities in light of the pending acquisition by United Online, Inc., $0.9 million of expenses related to the pending acquisition by United Online, Inc. and $0.6 million in advisory costs incurred in conjunction with the resolution of a sales tax audit. Net of tax, these charges amounted to $0.07 per diluted share. This was partially offset by a $0.01 per diluted share reduction to the tax provision during the current year quarter, which was primarily related to the expiration of a tax statute. Fiscal year 2007 third quarter net income was $9.6 million, or $0.32 per diluted share, which included $0.02 per diluted share in expenses related to the Company's secondary stock offering in the third quarter of fiscal year 2007.

Including the $3.5 million in unusual expenses described above, earnings before interest, taxes, depreciation and amortization (EBITDA) was $22.5 million for the third quarter of fiscal year 2008. Adjusted EBITDA, which excluded the unusual expenses described above and other (income) expense, net, was $26.0 million compared to Adjusted EBITDA (which excluded other (income) expense, net) of $26.1 million for the same period of the prior fiscal year.

A table reconciling net income to EBITDA and Adjusted EBITDA and management's discussion of the use of non-GAAP measures is included with the attached consolidated financial statements. The Company believes EBITDA and Adjusted EBITDA provide useful supplemental information related to the Company's operations and results.

Domestic Consumer Segment

The Domestic Consumer Segment achieved revenue of $81.7 million in the third quarter of fiscal year 2008, compared to revenue of $80.2 million in the same period of fiscal year 2007, an increase of 1.8%. Revenue in the quarter benefited from the shift of the Easter holiday into the third quarter compared with the prior year when Easter occurred in the fourth quarter. Third quarter operating income in the Domestic Consumer Segment was $4.7 million, or 5.8% of Domestic Consumer Segment revenue, compared to $4.2 million in the prior year quarter, or 5.3% of Domestic Consumer Segment revenue. Operating margin during the period increased due to more efficient technology spending and increased efficiencies in the customer service area.

Domestic Consumer orders during the third quarter of fiscal year 2008 totaled approximately 1,236,000 compared to approximately 1,243,000 orders in the same period of fiscal year 2007. Average order value increased to $64.48 in the current quarter from $63.04 in the prior year's quarter.

Domestic Florist Segment

The Domestic Florist Segment achieved revenue of $49.3 million in the third quarter of fiscal year 2008, slightly up from the $49.1 million of revenue achieved in the same period of the prior fiscal year. Fiscal year 2008 third quarter operating income for the Domestic Florist Segment was $14.5 million, or 29.4% of Domestic Florist Segment revenue, compared to $16.4 million in the prior year quarter, or 33.3% of Domestic Florist Segment revenue. This decline in operating income is largely related to a shift in timing of advertising expenses related to the Easter holiday and a florist membership event that occurred during the third quarter of the current fiscal year and during the fourth quarter of the prior fiscal year.

International Segment

For the third quarter of fiscal year 2008, the International Segment, primarily comprised of the Interflora U.K. business, achieved revenue of $61.0 million compared to revenue of $53.6 million in the third quarter of the prior fiscal year, representing a 14.0% increase. This increase included $0.9 million, or 1.5%, related to favorable foreign currency movement between the U.S. dollar and the British Pound. The International Segment achieved operating income of $7.3 million, or 12.0% of revenue, in the third quarter of fiscal year 2008 compared to $5.3 million, or 9.9% of revenue, in the third quarter of fiscal year 2007. This increase was largely due to efficiencies across the business.

The International Segment continued to experience strong demand as consumer order volume increased 14.0% to approximately 758,000 for the third quarter of fiscal year 2008, compared to approximately 665,000 orders in the same period of the prior fiscal year. Average order value in the International Segment was $67.39 in the current quarter, a 1.1% increase, attributable to favorable foreign currency movement, compared to $66.68 for the same period of the prior fiscal year. Internet orders increased to 77.9% in the current quarter, from 73.4% for the same period of fiscal year 2007.

BALANCE SHEET AND OTHER HIGHLIGHTS

As of March 31, 2008, the Company's cash and cash equivalents totaled $34.0 million. The Company's debt balance totaled $294.1 million, compared to total debt of $302.0 million as of December 31, 2007. As of March 31, 2008, the Company had $72.1 million available under its revolving credit facility.

In addition to the $7.8 million debt repayment made during the third quarter of fiscal year 2008, the Company paid a quarterly cash dividend of $0.1625 per share on April 4, 2008 to shareholders of record on March 21, 2008, in an amount totaling $4.8 million.

OUTLOOK

For fiscal year 2008, the Company is reaffirming its previously announced annual revenue target of approximately $645 million and targeted Adjusted EBITDA (excluding other (income) expense, net and the unusual charges incurred in the third quarter of fiscal year 2008, as described above) of approximately $98 million. Targeted EBITDA, including the $3.5 million of unusual expenses incurred in the third quarter as described above, is expected to be approximately $95 million. These targets exclude any expenses related to the pending acquisition by United Online, Inc. that may be incurred during the fourth quarter. The Company's targeted Adjusted EBITDA includes approximately $4 million of expense related to stock compensation associated with Statement of Financial Accounting Standards No. 123(R) and a deferred compensation plan at Interflora U.K. The Company expects targeted net income for the fiscal year to be approximately $39 million, or $1.31 per diluted share, a decrease from the previous net income target of $40 million, or $1.35 per diluted share. These new net income and diluted EPS targets reflect the unusual charges described earlier in the release and exclude any additional charges related to the pending acquisition by United Online, Inc. that may be incurred in the last quarter of the year. The above targets are only estimates, which may be exceeded or alternatively may not be achieved.

ACQUISITION OF COMPANY BY UNITED ONLINE, INC.

As announced on April 30, 2008, the Company and United Online, Inc. (Nasdaq:UNTD), a leading provider of consumer Internet and media services entered into a definitive merger agreement providing for the acquisition of FTD Group, Inc. by United Online, Inc. Under the terms of the merger agreement, FTD stockholders will receive $7.34 in cash, 0.4087 of a share of United Online common stock ("United Online Stock") and $3.31 principal amount of United Online 13% senior secured notes due 2013 (the "Notes") for each share of FTD common stock in the merger, for a total value of $15.08 per share of FTD common stock based on United Online's closing stock price of $10.83 on April 29, 2008. The total consideration to FTD stockholders will be approximately $456 million, consisting of $222 million in cash, 12.35 million shares of United Online Stock and $100 million aggregate principal amount of Notes. The remaining purchase price consists of repayment of FTD indebtedness and expenses incurred in connection with the transaction. Upon closing of the transaction, the former FTD stockholders will own approximately 15% of United Online.

Under the terms of the merger agreement, United Online may elect to increase the per share cash consideration payable to FTD's stockholders by $2.81 in full substitution of the Notes, in which case FTD stockholders will receive a total of $10.15 in cash and 0.4087 of a share of United Online Stock in exchange for each share of FTD common stock in the merger, or a total value of $14.58 per share of FTD common stock, based on United Online's closing stock price of $10.83 on April 29, 2008. In such case, the total consideration to FTD stockholders will be approximately $440 million, consisting of $307 million in cash and 12.34 million shares of United Online Stock. FTD will notify its stockholders as to the amount of cash, United Online Stock and, if applicable, Notes consideration they will receive for each share of FTD common stock in the merger in the definitive proxy/prospectus materials to be mailed to FTD's stockholders.

The acquisition is anticipated to close during the third quarter of calendar year 2008. The transaction requires the approval of FTD stockholders and is subject to a financing condition and customary closing conditions. Under the terms of the merger agreement, FTD has agreed to suspend all dividends on its common stock for 180 days after the date of the signing of the merger agreement. After the closing of the acquisition, FTD will continue to operate as a wholly-owned subsidiary of United Online, operating out of FTD's existing facilities, including its U.S. headquarters in Downers Grove, Illinois and its international headquarters in the United Kingdom.

ADDITIONAL INFORMATION AND WHERE YOU CAN FIND IT

United Online, Inc. ("United") intends to file with the Securities and Exchange Commission ("SEC") a Registration Statement on Form S-4, which will include a proxy statement/prospectus of United and the Company and other relevant materials in connection with the proposed transaction. The proxy statement/prospectus will be mailed to the stockholders of the Company. Investors and stockholders are urged to read the proxy statement/prospectus and Registration Statement, and any and all amendments or supplements thereto, when they become available because they will contain important information about the proposed transaction. Investors and stockholders may obtain a free copy of the proxy statement/prospectus and Registration Statement (when available), as well as other documents filed by United and the Company with the SEC, at the SEC's website at www.sec.gov (file://www.sec.gov). Investors and stockholders may also obtain a free copy of the proxy statement/prospectus and Registration Statement and the respective filings with the SEC directly from United by directing a request to Erik Randerson at (818) 287-3350 and directly from the Company by directing a request to Jandy Tomy at (630) 724-6984. Investors and stockholders are urged to read the proxy statement/prospectus and the other relevant materials when they become available before making any voting or investment decision with respect to the proposed transaction.

Each of the companies' directors and executive officers and other persons may be deemed, under SEC rules, to be participating in the solicitation of proxies in connection with the proposed transaction. Information regarding United's directors and officers can be found in its proxy statement filed with the SEC on April 29, 2008, and information regarding the Company's directors and officers can be found in its proxy statement filed with the SEC on October 11, 2007. Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interest in the transaction, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC.

ABOUT FTD GROUP, INC.

FTD Group, Inc. is a leading provider of floral related products and services to consumers and retail florists, as well as other retail locations offering floral products, in the U.S., Canada, the U.K. and the Republic of Ireland. The business utilizes the highly recognized FTD and Interflora brands, both supported by the Mercury Man logo, which is displayed in approximately 45,000 floral shops worldwide. The consumer businesses operate primarily through the www.ftd.com Web site in the U.S. and Canada and the www.interflora.co.uk Web site in the U.K. and are complemented by the florist businesses which provide products and services to the Company's independent members.

FORWARD-LOOKING STATEMENTS

This press release contains various "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements may include statements regarding the Company's outlook, anticipated revenue growth and profitability; anticipated benefits of its acquisition of Interflora Holdings Limited ("Interflora U.K."), anticipated benefits of investments in new products, programs and offerings and opportunities and trends within both the domestic and international floral businesses, including opportunities to expand these businesses and capitalize on growth opportunities or increase penetration of service offerings. The international business reflects the operations of Interflora U.K. These forward-looking statements are based on management's current expectations, assumptions, estimates and projections about the Company and the Company's industry. Investors are cautioned that actual results could differ from those contained in any forward-looking statements as a result of: the Company's ability to acquire and retain FTD and Interflora U.K. members and continued recognition by members of the value of the Company's products and services; the acceptance by members of new or modified service offerings recently introduced; the Company's ability to sell additional products and services to FTD and Interflora U.K. members; the Company's ability to expand existing marketing partnerships and secure new marketing partners within the domestic and international consumer businesses; the success of the Company's marketing campaigns; the ability to retain customers and maintain average order value within the domestic and international consumer businesses; the ability to manage foreign currency exchange rate risk; the Company's performance during key holiday selling seasons such as Christmas, Valentine's Day and Mother's Day; the existence of failures in the Company's computer systems; competition from existing and potential new competitors; levels of discretionary consumer purchases of flowers and specialty gifts; the Company's ability to manage or reduce its level of expenses within both the domestic and international businesses; actual growth rates for the markets in which the Company competes compared with forecasted growth rates; the Company's ability to increase capacity and introduce enhancements to its Web sites; and the Company's ability to integrate Interflora U.K. and additional partners or acquisitions, if any are identified. These factors, along with other potential risks and uncertainties, are discussed in the Company's reports and other documents filed with the Securities and Exchange Commission. The Company expressly disclaims any obligation to update its forward-looking statements.

Financial statements follow...

                                                   FTD GROUP, INC.
                             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                  (Unaudited)
                                                (In thousands)

                               Three Months Ended   Nine Months Ended
                                    March 31,           March 31,
                               ------------------- -------------------
                                 2008      2007      2008      2007
                               --------- --------- --------- ---------

Revenues:
 Consumer segment              $ 81,686  $ 80,216  $192,040  $197,084
 Florist segment                 49,264    49,123   136,686   137,522
 International segment           61,037    53,560   142,495   108,604
                               --------- --------- --------- ---------
      Total revenues            191,987   182,899   471,221   443,210

Costs of goods sold and
 services provided:
 Consumer segment                58,314    56,980   135,763   140,467
 Florist segment                 17,483    16,639    46,811    44,167
 International segment           42,730    37,491    98,130    75,203
 Corporate                          514       493     1,467     1,507
                               --------- --------- --------- ---------
      Total costs of goods
       sold and services
       provided                 119,041   111,603   282,171   261,344

Gross profit:
 Consumer segment                23,372    23,236    56,277    56,617
 Florist segment                 31,781    32,484    89,875    93,355
 International segment           18,307    16,069    44,365    33,401
 Corporate                         (514)     (493)   (1,467)   (1,507)
                               --------- --------- --------- ---------
      Total gross profit         72,946    71,296   189,050   181,866

Advertising and selling:
 Consumer segment                11,681    11,346    23,915    25,087
 Florist segment                 12,539    11,793    32,902    35,042
 International segment            5,355     4,209    12,346     8,638
                               --------- --------- --------- ---------
      Total advertising and
       selling                   29,575    27,348    69,163    68,767

General and administrative:
 Consumer segment                 5,637     6,525    14,515    16,750
 Florist segment                  2,292     2,052     6,570     6,348
 International segment            5,611     6,547    17,590    15,549
 Corporate                       10,372     6,374    24,740    19,615
                               --------- --------- --------- ---------
      Total general and
       administrative            23,912    21,498    63,415    58,262

Operating income (loss) before
 corporate allocations:
 Consumer segment                 6,054     5,365    17,847    14,780
 Florist segment                 16,950    18,639    50,403    51,965
 International segment            7,341     5,313    14,429     9,214
 Corporate                      (10,886)   (6,867)  (26,207)  (21,122)
                               --------- --------- --------- ---------
      Total operating income
       before corporate
       allocations               19,459    22,450    56,472    54,837
                               --------- --------- --------- ---------

Corporate Allocations:
 Consumer segment                 1,311     1,151     3,339     3,021
 Florist segment                  2,479     2,284     8,039     7,007
 International segment                -         -         -         -
 Corporate                       (3,790)   (3,435)  (11,378)  (10,028)
                               --------- --------- --------- ---------
      Total corporate
       allocations                    -         -         -         -

Income (loss) from operations:
 Consumer segment                 4,743     4,214    14,508    11,759
 Florist segment                 14,471    16,355    42,364    44,958
 International segment            7,341     5,313    14,429     9,214
 Corporate                       (7,096)   (3,432)  (14,829)  (11,094)
                               --------- --------- --------- ---------
      Total income from
       operations                19,459    22,450    56,472    54,837
                               --------- --------- --------- ---------

Other income and expenses:
 Interest income                   (399)     (489)   (1,020)   (1,126)
 Interest expense                 5,456     6,444    17,998    21,679
 Other (income) expense, net         23       570      (325)     (725)
                               --------- --------- --------- ---------

      Total other income and
       expenses                   5,080     6,525    16,653    19,828
                               --------- --------- --------- ---------

      Income before income tax   14,379    15,925    39,819    35,009

Income tax expense                5,086     6,310    13,404    13,844
                               --------- --------- --------- ---------

      Net income               $  9,293  $  9,615  $ 26,415  $ 21,165
                               ========= ========= ========= =========

Net income per common share -
 basic                         $   0.31  $   0.34  $   0.90  $   0.75
                               ========= ========= ========= =========
Net income per common share -
 diluted                       $   0.31  $   0.32  $   0.89  $   0.72
                               ========= ========= ========= =========

Weighted average common shares
 outstanding - basic             29,520    28,462    29,365    28,343
                               ========= ========= ========= =========
Weighted average common shares
 outstanding - diluted           29,755    29,827    29,698    29,510
                               ========= ========= ========= =========

                           FTD GROUP, INC.
                CONDENSED CONSOLIDATED BALANCE SHEETS
                            (In thousands)

                 ASSETS                   March 31, 2008 June 30, 2007
----------------------------------------- -------------- -------------
Current assets:                            (Unaudited)
 Cash and cash equivalents                $       33,997 $     25,462
 Accounts receivable, less allowance for
  doubtful accounts of $6,736 at March
  31, 2008 and $5,431 at June 30, 2007            38,958       32,416
 Inventories, net                                  4,356        3,694
 Other current assets                             11,844        9,500
                                          -------------- -------------
   Total current assets                           89,155       71,072

Property and equipment:
 Property and equipment                           36,931       35,791
 Less accumulated depreciation                    14,425       11,018
                                          -------------- -------------
   Property and equipment, net                    22,506       24,773

Other assets:
 Computer software, net                           12,674       12,699
 Other noncurrent assets                          23,228       21,085
 Other intangible assets, less
  accumulated amortization of $11,548 at
  March 31, 2008 and $9,154 at June 30,
  2007                                            11,052       13,454
 Trademarks                                      187,525      187,816
 Goodwill                                        417,645      418,001
                                          -------------- -------------
   Total other assets                            652,124      653,055
                                          -------------- -------------
   Total assets                           $      763,785 $    748,900
                                          ============== =============

  LIABILITIES AND STOCKHOLDERS' EQUITY
-----------------------------------------

Current liabilities:
 Accounts payable                         $       70,547 $     52,009
 Other accrued liabilities                        29,856       28,511
 Current maturities of long-term debt              1,242        8,475
 Dividends payable                                 4,801        4,707
                                          -------------- -------------
   Total current liabilities                     106,446       93,702

Senior secured credit facility                   121,079      133,418
Senior subordinated notes                        170,117      170,117
Post-retirement benefits, accrued pension
 obligations and other liabilities                 5,319        4,535
Deferred income taxes                             80,072       85,350

Stockholders' equity:
 Common stock: $0.01 par value, 75,000
  shares authorized; 29,832 shares issued
  as of March 31, 2008 and 29,482 shares
  issued as of June 30, 2007                         298          295
 Additional paid-in capital                      237,142      235,589
 Retained earnings                                33,657       20,952
 Accumulated other comprehensive income            9,655        9,933
 Treasury stock, at cost, 519 shares as
  of June 30, 2007                                     -       (4,991)
                                          -------------- -------------
   Total stockholders' equity                    280,752      261,778
                                          -------------- -------------
   Total liabilities and stockholders'
    equity                                $      763,785 $    748,900
                                          ============== =============

                           FTD GROUP, INC.
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Unaudited)
                            (In thousands)

                                                   Nine Months Ended
                                                       March 31,
                                                 ---------------------

                                                    2008       2007
                                                  --------- ----------

Cash flows from operating activities:
 Net income                                       $ 26,415  $  21,165
 Adjustments to reconcile net income to net cash
  provided by operating activities:
  Depreciation and amortization                      9,463     10,890
  Stock-based compensation expense                   1,947      1,451
  Amortization and write-off of deferred
   financing costs                                     742      2,512
  Provision for doubtful accounts                    2,504      2,088
  Deferred income taxes                             (5,817)     2,706
  Excess tax benefit from stock-based
   compensation                                     (2,421)    (1,904)
  (Decrease) increase due to changes in operating
   assets and liabilities, net of acquisition:
     Accounts receivable                            (8,963)    (9,743)
     Inventories                                      (663)      (341)
     Other current assets                           (1,007)     1,058
     Other noncurrent assets                        (3,160)       283
     Accounts payable                               17,849      2,444
     Other accrued liabilities                       5,365      4,784
                                                  --------- ----------

         Net cash provided by operating
          activities                                42,254     37,393
                                                  --------- ----------

Cash flows from investing activities:
 Capital expenditures                               (4,795)    (6,027)
 Dividends received                                     48          -
 Acquisition of business, net of cash acquired           -    (96,717)
                                                  --------- ----------

         Net cash used in investing activities      (4,747)  (102,744)
                                                  --------- ----------

Cash flows from financing activities:
 Repayments of long-term debt                      (19,572)   (57,750)
 Dividends paid                                    (14,366)         -
 Proceeds from exercise of stock options             2,187      2,315
 Excess tax benefit from stock-based compensation    2,421      1,904
 Proceeds from issuance of common stock                  6          -
 Proceeds from issuance of long-term debt, net of
  financing costs                                        -    148,536
                                                  --------------------

         Net cash (used in) provided by financing
          activities                               (29,324)    95,005
                                                  --------- ----------

 Effect of foreign exchange rate changes on cash       352        771
                                                  --------- ----------

Net increase in cash and cash equivalents            8,535     30,425

Cash and cash equivalents at beginning of period    25,462     10,954
                                                  --------- ----------

Cash and cash equivalents at end of period        $ 33,997  $  41,379
                                                  ========= ==========

                           FTD GROUP, INC.
                         SEGMENT INFORMATION
                             (Unaudited)
                            (In thousands)

                                         Three Months Ended
                                           March 31, 2008

                               ---------------------------------------
                               Gross Segment Eliminations Consolidated
                               ------------- ------------ ------------

Revenues:
Consumer segment               $     85,082  $    (3,396) $    81,686
Florist segment                      49,385         (121)      49,264
International segment                60,940           97       61,037
                               ------------- ------------ ------------
            Total                   195,407       (3,420)     191,987
                               ------------- ------------ ------------

Costs of Goods Sold and
 Services Provided:
Consumer segment                     58,435         (121)      58,314
Florist segment                      17,483            -       17,483
International segment                42,761          (31)      42,730
Corporate                               514            -          514
                               ------------- ------------ ------------
            Total                   119,193         (152)     119,041
                               ------------- ------------ ------------

Gross Profit:
Consumer segment                     26,647       (3,275)      23,372
Florist segment                      31,902         (121)      31,781
International segment                18,179          128       18,307
Corporate                              (514)           -         (514)
                               ------------- ------------ ------------
            Total                    76,214       (3,268)      72,946
                               ------------- ------------ ------------

Advertising and Selling:
Consumer segment                     11,681            -       11,681
Florist segment                      15,935       (3,396)      12,539
International segment                 5,324           31        5,355
                               ------------- ------------ ------------
            Total                    32,940       (3,365)      29,575
                               ------------- ------------ ------------

General and Administrative:
Consumer segment                      5,637            -        5,637
Florist segment                       2,292            -        2,292
International segment                 5,637          (26)       5,611
Corporate                            10,372            -       10,372
                               ------------- ------------ ------------
            Total                    23,938          (26)      23,912
                               ------------- ------------ ------------

Operating Income (Loss) before
 Corporate Allocations:
Consumer segment                      9,329       (3,275)       6,054
Florist segment                      13,675        3,275       16,950
International segment                 7,218          123        7,341
Corporate                           (10,886)           -      (10,886)
                               ------------- ------------ ------------
            Total                    19,336          123       19,459
                               ------------- ------------ ------------

Corporate Allocations:
Consumer segment                      1,311            -        1,311
Florist segment                       2,479            -        2,479
International segment                     -            -            -
Corporate                            (3,790)           -       (3,790)
                               ------------- ------------ ------------
            Total                         -            -            -
                               ------------- ------------ ------------

Operating Income (Loss):
Consumer segment                      8,018       (3,275)       4,743
Florist segment                      11,196        3,275       14,471
International segment                 7,218          123        7,341
Corporate                            (7,096)           -       (7,096)
                               ------------- ------------ ------------
            Total              $     19,336  $       123  $    19,459
                               ============= ============ ============

Depreciation and Amortization:
Consumer segment               $        877  $         -  $       877
Florist segment                         660            -          660
International segment                   851            -          851
Corporate                               656            -          656
                               ------------- ------------ ------------
            Total              $      3,044  $         -  $     3,044
                               ============= ============ ============

                                         Three Months Ended
                                           March 31, 2007

                               ---------------------------------------
                               Gross Segment Eliminations Consolidated
                               ------------- ------------ ------------

Revenues:
Consumer segment               $     83,244  $    (3,028) $    80,216
Florist segment                      49,221          (98)      49,123
International segment                53,476           84       53,560
                               ------------- ------------ ------------
            Total                   185,941       (3,042)     182,899
                               ------------- ------------ ------------

Costs of Goods Sold and
 Services Provided:
Consumer segment                     57,078          (98)      56,980
Florist segment                      16,639            -       16,639
International segment                37,528          (37)      37,491
Corporate                               493            -          493
                               ------------- ------------ ------------
            Total                   111,738         (135)     111,603
                               ------------- ------------ ------------

Gross Profit:
Consumer segment                     26,166       (2,930)      23,236
Florist segment                      32,582          (98)      32,484
International segment                15,948          121       16,069
Corporate                              (493)           -         (493)
                               ------------- ------------ ------------
            Total                    74,203       (2,907)      71,296
                               ------------- ------------ ------------

Advertising and Selling:
Consumer segment                     11,346            -       11,346
Florist segment                      14,821       (3,028)      11,793
International segment                 4,292          (83)       4,209
                               ------------- ------------ ------------
            Total                    30,459       (3,111)      27,348
                               ------------- ------------ ------------

General and Administrative:
Consumer segment                      6,525            -        6,525
Florist segment                       2,052            -        2,052
International segment                 6,486           61        6,547
Corporate                             6,374            -        6,374
                               ------------- ------------ ------------
            Total                    21,437           61       21,498
                               ------------- ------------ ------------

Operating Income (Loss) before
 Corporate Allocations:
Consumer segment                      8,295       (2,930)       5,365
Florist segment                      15,709        2,930       18,639
International segment                 5,170          143        5,313
Corporate                            (6,867)           -       (6,867)
                               ------------- ------------ ------------
            Total                    22,307          143       22,450
                               ------------- ------------ ------------

Corporate Allocations:
Consumer segment                      1,151            -        1,151
Florist segment                       2,284            -        2,284
International segment                     -            -            -
Corporate                            (3,435)           -       (3,435)
                               ------------- ------------ ------------
            Total                         -            -            -
                               ------------- ------------ ------------

Operating Income (Loss):
Consumer segment                      7,144       (2,930)       4,214
Florist segment                      13,425        2,930       16,355
International segment                 5,170          143        5,313
Corporate                            (3,432)           -       (3,432)
                               ------------- ------------ ------------
            Total              $     22,307  $       143  $    22,450
                               ============= ============ ============

Depreciation and Amortization:
Consumer segment               $        950  $         -  $       950
Florist segment                         799            -          799
International segment                 1,078            -        1,078
Corporate                               862            -          862
                               ------------- ------------ ------------
            Total              $      3,689  $         -  $     3,689
                               ============= ============ ============

                           FTD GROUP, INC.
                         SEGMENT INFORMATION
                             (Unaudited)
                            (In thousands)

                                         Nine Months Ended
                                           March 31, 2008

                               ---------------------------------------
                               Gross Segment Eliminations Consolidated
                               ------------- ------------ ------------

Revenues:
Consumer segment               $    200,459  $    (8,419) $   192,040
Florist segment                     137,037         (351)     136,686
International segment               142,197          298      142,495
                               ------------- ------------ ------------
            Total                   479,693       (8,472)     471,221
                               ------------- ------------ ------------

Costs of Goods Sold and
 Services Provided:
Consumer segment                    136,114         (351)     135,763
Florist segment                      46,811            -       46,811
International segment                98,229          (99)      98,130
Corporate                             1,467            -        1,467
                               ------------- ------------ ------------
            Total                   282,621         (450)     282,171
                               ------------- ------------ ------------

Gross Profit:
Consumer segment                     64,345       (8,068)      56,277
Florist segment                      90,226         (351)      89,875
International segment                43,968          397       44,365
Corporate                            (1,467)           -       (1,467)
                               ------------- ------------ ------------
            Total                   197,072       (8,022)     189,050
                               ------------- ------------ ------------

Advertising and Selling:
Consumer segment                     23,915            -       23,915
Florist segment                      41,321       (8,419)      32,902
International segment                12,280           66       12,346
                               ------------- ------------ ------------
            Total                    77,516       (8,353)      69,163
                               ------------- ------------ ------------

General and Administrative:
Consumer segment                     14,515            -       14,515
Florist segment                       6,570            -        6,570
International segment                17,584            6       17,590
Corporate                            24,740            -       24,740
                               ------------- ------------ ------------
            Total                    63,409            6       63,415
                               ------------- ------------ ------------

Operating Income (Loss) before
 Corporate Allocations:
Consumer segment                     25,915       (8,068)      17,847
Florist segment                      42,335        8,068       50,403
International segment                14,104          325       14,429
Corporate                           (26,207)           -      (26,207)
                               ------------- ------------ ------------
            Total                    56,147          325       56,472
                               ------------- ------------ ------------

Corporate Allocations:
Consumer segment                      3,339            -        3,339
Florist segment                       8,039            -        8,039
International segment                     -            -            -
Corporate                           (11,378)           -      (11,378)
                               ------------- ------------ ------------
            Total                         -            -            -
                               ------------- ------------ ------------

Operating Income (Loss):
Consumer segment                     22,576       (8,068)      14,508
Florist segment                      34,296        8,068       42,364
International segment                14,104          325       14,429
Corporate                           (14,829)           -      (14,829)
                               ------------- ------------ ------------
            Total              $     56,147  $       325  $    56,472
                               ============= ============ ============

Depreciation and Amortization:
Consumer segment               $      2,645  $         -  $     2,645
Florist segment                       1,970            -        1,970
International segment                 2,882            -        2,882
Corporate                             1,966            -        1,966
                               ------------- ------------ ------------
            Total              $      9,463  $         -  $     9,463
                               ============= ============ ============

                                         Nine Months Ended
                                           March 31, 2007

                               ---------------------------------------
                               Gross Segment Eliminations Consolidated
                               ------------- ------------ ------------

Revenues:
Consumer segment               $    205,437  $    (8,353) $   197,084
Florist segment                     137,834         (312)     137,522
International segment               108,422          182      108,604
                               ------------- ------------ ------------
            Total                   451,693       (8,483)     443,210
                               ------------- ------------ ------------

Costs of Goods Sold and
 Services Provided:
Consumer segment                    140,779         (312)     140,467
Florist segment                      44,167            -       44,167
International segment                75,280          (77)      75,203
Corporate                             1,507            -        1,507
                               ------------- ------------ ------------
            Total                   261,733         (389)     261,344
                               ------------- ------------ ------------

Gross Profit:
Consumer segment                     64,658       (8,041)      56,617
Florist segment                      93,667         (312)      93,355
International segment                33,142          259       33,401
Corporate                            (1,507)           -       (1,507)
                               ------------- ------------ ------------
            Total                   189,960       (8,094)     181,866
                               ------------- ------------ ------------

Advertising and Selling:
Consumer segment                     25,087            -       25,087
Florist segment                      43,395       (8,353)      35,042
International segment                 8,834         (196)       8,638
                               ------------- ------------ ------------
            Total                    77,316       (8,549)      68,767
                               ------------- ------------ ------------

General and Administrative:
Consumer segment                     16,750            -       16,750
Florist segment                       6,348            -        6,348
International segment                15,231          318       15,549
Corporate                            19,615            -       19,615
                               ------------- ------------ ------------
            Total                    57,944          318       58,262
                               ------------- ------------ ------------

Operating Income (Loss) before
 Corporate Allocations:
Consumer segment                     22,821       (8,041)      14,780
Florist segment                      43,924        8,041       51,965
International segment                 9,077          137        9,214
Corporate                           (21,122)           -      (21,122)
                               ------------- ------------ ------------
            Total                    54,700          137       54,837
                               ------------- ------------ ------------

Corporate Allocations:
Consumer segment                      3,021            -        3,021
Florist segment                       7,007            -        7,007
International segment                     -            -            -
Corporate                           (10,028)           -      (10,028)
                               ------------- ------------ ------------
            Total                         -            -            -
                               ------------- ------------ ------------

Operating Income (Loss):
Consumer segment                     19,800       (8,041)      11,759
Florist segment                      36,917        8,041       44,958
International segment                 9,077          137        9,214
Corporate                           (11,094)           -      (11,094)
                               ------------- ------------ ------------
            Total              $     54,700  $       137  $    54,837
                               ============= ============ ============

Depreciation and Amortization:
Consumer segment               $      2,883  $         -  $     2,883
Florist segment                       2,430            -        2,430
International segment                 2,783            -        2,783
Corporate                             2,794            -        2,794
                               ------------- ------------ ------------
            Total              $     10,890  $         -  $    10,890
                               ============= ============ ============

                           FTD GROUP, INC.
                     NON-GAAP FINANCIAL MEASURES
             EBITDA, Adjusted EBITDA and Targeted EBITDA
                             (Unaudited)
                            (In thousands)

Reconciliation of certain financial measures reported in accordance
 with Generally Accepted Accounting Principles ("GAAP") to those
 presented on the basis of methodologies other than in accordance with
 GAAP ("non-GAAP").

The Company defines EBITDA as net income before net interest expense,
 income tax expense, depreciation and amortization. The Company
 defines Adjusted EBITDA as EBITDA plus expenses and minus income
 items that are not considered reflective of the Company's core
 operations. EBITDA and Adjusted EBITDA are calculated as follows for
 the periods presented:

                             Three Months Ended     Nine Months Ended
                                 March 31,              March 31,
                          ------------------------ -------------------
                               2008         2007     2008      2007
                          --------------- -------- --------- ---------

   Net income, as
    reported (GAAP basis) $        9,293  $  9,615 $ 26,415  $ 21,165
   plus: Interest
    expense, net                   5,057     5,955   16,978    20,553
   plus: Depreciation and
    amortization                   3,044     3,689    9,463    10,890
   plus: Income tax
    expense                        5,086     6,310   13,404    13,844
                          --------------- -------- --------- ---------
   EBITDA (1)                     22,480    25,569   66,260    66,452
   less: Other (income)
    expense, net                      23       570     (325)     (725)
   Items not reflective
    of core operations
    (2)                            3,462         -    3,462         -
                          --------------- -------- --------- ---------
   Adjusted EBITDA (1)    $       25,965  $ 26,139 $ 69,397  $ 65,727
                          =============== ======== ========= =========

Targeted Adjusted EBITDA is calculated below for the year ending June
 30, 2008. The other (income) expense, net presented below reflects
 the Company's actual other (income) expense, net for the nine-month
 period ended March 31, 2008. The Company is not projecting any
 additional other (income) expense, net or other items not reflective
 of core operations for the year ending June 30, 2008. Targeted EBITDA
 includes approximately $4 million of expense related to stock
 compensation associated with SFAS No. 123(R) and a deferred
 compensation plan related to Interflora.

                            Forecasted
                              Targets
                            Year Ending
                           June 30, 2008
                          ---------------

   Net income (GAAP
    basis)                $       39,100
   plus: Interest
    expense, net                  22,000
   plus: Depreciation and
    amortization                  12,600
   plus: Income tax
    expense                       21,200
                          ---------------
   EBITDA (1)             $       94,900
                          ===============
   less: Other (income)
    expense, net                    (325)
   Items not reflective
    of core operations
    (2)                            3,462
                          ---------------
   Adjusted EBITDA (1)    $       98,037
                          ===============

(1)The Company uses EBITDA and Adjusted EBITDA as supplemental
    measures of performance. The Company presents Adjusted EBITDA
    because it considers it an important supplemental measure of
    performance, as it is used as a performance measure under the
    senior credit facility entered into in connection with the
    acquisition of Interflora Holdings Limited, the indenture
    governing the Notes and the Company's executive compensation plan.
    The adjustment made in the calculation of Adjusted EBITDA, as
    described above, is an adjustment that would be made in
    calculating the Company's performance for purposes of coverage
    ratios under the senior credit facility and the indenture
    governing the Notes, and the Company's executive compensation plan
    bases incentive compensation payments in significant part on the
    Company's performance measured using Adjusted EBITDA as presented
    above. Measures similar to EBITDA and Adjusted EBITDA are also
    widely used by the Company and by others in the Company's industry
    to evaluate and price potential acquisition candidates.

   The Company believes EBITDA and Adjusted EBITDA facilitate
    operating performance comparisons from period to period and
    company to company by backing out potential differences caused by
    variations in capital structure (affecting relative interest
    expense), tax positions (such as the impact on periods or
    companies of changes in effective tax rates or net operating
    losses), the age and book depreciation of facilities and equipment
    (affecting relative depreciation expense), other (income) expense,
    net (including foreign currency transactions) and other expenses
    or income items that are not considered reflective of the
    Company's core operations. The Company also presents EBITDA and
    Adjusted EBITDA because it believes they are frequently used by
    investors and other interested parties in the evaluation of high
    yield issuers, many of which present EBITDA and/or Adjusted EBITDA
    when reporting their results.

   EBITDA and Adjusted EBITDA have limitations as analytical tools,
    and should not be considered in isolation, or as a substitute for
    analysis of the Company's results as reported under GAAP. Some of
    the limitations of EBITDA and Adjusted EBITDA are that they do not
    reflect the Company's cash expenditures for capital expenditures,
    they do not reflect the significant interest expense or the cash
    requirements necessary to service interest or principal payments
    on the Company's debt, they do not reflect changes in, or cash
    requirements for, the Company's working capital requirements, they
    do not reflect other expenses or gains excluded above and other
    companies in the Company's industry may calculate these measures
    differently than presented above. The Company compensates for
    these limitations by relying primarily on GAAP results and using
    EBITDA and Adjusted EBITDA only supplementally.

(2)During the third quarter of fiscal year 2008, the Company recorded
    $2.0 million of expenses related to abandoned acquisition
    opportunities, $0.9 million of expenses related to the pending
    acquisition by United Online, Inc. and $0.6 million in advisory
    costs incurred in conjunction with the resolution of a sales tax
    audit. These expenses are not reflective of the Company's core
    operations.

###

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