##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2006
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 001-32425
 
 FTD Group, Inc.
 (Exact name of registrant as specified in its charter)
 Delaware
    
    87-0719190(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 3113 Woodcreek Drive
Downers Grove, IL 60515
(Address of principal executive offices)
 (630) 719-7800  )
 þ o
  o þ o
 o þ




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##### 



Part I. Financial InformationItem 1.
    
    Financial Statements (unaudited)Condensed Consolidated Balance Sheets
    
    
    2Condensed Consolidated Statements of Operations and Comprehensive Income
    
    
    3Condensed Consolidated Statements of Cash Flows
    
    
    4Notes to Condensed Consolidated Financial Statements
    
    
    5Item 2.
    
    Managements Discussion and Analysis of Financial Condition and
Results of Operations
    
    
    12Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    17Item 4.
    
    Controls and Procedures
    
    
    17Part II. Other InformationItem 1.
    
    Legal Proceedings
    
    
    18Item 1A.
    
    Risk Factors
    
    
    18Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    18Item 6.
    
    Exhibits
    
    
    18Signatures
    
    
    19Index of Exhibits302 Certification of Chief Executive Officer302 Certification of Chief Financial Officer906 Certifications of CEO and CFO




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 FTD GROUP, INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
 September 30, 2006
    
    
    June 30, 2006(Unaudited)ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    13,302
    
    
    $
    10,954Accounts receivable, less allowance for doubtful accounts
of $4,890 at September 30, 2006 and $4,437 at June 30, 2006
    
    
    44,780
    
    
    
    26,044Inventories,
net, prepaid expenses and other current assets
    
    
    12,578
    
    
    
    9,527Total current assets
    
    
    70,660
    
    
    
    46,525Property and equipment:Property and equipment
    
    
    32,306
    
    
    
    25,265Less accumulated depreciation
    
    
    7,124
    
    
    
    6,051Property and equipment, net
    
    
    25,182
    
    
    
    19,214Other assets:Computer software, net
    
    
    14,393
    
    
    
    10,577Other noncurrent assets
    
    
    21,938
    
    
    
    21,405Other intangible assets, less accumulated amortization of
$6,740 at September 30, 2006 and $5,993 at June 30, 2006
    
    
    15,776
    
    
    
    14,780Trademark
    
    
    184,471
    
    
    
    121,577Goodwill
    
    
    414,176
    
    
    
    336,659Total other assets
    
    
    650,754
    
    
    
    504,998Total assets
    
    $
    746,596
    
    
    $
    570,737LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Notes payable
    
    $
    21,645
    
    
    $
    Accounts payable
    
    
    58,573
    
    
    
    45,273Other accrued liabilities
    
    
    23,351
    
    
    
    24,083Current maturities of long-term debt
    
    
    1,500
    
    
    
    1,125Total current liabilities
    
    
    105,069
    
    
    
    70,481Senior secured credit facility
    
    
    154,500
    
    
    
    48,875Senior subordinated notes
    
    
    170,117
    
    
    
    170,117Post-retirement benefits, accrued pension obligations and other liabilities
    
    
    5,209
    
    
    
    2,368Deferred income taxes
    
    
    81,444
    
    
    
    61,160Stockholders equity:Common stock: $0.01 par value, 75,000,000 shares authorized; 29,482,182
shares issued as of September 30, 2006 and June 30, 2006
    
    
    295
    
    
    
    295Additional paid-in capital
    
    
    234,284
    
    
    
    233,362Retained earnings (accumulated deficit)
    
    
    3,889
    
    
    
    (1,554
    )Accumulated other comprehensive income
    
    
    2,600
    
    
    
    200Treasury stock, at cost, 1,147,326 shares as of September 30, 2006
and 1,504,480 shares as of June 30, 2006
    
    
    (10,811
    )
    
    
    (14,567
    )Total stockholders equity
    
    
    230,257
    
    
    
    217,736Total liabilities and stockholders equity
    
    $
    746,596
    
    
    $
    570,737
  2




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##### Table of Contents



FTD GROUP, INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
(In thousands, except per share amounts)
 Three Months EndedSeptember 30,2006
    
    
    2005Revenues:Products
    
    $
    73,873
    
    
    $
    55,830Services
    
    
    34,898
    
    
    
    30,039Total revenues
    
    
    108,771
    
    
    
    85,869Costs of Products Sold and Services Provided:Products
    
    
    56,154
    
    
    
    41,309Services
    
    
    4,269
    
    
    
    4,549Total costs of products sold and services provided
    
    
    60,423
    
    
    
    45,858Gross Profit:Products
    
    
    17,719
    
    
    
    9,391Services
    
    
    30,629
    
    
    
    30,620Total gross profit
    
    
    48,348
    
    
    
    40,011Operating Expenses:Advertising and selling
    
    
    16,564
    
    
    
    17,651General and administrative
    
    
    16,410
    
    
    
    11,929Total operating expenses
    
    
    32,974
    
    
    
    29,580Income from operations
    
    
    15,374
    
    
    
    10,431Other Income and Expenses:Interest income
    
    
    (298
    )
    
    
    (166
    )Interest expense
    
    
    8,226
    
    
    
    4,781Other income, net
    
    
    (1,544
    )
    
    
    (44
    )Total other income and expenses
    
    
    6,384
    
    
    
    4,571Income before income tax
    
    
    8,990
    
    
    
    5,860Income tax expense
    
    
    3,547
    
    
    
    2,433Net income
    
    $
    5,443
    
    
    $
    3,427Other Comprehensive Income:Foreign currency translation adjustments
    
    
    2,400
    
    
    
    (101
    )Comprehensive income
    
    $
    7,843
    
    
    $
    3,326Net income per Common Share  basic
    
    $
    0.19
    
    
    $
    0.12Net income per Common Share  diluted
    
    $
    0.18
    
    
    $
    0.11Weighted Average Common Shares Outstanding:Basic
    
    
    28,232
    
    
    
    29,454Diluted
    
    
    29,469
    
    
    
    30,542
  3




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##### Table of Contents



FTD GROUP, INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
 Three Months EndedSeptember 30,2006
    
    
    2005Cash flows from operating activities:Net income
    
    $
    5,443
    
    
    $
    3,427Adjustments to reconcile net income to net cash
used in operating activities:Depreciation and amortization
    
    
    3,316
    
    
    
    2,449Stock-based compensation expense
    
    
    393
    
    
    
    165Amortization and write off of deferred financing costs
    
    
    2,077
    
    
    
    316Provision for doubtful accounts
    
    
    764
    
    
    
    771Deferred income taxes
    
    
    (601
    )
    
    
    28Increase (decrease) in cash due to changes in operating assets and liabilities, net of acquisitions:Accounts receivable
    
    
    (5,924
    )
    
    
    (7,327
    )Inventories
    
    
    327
    
    
    
    44Prepaid expenses and other
    
    
    829
    
    
    
    2,218Other noncurrent assets
    
    
    (428
    )
    
    
    5Accounts payable
    
    
    (8,812
    )
    
    
    (5,697
    )Other accrued liabilities, unearned income, customer deposits and other
    
    
    (2,870
    )
    
    
    (4,443
    )Net cash used in operating activities
    
    
    (5,486
    )
    
    
    (8,044
    )Cash flows from investing activities:Acquisition of business, excluding cash acquired
    
    
    (96,717
    )
    
    
    Capital expenditures
    
    
    (1,935
    )
    
    
    (3,292
    )Dividends received
    
    
    146
    
    
    
    Net cash used in investing activities
    
    
    (98,506
    )
    
    
    (3,292
    )Cash flows from financing activities:Proceeds from issuance of long-term debt
    
    
    150,000
    
    
    
    Repayments of long-term debt
    
    
    (50,000
    )
    
    
    (174
    )Net proceeds from revolving credit facility
    
    
    6,000
    
    
    
    5,000Deferred financing costs
    
    
    (1,444
    )
    
    
    Proceeds from exercise of stock options
    
    
    422
    
    
    
    Excess tax benefit from stock-based compensation
    
    
    654
    
    
    
    Net cash provided by financing activities
    
    
    105,632
    
    
    
    4,826Effect of foreign exchange rate changes on cash and cash equivalents
    
    
    708
    
    
    
    100Net increase (decrease) in cash and cash equivalents
    
    
    2,348
    
    
    
    (6,410
    )Cash and cash equivalents at beginning of period
    
    
    10,954
    
    
    
    8,890Cash and cash equivalents at end of period
    
    $
    13,302
    
    
    $
    2,480Supplemental disclosures of cash flow informationCash paid for:Interest
    
    $
    7,105
    
    
    $
    7,728Income taxes
    
    $
    3,027
    
    
    $
    46Non-cash disclosure:Issuance of notes payable associated with the purchase of Interflora Holdings Limited
    
    $
    23,345
    
    
    $
    Issuance of treasury stock associated with the purchase of Interflora Holdings Limited
    
    $
    3,206
    
    
    $
    
  4




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FTD Group, Inc.
 
 Notes to Condensed Consolidated Financial Statements
(Unaudited)
 Note 1. Description of the Business
 Basis of Presentation
      Recently Issued Accounting Pronouncements
 Employers Accounting for Defined Benefit Pension and Other
Postretirement Plans  an amendment of FASB Statement No. 87, 88, 106 and 132(R), (SFAS 158)
 Accounting for Uncertainty in
Income Taxes  an Interpretation of FASB Statement No. 109 (SFAS 109)
 5




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Note 2. Acquisition of Interflora Holdings Limited
   Three Months EndedSeptember 30,2006
    
    
    2005Revenues
    
    $
    119,424
    
    
    $
    109,175Income from operations
    
    $
    16,249
    
    
    $
    11,967Net income
    
    $
    5,590
    
    
    $
    3,472Net income per share  basic
    
    $
    0.20
    
    
    $
    0.12Net income per share  diluted
    
    $
    0.19
    
    
    $
    0.11
  Goodwill
    
    $
    76,124Trademark
    
    
    61,764Computer software
    
    
    4,372Land and
building
    
    
    2,942Other
intangible assets (customer list)
    
    
    1,711Deferred tax liability
    
    
    (20,464
    )Other assets
acquired and liabilities assumed, net
    
    
    (1,311
    )Total preliminary allocation of acquisition cost
    
    $
    125,138
  6




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##### Table of Contents



Note 3. Goodwill and Other Intangibles
   Consumer
    
    
    Florist
    
    
    InternationalSegment
    
    
    Segment
    
    
    Segment
    
    
    TotalGoodwill:Balance at June 30, 2006
    
    $
    178,141
    
    
    $
    158,518
    
    
    $
    
    
    
    $
    336,659Acquisition of Interflora
    
    
    
    
    
    
    
    
    
    
    76,124
    
    
    
    76,124Impact of foreign exchange
    
    
    
    
    
    
    
    
    
    
    1,393
    
    
    
    1,393Balance at September 30, 2006
    
    $
    178,141
    
    
    $
    158,518
    
    
    $
    77,517
    
    
    $
    414,176
 Consumer
    
    
    Florist
    
    
    InternationalSegment
    
    
    Segment
    
    
    Segment
    
    
    TotalTrademark:Balance at June 30, 2006
    
    $
    67,842
    
    
    $
    53,735
    
    
    $
    
    
    
    $
    121,577Acquisition of Interflora
    
    
    
    
    
    
    
    
    
    
    61,764
    
    
    
    61,764Impact of foreign exchange
    
    
    
    
    
    
    
    
    
    
    1,130
    
    
    
    1,130Balance at September 30, 2006
    
    $
    67,842
    
    
    $
    53,735
    
    
    $
    62,894
    
    
    $
    184,471
 Three Months EndedSeptember 30, 2006
    
    
    June 30, 2006Gross Carrying
    
    
    Accumulated
    
    
    
    
    
    
    Gross Carrying
    
    
    AccumulatedAmount
    
    
    Amortization
    
    
    Net Carrying Amount
    
    
    Amount
    
    
    Amortization
    
    
    Net Carrying AmountAmortizable Intangible Assets:Customer lists
    
    $
    14,579
    
    
    $
    6,679
    
    
    $
    7,900
    
    
    $
    12,836
    
    
    $
    5,940
    
    
    $
    6,896Non-compete agreements
    
    
    100
    
    
    
    61
    
    
    
    39
    
    
    
    100
    
    
    
    53
    
    
    
    47Total
    
    $
    14,679
    
    
    $
    6,740
    
    
    $
    7,939
    
    
    $
    12,936
    
    
    $
    5,993
    
    
    $
    6,943
 Estimated amortization expense:
 For the remaining nine-month period ending June 30, 2007
    
    $
    2,386For the year ending June 30, 2008
    
    $
    3,162For the year ending June 30, 2009
    
    $
    2,314For the year ending June 30, 2010
    
    $
    77
 Note 4. Financing Arrangements
   7




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Note 5. Net Income Per Common Share
  Three Months EndedSeptember 30,2006
    
    
    2005Net income
    
    $
    5,443
    
    
    $
    3,427Weighted average common
shares outstanding  basic
    
    
    28,232
    
    
    
    29,454Effect of dilutive securities  stock options
    
    
    1,237
    
    
    
    1,088Weighted average common
shares outstanding  diluted
    
    
    29,469
    
    
    
    30,542Net income per share of Common Stock  basic
    
    $
    0.19
    
    
    $
    0.12Net income per share of Common Stock  diluted
    
    $
    0.18
    
    
    $
    0.11
  Note 6. Pension and Other Post-Retirement Benefit Plans
  8




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Salaried
Employees Pension PlanThree Months EndedSeptember 30,2006
    
    
    2005(in thousands)Service cost
    
    $
    13
    
    
    $
    14Interest cost
    
    
    26
    
    
    
    28Expected return on assets
    
    
    (23
    )
    
    
    (23
    )Amortization
    
    
    1
    
    
    
    9Net periodic benefit cost
    
    $
    17
    
    
    $
    28
  Retiree Medical PlanThree Months EndedSeptember 30,2006
    
    
    2005(in thousands)Interest cost
    
    $
    22
    
    
    $
    20Net periodic benefit cost
    
    $
    22
    
    
    $
    20
 Note 7. Stock-Based Compensation
 Share-Based Payment
   Note 8. Segment Information
   9




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##### Table of Contents



, www.ftd.com
  www.interflora.co.uk
    10




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##### Table of Contents



Three Months Ended September 30,2006
    
    
    2005Gross Segment
    
    
    Eliminations
    
    
    Consolidated
    
    
    Gross Segment
    
    
    Eliminations
    
    
    Consolidated(in thousands)Revenues:Consumer segment
    
    $
    50,868
    
    
    $
    (3,475
    )
    
    $
    47,393
    
    
    $
    44,950
    
    
    $
    (3,391
    )
    
    $
    41,559Florist segment
    
    
    43,881
    
    
    
    (60
    )
    
    
    43,821
    
    
    
    44,355
    
    
    
    (45
    )
    
    
    44,310International segment
    
    
    17,524
    
    
    
    33
    
    
    
    17,557
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    112,273
    
    
    
    (3,502
    )
    
    
    108,771
    
    
    
    89,305
    
    
    
    (3,436
    )
    
    
    85,869Cost of Products Sold and
Services Provided:Consumer segment
    
    
    33,905
    
    
    
    (458
    )
    
    
    33,447
    
    
    
    30,877
    
    
    
    (419
    )
    
    
    30,458Florist segment
    
    
    15,291
    
    
    
    (827
    )
    
    
    14,464
    
    
    
    15,683
    
    
    
    (845
    )
    
    
    14,838International segment
    
    
    12,012
    
    
    
    (16
    )
    
    
    11,996
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    516
    
    
    
    
    
    
    
    516
    
    
    
    562
    
    
    
    
    
    
    
    56261,724
    
    
    
    (1,301
    )
    
    
    60,423
    
    
    
    47,122
    
    
    
    (1,264
    )
    
    
    45,858Gross Profit:Consumer segment
    
    
    16,963
    
    
    
    (3,017
    )
    
    
    13,946
    
    
    
    14,073
    
    
    
    (2,972
    )
    
    
    11,101Florist segment
    
    
    28,590
    
    
    
    767
    
    
    
    29,357
    
    
    
    28,672
    
    
    
    800
    
    
    
    29,472International segment
    
    
    5,512
    
    
    
    49
    
    
    
    5,561
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    (516
    )
    
    
    
    
    
    
    (516
    )
    
    
    (562
    )
    
    
    
    
    
    
    (562
    )Total
    
    
    50,549
    
    
    
    (2,201
    )
    
    
    48,348
    
    
    
    42,183
    
    
    
    (2,172
    )
    
    
    40,011Advertising and Selling:Consumer segment
    
    
    4,886
    
    
    
    
    
    
    
    4,886
    
    
    
    4,532
    
    
    
    
    
    
    
    4,532Florist segment
    
    
    12,724
    
    
    
    (2,249
    )
    
    
    10,475
    
    
    
    15,291
    
    
    
    (2,172
    )
    
    
    13,119International segment
    
    
    1,246
    
    
    
    (43
    )
    
    
    1,203
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    18,856
    
    
    
    (2,292
    )
    
    
    16,564
    
    
    
    19,823
    
    
    
    (2,172
    )
    
    
    17,651General and AdministrativeConsumer segment
    
    
    4,940
    
    
    
    (462
    )
    
    
    4,478
    
    
    
    3,655
    
    
    
    (427
    )
    
    
    3,228Florist segment
    
    
    2,265
    
    
    
    
    
    
    
    2,265
    
    
    
    2,284
    
    
    
    
    
    
    
    2,284International segment
    
    
    3,023
    
    
    
    136
    
    
    
    3,159
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    6,046
    
    
    
    462
    
    
    
    6,508
    
    
    
    5,990
    
    
    
    427
    
    
    
    6,417Total
    
    
    16,274
    
    
    
    136
    
    
    
    16,410
    
    
    
    11,929
    
    
    
    
    
    
    
    11,929Operating Income (Loss)
before Corporate Allocations:Consumer segment
    
    
    7,137
    
    
    
    (2,555
    )
    
    
    4,582
    
    
    
    5,886
    
    
    
    (2,545
    )
    
    
    3,341Florist segment
    
    
    13,601
    
    
    
    3,016
    
    
    
    16,617
    
    
    
    11,097
    
    
    
    2,972
    
    
    
    14,069International segment
    
    
    1,243
    
    
    
    (44
    )
    
    
    1,199
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    (6,562
    )
    
    
    (462
    )
    
    
    (7,024
    )
    
    
    (6,552
    )
    
    
    (427
    )
    
    
    (6,979
    )Total
    
    
    15,419
    
    
    
    (45
    )
    
    
    15,374
    
    
    
    10,431
    
    
    
    
    
    
    
    10,431Corporate Allocations:Consumer segment
    
    
    817
    
    
    
    
    
    
    
    817
    
    
    
    735
    
    
    
    
    
    
    
    735Florist segment
    
    
    2,392
    
    
    
    
    
    
    
    2,392
    
    
    
    2,813
    
    
    
    
    
    
    
    2,813International segment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    (3,209
    )
    
    
    
    
    
    
    (3,209
    )
    
    
    (3,548
    )
    
    
    
    
    
    
    (3,548
    )Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating Income (Loss):Consumer segment
    
    
    6,320
    
    
    
    (2,555
    )
    
    
    3,765
    
    
    
    5,151
    
    
    
    (2,545
    )
    
    
    2,606Florist segment
    
    
    11,209
    
    
    
    3,016
    
    
    
    14,225
    
    
    
    8,284
    
    
    
    2,972
    
    
    
    11,256International segment
    
    
    1,243
    
    
    
    (44
    )
    
    
    1,199
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    (3,353
    )
    
    
    (462
    )
    
    
    (3,815
    )
    
    
    (3,004
    )
    
    
    (427
    )
    
    
    (3,431
    )Total
    
    $
    15,419
    
    
    $
    (45
    )
    
    $
    15,374
    
    
    $
    10,431
    
    
    $
    
    
    
    $
    10,431Depreciation and
Amortization:Consumer segment
    
    $
    940
    
    
    $
    
    
    
    $
    940
    
    
    $
    617
    
    
    $
    
    
    
    $
    617Florist segment
    
    
    834
    
    
    
    
    
    
    
    834
    
    
    
    868
    
    
    
    
    
    
    
    868International segment
    
    
    576
    
    
    
    
    
    
    
    576
    
    
    
    
    
    
    
    
    
    
    
    Corporate
    
    
    966
    
    
    
    
    
    
    
    966
    
    
    
    964
    
    
    
    
    
    
    
    964Total
    
    $
    3,316
    
    
    $
    
    
    
    $
    3,316
    
    
    $
    2,449
    
    
    $
    
    
    
    $
    2,449
 11




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
 Forward-Looking Information
   Overview
   Consumer Segment. www.ftd.com
 Florist Segment.
 12




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##### Table of Contents



International Segment
 Corporate Segment.
 Three Months Ended September 30, 2006 compared to the Three Months Ended September 30, 2005
 Total revenues
 Three Months EndedSeptember 30,2006
    
    
    2005
    
    
    % Change(in thousands)Consumer segment
    
    $
    47,393
    
    
    $
    41,559
    
    
    
    14.0
    %Florist segment
    
    
    43,821
    
    
    
    44,310
    
    
    
    (1.1
    %)International segment
    
    
    17,557
    
    
    
    
    
    
    
    N/ATotal revenues
    
    $
    108,771
    
    
    $
    85,869
    
    
    
    26.7
    %
     13




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##### Table of Contents



Total gross profit
 Three Months EndedSeptember 30,2006
    
    
    2005
    
    
    % Change(in thousands)Consumer segment
    
    $
    13,946
    
    
    $
    11,101
    
    
    
    25.6
    %Florist segment
    
    
    29,357
    
    
    
    29,472
    
    
    
    (0.4
    %)International segment
    
    
    5,561
    
    
    
    
    
    
    
    N/ACorporate
    
    
    (516
    )
    
    
    (562
    )
    
    
    (8.2
    %)Total gross profit
    
    $
    48,348
    
    
    $
    40,011
    
    
    
    20.8
    %
      Advertising and selling costs
 Three Months EndedSeptember 30,2006
    
    
    2005
    
    
    % Change(in thousands)Consumer segment
    
    $
    4,886
    
    
    $
    4,532
    
    
    
    7.8
    %Florist segment
    
    
    10,475
    
    
    
    13,119
    
    
    
    (20.2
    %)International segment
    
    
    1,203
    
    
    
    
    
    
    
    N/ATotal advertising and selling costs
    
    $
    16,564
    
    
    $
    17,651
    
    
    
    (6.2
    %)
   14




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##### Table of Contents



General and administrative costs
 Three Months EndedSeptember 30,2006
    
    
    2005
    
    
    % Change(in thousands)Consumer segment
    
    $
    4,478
    
    
    $
    3,228
    
    
    
    38.7
    %Florist segment
    
    
    2,265
    
    
    
    2,284
    
    
    
    (0.8
    %)International segment
    
    
    3,159
    
    
    
    
    
    
    
    N/ACorporate
    
    
    6,508
    
    
    
    6,417
    
    
    
    1.4
    %Total general and administrative costs
    
    $
    16,410
    
    
    $
    11,929
    
    
    
    37.6
    %
      Other income and expenses
 Three Months EndedSeptember 30,2006
    
    
    2005
    
    
    % Change(in thousands)Interest income
    
    $
    (298
    )
    
    $
    (166
    )
    
    
    79.5
    %Interest expense
    
    
    8,226
    
    
    
    4,781
    
    
    
    72.1
    %Other income, net
    
    
    (1,544
    )
    
    
    (44
    )
    
    NMTotal other (income) and expenses
    
    $
    6,384
    
    
    $
    4,571
    
    
    
    39.7
    %
   15




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##### Table of Contents



Liquidity and Capital Resources
         16




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##### Table of Contents



Critical Accounting Policies and Estimates
    
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
 Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control over Financial Reporting
  17




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
     
 Item 6. Exhibits
 31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of
Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of
Sarbanes-Oxley Act of 2002.32
    
    Certifications of Chief Executive Officer and Chief Financial Officer pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
 18




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##### Table of Contents



SIGNATURES
  FTD Group, Inc.Date: November 8, 2006
    By:
    /S/ BECKY A. SHEEHANBecky A. SheehanChief Financial Officer
(principal financial officer) 19




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##### Table of Contents



EXHIBIT INDEX
 Exhibit Number
    
    Description of Document31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of
Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of
Sarbanes-Oxley Act of 2002.32
    
    Certifications of Chief Executive Officer and Chief Financial Officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
 20