Internet.com Reports Record Revenues for Fourth Quarter With Revenues Increasing by 383% Over Prior Year
DARIEN, Conn.--(BUSINESS WIRE)--January 20, 2000--internet.com Corporation (Nasdaq: INTM - news), the E-Business and Internet Technology Network, today reported results for the quarter ended December 31, 1999. Revenues for the quarter ended December 31, 1999 increased to a record $7.5 million, a 383% increase over revenues of $1.6 million for the same period last year. Net loss for the fourth quarter, excluding amortization of intangibles, was $482,000, or $0.02 per share, compared to $723,000, or $0.04 per share, for the same period last year. Including amortization of intangibles, net loss for the fourth quarter ended December 31, 1999 was $ 3.9 million, or $0.17 per share.
For the year ended December 31, 1999, revenues were $16.1 million, a 272% increase over revenues of $4.3 million for the comparable period in 1998. Net loss for the year ended December 31, 1999, excluding amortization of intangibles and a non-cash compensation charge, was $4.2 million, or $0.21 per share, compared to $2.3 million, or $0.14 per share, for the same period in the prior year. Including amortization of intangibles and the non-cash compensation charge, net loss for the year ended December 31, 1999 was $22.0 million, or $1.08 per share.
``It was an extraordinary quarter for internet.com,'' stated internet.com Chairman and CEO Alan M. Meckler. ``We continued to expand our multiple revenue streams. The acquisition of InternetNewsBureau.com, which provides online press distribution services, adds yet another significant revenue opportunity for internet.com as we expand our e-business service offerings. We also completed the formation of internet.com Venture Fund II LLC in November 1999. In addition, we continued to expand our world-class proprietary content. Our strategic acquisitions of LinuxToday.com, LinuxCentral.com and LinuxStart.com mark our commitment to the needs of the important Linux and Open Source communities. On December 1, 1999, we filed a registration statement for a proposed follow-on public offering of common stock to raise additional capital to continue the expansion of our business. We plan to use the net proceeds primarily for potential strategic acquisitions, venture capital investments and general corporate purposes. We are pleased that Chase H&Q, Robertson Stephens, U.S. Bancorp Piper Jaffray Inc. and William Blair & Company are managing the underwriting group for this offering.''
Acquisitions and International Expansion
During the fourth quarter, internet.com completed the acquisitions of: devWire.com (its network of sites include: ASPWire.com, CEWire.com, SQLWire.com and VBWire.com), InternetNewsBureau.com, LinuxStart.com, LinuxToday.com, LinuxCentral.com, SharkyExtreme.com and Solarisguide.com. Internationally, the Company launched Germany.internet.com and SouthAfrica.internet.com, bringing the total number of international editions to 11. A joint venture agreement was formed with VNU International to jointly operate local internet.com branded Web sites in the U.K., Scandinavia, Spain, France, Belgium, Germany, The Netherlands and Italy. The two companies plan to work together to launch additional internet.com country-specific Web sites in the near future. In addition, a content agreement with Yahoo! Asia, Yahoo! Singapore and Yahoo! Hong Kong was announced in November. In January 2000, internet.com announced plans to launch additional international sites in Korea and Taiwan. These acquisitions, international expansion and continued organic growth have increased total monthly views for internet.com's network of Web sites and related Internet media properties to over 150 million.
Venture Fund Investments
internet.com Venture Fund I LLC and internet.com Venture Fund II LLC continued to expand their portfolios of early stage business-to-business content Internet companies. Venture Fund I made the following investments during the fourth quarter: AuctionRover.com, GoPDA.com network, BuyBuddy.com and workz.com. Venture Fund II made the following investments during the fourth quarter: AdvertisingConcepts.com, B2BExplorer.com, FoodService.com, Gourmetnet.com, HowStuffWorks.com, Jinvestor.com, LatinVision.com, LawBooks.com, List-Universe.com, Milesandpoints.com, NationalContractors.com, Psylum.com and the-sticks.com. internet.com will continue to follow the path of CMGI (Nasdaq: CMGI - news) and Internet Capital Group (Nasdaq: ICGE - news) with the added benefit of being a public operating company in the Internet space that also extends value to its stockholders by having a successful Internet venture capital arm.
New Content Areas and Services
During the fourth quarter, internet.com continued to expand its world-class proprietary content with the launch of the following internally developed sites: InternetEmailList.com, InternetTradeShowList.com, CLEC-Planet.com (Competitive Local Exchange Carrier), JavaScript.com and the re-launch of InternetStockReport.com and InternetShopper.com. In addition, boston.internet.com and dc.internet.com were created to cover the rapidly growing Internet and Internet venture capital activities in these two significant cities. internet.com plans to roll out sites to serve other metropolitan areas in the coming months. In January 2000, internet.com announced the addition of three new Internet content channels, bringing the total number of channels to 12. The most notable addition is the Linux/Open Source Channel, which integrates internet.com's LinuxToday.com, LinuxCentral.com, LinuxPlanet.com and the recently acquired LinuxStart.com and JustLinux.com Web sites. This additional channel was created as a result of internet.com's expanding coverage of Linux and Open Source technology. Other new channels include the Windows Internet Technology Channel, a robust collection of Windows resources, and the Internet Lists Channel, a starting point for online directories relevant to the Internet industry.
E-Commerce Agreements and Offerings
internet.com continued to expand its e-commerce partners with the addition of: Advanced Commerce Technologies, Inc., AdvertisingConcepts.com, Cyveillance, DXSTORM.com, ePromos.com, Fax4Free, 411Now.com Business Association, iRaves.com, Nexchange.com and ScreamingMedia during the fourth quarter. ``We have experienced tremendous success with our growing Commerce Partner Program and these additions continue to demonstrate that internet.com is ripe with opportunities to increase traffic, strengthen brands and generate commerce revenue for our partners,'' said Alan M. Meckler.
About internet.com
internet.com Corporation (
www.internet.com), based in Darien, CT, is a leading provider of global real-time news and information resources for Internet industry and Internet technology professionals, Web developers and experienced Internet users. internet.com operates a network of 90 Web sites, 71 e-mail newsletters, 101 online discussion forums and 75 moderated e-mail discussion lists with over 2 million unique visitors that generate more than 90 million page views monthly. Total ``views'', which include Web site page views, e-mail newsletter views and e-mail discussion list views, are now over 150 million per month. internet.com's global presence includes editions in Arabia, Asia, Australia, Canada, China, France, Germany, Israel, Japan, South Africa and the United Kingdom. In addition, internet.com with its related internet.com Venture Fund I and Venture Fund II is an investor in a growing number of business-to-business content sites and related Internet media properties.
Due to the proposed follow-on public offering of its common stock, internet.com will not hold a conference call to discuss its fourth quarter 1999 financial results.
``Safe Harbor'' Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding internet.com Corporation's business which are not historical facts are ``forward-looking statements'' that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see internet.com's reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934. The forward looking statements included herein are made as of the date of this press release, and internet.com assumes no obligation to update the forward looking statements after the date hereof.
internet.com Corporation
Consolidated Balance Sheets
December 31, 1998 and 1999
(in thousands, except share and per share amounts)
December 31,
1998 1999
ASSETS
Current assets:
Cash and cash equivalents $ 129 $17,943
Accounts receivable, net of
allowances of $42 and $712,
respectively 1,723 5,568
Prepaid expenses and other 120 347
Total current assets 1,972 23,858
Property and equipment, net of
accumulated depreciation
of $15 and $688, respectively 1,380 3,221
Intangible assets, net of
accumulated amortization
of $632 and $10,428, respectively 22,332 39,086
Investments in internet.com
venture funds - 1,855
Other assets 192 370
Total assets $25,876 $68,390
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 482 $1,635
Accrued payroll and related
expenses 296 1,441
Accrued expenses and other 462 2,096
Accrued Web site acquisition
payments 775 6,462
Deferred revenues 122 403
Borrowings under line of credit 1,886 -
Total current
liabilities 4,023 12,037
Accrued Web site acquisition payments - 338
Total liabilities 4,023 12,375
Commitments and contingencies - -
Stockholders' equity:
Preferred stock, $.01 par value,
4,000,000 shares authorized,
no shares issued and outstanding - -
Common stock, $.01 par value,
75,000,000 shares authorized,
16,215,891 and 23,334,520 shares
issued and outstanding at December
31, 1998 and 1999, respectively 162 233
Additional paid-in capital 22,665 70,917
Accumulated deficit (974) (15,135)
Total stockholders'
equity 21,853 56,015
Total liabilities and
stockholders' equity $25,876 $68,390
internet.com Corporation
Consolidated Statements of Operations
For the Three Months and Years Ended December 31, 1998 and 1999
(in thousands, except per share amounts)
Three Months Ended
December 31,
1998(1) 1999
(unaudited) (unaudited)
Revenues $ 1,550 $ 7,487
Cost of revenues 859 3,428
Gross profit 691 4,059
Operating expenses:
Advertising, promotion and selling 680 2,896
General and administrative 644 1,692
Depreciation 82 260
Amortization 718 3,424
Non-cash compensation charge -- --
Total operating expenses 2,124 8,272
Operating loss (1,433) (4,213)
Interest income (expense), net (8) 307
Net loss $ (1,441) $ (3,906)
Basic and diluted loss
per share excluding amortization
and non-cash compensation charge $ (0.04) $ (0.02)
Basic and diluted loss per share $ (0.09) $ (0.17)
Weighted average number of common shares 16,216 23,329
(1) Represents the combined financial data of predecessor business
and internet.com
Years Ended
December 31,
1998(1) 1999
(unaudited)
Revenues $ 4,325 $ 16,085
Cost of revenues 2,687 8,366
Gross profit 1,638 7,719
Operating expenses:
Advertising, promotion and selling 1,761 7,545
General and administrative 1,757 4,434
Depreciation 410 673
Amortization 1,430 9,796
Non-cash compensation charge -- 7,975
Total operating expenses 5,358 30,423
Operating loss (3,720) (22,704)
Interest income (expense), net (8) 688
Net loss $ (3,728) $(22,016)
Basic and diluted loss
per share excluding amortization
and non-cash compensation charge $ (0.14) $ (0.21)
Basic and diluted loss per share $ (0.23) $ (1.08)
Weighted average number of common shares 16,216 20,335
(1) Represents the combined financial data of predecessor business
and internet.com
internet.com Corporation
Consolidated Statements of Cash Flows
For the Years Ended December 31, 1998 and 1999
(in thousands)
Year Ended
December 31,
1998(1) 1999
(unaudited)
Cash flows from operating activities:
Net loss $ (3,728) $(22,016)
Adjustments to reconcile net cash
used in operations-
Depreciation and amortization 1,840 10,469
Provision for losses on accounts
receivable 94 670
Non-cash compensation charge - 7,975
Changes in assets and liabilities -
Accounts receivable, net (1,140) (4,193)
Prepaid expenses and other (60) (467)
Accounts payable and accrued expenses (365) 3,866
Deferred revenues 74 232
Net cash used in operating activities (3,285) (3,464)
Cash flows from investing activities:
Additions to property and equipment (1,287) (2,514)
Acquisitions of Web sites, related
Internet media properties and other (5,857) (20,670)
Investments in internet.com venture funds - (1,855)
Net cash used in investing activities (7,144) (25,039)
Cash flows from financing activities:
Proceeds from issuance of common stock, net - 45,070
Proceeds from exercise of warrant - 3,000
Proceeds from exercise of stock options - 133
Contributions from Mecklermedia
Corporation 8,672 -
Borrowings under line of credit 1,886 4,670
Payments for line of credit - (6,556)
Net cash provided by financing
activities 10,558 46,317
Net increase in cash and cash equivalents 129 17,814
Cash and cash equivalents, beginning of
period - 129
Cash and cash equivalents, end of period $ 129 $ 17,943
Supplemental disclosures of cash flow:
Cash paid for interest $ 8 $ 92
Cash paid for income taxes $ - $ -
(1) Represents the combined financial data of predecessor
business and internet.com
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