The following is the company press release on 11/15 announcing 3rd quarter results:
MediaBay, Inc. Announces Third Quarter and Nine Month Results
Third Quarter Gross Sales Increased 188% Percent, Nine Months Up 159% Percent Company Posts Nine Months Pro-Forma Net Income of $3,307,000 or $.36 EPS
MORRISTOWN, N.J., Nov. 15 /PRNewswire/ -- MediaBay, Inc. (Nasdaq: MBAY - news; formerly Amex: KLB) today announced financial results for its third quarter and nine months ended September 30, 1999.
Gross sales for the quarter ended September 30, 1999 increased 188 percent to $16,414,000 from $5,778,000 during the same period a year ago. Gross profit increased 325 percent to $6,068,000 from $1,427,000 in the second quarter of 1998. Gross profit as a percentage of net sales increased to 51 percent from 37 percent in the comparable prior period. Pro forma net income for the third quarter of 1999 was $1,106,000, or $.11 diluted earnings per share, excluding the effects of amortization of intangible assets, financing costs and interest expenses relating to the Company's recent merger and acquisitions, versus a loss of $1,851,000, or $(.30) per share, on a comparable basis for the third quarter of 1998. Earnings before depreciation, amortization, interest and taxes (EBITDA) for the third quarter increased by $2,873,000 to $1,244,000. On a GAAP basis, the net loss for the third quarter was $1,943,000 or $(.22) per share, versus $1,851,000, or $(.30) per share, for the comparable 1998 period.
Gross sales for the nine months ended September 30, 1999 increased 159 percent to $41,986,000 from $16,190,000 for the nine months ended September 30, 1998. Gross profit during the nine month period increased 294 percent to $15,652,000 from $3,977,000 a year ago. Gross profit as a percentage of net sales increased to 51 percent from 34 percent in the comparable prior period. Pro forma net income for the first nine months of 1999 was $3,307,000, or $.36 diluted earnings per share, excluding the effects of amortization of intangible assets, financing costs and interest expenses relating to the Company's recent merger and acquisitions versus a loss of $3,993,000 or $(.65) per share on a comparable basis for the first nine months of 1998. Earnings before depreciation, amortization, interest and taxes (EBITDA) for the nine months increased by $7,452,000 to $3,692,000. On a GAAP basis, the net loss for the nine months was $4,532,000, or $(.57) per share, versus $3,993,000, or $(.65) per share, for the comparable 1998 period.
Commenting on MediaBay's strong performance, Norton Herrick, Chairman and Co-CEO of MediaBay, stated, ''We are very pleased with our continued strong revenue growth and increased cost efficiencies as we continue to capitalize on the benefits realized from the consolidation of our recent acquisitions as well as the Company's own internal growth and expansion initiatives. We will continue to leverage our expanding content library, high volume of website visits and growing customer base, which now exceeds 2.1 million names, and will continue to improve shareholder value through both our own internal growth as well as through further acquisitions. We believe we have made and will continue to make substantial progress in building and maintaining ourselves as the leading premium spoken word content and commerce company both on-line and off-line.''
Mr. Herrick continued, ''During the third quarter, our e-commerce initiative continued to serve as a significant area of growth for the Company. In late July, we launched our media portal site located at mediabay.com and subsequently changed our corporate name to MediaBay, Inc. from Audio Book Club, Inc. in order to more accurately reflect the Company's expanding focus and growth strategy and experience in the areas of online sales and marketing. The MediaBay.com portal site significantly expands our e-commerce offerings, by providing a single location for access to the various content and products controlled by the Companies subsidiaries, including tens of thousands of audiobooks, old-time radio programs, and classic music and vintage movies. Over the next several months, we intend to continue to develop and grow our online presence, through additional product offerings and services, as well as through potential acquisitions of complementary businesses and alliances with other e-commerce and content providers.''
Other significant events during and subsequent to the quarter included:
-- November 10, 1999 -- The Company announced that its common shares were
approved for listing on Nasdaq's National Market System under the
symbol "MBAY" to begin trading on Nasdaq's National Market System
under the new symbol on November 15, 1999.
-- November 8, 1999 -- The Company entered into an agreement with
RealNetworks®, Inc. (Nasdaq: RNWK - news) to provide content to RealNetworks
-- including old-time radio shows, classic videos and audiobook titles
-- for use in RealPlayer® 7, where users can preview the Company's
content and be linked to the Company's products resulting in increased
website traffic, revenues and customer base.
-- November 2, 1999 -- The Company announced that it will serve as a
Merchant for no charge on Microsoft's (Nasdaq: MSFT - news) newly launched MSN
eShop within the site's "Books" and "Cars and Travel" departments,
where users can preview the Company's content and be linked to the
Company's products resulting in increased website traffic, revenues and
customer base.
-- October 25, 1999 -- The Company entered into a strategic e-commerce
alliance with USA Networks Interactive's (Nasdaq: USAI - news) SCIFI.com to
showcase the Company's classic science fiction and fantasy content and
products within the SCIFI.com site signifying its strategy to build a
foothold in the e-commerce arena by introducing potential new customers
to its various audio and video products synergistic with specific
subject categories.
-- October 20, 1999 -- The Company unveiled its new corporate name,
MediaBay, Inc., in a move designed to better reflect the Company's
strategic focus as a leading provider of premium spoken word audio
content and products in hard goods and digital download formats both
online and offline.
-- October 13, 1999 -- The Company entered into a strategic online
marketing alliance with iVillage Inc. (Nasdaq: IVIL - news) to become the
exclusive online retailer of audiobooks and old-time radio programs
within iVillage.com, the leading women's network online
(http://www.ivillage) in order to further expand it's growing online
customer base.
-- October 12, 1999 -- The Company expanded its online shopping alliance
with America Online (NYSE: AOL - news) as part of the Company's ongoing
Internet growth strategy in order to further expand it's growing online
customer base.
-- October 5, 1999 -- The Company expanded its online marketing alliance
with Go2Net, Inc. (Nasdaq: GNET - news), a network of branded, technology- and
community-driven Web sites (http://www.go2net.com) in order to further
expand it's growing online customer base.
-- September 29, 1999 -- The Company's MediaBay.com media-commerce site
began providing the free daily audio horoscopes on Microsoft's
WindowsMedia.com, the fastest-growing major audio and video guide on
the Internet, in order to create a solid base of repeat visitors to
build into loyal e-commerce customers by offering them the Company's
select products and services.
-- September 16, 1999 -- The Company expanded its relationship with
Microsoft Corp. (Nasdaq: MSFT - news) to convert 50,000 hours of Audio Book
Club's content, including its classic radio and audiobook titles, into
the Microsoft® Windows Media(TM) Audio format for secure digital
download and streaming.
-- September 15, 1999 -- The Company launched a co-branded website with
Doubleday Interactive, Inc. at bestbookclubs.com in order to
further grow it's database of email addresses and online customer base.
-- August 19, 1999 -- Harvard Management Company, Inc. on behalf of
Harvard College, purchased 700,000 shares of KLB at market price.
-- August 2, 1999 -- The Company announced that its MediaBay.com media
portal and e-commerce site generated over 7 million hits and 430,000
visits during the site's inaugural weekend which coincided with its
three day live webcast of Woodstock 99.
-- July 28, 1999 -- The Company's Radio Spirits, Inc. subsidiary in
conjunction with Walter Cronkite introduced a first-of-its-kind
old-time radio show collection entitled "60 Greatest Old Time Radio
Programs of the 20th Century as Selected by Walter Cronkite" to be sold
through more than 5,000 retail stores and through various online
retailers.
-- July 20, 1999 -- The Company entered into an exclusive online marketing
alliance with Mail.com, Inc. (Nasdaq: MAIL - news), a global provider of
personalized e-mail and advanced messaging services to consumers and
businesses, in order to further expand it's growing online customer
base.
About MediaBay, Inc.
MediaBay, Inc. is the dominant provider of premium spoken word audio content and products in hard goods and digital download formats both online and offline which it markets to its customer database of over 2.1 million names. MediaBay, Inc. is the world's largest marketer of audiobooks through its Audio Book Club membership club which markets and sells over 70,000 audiobook titles through direct mail and the Internet at audiobookclub.com. MediaBay, Inc. is also the world's largest marketer of old-time radio shows and a marketer of classic videos through its Radio Spirits subsidiary which markets and sells its content library of over 60,000 radio shows and 3,500 videos on audio cassette, compact disc and video cassette through direct mail, retail and radio channels, as well as through radiospirits.com and videoyesteryear.com. Launched earlier this year, the Company's MediaBay.com media portal site, located at mediabay.com, is an innovative content and e-commerce website offering the Company's millions of customers and website visitors a single location for premium spoken word content and products available in hard goods and secure digital download formats. The MediaBay.com network of websites includes audiobookclub.com, audiobook.com, radiospirits.com, videoyesteryear.com, and downloadbay.com. The company's shareholders include Time Warner, Sony, Harvard Management Company Inc. on behalf of Harvard College and a fund advised by Soros Fund Management LLC.
Safe Harbor Statement Under The Private Securities Litigation Reform Act of 1995: The statements which are not historical facts contained in this press release are forward looking statements that involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Such factors include, but are not limited to, the ability of the Company to successfully integrate newly acquired businesses into its operations and the uncertainty regarding the actual effect of acquisitions on the Company, risks relating to the Company's direct mail campaigns and the ability of its book club to retain members, risks relating to the Company's growth strategy, dependence on third party service providers, uncertainty of the scope of future product returns, collection and risks associated with selling products on credit, competition and other risks detailed in the Company's Securities and Exchange Commission filings. The words ''believe'' and ''should'' and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date the statement was made.
Audio Book Club, Inc.
Consolidated Statements of Operations
(In thousands except per share data)
(unaudited)
Three Months Ended Nine Months Ended
9/30/99 9/30/98 9/30/99 9/30/98
Sales $16,614 $5,778 $41,986 $16,190
Returns, discounts
and allowances 4,817 1,903 11,297 4,655
Sales, net 11,797 3,875 30,689 11,535
Cost of sales 5,729 2,448 15,037 7,558
Gross profit 6,068 1,427 15,652 3,977
Expenses:
Advertising and
promotion 2,259 2,423 5,356 6,108
General and
administrative 2,565 691 6,604 1,878
Depreciation and
amortization 1,997 222 4,862 233
Operating loss (753) (1,909) (1,170) (4,242)
Net interest
(expense) income (1,190) 58 (3,362) 249
Net loss $(1,943) $(1,851) $(4,532) $(3,993)
Net loss per share $(.22) $(.30) $(.57) $(.65)
Weighted average
number of common
shares outstanding 8,794 6,154 7,882 6,154
Pro Forma Results Excluding Merger and Acquisition Related Costs:
Net loss on a
GAAP basis $(1,943) $(1,851) $(4,532) $(3,993)
Amortization of
goodwill and
purchased intangibles
relating to mergers
and acquisitions 1,859 -- 4,477 --
Interest expenses
and finance charges
relating to debt
incurred in mergers
and acquisitions 1,190 -- 3,362 --
Pro forma net income
(loss), excluding
merger and
acquisition related
costs $ 1,106 $(1,851) $3,307 $(3,993)
Pro forma diluted
net income (loss)
per share $.11 $ (.30) $.36 $(.65)
Diluted weighted
average number
of common shares
outstanding 10,042 6,154 9,269 6,154
Pro forma net
income (loss),
excluding merger
and acquisition
related costs $1,106 $(1,851) $3,307 $(3,993)
Depreciation Expenses 138 222 385 233
Earnings before
depreciation,
amortization,
interest and
income taxes $1,244 $(1,629) $3,692 $(3,760)
SOURCE: MediaBay, Inc. |
