Terrific look at those numbers....For a Leader in a New Market this stock is looking explosive on paper...
NEW YORK--(BUSINESS WIRE)--July 28, 1999--
Revenues Increased 537% Over Second Quarter 1998
Page Views during the Quarter increased to 686 Million
Advertisers Increased 900% to 160 Over the Same Period One Year Ago
StarMedia Network, Inc. (Nasdaq: STRM.O, www.starmedia.com), the
leading global online network for Spanish- and Portuguese- speaking
audiences, and the first Internet company focused on the Latin
American market to be listed on Nasdaq, today announced financial
results for the quarter ended June 30, 1999. This quarter marks
StarMedia's first quarter as a public company.
StarMedia reported $3.8 million in total revenues for the quarter
ended June 30, 1999, a 537% increase over total revenues of $589,000
for the quarter ended June 30, 1998. Total revenues for the quarter
ended June 30, 1999 increased 142% over revenues of $1.5 million for
the quarter ended March 31, 1999. Additionally, the number of
advertisers increased to 160 in the quarter ended June 30, 1999, a
900% increase from the quarter ended June 30, 1998 and a 256% increase
from the quarter ended March 31, 1999.
StarMedia's page views in the quarter ended June 30, 1999
increased to 686 million, a 416% increase over page views of 133
million in the quarter ended March 31, 1999. Active e-mail accounts
grew to approximately 1.2 million in the quarter ended June 30, 1999,
a 183% increase over the 424,000 e-mail accounts in the quarter ended
March 31, 1999.
StarMedia reported a net loss of $20.8 million for the quarter
ended June 30, 1999, or a diluted net loss per share of $0.41, on a
pro forma basis, excluding one-time charges of $1.0 million or a
diluted net loss per share of $0.02, on a pro forma basis, related to
the LatinRed acquisition. Including those charges, StarMedia's net
loss for the quarter ended June 30, 1999 was $21.8 million, or a
diluted net loss per share of $0.43, on a pro forma basis. This
compares to a net loss of $9.9 million, or adiluted net loss per
share of $0.39, on a pro forma basis, for the quarter ended June 30,
1998, and a net loss of $15.6 million or a diluted net loss per share
of $0.33, on a pro forma basis, for the quarter ended March 31, 1999.
"This is our first quarter as a public company, and we are
pleased with our results," said Fernando Espuelas, Chairman and Chief
Executive Officer, StarMedia Network, Inc. "We experienced impressive
growth in revenue, page views and e-mail accounts. These solid
increases in our metrics this quarter indicate the return on our
investments. Strong organic growth was augmented by strategic moves
this quarter, such as our acquisition of LatinRed, one of the largest
Spanish language community services on the Web. This builds upon the
acquisitions of Cade? and Zeek! announced earlier this year and our
recently announced OpenChile acquisition. In the second quarter we
also launched our Puerto Rican operations and established a new
e-commerce platform for our users. We will continue to make
investments, add new products and services, and enhance our network to
accelerate our growth and further position StarMedia as the dominant
brand for Spanish and Portuguese speaking Internet audiences."
Highlights From the Quarter
StarMedia announced the following business initiatives during the
second quarter:
- On May 26, 1999 the Company successfully completed its initial
public offering of 8,050,000 shares of common stock at an initial
public offering price of $15.00 per share, raising over $120
million in gross proceeds for the Company. StarMedia will use the
proceeds from the offering to fund marketing activities, expand
its sales force, enhance products and services and make strategic
investments and acquisitions.
- In April and May, StarMedia completed a private placement of
3,727,272 shares of StarMedia common stock to a number of
strategic investors for a total of $41 million. These investors
include: Critical Path, (Nasdaq: CPTH.O), eBay (Nasdaq: EBAY.O),
Fininvest, Hearst Communications, NBC (NYSE: GE.N) and Reuters
(Nasdaq: RTRSY.O). The Company intends to work closely with these
partners to develop new content and add features to the StarMedia
network.
- To extend StarMedia's competitive lead in the Spanish and
Portuguese language online market, in May 1999, the Company
entered into an agreement to acquire Spain-based LatinRed.
LatinRed is one of the largest Spanish language community
services on the Web, providing a suite of free community services
in major markets that include U.S. Hispanic, Argentina, Mexico,
Colombia and Spain. This acquisition closed after the completion
of StarMedia's IPO.
- Further establishing leadership in Brazil, in April 1999,
StarMedia acquired Cade?, a leading online directory in Brazil.
This adds to StarMedia's first quarter 1999 acquisition of Zeek!,
another leading Brazilian online directory, positioning the
Company to maximize a broad base of users and advertisers.
- To continue aggressively expanding its reach to Spanish-speaking
regions, StarMedia launched its Puerto Rican operations, which
will focus on advertising sales, e-commerce relationships,
localization of content and new business development. Beatriz
Martinez was appointed as General Manager of the operations on
June 10, 1999.
- In June, StarMedia announced that it would provide Latin
America's first total e-commerce solution with SkyBox Services
Corporation. New merchant partners include 1-800-FLOWERS.com,
ShopSports.com, and Viajo.com. The agreement with SkyBox provides
a full service logistics solution, giving Latin Americans the
opportunity to buy a variety of premium brands online, in their
own language and with guaranteed delivery. Through this
initiative, the Company believes it will be wellpositioned to
take advantage of the growing e-commerce opportunities in Latin
America.
- StarMedia added over 40 new strategic partners during the quarter
ended June 30, 1999, comprised of content and commerce partners,
of which 32 are local Latin American partners and 8 are
pan-regional partners.
About StarMedia Network
StarMedia (Nasdaq:STRM.O) is the leading global online network for
Spanish- and Portuguese-speaking audiences. StarMedia offers Latin
Americans, U.S. Hispanics and Iberians a pan-regional community
experience, combined with a broad array of Spanish and Portuguese
content, tailored for regional dialects and local cultural norms.
StarMedia provides advertisers and merchants targeted access to
Spanish- and Portuguese-speaking Internet users, an audience with a
highly desirable demographic profile. Some of StarMedia's strategic
relationships include Netscape Communications, Real Networks,
Ziff-Davis, Fox Sports Latin America, CDNow, Reuters, eBay, National
Broadcasting Company, Hearst Communications, and Fininvest. Founded in
1996, the company employs approximately 400 people with operations in
Sao Paulo and Rio de Janeiro, Brazil; Mexico City, Mexico; Buenos
Aires, Argentina; Bogota, Colombia; Santiago, Chile; Montevideo,
Uruguay; Caracas, Venezuela; Madrid and Barcelona, Spain; New York
City, NY; Miami, FL; Los Angeles, CA; Dallas, TX; and San Juan, Puerto
Rico.
ABC Interactive, a service of the Audit Bureau of Circulations
(ABC), provides Internet traffic auditing services for StarMedia
Network. ABC Interactive provides such services for leading Internet
companies worldwide.
This press release contains statements of a forward-looking
nature relating to future events or future financial results of
StarMedia. Investors are cautioned that such statements are only
predictions and that actual events or results may differ materially.
In calculating such statements, investors should specifically consider
various factors which could cause actual events or results to differ
materially from those indicated from such forward-looking statements,
including the matters set forth in StarMedia's reports and documents
filed from time to time with the Securities and Exchange Commission.
*T
StarMedia Network, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended Six Months Ended
--------------------- --------------------
June 30, June 30, June 30, June 30,
1999 1998 1999 1998
---------------------- -------------------
Revenues $ 3,751,000 $ 589,000 $ 5,299,000 $ 850,000
Operating expenses:
Product & technology
development 6,462,000 2,384,000 10,024,000 3,178,000
Sales & marketing 13,264,000 4,199,000 22,924,000 6,015,000
General & administration 2,836,000 580,000 5,254,000 1,033,000
Non-recurring charges 1,023,000 - 1,023,000 -
Depreciation &
amortization 1,166,000 169,000 1,637,000 248,000
Stock-based
compensation expense 1,595,000 3,248,000 3,012,000 3,250,000
----------------------- ---------------------
Total operating
expenses 26,346,000 10,580,000 43,874,000 13,724,000
----------------------- ---------------------
Loss from operations (22,595,000)(9,991,000) (38,575,000)(12,874,000)
Interest income 997,000 63,000 1,456,000 119,000
Interest expense (231,000) (1,000) (269,000) (29,000)
------------------------ ---------------------
Net loss (21,829,000)(9,929,000) (37,388,000)(12,784,000)
Preferred stock
dividends and
accretion (1,725,000) (425,000) (4,266,000) (720,000)
---------------------------- -----------------
Net loss available
to common
shareholders $(23,554,000)$(10,354,000)$(41,654,000)$(13,504,000)
====================================================
Historical basic
and diluted net loss
per common share $ (0.77) $ (1.01) $ (1.97) $ (1.31)
=========================== =====================
Historical number of
shares used in
computing basic and
diluted net loss
per share 30,637,862 10,220,866 21,142,903 10,347,374
===================================================
Pro Forma
Net loss $(21,829,000)$(9,929,000)$(37,388,000)$(12,784,000)
===================================================
Net loss per share
on a pro forma
basis $ (0.43) $ (0.39) $ (0.80) $ (0.54)
========================== =====================
Number of shares
used in calculating
net loss per share
on a pro forma
basis 50,328,118 25,677,374 46,952,369 23,517,717
========================== ======================
Pro Forma excluding
non-recurring
charges
Net loss excluding
non-recurring
charges $(20,806,000)$(9,929,000)$(36,365,000)$(12,784,000)
==================================================
Net loss per share
excluding
non-recurring
charges on a
pro forma
basis $ (0.41) $ (0.39) ==================================================
Number of shares
used in
calculating
net loss per
share on a pro
forma basis 50,328,118 25,677,374 46,952,369 23,517,717
========================= ======================
-- Pro Forma calculations assume that all outstanding Redeemable
Convertible Preferred Shares have been converted to Common Shares
on a 1:1 basis.
StarMedia Network, Inc.
Condensed Consolidated Balance Sheets
June 30, 1999 December 31, 1998
------------- -----------------
ASSETS (unaudited) (audited)
Current assets:
Cash and cash equivalents $ 164,716,000 $ 53,141,000
Account receivables, net 2,122,000 460,000
Other current assets 2,403,000 1,674,000
------------- -------------
Total current assets 169,241,000 55,275,000
Fixed assets, net 10,616,000 5,403,000
Intangible assets, net 583,000 179,000
Goodwill, net 7,429,000 -
Other assets 4,467,000 129,000
------------- -------------
$ 192,336,000 $ 60,986,000
============= =============
LIABILITIES and STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities
Accounts payable $ 3,691,000 $ 286,000
Accrued expenses 8,644,000 6,442,000
Other current liabilities 2,531,000 1,035,000
------------- -------------
Total current liabilities 14,866,000 7,763,000
Long term liabilities 3,713,000 122,000
Series A Redeemable
convertible preferred stock - 4,218,000
Series B Redeemable
convertible preferred stock - 12,944,000
Series C Redeemable
convertible preferred stock - 79,332,000
Stockholders' equity (deficit):
Common stock 57,000 10,000
Additional paid-in capital281,543,000 19,563,000
Deferred compensation (11,609,000) (8,666,000)
Other comprehensive loss (302,000) (37,000)
Accumulated deficit (95,932,000) (54,263,000)
------------- -------------
Total stockholders' equity
(deficit) 173,757,000 (43,393,000)
------------- -------------
Total liabilities and
stockholders' deficit $ 192,336,000 $ 60,986,000
============= =============
*T
--30--lp/sw/ks/ny*
CONTACT: StarMedia Network, Inc., New York
Romi Schutzer, 212/548-9651
romi@starmedia.net
or
Abernathy MacGregor Frank, New York
Carina Thate/Kathryn Akers, 212/371-5999
cct@abmac.com/kea@abmac.com
KEYWORD: NEW YORK
INDUSTRY KEYWORD: INTERACTIVE/MULTIMEDIA/INTERNET
COMPUTERS/ELECTRONICS COMED EARNINGS
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