I would highly recommend that iTurf shareholders listen to the conference call replay. It is very positive and the analysts seemed to support the direction iTurf is going. Currently, the market is not rewarding iTurf for its corporate performance:
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But it's only a matter of time.
It's obvious that iTurf is becoming significantly more than an online Delia*s. Before long the discussion of whether to participate in iTurf directly or through DLIA will probably stop (although DLIA holders will obviously benefit from iTurf's success).
Much of the conference call dealt with the acquisition of OnTap.com, a college focused website. CEO Kahn expects the transaction to close by the end of August. The reasons for the purchase are to: (i) expand its community and e-commerce base beyond the current junior and high school students to the college crowd; (ii) follow the current iTurf customer to young adulthood and increase offerings to meet their maturing needs; (iii) enhance the iTurf webpage (which is under construction) to increase offerings and interactivity; and (iv) increase the revenue base from e-commerce solely to e-commerce/advertising.
During the conference call, it was mentioned that 2nd Quarter results will be discussed in a conference call scheduled for August 25th. Apparently, "page-views" have accelerated dramatically during the 2nd Quarter (and it was pointed out that that is before taking into account the recent AOL/iTurf marketing agreement, which should enhance "page-views" in the 3rd and 4th Quarters). Further, the OnTap.com acquisition should also add significantly to "page-views" during the 3rd and 4th Quarters. While more details will be provided during the 2nd Quarter results conference call, CFO Dennis Goldstein did state that the OnTap.com acquisition will not push-back the projected "cash-flow break-even" target of the second-half of 2001. The analysts appreciated that representation.
Regarding the on-going reconstruction of iTurf's web-page, not taking into account the OnTap.com acquisition, the project is going smoothly and will be completed during the 3rd or 4th Quarters. Once that project is complete, OnTap.com will be fully integrated into the reconstructed iTurf webpage. In the meantime, a seemless link will be offered.
iTurf officials seemed genuinely excited about the acquisition of OnTap.com and its new relationship with MarketSource Corporation, an established marketing service company focused on the high school and college markets. In 1998, OnTap.com received over 6 million college student visits and over twenty-five Fortune 500 companies advertise on the site. As we enter into the new school year, most of those advertisers have re-entered into advertisement contracts, most of the contracts are "larger," and double or triple the number of last year's Fortune 500 advertisers are currently in negotiations with OnTap.com to advertise. Names mentioned were: Proctor & Gamble, General Motors, J. C. Penny and Wallace & Carter. As part of the acquisition, MarketSource has entered into a three-year agreement to purchase $6 million of advertising space on the iTurf web-page (that almost covers the $8 million iTurf spent to be on AOL).
One unique feature iTurf will unveil is an "auction site" for used books and furniture for college students.
With the acquisition, iTurf will (through OnTap.com) launch more than 100 college websites on campuses nationwide and acquire an advertising salesforce of 20 experienced professionals.
Hope that helps! |
