Looks very good. Beat estimates, but more importantly there are alot of positive things developing that should continue to substantially increase TMCS's reach and revenue growth. I continue to believe that this stock will be rediscovered shortly and this earnings report could help draw some attention.
TMCS Announces Third Quarter Results; Revenue Increases 141%
Acquisitions, Traffic Growth and Financial Results Strengthen
TMCS Position as Leading Local Portal
PASADENA, Calif., Oct. 25 /PRNewswire/ -- Ticketmaster Online-CitySearch,
Inc. (Nasdaq: TMCS) today announced financial results and metrics for the
third quarter of 1999 that demonstrate its status as the leading city guide
and local "get it done" online consumer service. Revenues in the third
quarter increased 141% over the comparable year-ago period to $27.4 million,
driven by a 260% increase in online ticketing revenues and a 97% increase in
city guide and related revenues. Ticketmaster Online-CitySearch is the leader
in local content and transaction sites, registering 4.9 million users, before
the inclusion of the recently acquired Sidewalk city guides, according to
September figures from Media Metrix. Further increasing its lead over
competitors and significantly extending its reach, TMCS completed the
acquisition of Microsoft's Sidewalk city guides, during the quarter.
Ticketmaster Online-CitySearch also now ranks as the fourth largest Web
retailer among US home Web users according to PCData Online.
Financial Results
Ticketmaster Online-CitySearch reported the following:
Three Months Ended Nine Months Ended
September 30, September 30,
$ in thousands Actual Pro forma Change Actual Pro forma Change
1999 1998 1999 1998
Revenues
Ticketing $16,634 $4,624 260% $43,812 $10,571 314%
City Guide 8,977 4,548 97% 21,089 11,069 90%
Sponsorship
& Advertising 1,800 2,194 (18%) 4,009 4,915 (18%)
Total $27,411 $11,366 141% $68,910 $26,555 159%
EBITDA ($13,014) ($7,047) (85%) ($28,238) ($19,286) (46%)
The pro forma results are presented as if Ticketmaster Online and
CitySearch had been combined as of January 1, 1998.
Also in the third quarter, Ticketmaster Online-CitySearch completed the
acquisition of One and Only Network, making it the largest Internet personals
site in combination with its Match.Com unit, based on the data from Media
Metrix. Finally, TMCS teamed with Microsoft and Excite@Home to expand the
FairMarket Auction Network as the Company continued to add tools and
e-commerce services for its customers.
"We believe this quarter's metrics underscore the importance of the local
platform we are building," said Charles Conn, Chief Executive Officer of
Ticketmaster Online-CitySearch. "We are moving far beyond an online
information resource; we are becoming a practical tool that local consumers
use daily to save time and manage their lives more effectively. Today,
CitySearch and its multiple Web-based services allow consumers to do things
such as research live entertainment events through LiveDaily, purchase concert
tickets from Ticketmaster Online, buy and sell items through CityAuction, meet
new friends through Match.Com, and make hotel reservations through its partner
Hotel Reservations Network. We believe these types of services are more
relevant to people's everyday lives than those offered by most other sites."
The Company's EBITDA loss for the quarter was $13.0 million, or
approximately 85% wider than in the year-ago comparable period. The increase
in EBITDA loss was primarily attributable to the Company's accelerated
roll-out of new owned and operated city guides, which has created a national
network of local content and transactions capability.
Ticketing & Transactions
Ticketing revenue increased 260% in the third quarter of 1999 over the
comparable year-ago period. Ticketmaster Online sold 2.5 million tickets in
the quarter at an average convenience and handling charge of $6.45 per ticket.
For the quarter, this represented approximately 15.0% of the total tickets
sold by Ticketmaster Corp. within the United States, United Kingdom, and
Canada, with especially strong growth in the latter part of the quarter.
The percentage of total Ticketmaster tickets sold online continues to
expand rapidly for many types of events. In sports events, for example, 71%
of Cleveland Browns tickets, 63% of New York Rangers tickets, 53% of Cleveland
Indians Playoff tickets, and 61% of Minnesota Vikings season tickets were
purchased online. In entertainment events, 56% of Phish New Years Eve
tickets, 31% of Bruce Springsteen's Los Angeles tickets, 30% of Barney tickets
in Houston, and 26% of the Ricky Martin Tour tickets were purchased online.
City Guide & Related
Revenue in the City Guide and Related Business increased 97% in the third
quarter of 1999 over the comparable year-ago period. CitySearch city guides
which have been online for more than one year have seen traffic increase by
approximately 40% (before the inclusion of the acquired Sidewalk city guides)
since the beginning of the year. Including city guides launched this year
(and again before inclusion of Sidewalk), traffic has increased nearly 70%
year to date.
"These results reflect continued revenue growth in our established city
guide markets, the addition of our recently added personals businesses, as
well as revenue from new city guide markets we have launched throughout 1999,"
added Conn. "In particular we're pleased by the progress our recently
launched cities have made in establishing a strong local presence with
consumers, local media and advertisers."
The Company believes that the acquisition and integration of Microsoft's
Sidewalk city guides positions Ticketmaster Online-CitySearch as the clear
leader in online local information and transactions. This acquisition has
enabled the CitySearch network to expand from 33 cities to 77 cities
worldwide, and has accelerated the offering of a national network of arts and
entertainment content for nearly 3,000 cities in the U.S. by next month. Also
expanding CitySearch's reach are its partnerships with national and local
media companies. On a national level, these partnerships include companies
such as Times Mirror, The Washington Post Company and Belo Corp. On a local
level, in newly launched cities such as Charlotte and Atlanta, for example,
CitySearch has announced alliances with NBC/WCNC-TV, WEND FM 106.5,
Charlotte's Best, Atlanta Magazine, Atlanta Parent and WQXI 790.
Ticketmaster Online-CitySearch closed the acquisition of One and Only
Network in the third quarter. Combined with Match.Com, these properties have
over four million user registrations and approximately 560,000 active users.
In September, Media Metrix reported the combined personals companies had
approximately 1.0 million unique users, making it the largest provider of
online personals on the Internet.
Sponsorships and Advertising
Revenue in the Sponsorships and Advertising category increased 53% from
the second quarter of 1999. The company added CBS Sportsline and Encyclopedia
Britannica to its existing roster of leading sponsors which includes MSN,
ESPN, Ford Motor Company, and barnesandnoble.com.
"We are pleased by our momentum in selling innovative, locally-oriented
sponsorship and advertising to major advertisers," said Conn. "In the markets
where we have operated city guides for more than one year, our consumer reach
is substantial, ranging from 15% to 22% with the inclusion of the Sidewalk
properties. This reach typically makes CitySearch one of the leading
destination sites in a particular city. With the establishment of our
national network, we are now in a position to build similar reach in each of
our local markets."
Forrester Research found that city guides are particularly important
advertising vehicles for local marketers, with 47% indicating that city guides
are the most important places to advertise locally online. This compares to
27% for portals, 33% for newspaper sites, 3% for local TV sites, 3% for online
yellow pages and 17% for other. City guides were also the leading choice for
national companies seeking to advertise locally.
Other Recent Highlights
New Tools and Services
The Company believes its "get it done" strategy distances CitySearch from
link-based and other city guides by focusing on the development of online
services and tools that allow people to plan, manage and conduct transactions
relevant to their personal lives.
"Ultimately, we see CitySearch as the place consumers go to for access,"
says Conn. "When combined with our locally-sourced content, this will provide
consumers with a compelling local site for getting information and getting
things done in their communities."
Partnership: FairMarket Online Auction Network
Ticketmaster Online-CitySearch aligned with FairMarket Inc., Microsoft
Corp. (Nasdaq: MSFT), and Excite@Home (Nasdaq: ATHM) to expand an online
auction network that will reach more than 46 million unduplicated visitors, or
73.3 percent of all Internet users, the largest distribution of any auction
network. The FairMarket Auction Network gives buyers and sellers a rich
selection of auction resources without leaving the comfortable environment of
their favorite portal site or e-commerce vendor and is connected through a
single massive database of goods and services that is shared across the
network.
New Technologies and Services
CitySearch is incorporating new technologies, such as PDA and wireless
communications, into its service offerings to ensure that its services can
reach the maximum number of consumers. In the past several months, the
Company announced agreements with Nokia, 3Com/Palm Computing, and AvantGo to
deliver its service offerings to anyone, anywhere. CitySearch is now available
on AvantGo, and online ticketing is available on 3Com's Palm VII from
Ticketmaster Online.
In the coming months, CitySearch will integrate its foundation of in-depth
locally-developed content with new online tools and functionality to enrich
its service offering. For example, CitySearch plans to enhance its core
reservation engine to provide scheduling of golf tee times, restaurant
reservations, participatory sports registration, and tickets to smaller
entertainment events not currently served by the Ticketmaster system.
About Ticketmaster Online-CitySearch
Ticketmaster Online-CitySearch, Inc. (Nasdaq: TMCS) is a leading provider
of practical tools for living that help make the Internet an indispensable
part of people's everyday lives. The TMCS family of Web sites includes
CitySearch local city guides (www.citysearch.com), Ticketmaster Online
(www.ticketmaster.com), CityAuction (www.cityauction.com), Match.Com
(www.match.com), One & Only Network (www.oneandonly.com) and LiveDaily
(www.livedaily.com). In July, TMCS added Microsoft's Sidewalk city guides.
Combined, these Web sites guide and facilitate widespread local transactions
and help people save time and money in their local communities. TMCS is
located in Pasadena, California.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995
This press release contains forward-looking statements about Ticketmaster
Online-CitySearch, Inc. (the "Company"), including those concerning its future
product plans. These forward-looking statements involve risks and
uncertainties. The Company's actual results could differ materially from
these statements. Among the risks and uncertainties that could adversely
affect the Company's ited operating history and
early development stage of the Company; the absence of history of Ticketmaster
Online as an independent company; the Company's lack of profitability and
anticipation of continued losses; the Company's dependence on its relationship
with Ticketmaster Corporation; control of the Company by USA Networks, Inc.;
the potential for conflicts of interest; the fact that the license agreement
between USA Networks, Ticketmaster Corporation and the Company is subject to
certain limitations that are contained therein; possible future sales of the
Company's securities by USA Networks, Inc.; company integration risks; the
Company's dependence on increased ticket sales; the Company's future capital
needs and the uncertainty of additional financing; the unpredictability and
potential fluctuations in future revenues and operating results. Investors
are encouraged to read the risks and uncertainties detailed in the Company's
filings with the Securities and Exchange Commission.
Ticketmaster Online-CitySearch is the owner or licensee of its name and
logo trademarks and service marks. All other trademarks and trade names are
the property of their respective owners.
Ticketmaster Online-CitySearch, Inc.
Condensed Consolidated Balance Sheet
(in thousands)
September 30, 1999 December 31,
(unaudited) 1998
ASSETS
Current assets
Cash and cash equivalents $67,962 $106,910
Accounts receivable, net 3,123 1,249
Other current assets 4,699 3,030
Total current assets 75,784 111,189
Property and equipment, net 13,467 5,893
Investments 5,285 --
Goodwill and other
intangible assets, net 700,966 299,643
Total assets $795,502 $416,725
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $3,011 $2,734
Accrued expenses 6,713 4,551
Other current liabilities5,180 3,213
Total current liabilities 14,904 10,498
Other liabilities 1,844 2,639
Total liabilities 16,748 13,137
Stockholders' equity
Common stock & additional
paid in capital 867,216 419,633
Accumulated deficit (88,482) (16,038)
Foreign currency translation 20 (7)
Total stockholders' equity 778,754 403,588
Total liabilities and
stockholders' equity $795,502 $416,725
Ticketmaster Online - CitySearch, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
Actual Pro Forma (a) Actual Pro Forma (a)
3 Mos. Ended 3 Mos. Ended 9 Mos. Ended 9 Mos. Ended
09/30/99 09/30/98 09/30/99 09/30/98
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Ticketing
operations $16,634 $4,624 $43,812 $10,571
City guide
and related 8,977 4,548 21,089 11,069
Sponsorship and
advertising 1,800 2,194 4,009 4,915
Total revenues 27,411 11,366 68,910 26,555
Operating costs
and expenses
Ticketing
operations 12,305 3,402 32,612 7,810
City guide
and related 8,582 3,889 19,052 10,588
Sales and marketing 13,990 5,452 29,569 15,734
Research and
development 2,051 1,643 5,589 5,038
General and
administrative 4,0872,250 9,994 5,998
Amortization of
goodwill 18,606 11,929 44,294 35,784
Merger and other
transactions costs 514 2,622 3,285 3,101
Total costs and
expenses 60,135 31,187 144,395 84,053
Loss from operations (32,724) (19,821) (75,485) (57,498)
Interest income, net 986 436 3,223 696
Loss before income
taxes (31,738) (19,385) (72,262) (56,802)
Income tax provision 49 -- 182 --
Net loss ($31,787) ($19,385) ($72,444) ($56,802)
Basic and diluted
net loss per share ($0.41) ($0.31) ($0.99) ($0.92)
Shares used to
compute basic and
diluted net
loss per share 76,908 62,458 73,537 61,785
Supplemental Financial Information (b)
EBITDA (c) ($13,014) ($7,047) ($28,238) ($19,286)
EBITDA before
merger and other
transactions
costs (d) ($12,500) ($4,425) ($24,953) ($16,185)
Basic and diluted
net loss per share,
excluding merger
and other
transaction costs ($0.41) ($0.27) ($0.94) ($0.87)
Notes:
a) The unaudited pro forma statements of operations data reflects the
combined operating results of Ticketmaster Online and CitySearch as if
the merger between Ticketmaster Online and CitySearch had occurred at
the beginning of the period.
b) The accompanying supplemental financial information is presented for
informational purposes only and should not be considered as a
substitute for the historical and pro forma financial information
presented in accordance with GAAP.
c) EBITDA is defined as earnings before interest, taxes, depreciation and
amortization.
d) EBITDA before merger and other transaction costs excludes
non-recurring charges associated with the Ticketmaster Online and
CitySearch merger and other transactions. |
