Andover.Net, Inc. Reports Record Revenue Gains for the Period Ending December 31, 1999, Agrees to Acquire Linux Online Support Site
ACTON, Mass.--(BUSINESS WIRE)--Jan. 27, 2000--Andover.Net, Inc. (NASDAQ: ANDN - news), the Internet's leading Linux/Open Source destination, today reported that its revenues totaled $2.1 million in its quarterly results for the period ended on December 31, 1999. This is a 103% increase over revenues of $1.0 million for the quarter ended September 30, 1999. The Company also reported significant developments in their corporate services sector including the agreement to acquire QuestionExchange, a leading online tech support site for Linux and Open Source.
Andover.Net, Inc. also changed its year-end during the quarter from September 30 to December 31.
For the quarter ended December 31, 1999, the Company had a net loss of $15.7 million, which included non-cash charges of $15.1 million. $12.2 million of the non-cash charges, a non-recurring interest charge recorded due to the conversion of preferred stock to common as part of the initial public offering. The loss of $15.7 million, or ($1.58) per share, for the quarter ended December 31, 1999 compared with a net loss of $3.2 million, or ($.40) per share, in the quarter ended September 30, 1999.
Andover.Net, Inc. completed its initial public offering on December 8, 1999. Had the initial public offering been completed on October 1, 1999, the weighted average common shares outstanding for the quarter ended December 31, 1999 would have been 15.7 million. The ``normalized' net loss per common share would have been ($1.00) per share.
``The increasingly rapid adoption of Linux and Open Source software around the world continues to propel Andover.Net upward,' said Bruce Twickler, president and CEO of Andover.Net, Inc. ``Our advertising revenues more than doubled from the previous quarter. Our e-commerce revenues exceeded our expectations by increasing 700% from October to December. Additionally, we have agreed to make a significant acquisition, QuestionExchange.'
QuestionExchange is the leading on-line tech support site for Linux and Open Source. It provides a technical support marketplace over the Web to individuals and corporations adopting Linux and Open Source products. QuestionExchange will be the first of many services in Andover.Net's new corporate services initiative.
``Just as ThinkGeek accelerated our entry into e-commerce, QuestionExchange accelerates Andover.Net's offering of corporate services. We are fortunate once again to get a site that fits so perfectly into our strategy,' Twickler said. ``They have a support business that works and is scalable with growing levels of traffic. We have traffic of over 2.4 million unique visitors every month.'
In addition, Andover.Net is expanding Freshmeat.net, the Internet's leading archive for Linux/Open Source projects, into a major resource for Linux and Open Source developers. It will offer features developers need to begin, develop, promote, and distribute an Open Source project. Andover.Net is also releasing Slashcode, the first Open Source application Andover.Net is taking an active role in developing, managing, and promoting. Slashcode is the engine for Slashdot, the largest Open Source news and community site on the Web. It is an application that many corporations can use to build and foster communities of customers and affiliates.
``It is our purpose to be at the center of Linux development with Freshmeat. And then expand our corporate services from there,' said Twickler. ``And, Slashcode is our first significant application where we will promote, manage, and consult to corporations as part of our corporate services.'
About Andover.Net
Andover.Net (NASDAQ: ANDN - news) is the leading Linux destination on the Internet. Serving 50 million page impressions to over 2.4 million users each month, Andover.Net (www.andover.net) includes the largest news/community site, Slashdot (slashdot.org); the largest site for programmer resources, Freshmeat.net (www.freshmeat.net); and the popular developer e-commerce site, ThinkGeek (thinkgeek.com). With these sites and our other Linux sites such as FreeCode (freecode.com) and LinuxDaveCentral (www.linux.davecentral.com), Andover.Net accounts for over 50% of the visits to Linux destinations on the Internet. Andover.Net also includes cross-platform sites such as MediaBuilder (www.mediabuilder.com) that provide programmer and developer resources for users of many popular operating systems in addition to Linux such as Windows, UNIX and Macintosh.
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements involving risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. Potential risks and uncertainties include, but are not limited to, Andover.Net's limited operating history, expectation that Andover will incur substantial losses in the future; Andover's reliance on linux/open source community; Andover's heavy reliance on advertising revenues; intense competition and other risks listed in Andover.Net's registration statement on form S-1.
Andover.Net, Slashdot, Freshmeat, HTMLWorks, GIFWorks, AndoverNews Network, MediaBuilder, Internet Traffic Report, DaveCentral, FreeCode, IT Managers Journal, Slaughterhouse, TechSightings and TechMailings are trademarks of Andover.Net.
ANDOVER.NET, INC. AND SUBSIDIARY
CONSOLIDATED INCOME STATEMENTS
(Thousands of dollars except per share amounts)
(Unaudited)
Three Months Ended Three Months Ended
September 30, 1999 December 31,1999
Net revenues:
Advertising $ 560 $ 1,324
Barter advertising 352 447
E-commerce 100 285
Total revenues 1,012 2,056
Cost of revenues:
Editorial content and related 302 355
E-commerce 1 126
Total cost of revenues: 303 481
Gross profit 709 1,575
Operating expenses:
Sales and marketing 482 836
General and administrative 802 949
Research and development 298 323
Barter advertising 352 447
Amortization of intangible assets 405 424
Amortization of deferred compensation 303 1,154
Compensation related to acquisitions 813 1,216
Total operating expenses 3,455 5,349
Operating loss (2,746) (3,774)
Interest expense, net (437) (11,946)
Net loss ($ 3,183) ($15,720)
Net loss per share
basic and diluted ($ 0.40) ($ 1.58)
Weighted average shares,
basic and diluted 7,966 9,923
ANDOVER.NET, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Thousands of dollars)
(Unaudited)
September 30, 1999 December 31,1999
Assets
Current assets:
Cash and cash equivalents $ 9,871 $ 78,409
Restricted cash -- 605
Accounts receivable, net 539 1,084
Inventory -- 124
Other current assets 126 594
Total current assets 10,536 80,816
Property and equipment, net 218 457
Intangible assets 3,166 2,959
Other assets 520 185
Total assets $ 14,440 $ 84,417
Liabilities, Preferred Stock and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued expenses $ 1,868 $ 807
Amounts due to stockholders -- 605
Long-term debt - current portion 654 1,163
Total current liabilities 2,522 2,575
Long-term debt 762 --
Preferred stock 17,469 --
Stockholders' Equity
Common stock 80 158
Additional paid in capital 6,934 110,116
Deferred compensation (5,156) (4,281)
Accumulated deficit (8,171) (24,151)
Total stockholders' equity (6,313) 81,842
Total liabilities and
stockholders' equity $ 14,440 $ 84,417
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Contact:
Andover.Net
Janet Holian, 978-635-5300
janet@andover.net |
