Earnings are out and look real good:
siliconinvestor.com
Bid.Com Announces Fourth Quarter 1999 Results
Q4 Revenues Increase 80%, Annual Revenues up 55%
(Nasdaq: BIDS; TSE: BII)
TORONTO, Feb. 24 /CNW-PRN/ - Bid.Com International Inc. (Nasdaq: BIDS; TSE: BII), a leading enabler of global e-commerce, today announced its results for the fourth quarter and year ended December 31, 1999. All figures are in Canadian dollars. As of December 31, 1999, the exchange rate was Cdn$1.444 to US$1.00.
Revenue in the fourth quarter of 1999 increased 80.3% to $11.4 million compared to $6.3 million in the fourth quarter of 1998. Revenue increased 36.9% from $8.3 million in the third quarter of 1999. Revenues are derived from merchandise sales and shipping revenue from products sold on www.bid.com and from the provision of Bid.Com's licensed technology, consulting and related services.
Advertising and promotion expenses in the current quarter were $5.2 million, or 45.5% of revenue, compared to $3.7 million, or 58.4% of revenue, for the fourth quarter of 1998 and $3.4 million, or 40.9% of revenue, in the quarter ending September 30, 1999. General and administrative expenses were $3.9 million, or 34.4% of revenue, in the fourth quarter compared to $2.1 million, or 33.5% of revenue, in the fourth quarter of 1998 and $3.2 million, or 38.5% of revenue, in the quarter ending September 30, 1999. Approximately 60% of the increase in general and administrative expenses from the third to fourth quarter of 1999 was related to additional resources required to support the Company's growing focus on its business-to-business opportunities.
The net loss for the fourth quarter of 1999 was $8.7 million, or $0.17 per basic share, compared to a net loss of $5.8 million, or $0.18 per basic share, in the comparable period of 1998 and a net loss of $5.0 million, or $0.10 per basic share, in the third quarter of 1999.
Commenting on the financial results, Mr. Jeff Lymburner, President and CEO of Bid.Com International Inc. said, ``The majority of the revenue growth in the fourth quarter was due to traffic and revenue gains at The Company Store at www.bid.com. Driving this growth was retail seasonality, as well as several advertising programs initiated in the United States. The shift in revenue mix to business-to-consumer due to the holiday season resulted in lower margins and an increase in the net loss, however we continued to build our portfolio of more profitable business-to-business (``B2B') investments that have significant long term value not yet recognized in the financial statements. Going forward, we anticipate margins will improve as we begin to generate a growing portion of our business from our B2B initiatives. This is consistent with our strategy and further justifies our acceleration into the B2B arena.'
Strategic Alliances
Bid.Com's strategy is based on leveraging its proprietary technology platform and building a multi-revenue stream business model consisting of business-to-business and business-to-consumer revenues which includes providing ``powered by Bid.Com' e-commerce enabling solutions to others in return for license and services fees and a percentage of sales or profits. Partnerships and alliances with leading Internet companies will continue to be an important part of the Company's strategy. In addition to Bid.Com's existing relationships with Point2 Internet Systems, NBCi through ValueVision TV, Chapters.ca, and Rogers Video, the Company continued to diversify into the much larger and rapidly growing business-to-business segment of the on-line auction and fixed price market, announcing the following key initiatives in the fourth quarter and early in the first quarter of 2000:
- Entered into a multi-year agreement with Megawheels.Com providing
online auction services in the automotive business-to-business and
consumer markets.
- Entered into a marketing agreement with CapGemini Group, a leading
European management consulting and IT services company, providing
sales support and ``powered by Bid.Com' technology solutions for its
clients.
- Entered into a marketing agreement with Xerox providing Internet
distribution for Xerox certified pre-owned business copiers.
- Entered into a marketing agreement with FutureShop.ca providing online
auction capabilities to liquidate consumer electronics and computers
on its website.
- Signed an agreement with Sprint Canada to become its auction partner.
- Opened an office in Melbourne, Australia, which is recognized as a
technological hub with the necessary infrastructure to support
Bid.Com's expansion into the Asia-Pacific marketplace.
- Entered into an alliance with Research In Motion to allow secure
wireless interaction and e-commerce transactions utilizing Bid.Com's
on-line auction products and services and RIM's wireless products and
services.
- Entered into a technology licensing agreement with The Art Vault for
the online auction of arts and antiquities.
``We are extremely pleased with the quality of transactions, partnerships and alliances completed in the fourth quarter,' said Mr. Lymburner. ``Our focus continues to be on a model that provides revenues from business-to-business and enables e-commerce solutions for our clients. Our various agreements, while all unique, typically include an ongoing revenue sharing component. We believe this strategy is the correct one and in the long term will yield a sustainable, profitable business.'
Mr. Lymburner added, ``In order to provide our clients with superior sales and technology support we have recently added many key personnel with excellent credentials. We now have management personnel on staff from companies such as IBM, Oracle, Hummingbird, HP, IMAX, Clearnet and AT&T Canada. This management depth will be a key to our ongoing growth.'
For the year, revenue increased 55.0% to $31.0 million compared to $20.0 million for 1998. Advertising and promotion expenses declined to $11.9 million, or 38.3% of revenue, in 1999 from $12.6 million, or 63.0% of revenue, in 1998. General and administrative expenses for the year increased to $12.4 million, or 40.0% of revenue, from $5.8 million, or 28.8% of revenue, in 1998.
``We are fortunate to be in a strong position financially. Having raised $16 million, net of expenses, at the end of the third quarter, we ended the year with working capital of $21.5 million. We are excited about the opportunities that we have in the works and look forward to updating our shareholders on our progress as we continue to grow Bid.Com into a significant player in the business-to-business e-commerce marketplace,' concluded Mr. Lymburner.
About Bid.Com International Inc.
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Founded in 1995, Bid.Com offers online auction platforms for business-to- business and business-to-consumer markets. Bid.com offers multiple online transaction methods within a single suite of services, providing fixed price, traditional auction, real-time declining price (Dutch) auction and Request for Quotation (RFQ) -- all within the same package. Thanks to award-winning modular architecture, the Bid.Com system can be integrated with virtually any business-to-business or consumer-based application. A growing number of major online players have made Bid.Com their online sales partner in sectors such as electronic media, travel, wireless communications, automotive and heavy machinery. Partners include Research In Motion, Sprint Canada, America Online, Chapters.ca, Rogers New Media, CapGemini, The Art Vault and NBCi through ValueVision Interactive.
Bid.Com has offices in Toronto, Tampa, Dublin, and Melbourne, Australia, and the company's shares trade on both the Nasdaq National Market and the Toronto Stock Exchange (Nasdaq: BIDS; TSE: BII).
This news release may include comments that do not refer strictly to historical results or actions and may be deemed to be forward-looking within the meaning of the Safe Harbor provisions of the U.S. federal securities laws. These include, among others, statements about expectations of future revenues, cash flows and capital requirements. Forward-looking statements are subject to risks and uncertainties that may cause the Company's results to differ materially from expectations. These risks include the Company's ability to further develop its business-to-business and licensing businesses, the Company's ability to develop appropriate strategic alliances and successful development and implementation of technology, acceptance of the Company's products and services, competitive factors, new products and technological changes, and other such risks as the Company may identify and discuss from time to time, including those risks disclosed in the Company's amended Form 20-F filed with the Securities and Exchange Commission. Accordingly, there is no certainty that the Company's plans will be achieved.
To receive additional information about Bid.Com International Inc.
please visit www.bid.com.
(Financial Tables Follow)
BID.COM International Inc.
Statement of Operations
(expressed in thousands of Canadian dollars, except per share amounts)
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(Canadian GAAP, Audited)
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Three Months Ended Twelve Months Ended
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December 31 December 31
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1999 1999 1998 1999 1999 1998
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(translated (translated
into US$ at into US$ at
$US equals $US equals
Cdn$1.444 for Cdn$1.444 for
convenience) convenience)
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Revenue $11,406 $7,899 $6,325 $31,001 $21,469 $20,001
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Direct expenses 10,810 7,486 5,939 26,696 18,488 19,361
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General and 3,924 2,717 2,116 12,405 8,591 5,751
administrative
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Advertising and 5,189 3,593 3,692 11,870 8,220 12,594
promotion
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Software development 251 174 395 1,001 693 889
and expense
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Depreciation and 196 136 65 621 430 201
amortization
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20,370 14,106 12,207 52,593 36,422 38,796
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Interest income 236 163 51 767 531 88
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Net loss ($8,728) ($6,044) ($5,831) ($20,825) ($14,422) ($18,707)
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Loss per basic
share ($0.17) ($0.12) ($0.18) ($0.42) ($0.29) ($0.79)
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Weighted average
common shares
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Outstanding 50,682 50,682 32,609 49,218 49,218 23,680
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December December December
31, 31, 31,
Balance Sheet Data: 1999 1999 1998
(in US$)
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Cash and $21,497 $14,887 $16,598
marketable
securities
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Other current 6,495 4,498 3,756
assets
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Other assets 8,751 6,060 693
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Total assets $36,743 $25,445 $21,047
------- ------- -------
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Total current 6,469 4,480 2,425
liabilities
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Deferred Revenue 1,289 893 -
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Total 28,985 20,072 18,622
stockholders'
equity
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Total $36,743 $25,445 $21,047
liabilities and ------- ------- -------
shareholders' ------- ------- -------
equity
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CERTAIN PRIOR PERIOD AMOUNTS HAVE BEEN RECLASSIFIED TO CONFORM TO THE
CURRENT PERIOD PRESENTATION. |
