GNET is profitable!
Go2Net Reports Profitable Fourth Quarter Results
PR Newswire - November 12, 1998 16:30
Fourth Quarter Net Income of $.02 Per Share
SEATTLE, Nov. 12 /PRNewswire/ -- Go2Net, Inc. (Nasdaq: GNET), a network of technology and community-driven Web sites ( go2net.com ), today announced operating results for the fourth quarter and fiscal year ended September 30, 1998. Revenue for the three months ended September 30, 1998 was $1,955,243, representing an increase of 46.9% from the previous quarter ended June 30, 1998 and a 530% increase from the comparable period for the previous fiscal year.
For the quarter, the company reported net income of $130,545, or $.02 per share, before non-recurring merger and acquisition-related charges. This compares to a net loss of $400,746, or $.09 per share, for the comparable period during the previous fiscal year. The non-recurring merger and acquisition-related charges associated with the company's acquisition of Hypermart totaled $319,512. Net loss for the quarter after these non-recurring charges was $188,967, or $.03 per share.
For the fiscal year ended September 30, 1998, revenues were $4,830,882 as compared to $528,595 for the previous fiscal year, representing an 814% increase. Before non-recurring merger and acquisition-related charges and non-recurring, non-cash charges, net loss for the year ended September 30, 1998 was $937,505 or $0.16 per share as compared to a net loss of $1,756,247 or $0.39 per share for the year ended September 30, 1997. Net loss for the year ended September 30, 1998 after non-recurring merger and acquisition-related charges and non-recurring, non-cash charges was $2,371,125 or $0.41 per share.
Gross profit as a percentage of net sales increased to 71.6% and 62.7% for the three months and fiscal year ended September 30, 1998, as compared to 69.0% and 56.8% for the three months and fiscal year ended September 30, 1997.
Basic net loss per share after non-recurring merger and acquisition-related charges for the three months and fiscal year ended September 30, 1998 was $0.03 and $0.41, respectively, as compared to a basic net loss per share of $0.09 and $0.39 for the three months and fiscal year ended September 30, 1997, respectively. The number of shares used in the computation of basic net loss per share for the three months and fiscal year ended September 30, 1998 were 5,869,714 and 5,781,937, respectively. The number of shares used in the computation of the basic net loss per share for the three months and fiscal year ended September 30, 1997 were 4,522,753 and 4,518,390, respectively.
Go2Net CEO Russell C. Horowitz stated, "While Go2Net is still in the very early stages of accomplishing its goals, we are pleased with the strong revenue and traffic growth this quarter and particularly pleased with achieving profitability. While we feel that the favorable results of operations initially validates our business model, we are very much focused on continuing to enhance Go2Net's overall market position through increased reach and brand recognition. In fact, expanding recognition of the Go2Net brand is one of our primary goals for fiscal 1999. To this end, we will be increasing our marketing expenditures going forward, as well as expenditures in other appropriate areas, as we continue with our growth strategy.
We will also continue to pursue acquisitions and other strategic relationships to expand our product offerings and increase our reach, which coupled with other expenditures, could affect short-term profitability. That being said, we continue to see favorable operating trends for Go2Net overall. In addition, our network is currently seeing record levels of usage and favorable usage growth trends."
The Go2Net Network traffic increased 22% to 6.7 million average page views per day during the month of September 1998, compared to 5.5 million average page views per day in June 1998.
Go2Net's advertisers totaled 227 for the fourth quarter of 1998, up from 138 advertisers for the third quarter of 1998. As of September 30, 1997, the total number of advertisers was 11.
During the September 30th quarter, the company closed its acquisition of Hypermart, ( hypermart.net ), the Web's leading provider of free business hosting services. Hypermart recently surpassed 100,000 member businesses, which includes organizations and entrepreneurs from more than 235 countries. Since its acquisition by Go2Net in August, Hypermart's membership base has grown at the rate of more than 400 members per day.
In addition to Go2Net's Seattle and New York offices, the company also opened its Chicago sales office during the fourth quarter, and in November is opening its San Francisco sales office. Other highlights included co-branded games offerings with Mindspring and a co-branded MetaCrawler search service with USA Today.
The company recently announced the selection of Seattle-based Hadley Green Advertising for a series of national-level advertising campaigns to build Internet industry and consumer awareness of the Go2Net Network. Go2Net's first initiative began with a regional campaign to build awareness of Go2Net's Silicon Investor ( siliconinvestor.com ) in the San Francisco Bay Area business and media-buying communities. The Silicon Investor push combined paid print and outdoor mobile advertising with direct marketing focused on San Francisco's financial and agency districts. Silicon Investor is the Web's largest financial discussion community, with more than 6 million postings on the site since its 1995 inception.
Go2Net's advertising will extend nationally throughout the remainder of 1998 and into 1999, with strong emphasis on the Go2Net Network and the Go2Net brand. Elements will include strategic national business, trade and consumer media buys, market-specific focuses in major U.S. cities and a variety of online advertising programs.
|
