KOOP vs MCNS: A comparison for your consideration (MCNS is not committed to spending Millions on advertising with AOL)
Mediconsult.com Announces Record Breaking Financial and
Operating Results for Second Quarter Business/Technology
Editors
Business Wire - July 28, 1999 16:39
35.4 Million Pages Viewed by 6.2 Million Visitors During Quarter
Mediconsult.com, Inc. (NASDAQ:MCNS) today announced its financial and operating results for the
quarter ending June 30, 1999.
HIGHLIGHTS
--Mediconsult.com achieved record operating revenues of $1.2 million and $1.9 million for the first
quarter and six months ending June 30 1999, respectively. These figures are up 459% and 352% from the
same periods of the prior year.
--Basic earnings per share (excluding option and warrant costs) for the quarter and six months ended June
30, 1999 were ($0.05) and ($0.14), respectively. The Company's advertising costs and visitor acquisition
costs on a per capita basis remain among the lowest in the sector, even with the Company's substantial
growth and leadership position.
--According to audited I/Pro statistics, 6.2 million visitors viewed over 35.4 million pages of information
during the second quarter; in June alone 2.2 million visitors viewed more than 13.1 million pages of
information.
--Mediconsult.com was selected for listing by the Chicago Board Options Exchange ("CBOE") and
trading in the options under the symbol "UCS" commenced in April. Mediconsult.com's common stock
was added to the Russell 2000(R) Index in mid-July.
VISITOR TRAFFIC
During the second quarter, Mediconsult.com's Web sites attracted 6.2 million visitors who viewed 35.4
million pages. On average, viewers spend 15 minutes on Mediconsult.com's Web sites, representing one of
the highest visitor durations for an on-line healthcare company.
These figures validate Mediconsult.com's strategy of offering patients and healthcare consumers a superior
Internet experience. Historically, the Company has spent considerably more on Web site product and
content development than on Web site advertising and this trend continued in the second quarter.
Specifically, the gains in visitor traffic during the second quarter were not the result of an advertising
"blitz" but, rather, represent the momentum Mediconsult.com has developed after more than three years of
offering consumers, patients and doctors user-friendly Internet resources with strong communities and
relevant medical information.
RETURN ON INVESTMENT FOR BOTH SHAREHOLDERS AND CLIENTS
The greater number of visitors taking significantly longer periods of time to view more pages of
information all point to an increasing "stickiness" of Mediconsult.com's Web sites. In addition,
Mediconsult.com's management team has been able to develop programs to acquire leadership levels of
visitor traffic at among the lowest costs of any on-line healthcare company. Together, these features
provide a compelling economic framework for the Company to be able to deliver effective, profitable
Internet marketing programs to its pharmaceutical clients that want their advertising programs to reach
targeted, interested audiences.
INDUSTRY RECOGNITION IN THE SECOND QUARTER
The Company's Web sites have received awards from more than 30 independent organizations including
Encyclopedia Britannica (one of the 76 "Best of Web" sites out of 125,000 reviewed), The Lancet ("An
exceptionally well-designed, easy to navigate site brimming with health news and patient information"),
and Popular Science (one of the "50 Best of the Web" for 1998). During the second quarter
Mediconsult.com continued to build on its reputation for providing a trusted source of comprehensive and
easy to understand health and medical information. Below are examples of the industry recognition
received by Mediconsult.com and its Web sites during the second quarter:
The Federal Trade Commission (FTC) named Mediconsult.com as a "resource providing quality
patient-oriented healthcare information and services on the Internet" during the unveiling of "Operation
Cure.All", a national consumer protection and education campaign.
www.CyberDiet.com was named "The Best" with 4 stars in the June 1999 issue of Yahoo Magazine.
www.CyberDiet.com was named a "favorite site" in the May/June 1999 issue of The Walking Magazine.
CyberDiet's Nutritional Profile was named by ZD and Yahoo Internet Life as "Today's Most Incredibly
Useful Site."
www.Mediconsult.com was selected as a Links2Go "Key Resource" in the Health and Medicine topic.
www.PharmInfo.com was chosen as HMS Beagle's "Web Pick of the Day."
www.PharmInfo.com was chosen by Encyclopedia Britannica as the "Site of the Week" (4 Stars).
www.heartinfo.com named by TIME magazine as a Web resource for information on cholesterol.
CAPITAL RESERVES
As a result of the successful completion of the Company's public offering on April 6th and its disciplined
approached to managing capital, the Company completed the second quarter with $51 million in cash. The
Company has no debt. The Company has sufficient capital to fulfill all its commitments, execute its
business plan and still allow for a significant acceleration of business activity.
QUARTERLY AND YEAR-TO-DATE FINANCIAL RESULTS
Revenue increased to $1.2 million for the second quarter of 1999 from $215,000 in the second quarter of
the prior year, a 459% increase. For the six months, revenue grew to $1.9 million, up from $421,000 in the
first six months of last year, an increase of 352%.
Net losses for the second quarter of 1999 were ($1.464) million or ($0.05) per share before inclusion of
expenses of $2.653 million related to the fair value of stock options and warrants, which generated a total
loss for the period of ($4.117) million or ($0.15) per share. This compares to net losses in the second
quarter of last year of ($800,000) or ($0.04) per share before inclusion of $30,000 related to the fair value
of stock options and warrants, which generated a total loss for the period of ($830,000) or ($0.05) per share.
For the first six months of 1999 net losses were ($3.197) million or ($0.14) per share before inclusion of
expenses of $2.844 million related to the fair value of stock options and warrants, which resulted in a total
loss for the period of ($6.041) million or ($0.26) per share. This compares to net losses in the first six
months of last year of ($1.243) million or ($0.07) per share before inclusion of expenses of $69,000 related
to the fair value of stock options and warrants, which resulted in a total loss for the period of ($1.312)
million or ($0.07) per share.
Summary Financial Statements
Income Statement (unaudited)
($000s or $ per share, except number of shares)
For The Three For The Six
Months Ended: Months Ended:
June 30, June 30, June 30, June 30,
1999 1998 1999 1998
Revenues:
Operating
Revenues $ 1,203 $ 215 $ 1,904 $ 421
Expenses:
Product & Content
Development 1,368 260 2,273 510
Marketing, Sales
and Client
Services 837 492 1,575 681
General &
Administrative 650 137 1,322 308
Depreciation and
Amortization 388 126 507 165
Expenses Before
Fair Value of
Options &
Warrants 3,243 1,015 5,677 1,664
Other Income
(Interest) 576 -- 576 --
Profit/(Loss)
Before
Fair Value of
Options &
Warrants (1,464) (800) (3,197) (1,243)
Fair Value of
Options and
Warrants Granted 2,653 30 2,844 69
Net Profit/(Loss) $ (4,117) $ (830) $ (6,041) $ (1,312)
Net Profit/(Loss) per Share:
After Fair Value
of Option &
Warrant
Expense $ (0.15) $ (0.05) $ (0.26) $ (0.07)
Before Fair Value
of Option &
Warrant
Expense $ (0.05) $ (0.04) $ (0.14) $ (0.07)
Weighted Average
Number of Shares
During Period 27,446,133 17,889,048 23,013,169 17,593,820
Balance Sheet (unaudited) As at:
June 30, Dec. 31,
($000s except number of shares) 1999 1998
Assets
Cash & Equivalents $ 51,127 $ 135
Other Current Assets 2,438 136
Non-Current Assets 11,868 871
Total Assets $ 65,433 $ 1,142
Liabilities and Shareholders' Equity
Current Liabilities $ 1,686 $ 864
Shareholders' Equity 63,747 278
Total Liabilities and
Shareholders' Equity $ 65,433 $ 1,142
Number of Shares Outstanding
at End of Period 28,446,263 18,519,950
General Comments on Revenue Recognition and Treatment of Certain Expenses
Mediconsult.com does not include any "barter" advertising or "contra" transactions in its revenues. This
fiscally conservative policy has been adopted by the Company to assure shareholders that the Company
reports appropriate information with regard to its commercial transactions and not potentially inflated
results. We are aware that some Internet companies record "barter" and "contra" revenues and direct the
reader's attention to this practice so that comparable revenue figures are used.
Under the Statement of Financial Accounting Standards No. 123 ("SFAS 123") "Accounting for
Stock-Based Compensation" stock options granted to employees and consultants are expensed over their
vesting period, based on their fair market value as at the date of the grant. These non-cash expenses must
be recognized in either the financial statements or in a note to the financial statements. Mediconsult.com
recognizes such costs in its financial statements, which has the effect of decreasing earnings during periods
where options vest and the share price has risen. We are aware that most reporting companies elect to
recognize expenses under SFAS 123 in a note to their financial statements. Accordingly, for the benefit of
shareholders and analysts, we have provided numbers in the tables above that allow for a comparison to
other public companies.
Analysts' Conference Call
A conference call will be held for analysts to discuss the second quarter results today at 4:45 PM EDT.
Analysts wishing to participate in the conference call should contact John Jennings at 888-316-1133 for
details.
Vcall for Investors
Investors will have the opportunity to listen to the conference call over the Internet through Vcall, a service
of the Investor Broadcast Network, at vcall.com. To listen to the live call, please go to the Web
site at least fifteen minutes early to register, download, and install any necessary audio software. For those
who cannot listen to the live broadcast, a replay will be available shortly after the call and a transcript will
be available 24 to 48 hours later at vcall.com.
About Mediconsult.com:
Mediconsult.com is a leading provider of patient-oriented healthcare information and services on the
World Wide Web. Founded in 1996 with its flagship Web site, www.mediconsult.com, the company's
growing network of sites educate and empower consumers to manage their health by providing the most
in-depth medical information and breadth of support available on the Web. Mediconsult.com prepares
patients to speak effectively with their healthcare provider by providing the same reliable and independent
information that medical professionals read. This focus on patient-empowerment has resulted in a large
and loyal following of Web site visitors and a leadership position in the industry as an award-winning,
highly-regarded health and medical Web site.
Mediconsult.com's network of sites and communities include: CyberDiet (www.cyberdiet.com), the
leading diet and nutrition site; Heart Information Network (www.heartinfo.com), the leading heart health
information site; PharmInfoNet (www.pharminfo.com), an online drug information resource; and INCIID
(www.inciid.org), the leading Web resource on infertility.
Certain statements in this release, such as management's view of future revenues and expenses, may be
forward-looking statements that are subject to risks and uncertainties that could cause actual results to
differ materially from those projected. Potential risks and uncertainties include such factors as acceptance
of the Company's products and services, competition and other risks described in the Company's filings
with
CONTACT: Mediconsult.com, Inc. Kekst & Company
John Jennings, CFA, MBA Caroline Gentile
1-888-316-1133 212/521-4883
jjennings@mediconsult.com caroline-gentile@kekst.com
Lissa Perlman
212/521-4830
lissa-perlman@kekst.com
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