Modem Media Achieves Record Revenue and Gross Profit for First Quarter 2000
Revenues up 130% to $28.5 million year-on-year
Gross margin of 50%, up from 47% year-on-year
Adds 246 employees to 858 at quarter end
NORWALK, Conn., April 26 /PRNewswire/ -- Modem Media (Nasdaq: MMPT), the
exclusive builder and marketer of customer-focused Me-business(SM) services,
today announced financial results for the first quarter ending March 31, 2000.
Revenues for the first quarter rose to a record $28.5 million, a 130%
increase over $12.4 million in the first quarter of 1999. Gross margins
improved to 50% from 47% in the first quarter of 1999 even with continued
investments in domestic and international capacity and in the Company's
CentrPort subsidiary. Earnings before interest, taxes and amortization of
goodwill (EBITA) was $0.2 million representing an EBITA margin of 1%. This
compares to break-even EBITA in the first quarter of 1999. The net loss for
the first quarter of 2000 was ($3.0) million driven by increased amortization
of goodwill to $3.0 million resulting from the Company's acquisition of Vivid
in February 2000. Basic and diluted cash earnings per share was $0.00.
"Our revenue growth continues to be driven by our existing roster of
Fortune 500 clients such as General Electric, Citibank, IBM, General Motors
and Intel who are increasing their commitment to the Internet globally," said
G.M. O'Connell, Modem Media Chairman and CEO. "In addition, we've established
strong momentum for 2000 following the General Motors win and several new
client additions including Christie's, Avon, Philips and Buy.com."
Mr. O'Connell continued, "We continue to accelerate our revenue growth and
to generate above average gross margins even while investing in our
international office network and CentrPort, which will add scale and leverage
to our model in the future. In addition, we completed the Vivid acquisition
in San Francisco and opened our Paris and Sao Paulo offices. During 2000, we
will continue to invest in building the talent base, global reach and
Me-business technology that our world-class clients demand."
First quarter operational highlights include:
-- Increased Spending From Top 10 Clients: Average annualized revenue for
the Top 10 accounts in the first quarter grew 102% to $7.6 million, up
from $3.8 million in the first quarter of 1999.
-- Lower Revenue concentration: Revenue concentration from the Top 5 and
Top 10 accounts was reduced to 41% and 67% in the first quarter of
2000, from 54% and 76% in the first quarter of 1999, respectively. No
client accounted for more than 10% of revenue in the first quarter of
2000.
-- Strong International Growth: Modem Media achieved a 282% year-on-year
increase in international revenue to $6.1 million. This growth was
driven by international spending from core global accounts including
General Motors, IBM, Intel, Coca-Cola, and General Electric across
Latin America, Canada, Asia and Europe. Modem Media's global office
network now includes New York City, San Francisco, Norwalk, London,
Paris, Munich, Toronto, Tokyo, Hong Kong, and Sao Paulo.
-- Employee Growth: Solid recruiting resulted in total number of
employees growing to 858 at the end of the first quarter of 2000 up
from 612 at the end of the fourth quarter of 1999. Billable employees
grew to 679 in the first quarter of 2000, up from 491 at the end of the
fourth quarter of 1999.
About Modem Media
Modem Media (http://www.modemmedia.com) is the exclusive builder and
marketer of Me-business solutions, a customer-focused approach to Internet
business. Driven by customer needs, Modem Media identifies Me-business
opportunities, and utilizes its strategic, conceptual, technological and
marketing expertise to build, distribute and manage unique Me-business
solutions for global companies and Internet ventures. Headquartered in
Norwalk, CT, Modem Media's expanding global presence includes offices in New
York City, San Francisco, Toronto, London, Paris, Munich, Tokyo, Hong Kong and
Sao Paulo. With more than 850 professionals worldwide, Modem Media has created
customer-focused Internet solutions for global brands such as Citibank, Intel,
General Motors, Delta Air Lines, General Electric, IBM and JCPenney.
Me-business is a service mark of Modem Media
CentrPort is a service mark of CentrPort LLC
This press release contains statements that are "forward-looking" within
the meaning of applicable federal securities laws, including the Company's
future investments, revenue growth and gross margins, and clients' demand for
services and their spending, which are subject to a number of risks and
uncertainties that could cause actual results to differ materially from those
anticipated. Factors that could cause actual results to differ include timing
and scope of new projects and client initiatives, demand for the Company's
services, spending levels of the Company's clients, costs and timing related
to the expansion of the Company's business and investments, the ability to
attract and retain qualified professionals and other factors more fully
discussed in our filings with the Securities and Exchange Commission.
MODEM MEDIA . POPPE TYSON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
March 31,
2000 1999
(unaudited)
Revenues $28,537,000 $12,383,000
Cost of revenues 14,316,000 6,506,000
Gross profit 14,221,000 5,877,000
Operating expenses:
Sales and marketing 1,238,000 347,000
General and administrative 12,818,000 5,554,000
Amortization of goodwill 3,029,000 590,000
Total operating expenses 17,085,000 6,491,000
Operating loss (2,864,000) (614,000)
Interest income, net 544,000 337,000
Loss before income taxes (2,320,000) (277,000)
Provision for income taxes 647,000 196,000
Net loss $(2,967,000) $(473,000)
Basic and diluted net loss per share $(0.13) $(0.02)
Basic and diluted cash earnings per share $ -- $0.01
Basic and diluted weighted-average
number of common shares outstanding 23,583,000 19,310,000
SOURCE Modem Media |
