Terra Increases Revenues by 180% in the First Half of 2000
PR Newswire - August 01, 2000 12:42
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* Advertising revenues continued to register very strong growth in the
first half of 2000, 540% higher than the first half of 1999 and an
increase of 84% in the last quarter
* E-commerce revenues increased 6 times in the first half of 2000
* The number of clients has doubled in 6 months
* Terra's audience growth-450% in the number of subscribers and 428% in
the number of visits since June 1999-is reflected in ISP revenues
* The company has consolidated its position as leader in the
Spanish- and Portuguese-speaking internet markets with nearly
2.7 million subscribers, 86 million visits and 1.03 billion page views
in June 2000
MADRID, Spain, Aug. 1 /PRNewswire/ Terra Networks, S.A., internet subsidiary of Telefonica, S.A.,
gained 1.3 million new subscribers in the second quarter of 2000 to reach a total of 2.7 million
subscribers, representing growth of 450% over the same period in 1999 and 33% over the last quarter.
This also means Terra ended the first half of 2000 with double the number of clients that it attracted
during the whole of 1999.
In June 2000 Terra recorded 1.03 billion page views and 86 million visits, representing increases of
310% and 430%, respectively. This rapid audience growth was reflected in the company's revenues,
which in the first half of 2000 reached EUR 83.6 million, or an increase of 180% compared to the first
half of 1999. Specifically, advertising revenues experienced an annual increase of 540% and a quarterly
increase of 84%, and e-commerce revenues experienced an annual increase of 485% and a quarterly
increase of 182% in the last quarter.
These results consolidate Terra Networks as the leading Spanish- and Portuguese-speaking Internet
Company, with a potential market of 550 million people. Since the beginning of the year, the Telefonica
subsidiary has taken a number of steps to achieve this position, most notably: the proposed acquisition
of Lycos to create the first truly global internet company; the creation of a logistics services company
with Logista, BBVA and Bertelsmann; the launch of various Terra portals in Central America as well as
the launch of Terra Venezuela and Terra Uruguay; the acquisition of the "La Ciudad" portal to lead the
Internet market in Colombia; the signing of an e-commerce joint venture with Telepizza; and the
consolidation of Invertia as the leading financial portal in Spain.
KEY FIGURES
% Quart. % Ann.
6/30/00 3/31/00 12/31/99 6/30/99 growth growth
Subscribers
(thousands) 2,659 1,992 1,317 485 33.4% 448%
Page views
(millions) 1,032 705 434 251 46.38% 311%
Visits/month
(millions) 86 63 38 16 36.5% 428%
% Quart. % Ann.
2Q-00 1Q-00 2Q99 growth growth
Revenues
(millions
of euro) 46.8 36.8 13.5 27% 247%
Terra Networks revenues for the periods referenced include the results of operations of companies that
Terra Networks acquired during each of 1999 and 2000 as of January 1 of the respective year in which
each company was acquired, regardless of the actual date of acquisition. This differs from Terra
Networks' financial reporting under U.S. GAAP which includes the results of operations of such
companies as of the respective dates that each company was acquired.
ACCESS SERVICES
ISP revenues totaled EUR 53.5 million in the first half of 2000, an increase of 200% over the same
period of 1999. This performance was driven by a major increase in the ISP client base, the sale of
value- added services and revenues from traffic inducement.
Terra group client base (thousands):
6/30/00 3/31/00 12/31/99 6/30/99
Spain 1,250 938 659 186
Brazil 732 558 346 194
Mexico 373 215 82 45
Others 304 280 230 60
TOTAL 2,659 1,992 1,317 485
The rise in Terra's ISP client numbers has been significant in all countries where Terra is present. The
total increased 448% compared to June 30, 1999, and Terra Networks ended the first half of 2000
with double the number of clients attracted during the whole of 1999. As of June 30, 2000, the
company had approximately 2.7 million ISP subscribers.
Although growth in the number of ISP clients has been significant in all countries where Terra is present,
Spain and Mexico registered particularly noteworthy figures. At June 30, 2000, Spain had increased its
client base by 570% compared to June 30, 1999, while Mexico saw its number of ISP clients rise by
nearly 730%. Brazil also posted a very strong growth rate of 277%.
The Terra group's subscriber growth was strong for both free access and paying access. he company
now has 1.7 million free-access subscribers, an increase of 1,316% over June 30, 1999. After Terra's
first free-access service was launched in Spain, free-access services were introduced in Brazil in
February 2000 and in Mexico and Chile in March 2000.
The number of paying clients has also risen strongly, with 569,000 new paying subscribers, an increase
of 157% during the twelve months ended June 30, 2000. This growth reflects the growing demand for a
more sophisticated product with greater value-added services and a segmented strategy of offering a
wide range of services which have been well received by the market.
PAGE VIEWS
Terra group page views in June 2000 totaled 1.03 billion, surpassing 1 billion page views in one month
for the first time. This is four times higher than June 1999 and represents 33 million page views per day.
These figures are the result of the Terra group's strategy of steadily adding new content and services in
order to distinguish itself from the competition.
6/30/00 3/31/00 12/31/99 6/30/99
(millions)
Spain 175 115 89 34
Brazil 537 389 267 186
Mexico 156 116 67 28
Others 164 85 11 3
TOTAL 1,032 705 434 251
VISITS
Visits in June 2000 totaled 86 million compared with 16 million in June 1999, an increase of 444%.
6/30/00 3/31/00 12/31/99 06/30/99
Spain 25 23 17 7
Brazil 23 18 12 8
Mexico 20 12 7 2
Others 18 9 3 --
TOTAL 86 63 38 16
ADVERTISING
The first half of 2000 saw strong growth in advertising revenues to EUR 16.9 million, 540% higher than
in the first half of 1999. A point worth noting is that advertising revenues in the second quarter of 2000
were greater than for the whole of 1999, representing growth of 84% in the last quarter.
E-COMMERCE
The various activities of the Terra group in all the countries where it operates resulted in e-commerce
revenues of EUR 3.5 million for the six months ended June 30, 2000, representing an annual growth of
485% and 182% in the last quarter.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
30 JUNE 2000
(in millions of euro)
1H - 2000 1H - 1999 % Change
ISP 53.5 18.1 195.5%
Portal 21.1 3.3 548.2%
Other revenues 9.1 8.8 3.3%
Total revenues 83.6 30.1 177.7%
Cost of sales (52.8) (21.9) 141.6%
Gross profit 30.8 8.3 273.1%
EBITDA (154.1) (19.4) 694.9%
Depreciation (26.9) (1.5) 1,675.6%
EBIT (180.9) (20.9) 765.9%
Interest and extraordinaries (5.0) (0.9) 440.9%
Profit before tax and goodwill (186.0) (21.8) 752.1%
Tax 76.2 4.1 1,752.5%
Profit after tax
and before goodwill (109.8) (17.7) 519.9%
Goodwill amortization (57.8) (54.4) n.a.
Net profit (167.6) (72.1) 132.4%
Minority interests 1.7 1.7 0.6%
Attributable net profit (165.9) (70.4) 135.6%
ABOUT TERRA NETWORKS
Terra Networks is the world's leading provider of both ISP services to residential and small office
(SOHO) clients and content for the Spanish-and-Portuguese-speaking markets. Its ISP business has
approximately 2.7 million clients and hosts 1,032 million pages per month, while Terra portals receive
86 million log-ins per month.
On May 16, 2000, Terra announced the proposed acquisition of Lycos to create the first global internet
portal. This operation will allow the convergence of Lycos in services, contents and distribution with
operations in 37 countries.
Terra currently provides ISP services in Spain, Brazil, Mexico, Chile, Peru, Guatemala and the United
States and operates portals in Argentina, Venezuela, Uruguay, Costa Rica, El Salvador, Honduras,
Nicaragua and Panama. Recently Terra announced the acquisition of the "La Ciudad" portal to lead the
internet market in Colombia.
Terra is developing on-line advertising, marketing, e-commerce and other related initiatives in all of its
markets. The company also combines a wide range of international content with other content of a
largely local nature to reflect the individual communities of its users as well as their everyday interests
and concerns.
SOURCE Terra Networks, S.A.
/CONTACT: Terra Networks, S.A., Press Office, +34-91-452-30-47, or
+34-91-452-31-46, or comunicacion@corp.terra.com/ |
