CMGI Presents Financial Guidance for Third and Fourth Quarters of
Fiscal 2001
ANDOVER, Mass.--(BUSINESS WIRE)--March 13, 2001--In conjunction with its operating results for the second fiscal quarter ended January 31, 2001 (see
separate release), CMGI, Inc. (Nasdaq: CMGI - news), a leading Internet operating and development company, today announced its projected financial results for
the third and fourth quarters of its 2001 fiscal year (ending July 31, 2001).
The guidance detailed below will also be reviewed on the Company's Q2 operating results conference call and webcast, to be held today at 5 PM EST. For
additional information and/or to participate in the webcast, visit the CMGI web site at: cmgi.com.
Financial Guidance for Q3 and Q4 Fiscal 2001
Note: Some of the following estimates do not include goodwill amortization and impairment charges.
Consolidated CMGI
Consolidated Revenue is expected to be $280 to $290 million in Q3, growing modestly at between 3% and 5% for Q4. The expected third quarter decline
primarily reflects the sale of Signatures Network as well as continued softness in Internet-based advertising revenue.
Consolidated Gross Profit Margin is projected to be between 5% and 7% in Q3, and 8% to 10% in Q4.
Consolidated Operating Loss Exclusive of Amortization Charges is projected to be $236 to $246 million in Q3, and $174 to $184 million in Q4.
Restructuring charges are expected to be between $48 and $52 million in Q3, and $42 to $46 million in Q4.
Estimated weighted average shares outstanding for the third fiscal quarter are projected to be approximately 344 million.
Projected funding for @Ventures is expected to be approximately $15 million per quarter for both new and follow-on investments.
Search & Portals
Segment Revenue is expected to be $33 to $35 million in Q3, growing modestly at 2% to 4% in Q4. The expected decline in the third quarter primarily
reflects continued softness in Internet-based advertising revenue.
Gross Profit Margin of 48% to 50% is projected in Q3, with continued improvement expected in Q4.
Operating Loss Exclusive of Amortization Charges is projected to be $45 to $47 million in Q3, and $28 to $30 million in Q4.
Restructuring charges are expected to be between $17 and $19 million in Q3, and $4 to $6 million in Q4.
Infrastructure and Enabling Technologies
Segment Revenue is expected to be $27 to $29 million in Q3, with projected growth of approximately 10% to 12% in Q4. The expected decline in the third
quarter primarily reflects continued softness in dot.com revenues as the Infrastructure companies transition to a more stable enterprise customer base.
Gross Margin is expected to remain negative in Q3 and Q4, between $32 to $34 million and $18 to $20 million respectively.
Operating Loss Exclusive of Amortization Charges is projected to be $118 to $120 million in Q3, and $90 to $92 million in Q4.
Restructuring charges are expected to be between $31 and $33 million in Q3, and $38 to $40 million in Q4.
Internet Professional Services
Segment Revenue is expected to be $24 to $26 million in Q3, growing modestly at 3% to 5% in Q4. The expected decline in the third quarter primarily
reflects general industry softness in the services sector.
Gross Profit Margin is expected to be in the range of 26% to 28% in Q3, increasing to 30% to 32% for Q4.
Operating Loss Exclusive of Amortization Charges is projected to be $1 to $3 million in both Q3 and Q4.
Interactive Marketing
Segment Revenue is expected to be $26 to $28 million in Q3, growing in excess of 15% in Q4. The expected decline in the third quarter primarily reflects the
continued softness in Internet-based advertising revenue; Q4 revenue growth is projected as a result of expected increases from enterprise sales.
Gross Profit Margin is projected to be 25% to 27% in Q3, improving to between 32% and 34% in Q4.
Operating Loss Exclusive of Amortization Charges is projected to be $42 to $44 million in Q3 and $28 to $30 million in Q4.
eBusiness & Fulfillment
Segment Revenue is expected to be $170 to $172 million in Q3 and is forecast to grow modestly at 1% to 3% in Q4. The expected decline in third quarter
primarily reflects the sale of Signatures Network.
Gross Profit Margin is projected to remain stable at 10% in both Q3 and Q4.
Operating Loss Exclusive of Amortization Charges is projected to be $5 to $7 million in Q3 and $2 to $4 million in Q4.
About CMGI and CMGI @Ventures
CMGI, Inc. (Nasdaq: CMGI - news), a leading global Internet operating and development company, represents a network of more than 60 established and
emerging companies, including both CMGI operating businesses and synergistic investments made through its venture capital affiliate, CMGI @Ventures. Companies
in the CMGI network span a range of vertical market segments including search and portals; infrastructure and enabling technologies; e-business and fulfillment;
interactive marketing; and Internet professional services. CMGI leverages the technologies, content and market reach of its extended network to foster rapid growth
and industry leadership across the Internet Economy. Compaq, Microsoft, Pacific Century CyberWorks and Sumitomo hold minority positions in CMGI.
CMGI's majority-owned operating companies include Engage (Nasdaq: ENGA - news), NaviSite (Nasdaq: NAVI - news), Activate, AltaVista, CMGion,
Equilibrium, MyWay.com, NaviPath, SalesLink, Tallan, uBid and yesmail.com. CMGI @Ventures has ownership interests in 50 companies, with a focus on
identifying, investing in and developing emerging technology companies and eBusinesses.
CMGI's corporate headquarters is located at 100 Brickstone Square, Andover, MA 01810. CMGI @Ventures has offices there, as well as at 3000 Alpine Road,
Menlo Park, CA 94028. For additional information, see cmgi.com and ventures.com.
This release contains forward-looking statements which address a variety of subjects including, for example, the expected growth and expansion of CMGI's business
and operations, the expected financial results of CMGI and its segments and operating companies, the expected benefits resulting from CMGI's segmentation
structure and restructuring efforts, the expected funding levels of @Ventures, the expected decrease in cash burn rate, and expected market conditions. All
statements other than statements of historical fact, including without limitation, those with respect to CMGI's beliefs, projections, goals, plans and strategies set forth
herein are forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those
described in these forward-looking statements: CMGI's success is dependent upon its ability to integrate its operating companies in accordance with its segment
strategy; CMGI's success, including its ability to decrease its cash burn rate, improve its cash position and reach profitability, depends on its ability to execute on its
business strategy and the continued and increased demand for and market acceptance of CMGI's and its operating companies' web sites and the Internet in general;
CMGI may experience difficulties integrating technologies, operations and personnel of recent acquisitions; and increased competition and technological changes in
the markets in which CMGI competes. For a detailed discussion of cautionary statements that may affect CMGI's future results of operations and financial results,
please refer to CMGI's filings with the Securities and Exchange Commission, including CMGI's most recent Quarterly Report on Form 10-Q.
Contact:
CMGI, Inc.
Andrew J. Hajducky III
EVP and Chief Financial Officer
(978) 684-3660
ahajducky@cmgi.com
or
Catherine Taylor
CMGI Investor Relations
(978) 684-3540
ctaylor@cmgi.com
or
Deidre Moore
CMGI Public Relations
(978) 684-3655
dmoore@cmgi.com |
