So this beaut doesn't go away.. 2nd Qtr PRO-FORMA Results...
INSP : INFOSPACE INC (NASDAQ)
All Headlines
InfoSpace Reports 2nd Quarter Financial
Results
siliconinvestor.com
BELLEVUE, Wash., Jul 24, 2001 (BUSINESS WIRE) --
InfoSpace returns to pro-forma profitability of $0.01 as revenues grow to $51 million;
Wireless and merchant services continue to drive future growth, as registered wireless subscribers surpass 3 million mark, and total dollars processed increase to more than $600 million in the second quarter
InfoSpace, Inc. (Nasdaq: INSP chart, msgs), a leading provider of the platform and applications that enable partners to deliver consumer and commerce services across the Internet to any device over current and next-generation networks, today announced that second quarter revenues grew to $50.9 million with a pro-forma profit of $0.01. This is compared to revenues of $46.6 and a pro-forma loss of $0.02 per share reported in the previous quarter.
Key financial and operating metrics:
-- InfoSpace returned to pro-forma profitability, posting a $0.01 pro-forma profit.
-- Balance sheet remains strong with cash, investments and a payroll tax receivable of $446 million and no debt.
-- Registered wireless subscribers continue to show solid growth as numbers increased to more than 3 million, up from more than 2 million reported last quarter.
-- InfoSpace's merchant services processed more than $600 million in transactions, up from $500 million reported last quarter. Number of transactions processed grew to more than 8 million, up from 7 million reported last quarter.
-- Wireless and Merchant Services continue to offer the greatest growth potential and together are expected to represent more than 50% of revenues by the end of the year.
-- New growth opportunities continue in wireless, especially with SMS, the roll out of GPRS/2.5G networks, voice and mobile payments, and in merchant with payment authorization.
"We believe that our return to pro-forma profitability this quarter reconfirms the strength of our business model. Wireless and merchant continue to offer the greatest potential for growth. We expect that together they will represent more than 50% of our revenues by the end of the year," said Naveen Jain, chairman and CEO of InfoSpace, Inc. "InfoSpace is well positioned for the future, but like many other leading companies, we are confronted with many of the issues associated with today's challenging economic climate. We believe that because of our leadership position in the marketplace, company focus and business fundamentals, we are in a strong position to capitalize on our business objectives for the long term."
Wireless
InfoSpace's Wireless Services business continues to show solid
potential for growth. By the end of the second quarter, more than 3
million wireless subscribers registered for services powered by
InfoSpace's platform and applications. This number represents the
demand for wireless data services across leading wireless carrier
partners, including Verizon, Cingular and AT&T Wireless.
New subscriber growth, coupled with up selling new features and
functionality to current partners, led InfoSpace's Wireless Services
growth.
InfoSpace has again exceeded its projections for registered
wireless subscribers and believes that the next step in the
evolutionary path for wireless data services is the rollout of GPRS
(General Packet Radio Service) or 2.5G networks, which will improve
network capacity, screen capabilities and the user experience through
an "always on" connection, and rich interfaces and services. Last
week, InfoSpace partner AT&T became the first wireless operator in the
U.S. to rollout GPRS capabilities. InfoSpace partners, Cingular and
VoiceStream, have also announced intentions to roll out GPRS networks
by the end of 2001.
InfoSpace signed agreements to work with PacketVideo, ActiveSky
and SolidStreaming to bring rich services that take advantage of the
faster connection speeds and increased functionality that GPRS/2.5G
networks are expected to bring to wireless devices.
In late May, InfoSpace announced one of its largest wireless
initiatives - the Company's ability and position to enable
phone-to-phone SMS messaging interoperability amongst carriers in
North America. Two-way SMS services have been highly successful in
Europe, as many carriers there derive significant percentages of their
wireless data services revenues from the delivery of SMS services.
Because of InfoSpace's existing connectivity into the networks of
leading wireless carriers in the U.S., and the ability to power
two-way SMS services, the Company believes it is in a strong position
to make SMS messaging and SMS interactive services a reality in the
Americas.
In Europe, InfoSpace was one of the first companies to realize the
full potential of SMS and was a pioneer in rolling out its platform of
two-way SMS interactive services there. Today we power two-way SMS
services for a long list of carrier partners overseas, including
Virgin Mobile, Vodafone Australia, KPN, Libertel, Dutchtone, Telfort,
BEN and diAx, as well as one-way SMS services for most carriers in the
U.S.
Demonstrating strong momentum for the Company's SMS platform,
InfoSpace announced this morning that Orange subsidiary, Dutchtone,
had selected the InfoSpace SMS platform for the roll out of enhanced
two-way SMS interactive services to their subscribers.
InfoSpace continues to extend its wireless platform and
applications in new ways beyond the traditional wireless carrier
market. InfoSpace recently announced that Charles Schwab selected
InfoSpace to power an array of enhanced services on the Schwab
PocketBroker(sm) wireless investing service. This relationship
demonstrates InfoSpace's efforts to extend its platform and
applications to new types of customers.
InfoSpace's Wireless Services continue to earn praise and
recognition. In Australia, the location-based services InfoSpace
powers for Vodafone won a coveted Innovation Award from Managing
Information Strategies Magazine, a leading information technology
publication in Australia. The magazine describes the service as, the
first WAP application in Australia, one of the first in the world, to
automatically deliver services based on a user's geographical
location, and as one of Vodafone Australia's most popular WAP
services. InfoSpace's relationship with Vodafone Australia dates back
to April of last year when InfoSpace announced that it would provide
the platform and applications for Vodafone Australia's wireless
Internet
Total operating
expenses 42,135 38,542 88,660 63,937
Income (loss) from
operations (1,805) 3,862 (13,485) 11,157
Other income, net 4,580 7,123 10,563 14,707
Income tax expense 137 6 187 24
--------------------------------------------
Pro forma income (loss) $2,638 $10,979 $(3,109) $25,840
============================================
Pro forma basic earnings
(loss) per share $0.01 $0.04 $(0.01) $0.09
Pro forma diluted earnings
(loss) per share $0.01 $0.03 $(0.01) $0.07
Shares used in computing
pro forma basic earnings
(loss) per share 325,027 303,992 324,167 296,726
Shares used in computing
pro forma diluted
earnings (loss) per share 342,249 358,195 324,167 355,461
(1) Pro forma results exclude non-cash charges, non-recurring charges and items unrelated to the Company's core operations. This financial statement excludes amortization of intangibles, acquisition-related expenses, restructuring and other non-recurring charges, losses on investments and cumulative effect of change in accounting principle, which are summarized in the following table. This financial statement also excludes employer payroll taxes assessed on stock option gains realized by employees from non-qualified stock option exercises which are recorded in cost of revenue, product development and sales, general and administrative expenses. They do not purport to be financial statements prepared in accordance with accounting principles generally accepted in the United States (GAAP). The following table reconciles the pro forma net income (loss) in accordance with GAAP for the periods presented.
InfoSpace, Inc.
Reconciliation of Pro Forma Net Income (Loss)
(unaudited)
(Amounts in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
2001 2000 2001 2000
Pro forma net income (loss) $2,638 $10,979 $(3,109) $25,840
Employer payroll taxes on
stock option exercises (16) (1,819) (300) (6,404)
Amortization of
intangibles (59,107) (40,636) (123,004) (68,646)
Acquisition and related
charges (111) (202) (1,000) (86,599)
Other non-recurring and
restructuring charges (226) (2,171) (2,999) (5,059)
Gain (loss) on investments,
net of minority interest (14,099) (5,002) (61,715) 8,753
Cumulative effect of change
in accounting principle -- -- (3,171) (2,055)
-------------------------------------------
Net loss $(70,921) $(38,851) $(195,298) $(134,170)
===========================================
InfoSpace, Inc.
Consolidated Statements of Operations
(unaudited)
(Amounts in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
2001 2000 2001 2000
Revenues $50,942 $50,486 97,507 89,264
Cost of revenues 10,614 8,109 22,335 14,243
------------------------------------------
Gross Profit 40,328 42,377 75,172 75,021
Operating expenses:
Product development 10,569 9,507 22,356 16,458
Sales, general and
administrative 31,580 30,827 66,601 53,810
Amortization of intangibles 59,107 40,636 123,004 68,646
Acquisition and related
charges 111 202 1,000 86,599
Other non-recurring and
restructuring charges 226 2,171 2,999 5,059
------------------------------------------
Total operating expenses 101,593 83,343 215,960 230,572
Loss from operations (61,265) (40,966) (140,788) (155,551)
Gain (loss) on investments (14,099) (8,447) (61,715) 15,151
Other income, net 4,580 7,123 10,563 14,707
------------------------------------------
Loss before income tax
expense, minority interest
and cumulative effect of
change in accounting
principle (70,784) (42,290) (191,940) (125,693)
Minority interest -- (3,445) -- 6,398
Income tax expense 137 6 187 24
------------------------------------------
Loss before cumulative
effect of change in
accounting principle (70,921) (38,851) (192,127) (132,115)
Cumulative effect of change
in accounting principle -- -- (3,171) (2,055)
------------------------------------------
Net loss $(70,921) $(38,851) $(195,298) (134,170)
==========================================
Basic loss per share $(0.22) $(0.13) $(0.60) (0.45)
Shares used in computing
basic net loss per share 325,027 303,992 324,167 296,727
InfoSpace, Inc.
Condensed Consolidated Balance Sheets
(in 000's)
June 30, December 31,
2001 2000
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $182,295 $153,913
Short-term investments 85,866 216,235
Accounts receivable, net 17,414 33,881
Payroll tax receivable 13,214 620
Notes and other receivables, net 21,804 21,701
Prepaid expenses and other current assets 14,582 14,491
--------------------------
Total current assets 335,175 440,841
Property and equipment, net 52,946 51,137
Long-term investments 75,445 32,451
Other investments 88,949 121,574
Intangibles, net 615,501 621,032
Other long-term assets 3,300 5,075
--------------------------
Total assets $1,171,316 $1,272,110
==========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $5,891 $4,5371
Accrued expenses and other current
liabilities 35,103 37,999
Deferred revenue 20,226 31,430
--------------------------
Total current liabilities 61,220 73,966
Long-term liabilities and minority interest:
Long-term deferred revenue 3,477 7,974
Minority interest -- 21,599
--------------------------
Total liabilities 64,697 103,539
Stockholders' equity:
Common stock 33 32
Additional paid-in capital 1,717,399 1,596,213
Accumulated deficit (603,945) (408,647)
Deferred expense - warrants (1,088) (1,495)
Unearned compensation - stock options (1,710) (1,500)
Accumulated other comprehensive loss (4,070) (16,032)
--------------------------
Total stockholders' equity 1,106,619 1,168,571
--------------------------
Total liabilities and stockholders' equity $1,171,316 $1,272,110
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