2007 Press
JUPITERMEDIA CORPORATION REPORTS RESULTS FOR ITS THIRD QUARTER ENDED SEPTEMBER 30, 2007
(New York, NY - November 8, 2007) - Jupitermedia Corporation (Nasdaq: JUPM) today reported results for the quarter ended September 30, 2007.Highlights for the third quarter of 2007 include:
- Revenues for the third quarter of 2007 were $34.8 million compared to revenues of $33.8 million for the same period last year. Revenues from Online Images increased from $26.2 million to $26.8 million, while revenues from Online Media increased from $7.6 million to $7.9 million.
- Loss per diluted share from continuing operations was $0.01 and included non-cash stock-based compensation expense, debt issuance costs that were expensed related to the previous credit facility that was repaid with proceeds from the new credit facility arranged by KeyBanc Capital Markets in July 2007 and expenses related to canceled events, which totaled $0.03 per diluted share.
- Deferred revenues increased from $14.3 million at June 30, 2007 to $16.1 million at September 30, 2007 due to the acquisition of Mediabistro and the increase in bookings for our JupiterimagesUnlimited high level subscription offering.
"Our Jupiterimages division showed strength in the third quarter and for the first nine months of 2007. Our Rights Managed category experienced approximately 30% revenue growth for the first nine months of this year compared to the same period of 2006. In addition, revenues from our JupiterimagesUnlimited high level royalty-free subscription offering grew over 300% for the first nine months of 2007 compared to the same period last year. Our backlog for JupiterimagesUnlimited increased sharply during the third quarter which bodes well for revenues in future quarters. Due to the evolution taking place in the stock photo industry, we are currently focusing our direct sales team to further emphasize our strengths: sales of Rights Managed images and our subscription products, including JupiterimagesUnlimited. In the third quarter we initiated a rigorous review of our operating expenses that we expect will result in annual expense reductions of $2.0-$3.0 million on a prospective basis. Additionally, we have identified opportunities to streamline various capital projects and content production that we expect will result in a reduction of over $3.0 million in annual cash expenditures. Combined, this restructuring is expected to improve our annual after-tax cash flows by approximately $4.0 million and possibly more," stated Jupitermedia's Chairman and CEO Alan M. Meckler.
"During the third quarter we continued to make investments in our JupiterOnlineMedia division, including our acquisition of Mediabistro in July. Mediabistro, which has a loyal following of media and creative professionals, provides our JupiterOnlineMedia division with new and growing revenue streams through its vertical online job board and its training courses which are offered both online and in-person. We believe that Mediabistro will benefit from the vast traffic generated from our Online Media and Jupiterimages properties. Furthermore, Mediabistro has a wide variety of original content and blogs which will augment our 150 original content sites, and Mediabistro's events mesh nicely with Jupitermedia's trade show and Webcast operations," added Meckler.
Jupitermedia Corporation 3rd Quarter 2007 Financial Results Conference Call Alert
Jupitermedia Corporation invites you to participate in its conference call reviewing 2007 third quarter results on Friday, November 9, 2007 at 11:00 am EST.
The conference call number is (888) 737-3616 for domestic participants and (913) 981-5542 for international participants; confirmation code "491 4712." Please call five minutes in advance to ensure that you are connected prior to the presentation. The conference call replay will be available until Friday, November 23, 2007. Replay call numbers are (888) 203-1112 for domestic participants and (719) 457-0820 for international participants: confirmation code: "491 4712."
Credit Facility
In July 2007, Jupitermedia announced that it had closed a $115 million senior credit facility arranged by KeyBanc Capital Markets. Jupitermedia has initially borrowed $88 million under this credit facility to repay indebtedness under a previous credit facility with JPMorgan Securities and to fund the acquisition of Mediabistro.com Inc. in July 2007.
Acquisitions
In July 2007, Jupitermedia announced that it had acquired all of the shares of Mediabistro.com Inc. (www.mediabistro.com), the career and community site for media and creative professionals, for $20.0 million in cash and a two year earn-out that could result in an additional $3.0 million in cash consideration. Funding for this acquisition was secured through the recently announced closing of a $115 million senior credit facility arranged by KeyBanc Capital Markets.
New Online Images Offerings
Jupitermedia continued to expand and strengthen its world-class proprietary Jupiterimages offerings with the addition of the following:
In September 2007, Jupitermedia announced that it had entered into an agreement with Broderbund Software (a division of Riverdeep) to offer ClickArt Online (clickart.broderbund.com/en/index), a subscription service offering one million images from Jupiterimages' (www.jupiterimages.com) to Broderbund's database of registered users. Broderbund offers this subscription via their Web store.
In September 2007 Jupitermedia announced that its offering of a new channel of distribution to its Stockxpert (www.stockxpert.com) community with an on-ramp program to submit images to Jupiterimages. Jupiterimages now accepts image submissions from the 'Xpert' community to be sold under the Dynamic Graphics brand on its Web site and through its worldwide network of agents.
In October 2007, Jupitermedia announced Stockxpert.com's (www.stockxpert.com) subscription service which provides access to its library of user-contributed microstock images. Subscriptions are available for one month, three months and one year, and allow subscribers to download up to 25 images per day at resolutions up to 50MB. The Stockxpert.com subscription service was launched to serve the needs of high volume microstock image buyers. Stockxpert.com now enables image buyers to purchase the images they need for their creative projects either by single image download or by subscription from its ever-growing library.
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Jupitermedia Corporation Unaudited Consolidated Condensed Statements of Operations For the Three Months and Nine Months Ended September 30, 2006 and 2007 (in thousands, except per share amounts) |
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2006 | 2007 | 2006 | 2007 | ||||||
| Revenues | $ | 33,784 | $ | 34,766 | $ | 102,751 | $ | 104,206 | |
| Cost of revenues (exclusive of items shown separately below) | 12,115 | 14,524 | 36,752 | 43,825 | |||||
| Advertising, promotion and selling | 7,120 | 7,168 | 22,161 | 21,534 | |||||
| General and administrative | 7,259 | 6,511 | 20,626 | 21,221 | |||||
| Depreciation | 996 | 1,128 | 2,498 | 3,353 | |||||
| Amortization | 2,637 | 3,381 | 7,003 | 9,669 | |||||
| Total operating expenses | 30,127 | 32,712 | 89,040 | 99,602 | |||||
| Operating income | 3,657 | 2,054 | 13,711 | 4,604 | |||||
| Income (loss) on investments and other, net | (79) | 15 | 58 | (34) | |||||
| Interest income | 99 | 62 | 380 | 140 | |||||
| Interest expense | (1,395) | (2,328) | (4,107) | (5,232) | |||||
| Income before income taxes, minority interests and equity income from investments, net | 2,282 | (197) | 10,042 | (522) | |||||
| Provision (benefit) for income taxes | 1,326 | 307 | 3,129 | 325 | |||||
| Minority interests | (32) | (30) | (67) | (109) | |||||
| Equity income from investments, net | — | 86 | - | 136 | - | ||||
| Income from continuing operations | 1,010 | (534) | 6,982 | (956) | |||||
| Income from discontinued operations, net of taxes | - | — | 67 | - | |||||
| Gain on sale of discontinued operations, net of taxes | - | - | — | 5,573 | - | ||||
| Net income (loss) | $ | 1,010 | $ | (534) | $ | 12,622 | $ | (956) | |
| Earnings per share: | |||||||||
| Basic | |||||||||
| Income (loss) from continuing operations | $ | 0.03 | $ | (0.01) | $ | 0.20 | $ | (0.03) | |
| Net (loss) income | $ | 0.03 | $ | (0.01) | $ | 0.36 | $ | (0.03) | |
| Diluted | |||||||||
| Income (loss) from continuing operations | $ | 0.03 | $ | (0.01) | $ | 0.19 | $ | (0.03) | |
| Net income (loss) | $ | 0.03 | $ | (0.01) | $ | 0.35 | $ | (0.03) | |
| Shares used in computing earnings (loss) per share: | |||||||||
| Basic | 35,517 | 35,990 | 35,322 | 35,921 | |||||
| Diluted | 35,777 | 35,990 | 36,109 | 35,921 | |||||
Segment Information
The following tables summarize the results of the segments of Jupitermedia for the three and nine months ended September 30, 2006 and 2007. Online images consists of the Jupiterimages business that includes: BananaStock, Workbook Stock, Brand X Pictures, FoodPix, Botanica, Nonstock, The Beauty Archive, IFA Bilderteam, Comstock Images, Creatas Images, PictureQuest, Liquid Library, Thinkstock Images, Thinkstock Footage, Bigshot Media, Goodshoot, Polka Dot Images, Stock Image, Pixland, Photos.com, Ablestock.com, PhotoObjects.net, Clipart.com, JupiterGreetings.com, AnimationFactory.com, RoyaltyFreeMusic.com, StudioCutz.com and Stockxpert.com. Online media includes the internet.com, EarthWeb.com, DevX.com, Mediabistro.com and Graphics.com Networks. Other includes corporate overhead, depreciation and amortization.
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2006 | 2007 | 2006 | 2007 | ||||||
| Revenues: | |||||||||
| Online images | $ | 26,177 | $ | 26,824 | $ | 79,549 | $ | 82,121 | |
| Online media | 7,607 | 7,942 | 23,196 | 22,085 | |||||
| Other | — | — | 6 | — | |||||
| 33,784 | 34,766 | 102,751 | 104,206 | ||||||
| Cost of revenues and operating expenses:(A) | |||||||||
| Online images | 16,975 | 17,992 | 50,944 | 55,445 | |||||
| Online media | 4,616 | 6,390 | 15,254 | 16,795 | |||||
| Depreciation and amortization | 3,633 | 4,509 | 9,501 | 13,022 | |||||
| Other (C) | 4,903 | 3,821 | 13,341 | 14,340 | |||||
| 30,127 | 32,712 | 89,040 | 99,602 | ||||||
| Operating income (loss): | |||||||||
| Online images | 9,202 | 8,832 | 28,605 | 26,676 | |||||
| Online media | 2,991 | 1,552 | 7,942 | 5,290 | |||||
| Other (B) (C) | (8,536) | (8,330) | (22,836) | (27,362) | |||||
| $ | 3,657 | $ | 2,054 | $ | 13,711 | $ | 4,604 | ||
(A) Cost of revenues and operating expenses include non-cash, stock-based compensation expense of $1.2 million and $2.9 million, respectively, for the three and nine months ended September 30, 2006, and $652,000 and $2.4 million, respectively, for the three and nine months ended September 30, 2007.
(B) Includes depreciation and amortization expense.
(C) The nine months ended September 30, 2007 include $1.9 million in legal and other fees associated with discussions with Getty Images, Inc. regarding a potential transaction which were terminated on March 7, 2007.
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Jupitermedia Corporation Unaudited Consolidated Condensed Balance Sheets December 31, 2006 and September 30, 2007 (in thousands, except share and per share amounts) |
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December 31, 2006 |
September 30,
2007 |
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| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | $ | 8,891 | $ | 7,433 | |
| Accounts receivable, net of allowances of $2,114 and $2,211, respectively | 25,296 | 27,176 | |||
| Prepaid expenses and other | 2,601 | 7,096 | |||
| Deferred income taxes | 3,350 | 3,304 | |||
| Total current assets | 40,138 | 45,009 | |||
| Property and equipment, net of accumulated depreciation of $13,996 and $17,051, respectively | 11,691 | 12,586 | |||
| Intangible assets, net | 77,923 | 73,681 | |||
| Goodwill | 199,010 | 229,379 | |||
| Deferred income taxes | 2,147 | 2,016 | |||
| Investments and other assets | 1,281 | 2,440 | |||
| Total assets | $ | 332,190 | $ | 365,111 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | $ | 5,269 | $ | 7,563 | |
| Accrued payroll and related expenses | 3,188 | 3,791 | |||
| Accrued expenses and other | 14,469 | 11,591 | |||
| Current portion of long-term debt | 16,000 | 750 | |||
| Deferred revenues | 13,362 | 15,657 | |||
| Total current liabilities | 52,288 | 39,352 | |||
| Long-term debt | 49,899 | 87,063 | |||
| Deferred revenues | 181 | 456 | |||
| Other long-term liabilities | - | 1,852 | |||
| Total liabilities | 102,368 | 128,723 | |||
| Commitments and contingencies | |||||
| Stockholders’ equity: | |||||
| Preferred stock, $.01 par value, 4,000,000 shares authorized, no shares issued | — | — | |||
| Common stock, $.01 par value, 75,000,000 shares authorized, 35,713,327 and 36,001,732 shares issued respectively | 357 | 360 | |||
| Additional paid-in capital | 261,666 | 265,873 | |||
| Accumulated deficit | (33,888) | (34,844) | |||
| Treasury stock, 65,000 shares at cost | (106) | (106) | |||
| Accumulated other comprehensive income | 1,793 | 5,105 | |||
| Total stockholders’ equity | 229,822 | 236,388 | |||
| Total liabilities and stockholders’ equity | $ | 332,190 | $ | 365,111 | |
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Jupitermedia Corporation Unaudited Consolidated Condensed Statements of Cash Flows For the Nine Months Ended September 30, 2006 and 2007 (in thousands) |
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Nine Months Ended
September 30, |
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| 2006 | 2007 | |||
| Cash flows from operating activities: | ||||
| Income (loss) from continuing operations | $ | 6,982 | $ | (956) |
| Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities: | ||||
| Depreciation and amortization | 9,501 | 13,022 | ||
| Stock-based compensation | 2,894 | 2,363 | ||
| Provision for losses on accounts receivable | 361 | 62 | ||
| Minority interests | 67 | 109 | ||
| Equity income from investments, net | (136) | - | ||
| (Income) loss on investments and other, net | (58) | 34 | ||
| Deferred income taxes | 1,885 | 288 | ||
| Excess tax benefit from stock-based compensation | (3,014) | (785) | ||
| Changes in current assets and liabilities (net of businesses acquired): | ||||
| Accounts receivable, net | (4,300) | (1,587) | ||
| Prepaid expenses and other | (2,189) | (3,781) | ||
| Accounts payable and accrued expenses and other | (9,078) | (197) | ||
| Deferred revenues | 1,423 | 1,563 | ||
| Discontinued operations | 1,110 | - | ||
| Net cash provided by operating activities | 5,448 | 10,135 | ||
| Cash flows from investing activities: | ||||
| Purchases of property and equipment | (2,302) | (4,003) | ||
| Acquisitions of businesses, images and other | (29,162) | (30,281) | ||
| Proceeds from sales of assets and other | 368 | 142 | ||
| Proceeds from sale of discontinued operations | 9,600 | - | ||
| Discontinued operations | — | — | ||
| Net cash used in investing activities | (21,496) | (34,142) | ||
| Cash flows from financing activities: | ||||
| Borrowings under credit facilities | 19,000 | 94,900 | ||
| Debt issuance costs | (38) | (1,537) | ||
| Repayment of borrowings under credit facilities | (16,965) | (722,986) | ||
| Proceeds from exercise of stock options | 2,647 | 1,115 | ||
| Excess tax benefit from stock-based compensation | 3,014 | 785 | ||
| Discontinued operations | — | — | ||
| Net cash provided by financing activities | 7,658 | 22,277 | ||
| Effects of exchange rates on cash and cash equivalents | 108 | 272 | ||
| Net decrease in cash and cash equivalents | (8,282) | (1,458) | ||
| Cash and cash equivalents, beginning of period | 18,546 | 8,891 | ||
| Cash and cash equivalents, end of period | $ | 10,264 | $ | 7,433 |
| Supplemental disclosures of cash flow: | ||||
| Cash paid for income taxes | $ | 7,818 | $ | 2,846 |
| Cash paid for interest | $ | 2,854 | $ | 4,988 |
Business Outlook
Jupitermedia's financial guidance is prepared in accordance with accounting principles generally accepted in the United States of America, except as noted below. Historical results below have been adjusted to conform to this presentation. The amounts below reflect the preliminary allocation of the purchase prices paid by Jupitermedia in connection with its recent acquisitions and are subject to change pending a final allocation of these amounts. The following forward-looking statements reflect Jupitermedia's expectations as of November 8, 2007. Due to potential changes in general economic conditions and the various other risk factors discussed below and in Jupitermedia's reports filed with the Securities and Exchange Commission from time to time, actual results may differ materially. Jupitermedia intends to continue its practice of not updating forward-looking statements until its next quarterly results announcement, other than in publicly available statements.
Future Expectations
| (In millions except for earnings per diluted share) |
Q4 2007 (A) |
| Revenues | $35.0-36.0 |
| Cost of revenues, advertising, promotion & selling, and general & administrative expenses | $27.5-28.5 |
| EBITDA (Earnings before interest, taxes, depreciation and amortization) | $7.3 |
| Depreciation and amortization | $4.6 |
| Interest expense, net | $1.8 |
| Provision for income taxes | $0.3 |
| Net income | $0.6 |
| Diluted share count | 36.1 |
| Earnings per diluted share | $0.02 |
Notes:
(A) This financial guidance does not include estimated non-cash stock-based compensation expense relating to employee stock options in the amount of $0.01 per share for Q4 2007.
About Jupitermedia Corporation
Jupitermedia Corporation (Nasdaq: JUPM), (www.jupitermedia.com),
headquartered in Darien, CT, is a leading global provider of images, news and original information, career Web sites and events for information technology, business, media and creative professionals. Jupitermedia includes Jupiterimages, one of the leading images companies in the world with over 7.0 million images online serving creative professionals with brands like BananaStock, Workbook Stock, Brand X Pictures, FoodPix, Botanica, Nonstock, The Beauty Archive, IFA Bilderteam, Comstock Images, Creatas Images, PictureQuest, Liquid Library, Thinkstock Images, Thinkstock Footage, Bigshot Media, Goodshoot, Polka Dot Images, Stock Image, Pixland, Photos.com, Ablestock.com, PhotoObjects.net, Clipart.com, JupiterGreetings.com, AnimationFactory.com, RoyaltyFreeMusic.com, StudioCutz.com and Stockxpert.com. The JupiterOnlineMedia division of Jupitermedia consists of five distinct online networks: internet.com and EarthWeb.com for IT and business professionals; DevX.com for developers; and Mediabistro.com and Graphics.com for media and creative professionals. These networks include more than 150 Web sites and over 150 e-mail newsletters that are viewed by over 20 million users and generate over 400 million page views monthly. JupiterOnlineMedia also includes specialized career Web sites for select professional communities which can be found on Mediabistro.com and JustTechJobs.com. In addition, JupiterOnlineMedia includes JupiterEvents and MediabistroÕs media-related events, which produce offline conferences and trade shows focused on IT and business-specific topics including ISPCON and Web Video Summit.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release which are not historical facts are "forward-looking statements" that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The potential risks and uncertainties address a variety of subjects including, for example, the competitive environment in which Jupitermedia competes; the unpredictability of Jupitermedia's future revenues, expenses, cash flows and stock price; Jupitermedia's ability to integrate acquired businesses, products and personnel into its existing businesses; Jupitermedia's ability to protect its intellectual property; and Jupitermedia's dependence on a limited number of advertisers. For a more detailed discussion of such risks and uncertainties, refer to Jupitermedia's reports filed with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934. The forward-looking statements included herein are made as of the date of this press release, and Jupitermedia assumes no obligation to update the forward-looking statements after the date hereof.
All current Jupitermedia Corporation press releases can be found on the World Wide Web at www.jupitermedia.com/corporate/press.html
CONTACT:
Michael DeMilt
VP of Marketing
Jupitermedia Corporation
203-662-2989
[email protected]
