Avenue A, Inc. Announces Q1 Financial Performance; Results Exceed Previously Announced Guidance.Business Editors/High-Tech Writers SEATTLE--(BUSINESS WIRE)--April 23, 2002 Board of Directors Authorizes Stock Buyback Stock buyback A corporation's purchase of its own outstanding stock, usually in order to raise the company's earnings per share. stock buyback See buyback. (Conference Call and Webcast at 11:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy Today) Avenue A, Inc. (Nasdaq:AVEA AVEA American Veterinary Exhibitors Association ), a digital marketing services and technology company, today announced first quarter 2002 financial results that exceeded previously announced guidance. For the first quarter ended March 31, 2002, Avenue A, Inc. reported revenues of $23.5 million, compared to revenues of $24.2 million for the first quarter of 2001. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net loss for the 2002 first quarter, which excludes the amortization of deferred stock compensation and the impact of a change in accounting principle associated with intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , was $1.8 million, or $0.03 per share. This compares to a pro forma net loss for the year-ago first quarter of $7.6 million, or $0.13 per share. Net loss in accordance with Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ), which includes the amortization of deferred stock compensation and the change in accounting principle, was $3.9 million in the first quarter of 2002, or $0.06 per share, versus a net loss of $13.5 million, or $0.24 per share, in the first quarter of 2001. Brian McAndrews, President and Chief Executive Officer of Avenue A Inc., stated, "We are pleased with the results of the first quarter. Client commitments remained firm, our Avenue A digital marketing agency is profitable, and our rollout of Atlas DMT's(TM) Digital Marketing Suite continues to receive very positive feedback from the marketplace. We have momentum going into the second quarter and believe we will continue to expand our revenue base." McAndrews added, "Recognition of the effectiveness of digital marketing continues to grow among traditional marketers. Our Avenue A interactive agency has added new clients. For Atlas DMT See DSL. , 24 advertising agencies, including such major players as TBWA/Chiat/Day and Tribal DDB Tribal DDB is a worldwide network of interactive agencies, established in 2000, when the advertising giant DDB integrated all its interactive-web properties under the Tribal brand. , have thus far chosen the Atlas Digital Marketing Suite, our fully-integrated campaign management system, to execute online campaigns." Avenue A, Inc. ended the first quarter with $113.6 million in cash and short-term investments. The Company also announced that its Board of Directors authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: the Company to establish a stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program, under which up to $15,000,000 of the Company's common stock could be repurchased from time to time with available funds. The primary purpose of the stock repurchase program is to allow the Company the flexibility to repurchase its common stock to potentially reduce stock dilution Stock dilution is a general term that results from the issue of additional common shares by a company. This increase in common shares of a stock can result from a secondary market offering, employees exercising stock options, or by conversion of convertible bonds, preferred shares and seek to improve its long-term earnings per share. Repurchases may be made in the open market or in privately negotiated transactions, subject to regulatory considerations, and may be discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: at any time. The number of shares of common stock actually acquired, if any, by the Company will depend on subsequent developments, corporate needs and market conditions. First Quarter 2002 Conference Call/Webcast Today Avenue A, Inc. will host a conference call/webcast to discuss Q1 financial results today at 11:00 a.m. EDT/8:00 a.m. PDT PDT abbr. Pacific Daylight Time PDT Pacific Daylight Time PDT n abbr (US) (= Pacific Daylight Time) → hora de verano del Pacífico PDT . The conference call will be webcast from the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Company's website at www.avenueainc.com, under "Calendar of Events." Interested parties should log on to the webcast approximately 15 minutes prior to download any necessary software. The webcast is not interactive. Any parties wishing to submit a question to management should e-mail it no later than 10:30 am EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT today to jpetra@schwartz.com. About Avenue A, Inc. Avenue A, Inc., a digital marketing services and technology company, was founded in 1997 to help marketers acquire, retain and grow customers across all digital media. Through its two operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon -- Avenue A, an interactive agency, and Atlas DMT, provider of advertising technology solutions -- Avenue A, Inc. is able to touch and bring value to any interaction in the digital marketplace. Both units are headquartered in Seattle and have offices in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . Atlas DMT also has an office in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden . Avenue A, Inc. and Avenue A/NYC adhere to adhere to verb 1. follow, keep, maintain, respect, observe, be true, fulfil, obey, heed, keep to, abide by, be loyal, mind, be constant, be faithful 2. the NAI See Network Associates. privacy principles that have been applauded by the FTC FTC See Federal Trade Commission (FTC). . These principles are designed to ensure Internet user Internet user n → internauta m/f Internet user Internet n → internaute m/f privacy. Please visit www.avenueainc.com to learn more. About Atlas DMT Atlas DMT is DMT I Diabetes Mellitus Type 1 an advertising technology provider and operating unit of Avenue A, Inc. Atlas DMT is the creator of Atlas Digital Marketing Suite 2.0, the industry's first complete digital marketing management system built by and for marketers. The Atlas Suite helps advertising agencies and other marketing professionals deliver efficient, profitable digital marketing programs. The end-to-end system manages online media planning, buying, ad serving, analysis and optimization optimization Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics. . Atlas DMT serves its clients from offices in Seattle and New York. To learn more, please visit www.atlasdmt.com. About Avenue A Avenue A is an interactive marketing agency and operating unit of Avenue A, Inc. It offers a one-stop solution that seeks to drive breakthrough results for its clients' web and e-mail marketing Email marketing is a form of direct marketing which uses electronic mail as a means of communicating commercial or fundraising messages to an audience. In its broadest sense, every email sent to a potential or current customer could be considered email marketing. initiatives by using innovative technology and rigorous analytical methods that turn campaign data into actionable Giving sufficient legal grounds for a lawsuit; giving rise to a Cause of Action. An act, event, or occurrence is said to be actionable when there are legal grounds for basing a lawsuit on it. insights. Avenue A's integrated suite of services includes web advertising, affiliate programs, search engine optimization Designing a Web site so that search engines easily find the pages and index them. The goal is to have your page be in the top 10 results of a search. Optimization includes the choice of words used in the text paragraphs and the placement of those words on the page, both visible and hidden , strategic portal relationships, e-mail prospecting, e-mail list management, customer targeting, profiling and advanced analytical services. Avenue A focuses on achieving the best possible results and the highest possible return on investment for its clients' digital marketing efforts. Clients include Microsoft, AT&T Wireless, and Best Buy. Please visit www.avenuea.com to learn more. Certain statements in this press release are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements include all passages containing verbs such as 'aims, anticipates, believes, estimates, expects, intends, plans, predicts, projects or targets' or nouns corresponding to such verbs. Forward-looking statements also include any other passages that are primarily relevant to expected future events or that can only be evaluated by events that will occur in the future. The forward-looking statements in this release include, among others, statements about future expansion of the Company's revenue base, the growth potential of digital marketing and seeking to improve earnings per share through the Company's repurchase of its shares. Forward-looking statements are based on the opinions and estimates of the management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. These risks and uncertainties include, among others, the risk of fluctuating fluc·tu·ate v. fluc·tu·at·ed, fluc·tu·at·ing, fluc·tu·ates v.intr. 1. To vary irregularly. See Synonyms at swing. 2. To rise and fall in or as if in waves; undulate. v. or declining demand for our advertising services, the risk of erosion in service pricing, potential failure to attract sufficient new business to Atlas DMT to materially and positively impact financial results, the potential failure to attract new clients, to maintain current, desired client relationships or to achieve effective advertising campaigns for existing clients, potential deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. or slower-than-expected development of the Internet advertising Delivering ads to Internet users via Web sites, e-mail, ad-supported software and Internet-enabled cellphones. Also called an "ad network," Internet advertising organizations act as a middleman between the advertiser and the Web sites and software publishers that display the ads. market, the potential need for additional funds to finance operations The execution of the joint finance mission to provide financial advice and guidance, support of the procurement process, providing pay support, and providing disbursing support.See also financial management. , the need to generate significant additional revenue to achieve profitability, quarterly and seasonal fluctuations in operating results, timing variations on the part of advertisers to implement advertising campaigns, costs related to any possible future acquisitions of technologies or businesses, the short term nature of Avenue A, Inc's contracts with clients which are cancelable on 90 days' or less notice, the uncertainties, potential costs, and possible business impacts of unfavorable rulings in the previously-announced class action lawsuits class action lawsuit A lawsuit in which one party or a limited number of parties sue on behalf of a larger group to which the parties belong. For example, investors may bring a class action lawsuit against a brokerage firm that has actively promoted a tax , and potential failure to repurchase the Company's shares, or the repurchase of an insignificant number of the Company's shares resulting in no impact or only an immaterial Not essential or necessary; not important or pertinent; not decisive; of no substantial consequence; without weight; of no material significance. immaterial adj. impact on dilution or earnings per share. More information about factors that potentially could affect Avenue A, Inc.'s financial results is included in Avenue A, Inc.'s Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 2001 filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance upon these forward-looking statements that speak only as to the date of this release. Except as required by law, Avenue A, Inc. undertakes no obligation to update any forward-looking or other statements in this press release, whether as a result of new information, future events or otherwise.
Avenue A, Inc.
Consolidated Balance Sheets
(in thousands)
March 31, 2002 December 31, 2001
------------------ -------------------
Assets (unaudited)
Current assets:
Cash, cash equivalents, and
short-term investments $ 113,641 $ 117,754
Accounts receivable, net of
allowance 14,408 16,127
Other receivable 998 1,369
Prepaid expenses and other
current assets 991 242
------------------ -------------------
Total current assets 130,038 135,492
Property and equipment, net 5,576 6,664
Intangible assets, net - 1,330
Other assets 1,069 1,325
------------------ -------------------
Total assets $ 136,683 $ 144,811
================== ===================
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and
accrued expenses $ 21,353 $ 25,448
Notes payable, current portion 2,000 2,000
Deferred revenue 459 488
------------------ -------------------
Total current liabilities 23,812 27,936
------------------ -------------------
Long-term notes payable 1,056 1,555
------------------ -------------------
Total liabilities 24,868 29,491
------------------ -------------------
Shareholders' equity:
Common stock 585 584
Paid-in capital 216,934 216,884
Deferred stock compensation (3,212) (4,063)
Subscription receivable (481) (548)
Accumulated deficit (102,011) (97,537)
------------------ -------------------
Total shareholders' equity 111,815 115,320
------------------ -------------------
Total liabilities and
shareholders' equity $ 136,683 $ 144,811
================== ===================
Avenue A, Inc.
Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
Quarter Ended
March 31,
----------------------------------------
2002 2001
------------------ -------------------
Revenue $ 23,534 $ 24,172
Cost of revenue 16,719 18,491
------------------ -------------------
Gross profit 6,815 5,681
------------------ -------------------
Expenses:
Client support 3,338 4,270
Product development 1,732 3,507
Selling, general, and
administrative 3,627 6,027
Depreciation and amortization
of property and equipment 1,161 1,462
Amortization of deferred stock
compensation 772 3,836
Amortization of intangible
assets - 502
Corporate restructuring
charges - 1,500
------------------ -------------------
Total expenses 10,630 21,104
------------------ -------------------
Loss from operations (3,815) (15,423)
Interest income, net 1,249 1,943
------------------ -------------------
Net loss before cumulative
effect of change in
accounting principle (2,566) (13,480)
Cumulative effect of change
in accounting principle (1,330) -
------------------ -------------------
Net loss $ (3,896) $ (13,480)
================== ===================
Basic and diluted net loss
per share before
change in accounting
principle $ (0.04) $ (0.24)
Cumulative effect of change
in accounting principle (0.02) -
------------------ -------------------
Basic and diluted net loss
per share $ (0.06) $ (0.24)
================== ===================
Shares used in computing basic
and diluted net loss per share 58,130 56,728
================== ===================
Avenue A, Inc.
Reconciliation of Loss From Operations to
Pro Forma Loss From Operations,
Pro Forma Net Loss, and Pro Forma Net Loss
Excluding Non-recurring items
(in thousands)
Quarter Ended
March 31,
----------------------------------------
2002 2001
------------------ -------------------
Loss from operations $ (3,815) $ (15,423)
Amortization of deferred
stock compensation 772 3,836
Amortization of intangible
assets - 502
Corporate restructuring
charges - 1,500
------------------ -------------------
Pro forma loss from
operations (A) (3,043) (9,585)
Interest income, net 1,249 1,943
------------------ -------------------
Pro forma net loss (B) $ (1,794) $ (7,642)
================== ===================
Pro forma basic and diluted
net loss per share $ (0.03) $ (0.13)
================== ===================
Shares used in computing pro
forma basic and diluted net
loss per share 58,130 56,728
================== ===================
(A) The pro forma loss from operations excludes amortization of
intangible assets, stock-based compensation, and corporate
restructuring charges, which are summarized in the above table.
These disclosures do not purport to be prepared in accordance with
Generally Accepted Accounting Principles (GAAP).
(B) The pro forma net loss excludes amortization of intangible assets,
stock-based compensation, corporate restructuring charges, and
cumulative effect of the change in accounting principle, which are
summarized in the above table. These disclosures do not purport to
be prepared in accordance with Generally Accepted Accounting
Principles (GAAP).
|
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion