Avenue A, Inc. Announces Q4 Results; Strong revenue growth drives GAAP profit of 3 cents per share; Outlook is positive for 2003.Business Editors/High-Tech Writers Conference Call and Webcast at 9 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy Today SEATTLE--(BUSINESS WIRE)--Feb. 4, 2003 Avenue A, Inc. (Nasdaq:AVEA AVEA American Veterinary Exhibitors Association ), a digital marketing and technology company, today announced financial results for the fourth quarter and year ended December December: see month. 31, 2002. Fourth quarter highlights included: -- Revenue of $44.4 million, an 82% increase from the comparable year-ago period and a 29% increase from the prior quarter -- Gross profit of $13.1 million, an increase of 66% from the comparable period in 2001 and an increase of 30% from the prior quarter -- GAAP net income of $1.7 million, or 3 cents per share, which exceeded company guidance of 0-1 cent per share -- Pro forma net income of $2.2 million, or 4 cents per share, which exceeded company guidance of 1-2 cents per share -- Continued balance sheet strength, with cash and short-term investments of $121.4 million -- Acquisition of the full-service interactive advertising agency i-FRONTIER -- Avenue A was named AdWeek's Independent Interactive Agency of the Year. "This was another excellent quarter. We had strong revenue growth, and the achievement of GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). net income for the first time represents a tremendous milestone “Milemarker” redirects here. For the American indie rock band, see Milemarker (band). A milestone or kilometre sign is one of a series of numbered markers placed along a road at regular intervals, typically at the side of the road or in a median. for the company," said Brian The name Brian (sometimes spelled Bryan) comes from an Irish backround. It is of Celtic origin and its meaning may be "hill" or "strong, noble, and high"[1]. McAndrews McAndrews may refer to:
For the fourth quarter ended December 31, 2002, Avenue A, Inc. reported revenue of $44.4 million, compared to revenue of $24.4 million for the fourth quarter of 2001. Net income, in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. 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), for the fourth quarter ended December 31, 2002 was $1.7 million, or 3 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , compared to a net loss of $4.5 million, or 8 cents per share, for the fourth quarter of 2001. Revenue for the full year 2002 was $132.7 million, compared to revenue of $89.6 million for the full year 2001. GAAP net loss for the full year 2002, including 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 $4.6 million, or 8 cents per share, compared to a GAAP net loss of $40.0 million, or 70 cents per share, for the full year 2001. Avenue A, Inc. ended the year with $121.4 million in cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments. Guidance The company announced that it expects its Q1 2003 revenues to be in the range of $36-40 million, gross profit to be in the range of $11-13 million, and GAAP net income of 0-1 cent per share. For the full year 2003, the company expects revenue to be in the range of $160-180 million, gross profit of $53-60 million, and GAAP net income of 14-20 cents per share. Fourth Quarter 2002 Conference Call/Webcast Today Avenue A, Inc. will host a conference call today, February February: see month. 4, 2003 to discuss these financial results at 9:00 a.m. Eastern/6:00 a.m. Pacific. The webcast and replay will be available 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 visit the website approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 15 minutes prior to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary software. 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 three 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 (www.avenuea.com) and i-FRONTIER (www.ifrontier.com), full service interactive agencies, and Atlas Atlas, in Greek mythology Atlas (ăt`ləs), in Greek mythology, a Titan; son of Iapetus and Clymene and the brother of Prometheus. DMT See DSL. (www.atlasdmt.com), a provider of advertising technology solutions, Avenue A, Inc. is able to touch and bring value to any interaction in the digital marketplace. Avenue A and Atlas DMT are headquartered in Seattle Seattle (sēăt`əl), city (1990 pop. 516,259), seat of King co., W Wash., built on seven hills, between Elliott Bay of Puget Sound and Lake Washington; inc. 1869. and have offices in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. . i-Frontier is headquartered in Philadelphia Philadelphia, ancient cities Philadelphia, name of several ancient cities. One was in Lydia, W Asia Minor (now W Turkey). At the foot of Mt. Tmolus and near the location of modern Alaşehir, it was founded in the 2d cent. B.C. . Avenue A, Inc. adheres to 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. 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 statements about the positive outlook for 2003, expectations that 2003 will be a strong year, expectations about the company's revenue and GAAP net income for the first quarter of 2003 and expectations about the company's revenue and GAAP net income for fiscal year 2003. The 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 erosion (ĭrō`zhən), general term for the processes by which the surface of the earth is constantly being worn away. The principal agents are gravity, running water, near-shore waves, ice (mostly glaciers), and wind. 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, 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 generally are cancelable on 90 days' or less notice, and the uncertainties, potential costs, and possible business impacts of unfavorable rulings in the previously-announced lawsuits involving the company. More information about factors that potentially could affect Avenue A, Inc.'s financial results is included in Avenue A, Inc.'s Form 10-Q Form 10-Q See 10-Q. for the quarter ended September September: see month. 30, 2002, filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance upon these forward-looking statements, which 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 for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. or other statements in this press release, whether as a result of new information, future events or otherwise.
Avenue A, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
December 31, December 31,
2002 2001
------------ ------------
Assets
Current assets:
Cash, cash equivalents, and short-term
investments $121,391 $117,754
Accounts receivable, net of allowance 26,587 16,127
Other receivables 1,316 1,369
Prepaid expenses and other current assets 398 242
------------ ------------
Total current assets 149,692 135,492
Property and equipment, net 4,166 6,664
Other assets 843 1,325
Goodwill and other intangible assets, net 4,439 1,330
------------ ------------
Total assets $159,140 $144,811
============ ============
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses $42,180 $25,448
Notes payable, current portion 1,569 2,000
Deferred revenue 2,554 488
------------ ------------
Total current liabilities 46,303 27,936
Notes payable, less current portion - 1,555
------------ ------------
Total liabilities 46,303 29,491
------------ ------------
Shareholders' equity:
Common stock 584 584
Paid-in capital 215,858 216,884
Deferred stock compensation (1,116) (4,063)
Subscription receivable (280) (548)
Accumulated deficit (102,209) (97,537)
------------ ------------
Total shareholders' equity 112,837 115,320
------------ ------------
Total liabilities and shareholders' equity $159,140 $144,811
============ ============
Avenue A, Inc.
Consolidated Statement of Operations
(in thousands, except per share data)
(unaudited)
Quarter Ended Twelve Months Ended
December 31, December 31,
----------------- -------------------
2002 2001 2002 2001
-------- -------- --------- ---------
Revenue $44,351 $24,434 $132,650 $89,611
Cost of revenue 31,203 $16,490 94,194 63,419
-------- -------- --------- ---------
Gross profit 13,148 7,944 38,456 26,192
-------- -------- --------- ---------
Expenses:
Client support 4,600 3,093 15,065 11,170
Product development 1,330 2,207 6,183 12,129
Selling, general, and
administrative 4,171 4,830 16,040 23,535
Depreciation and amortization of
property and equipment 1,213 1,208 4,723 5,600
Amortization of deferred stock
compensation 449 1,445 2,718 10,899
Corporate restructuring charges - - 497 3,666
Amortization of intangible
assets 50 499 50 2,002
Impairment of fixed assets - 490 - 1,040
-------- -------- --------- ---------
Total expenses 11,813 13,772 45,276 70,041
-------- -------- --------- ---------
Income (loss) from operations 1,335 (5,828) (6,820) (43,849)
Interest and other income, net 401 1,364 3,557 6,365
Impairment of cost-basis
investment - - - 2,500
-------- -------- --------- ---------
Net income (loss) before
cumulative effect of change
in accounting principle 1,736 (4,464) (3,263) (39,984)
Cumulative effect of change in
accounting principle - - (1,330) -
-------- -------- --------- ---------
Net income (loss) $1,736 $(4,464) $(4,593) $(39,984)
======== ======== ========= =========
Basic and diluted net income
(loss) per share before
change in accounting principle $0.03 $(0.08) $(0.06) $(0.70)
Cumulative effect of change in
accounting principle $- $- $(0.02) $-
-------- -------- --------- ---------
Basic and diluted net income
(loss) per share $0.03 $(0.08) $(0.08) $(0.70)
======== ======== ========= =========
Shares used in computing basic
net income (loss) per share 58,175 57,794 58,270 57,229
======== ======== ========= =========
Shares used in computing diluted
net income (loss) per share 63,447 57,794 58,270 57,229
======== ======== ========= =========
Avenue A, Inc.
Reconciliation of Loss From Operations to Pro Forma Income (Loss)
From Operations and Pro Forma Net Income (Loss)
(in thousands, except per share data)
(unaudited)
Quarter Ended Twelve Months Ended
December 31, December 31,
----------------- -------------------
2002 2001 2002 2001
-------- -------- --------- ---------
Income (loss) from operations $1,335 $(5,828) $(6,820) $(43,849)
Amortization of deferred stock
compensation 449 1,445 2,718 10,899
Amortization of intangible
assets 50 499 50 2,002
-------- -------- --------- ---------
Pro forma income (loss) from
operations (a) 1,834 (3,884) (4,052) (30,948)
Interest income, net 401 1,364 3,557 6,365
Impairment of cost-basis
investment - - - 2,500
-------- -------- --------- ---------
Pro forma net income (loss) (A) $2,235 $(2,520) $(495) $(27,083)
======== ======== ========= =========
Pro forma basic and diluted
earnings (loss) per share $0.04 $(0.04) $(0.01) $(0.47)
======== ======== ========= =========
Shares used in computing pro
forma basic earnings (loss)
per share 58,175 57,794 58,270 57,229
======== ======== ========= =========
Shares used in computing pro
forma diluted earnings (loss)
per share 63,447 57,794 58,270 57,229
======== ======== ========= =========
(a) The pro forma income (loss) from operations and net income (loss)
exclude amortization of intangible assets and stock-based
compensation charges, which are summarized in the above table.
These disclosures do not purport to be prepared in accordance with
Generally Accepted Accounting Principles (GAAP).
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