E-Stamp Corporation Announces First Quarter 2000 Results.Business Editors SAN MATEO San Mateo (săn mətā`ō), city (1990 pop. 85,486), San Mateo co., W Calif., on San Francisco Bay; inc. 1894. It is a commercial and retail center with some high-technology manufacturing. San Mateo, Spanish for St. , Calif.--(BUSINESS WIRE)--April 18, 2000 Revenue Up 55% Over Previous Quarter; Company Leverages its Technology for Secure Internet Transactions to Expand Business Beyond Postage E-Stamp Corporation (Nasdaq: ESTM) today announced its results for the first quarter of 2000. The Company generated revenue of $1.5 million, an increase of over 55% from $960,000 in the fourth quarter of 1999. The Company also announced that it shipped more than 32,000 E-Stamp(R) Internet postage See PC Postage. starter kits during the first quarter. Since the commercial launch of its Internet postage product, E-Stamp has shipped approximately 79,000 E-Stamp Internet postage starter kits, with an average revenue per unit during the first quarter of $14, or $56 per unit on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis. For 2000, the Company's objective is to increase the number of units shipped, while increasing the revenue generated per unit by moving up-market to serve larger customers, increasing postage spend and transaction revenues per customer, and increasing the sales of supplies and services. The Company, which has a significant intellectual property portfolio, also reported its first revenue from technology licensing. The Company recognized $0.4 million of technology licensing revenue during the quarter, primarily related to a $1 million licensing agreement with Kewill Electronic Commerce, with a small additional contribution from an undisclosed foreign postal authority A postal authority organises collection and delivery of domestic mail (US), or post (UK), within its area of control, or in the case of foreign mail, delivery to or receipt of mail from other postal authorities. Payment for the service has been performed in many ways. . The Company reported a net loss excluding amortization of deferred stock compensation of $(26.3) million or $(0.73) per share for the first quarter of 2000. Reported net loss was $(29.7) million, or $(0.82) per share. The net loss per share was based on 36.1 million weighted average shares, which represented 39.1 million weighted average shares of common stock outstanding less 3.0 million weighted average shares subject to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. by the Company. "With regard to the first quarter, we are pleased with our operational results and accomplishments," commented Robert (Bo) Ewald, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of E-Stamp Corporation. "E-Stamp demonstrated the potential to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the value of our proprietary technology for secure Internet transactions by licensing the technology to others. Additionally, we completed the first international Internet postage trial and our browser-based product received US Postal Service postal service, arrangements made by a government for the transmission of letters, packages, and periodicals, and for related services. Early courier systems for government use were organized in the Persian Empire under Cyrus, in the Roman Empire, and in medieval approval to move into market trial." "We're pioneers in changing the way that people work," Ewald continued. "This market clearly has not yet reached the inflection point Inflection Point An event that changes the way we think and act. -Andy Grove, Founder of Intel. Notes: For example, the fall of the Berlin Wall was an inflection point in global politics and the commercialization of the Internet was an inflection point in technology. of the adoption curve, but we're building our business and our infrastructure in order to be well positioned to take advantage of that market growth and to ensure that E-Stamp's growth is in the most profitable customer segments in the market." This quarter, E-Stamp expanded beyond Internet postage into related areas such as mailing, shipping and supplies. E-Stamp launched its online Mailing Services Center where customers can use direct marketing, shipping and address management services offered by E-Stamp and through alliances. E-Stamp expanded its supplies offerings and began selling its patented E-Stamp multi-window envelope, saving customers a step in the mail preparation process. In shipping, E-Stamp announced its strategic relationship with multi-carrier shipping leader, Kewill Electronic Commerce, which has over 70% market share in the US enterprise shipping market. The Company also noted that 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 per share reported for the fourth quarter and for the fiscal year ending December 31, 1999 was understated by $0.004 and $0.0065, respectively, due to a miscalculation mis·cal·cu·late tr. & intr.v. mis·cal·cu·lat·ed, mis·cal·cu·lat·ing, mis·cal·cu·lates To count or estimate incorrectly. mis·cal of the weighted average number of shares. The Company believes that this understatement is immaterial Not essential or necessary; not important or pertinent; not decisive; of no substantial consequence; without weight; of no material significance. immaterial adj. and does not intend to restate re·state tr.v. re·stat·ed, re·stat·ing, re·states To state again or in a new form. See Synonyms at repeat. re·state its 1999 financial statements. About E-Stamp (Nasdaq: ESTM) E-Stamp provides Internet solutions designed to help businesses and consumers complete secure transactions. The first application of this technology was an easy-to-use Internet postage service that enables customers to purchase, download and print postage directly from their personal computer. The purchased postage can be printed onto envelopes, labels or documents using standard laser or inkjet printers A printer that propels droplets of ink directly onto the medium. Today, almost all inkjet printers produce color. Low-end inkjets use three ink colors (cyan, magenta and yellow), but produce a composite black that is often muddy. , 24 hours a day, seven days a week, without the need to remain connected to the Internet. The company received approval from the U.S. Postal Service The U.S. Postal Service (USPS) processes and delivers mail to individuals and businesses within the United States. The service seeks to improve its performance through the development of efficient mail-handling systems and operates its own planning and engineering programs. in August 1999 for its Internet postage service, and since then has been selling that solution nationally. E-Stamp's Internet postage service is targeted at small business, small office and home office users. E-Stamp has established strategic relationships with industry leaders including Microsoft, eBay, Yahoo!, Compaq, America Online See AOL. , Intuit in·tu·it tr.v. in·tu·it·ed, in·tu·it·ing, in·tu·its Usage Problem To know intuitively. [Back-formation from intuition. , Francotyp-Postalia and Avery Dennison Avery Dennison Corporation (NYSE: AVY) produces pressure-sensitive materials (such as self-adhesive labels), office products, and various paper products. R. Stanton Avery founded Avery in 1935. Avery Dennison Corporation was created in 1990 by merger of Avery and Dennison. . For more information about E-Stamp, please visit the company's web site at www.e-stamp.com. "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement under 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: This release contains 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. that involve risks and uncertainties, including statements that the company will commence new product trials and expand the business to include online ticketing, increase product shipments and revenues per customer, and expand the availability of its products and services. Important factors, which could cause actual results to differ materially from those in the forward-looking statements, include customer and market acceptance of the company's products and services, the ability of the company to attract and maintain customers, the ability of the company to manage the development, marketing and distribution of its products and services, the ability of the company to develop and maintain marketing and distribution relationships, the ability of the company to effective compete against its competitors, and the ability of the company to manage the growth of its business. Additional risk factors are detailed in filings with the Securities and Exchange Commission, made from time to time by E-Stamp, including its prospectus related to its initial public offering, which was filed with the Securities and Exchange Commission on October 12, 1999 and its 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 ending December 31, 1999.
E-Stamp Corporation
Statements of Operations
(In Thousands, except per share amounts)
For the Three For the Three
Months Ended Months Ended
3/31/00 3/31/99
Revenue $ 1,490 $ --
Cost of Sales 1,879 --
Gross Profit (Loss) (389) --
GM Percent -26.1% 0.0%
Operating Expenses:
Research & Development 5,231 2,080
Sales & Marketing 19,512 860
General & Administration 1,577 713
Amortization of deferred
stock compensation 3,434 962
Amortization of deferred
distribution costs 950 --
Total Operating Expenses 30,704 4,615
Loss from Operations (31,093) (4,615)
Interest Income 1,437 105
Interest and other Expenses (32) (1)
Net Loss $ (29,688) $ (4,511)
Net Loss per share ($0.82) ($0.20)
Net loss per share before
amortization of deferred
stock compensation ($0.73) ($0.16)
Shares used in computing
net loss per share (1) 36,086 22,370
(1) Shares used in computing net loss per share for the three months
ended March 31, 1999 includes the weighted effect of the assumed
conversion of convertible preferred stock.
E-Stamp Corporation
Balance Sheets
(In Thousands)
As of 3/31/00 As of 12/31/99
Assets
Current Assets
Cash and Cash Equivalents $91,261 $118,689
Accounts Receivable - Trade 403 237
Other Receivables 781 253
Inventory 2,358 2,120
Prepaid Marketing Expenses 7,222 6,156
Prepaids and Other Currents Assets 2,528 6,222
Total Current Assets 104,553 133,677
Fixed Assets, net 4,106 2,740
Other Assets 2,829 --
Total Assets $ 111,488 $ 136,417
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable - Trade $ 2,199 $ 707
Accrued Expenses 7,079 8,164
Short-Term Portion of Capital Leases 14 23
Deferred Revenue 40 193
Total Current Liabilities 9,332 9,087
Stockholders' Equity 102,156 127,330
Total Liabilities & Stockholders' Equity $ 111,488 $ 136,417
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