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JUPITERMEDIA CORPORATION REPORTS RECORD RESULTS FOR ITS SECOND QUARTER ENDED JUNE 30, 2004

(New York, NY - August 4, 2004) - -- Jupitermedia Corporation (Nasdaq: JUPM) today reported results for the quarter ended June 30, 2004. Revenues for the second quarter of 2004 were $17.8 million compared to revenues of $10.2 million for the same period last year, an increase of 75%. Net income for the second quarter was $3.5 million, or $0.11 per diluted share, compared to a net loss of $111,000, or $0.00 per diluted share, for the same period last year.

"We are pleased with our financial results this quarter, with both record quarterly revenues and net income," stated Jupitermedia's Chairman and CEO Alan M. Meckler. "Our acquisition of the assets of the Comstock Images business on April 1, 2004, added over 500,000 wholly owned images to our growing JupiterImages business which sells commercial stock images by single download, CD or online subscription. We are experiencing significant marketing and business synergies between Comstock Images and our JupiterImages division as well as our other Jupitermedia divisions. Our acquisition of the assets of the Thinkstock Images and Thinkstock Footage businesses on July 28, 2004, furthers Jupitermedia's position as one of the largest worldwide organizations in the business of selling stock images and enables us to enter the rapidly growing business of selling video footage online. Our follow-on public offering, co-managed by Piper Jaffray & Co. and SG Cowen & Co., LLC, was successfully completed on May 28, 2004, and raised net proceeds of over $30 million for Jupitermedia. Net proceeds are being used primarily for working capital and general corporate purposes, including potential acquisitions and the repayment of all outstanding indebtedness incurred to finance the acquisition of Comstock Images," added Meckler.

Jupitermedia Corporation 2nd Quarter 2004 Financial Results Conference Call Alert
Jupitermedia Corporation invites you to participate in its conference call reviewing 2004 second quarter results, scheduled for Thursday, August 5, 2004 at 11:00 am EST.

The conference call number is (800) 259-2693 for domestic participants and (913) 981-5575 for international participants: pass code "276 568". Please call five minutes in advance to ensure that you are connected prior to the presentation. The conference call replay will be available until Thursday, August 19, 2004. Replay call numbers are (888) 203-1112 for domestic participants and (719) 457-0820 for international participants: pass code "276 568".

Acquisitions

  • In April, Jupitermedia announced that it acquired substantially all of the assets of Comstock Images (www.comstock.com) for $20.85 million in cash and the assumption of certain liabilities. Comstock Images is based in Mountainside, NJ with operations in Toronto, Canada and Steinsel, Luxembourg. Comstock Images has been in the stock imagery business since 1976 and possesses an extensive archive of wholly owned commercial stock images. Jupitermedia also announced that it had obtained credit facilities with HSBC Bank USA that provide for borrowings of up to $23 million to help finance this and other potential acquisitions. A total of $13 million was borrowed to help finance the acquisition of Comstock Images. These borrowings were repaid in full in May 2004 after the completion of Jupitermedia's follow-on stock offering.
  • In July, Jupitermedia announced that it acquired over 30,000 high-resolution image assets from a variety of leading content providers in several transactions for its JupiterImages division (www.jupiterimages.com). Terms of these acquisitions were not disclosed.
  • In July, Jupitermedia also announced that it acquired the assets of the Thinkstock Images and Thinkstock Footage businesses (www.thinkstock.com, www.thinkstockfootage.com) for $4.0 million in cash, the assumption of certain limited liabilities and 50,000 restricted shares of Jupitermedia common stock. Thinkstock has been in the stock imagery and stock footage business since 1999 and is based in Charlotte, NC. The acquisition adds over 25,000 wholly-owned digitized stock images and over 4,000 wholly-owned stock video clips to JupiterImages' image library. Ron Chapple, renowned photographer and founder of Thinkstock, will continue to provide world-class imagery for Thinkstock and JupiterImages.

New Online Media Offerings
In June, Jupitermedia launched the SearchEngineWatch.com Forums (forums.searchenginewatch.com), an online discussion area allowing readers to share experiences, tips and thoughts about the growing area of search and search marketing. Major discussion areas of the SearchEngineWatch.com Forums include Featured Discussions, Search Engines and Directories, Search Engine Marketing Strategies and General Search Issues.

New Research Services
Jupitermedia continued to expand and strengthen its proprietary research offerings. In August, JupiterResearch launched a new research service covering home theater and digital home entertainment, marking the eighth new practice started by JupiterResearch since it was acquired in July 2002. The Home Theater research service helps vendors prepare for market opportunities created by the explosion of new home entertainment technologies. It delivers insights on consumer needs and expectations, enables better decisions about such topics as convergence and optimal form factors and helps vendors develop strategies to maintain margins in the face of rapid commoditization.

Conferences and Trade Shows

JupiterEvents, a division of Jupitermedia, produces paid conferences and trade shows on IT and business-specific topics worldwide that are aligned with the content on our web sites and our research offerings. JupiterEvents held eight paid conferences and trade shows in the second quarter, each focusing on a different issue pertaining to information technology and the Internet industry. Events included Digital Rights Management Strategies Conference & Expo; ISPCON Spring 2004; Wi-Fi Planet Japan Conference & Expo; Search Engine Strategies Japan Conference & Expo 2004; Search Engine Strategies Canada Conference & Expo 2004; Search Engine Strategies U.K. Conference & Expo 2004; Wi-Fi Planet Conference & Expo Spring 2004 and Internet Planet Spring Conference & Expo 2004.

JupiterEvents has announced the following conferences and trade shows for the remainder of 2004:

  • Jupiter Plug.IN Conference & Expo (July 26-27, New York, NY)
  • Jupiter/ClickZ Advertising Forum Conference & Expo (July 28-29, New York, NY)
  • Search Engine Strategies Conference & Expo 2004 (August 2-5, San Jose, CA)
  • IT Service Management Forum Conference & Expo (September. 27-Oct. 2, Long Beach, CA)
  • Digital Rights Management Strategies (October 25 - 27, Los Angeles, CA)
  • Search Engine Strategies Conference & Expo 2004 (October 27 28, Stockholm)
  • ISPCON Fall (November 2 - 5, Santa Clara, CA)
  • Inside ID Conference & Expo (November 15 - 17, Washington, D.C.)
  • Wi-Fi Planet Conference & Expo Fall 2004 (November 30 - December 2, San Jose, CA)
  • Search Engine Strategies Conference & Expo 2004 (December 13 - 16, Chicago, IL)


Jupitermedia Corporation

Consolidated Statements of Operations

For the Three and Six Months Ended June 30, 2003 and 2004

(unaudited)

(in thousands, except per share amounts)

 

 

Three Months Ended

June 30

Six Months Ended

June 30

 

2003

 

2004

2003

 

2004

Revenues

$10,220

 

$17,846

$18,465

 

$32,199

Cost of revenues

$4,508

 

$6,547

$9,180

 

$12,567

             

Gross profit

$5,712

 

$11,299

$9,285

 

$19,632

             

Operating expenses:

           

          Advertising, promotion and selling

$3,539

 

$4,550

$6,261

 

$8,125

          General and administrative

$1,785

 

$2,152

$3,378

 

$4,677

          Depreciation

$338

 

$242

$701

 

$465

          Amortization

$256

 

$722

$496

 

$1,117

Total operating expenses

$5,918

 

$7,666

$10,836

 

$14,384

             

Operating income (loss)

$(206)

 

$3,633

$(1,551)

 

$5,248

             

Income loss on investments and other, net

$54

 

$105

$(1)

 

$119

Interest income

$62

 

$9

$151

 

$27

Interest expense

$-

 

$(56)

$-

 

$(62)

             

Income (loss) before income taxes, minority interests and equity loss
from venture fund investments and other, net

$(90)

 

$3,691

$(1,401)

 

$5,332

Provision for income taxes

$-

 

$140

$-

 

$140

Minority Interests

$6

 

$(26)

$10

 

$(37)

Equity Loss from venture fund
investments and other, net

$(27)

 

$(16)

$(50)

 

$(9)

Net income (loss)

$(111)

 

$3,509

$(1,441)

 

$5,146

             

Basic net income (loss) per share

 

($0.0)

 

 

$0.13

 

($0.06)

 

 

$0.19

             

Basic weighted average number of
common shares outstanding

 

 

25,301

 

 

 

27,903

 

 

25,292

 

 

 

26,965

             

Diluted net income (loss) per share

 

 

$(0.0)

 

 

 

$0.11

 

 

$(0.06)

 

 

 

$0.17

             

Diluted weighted average number of
common shares outstanding

$25,301

 

$30,906

$25,292

 

$29,783

             

Segment Information

The following tables summarize the results of the segments of Jupitermedia for the three and six months ended June 30, 2003 and 2004. Online media consists of the JupiterWeb business that includes the internet.com, EarthWeb.com, DevX.com and ClickZ.com Networks. Online images consists of the JupiterImages business that includes Comstock Images, Photos.com and ClipArt.com. Research represents the JupiterResearch business. Events represents the JupiterEvents business. Other includes corporate overhead, depreciation, amortization and venture fund related activities.

(unaudited)
(In thousands)
 

Three Months Ended
June 30

Six Months Ended
June 30

 

2003

2004

2003

2004

Revenues:
Online Media

$6,034

$8,002

$10,679

$15,221

Online Images

-

$5,791

$-

$8,248

Research

$2,157

$2,201

$4,433

$4,543

Events

$1,876

$1,841

$3,053

$4,163

Other

$153

$11

$300

$24

 

$10,220

$17,846

$18,465

$32,199

Cost of revenues:
Online Media

$2,427

$2,867

$4,995

$5,770

Online Images

$ -

$1,143

$-

$1,778

Research

$1,208

$1,318

$2,722

$2,554

Events

$873

$1,219

$1,463

$2,465

 

$4,508

$6,547

$9,180

$12,567

Gross Profit:
Online Media

$3,607

$5,135

$5,684

$9,451

Online Images

$-

$4,648

$-

$6,470

Research

$949

$883

$1,711

$1,989

Events

$1,003

$622

$1,590

$1,698

Other

$153

$11

$300

$24

 

$5,712

$11,299

$9,285

$19,632

Advertising, promotion and selling:
Online Media

$1,461

$1,760

$2,747

$3,444

Online Images

$-

$1,237

$-

$1,556

Research

$768

$780

$1,530

$1,498

Events

$1,310

$773

$1,984

$1,627

 

$3,539

$4,550

$6,261

$8,125

General and administrative:
Online Media

$170

$(186)

$408

$234

Online Images

$-

$263

$-

$517

Research

$301

$177

$612

$374

Events

$47

$38

$96

$82

Other

$1,267

$1,860

$2,262

$3,470

 

$1,785

$2,152

$3,378

$4,677

Depreciation

$338

$242

$701

$465

Amoritization

$256

$722

$496

$1,117

Operating income (loss):
Online Media

$1,976

$3,561

$2,529

$5,773

Online Images

$-

$3,148

$-

$4,397

Research

$(120)

$(74)

$(431)

$117

Events

$(354)

$(189)

$(490)

$(11)

Other

$(1,708)

$(2,813)

$(3,159)

$(5,028)

 

$(206)

$3,633

$(1,551)

$5,248


Jupitermedia Corporation

Consolidated Balance Sheets

December 31, 2003 and June 30, 2004

(in thousands, except share and per share amounts)

   

December 31, 2003

 

June 30, 2004

         

ASSETS

       
         

Current assets:

       
          Cash and cash equivalents  

$9,567

 

$29,222

          Accounts receivable, net of allowances of $948 and $1,165, respectively  

10,281

 

10,862

          Unbilled accounts receivable  

1,012

 

1,058

          Prepaid expenses and other  

2,124

 

2,350

          Total current assets

 

22,984

 

43,492

         
Property and equipment, net of accumulated depreciation of $8,674 and $8,927, respectively  

1,488

 

2,002

Intangible assets, net of accumulated amortization of $3,204 and $4,321, respectively  

8,130

 

18,410

Goodwill  

21,760

 

31,952

Investments and other assets  

1,676

 

1,507

          Total assets

 

$56,038

 

$97,363

         

LIABILITIES AND STOCKHOLDERS' EQUITY

       
         

Current liabilities:

       
Accounts payable  

$1,494

 

$3,210

Accrued payroll and related expenses  

2,482

 

2,029

Accrued expenses and other  

4,151

 

4,677

Deferred revenues  

9,211

 

11,101

          Total current liabilities

 

17,338

 

21,017

         

Long Term Liabilities

 

341

 

283

Deferred tax Liabilities

 

-

 

103

          Total liabilities

 

17,679

 

21,403

         

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, 25,984,130 and 31,032,035 shares issued at December 31, 2003 and June 30, 2004, respectively

 

260

 

311

Additional paid-in capital

 

177,629

 

210,019

Accumulated deficit

 

(139,427)

 

(134,281)

Treasury stock, 65,000 shares at cost

 

(106)

 

(106)

Accumulated other comprehensive income

 

3

 

17

          Total stockholders' equity

 

38,359

 

75,960

          Total liabilities and stockholders' equity

 

$56,038

 

$97,363

Jupitermedia Corporation

Consolidated Statements of Cash Flows

Six Months Ended June 30,2003 and 2004

(unaudited)

(in thousands)

 

Six Months Ended

June 30

 

2003

 

2004

Cash flows from operating activities:

     

          Net income (loss)

$(1,441)

 

$5,146

          Adjustments to reconcile net Income (loss) to net cash provided by
          operating activities:

     

                    Depreciation and amortization

1,197

1,582

          Barter transactions, net

(456)

-

          Provision for losses on accounts receivable

52

(144)

          Minority interests

(10)

37

          Equity loss from venture fund investments
          and other, net

50

9

          Income (loss) on investments and other, net

1

 

(119)

          Provision for income taxes

-

 

37

Changes in current assets and liabilities, (net of businesses acquired):

     

          Accounts receivable

1,667

 

322

          Unbilled accounts receivable

147

 

(46)

          Prepaid expenses and other

(594)

 

(267)

          Accounts payable and accrued expenses

(699)

(1,408)

          Deferred revenues

575

1,855

          Net cash provided by operating activities

489

 

9,820

       

Cash flows from investing activities:

          Additions to property and equipment

(147)

(207)

          Acquisitions of businesses and other

(13,431)

 

(22,917)

          Distribution from internet.com venture funds

-

148

          Proceeds from sales of assets and other

54

135

          Net cash used in investing activities

(13,524)

(22,841)

       

Cash flows from financing activities:

     

          Proceeds from issuance of common stock, net

-

 

30,580

          Borrowings under credit facilities

-

 

13,000

          Repayment of borrowings under credit facilities

-

 

(13,000)

          Proceeds from exercise of stock options

103

 

2,096

          Net cash provided by financing activities

103

 

32,676

       

Net increase (decrease) in cash and cash equivalents

(12,932)

 

19,655

       

Cash and cash equivalents, beginning of period

25,451

 

9,567

       

Cash and cash equivalents, end of period

$12,519

 

$29,222

       

Supplemental disclosures of cash flow:

     

          Cash paid for income taxes

$-

 

-

          Cash paid for interest

-

 

$62

Business Outlook

Jupitermedia's financial guidance is prepared in accordance with accounting principles generally accepted in the United States of America. 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 of DevX, Comstock Images and Thinkstock Images, and are subject to change pending a final allocation of these amounts. The following forward-looking statements reflect Jupitermedia's expectations as of August 4, 2004. 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
 

Actual Total 2003

Q1 2004

Q2 2004

Q3 2004

Q4 2004

Total 2004

(in millions, except per share amounts)

Revenues ($M)

$47.0

$14.4

$17.8

$18.0-19.0

$19.0-20.0

$69.2-71.2

Cost of revenues, advertising, promotion & selling, and G & A expenses

$42.8

$12.2

$13.3

$13.2-14.3

$13.3-14.3

$52.0-54.0

Depreciation and amortization

$2.8

$0.6

$1.0

$1.1

$1.2

$3.9

Interest Income, net

$0.2

$0.0

$0.0

$0.1

$0.1

$0.2

Other income

$0.2

$0.0

$0.1

$0.0

$0.0

$0.1

Income Taxes

$0.0

$0.0

$0.1

$0.1

$0.1

$0.3

Net income

$1.4

$1.6

$3.5

$3.7

$4.5

$13.3

Diluted Share Count

26.9

29.5

31.0

34.3

34.6

32.4

Earnings per diluted share

$0.05

$0.06

$0.11

$0.11

$0.13

$0.41

About Jupitermedia Corporation
Jupitermedia Corporation (Nasdaq: JUPM), (www.jupitermedia.com) headquartered in Darien, CT, is a leading global provider of original information, images, research and events for information technology, business and creative professionals. JupiterWeb, the online division of Jupitermedia, operates four distinct online networks: internet.com and EarthWeb.com for IT and business professionals; DevX.com for developers; and ClickZ.com for interactive marketers. JupiterWeb properties include more than 150 Web sites and over 150 e-mail newsletters that are viewed by approximately 20 million users and generate approximately 300 million page views monthly. Jupitermedia also includes: JupiterImages, one of the leading images companies in the world with over 3.5 million images online serving creative professionals with products like Comstock Images, Thinkstock Images, Photos.com and ClipArt.com; JupiterResearch, a leading international research advisory organization specializing in business and technology market research in 18 business areas and 14 vertical markets; and JupiterEvents, which produces offline conferences and trade shows focused on IT and business-specific topics, including Search Engine Strategies and Wi-Fi Planet.

"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 dependence on a limited number of advertisers; and Jupitermedia's ability to protect its intellectual property. 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 Act of 1933 and 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:
Lisa DiGiacomo
Marketing & Public Relations Associate
Jupitermedia Corporation
203-662-2870
[email protected]

All current Jupiter Research press releases can be found online at www.jupitermedia.com/corporate/press.html.

All current Jupitermedia Corporation press releases can be found on the World Wide Web at http://www.internet.com/corporate/press.html.