2006 Press
JUPITERMEDIA CORPORATION REPORTS RECORD RESULTS FOR ITS FOURTH QUARTER ENDED DECEMBER 31, 2005
(New York, NY - March 9, 2006) - Jupitermedia Corporation (Nasdaq: JUPM) today reported results for the quarter ended December 31, 2005. Revenues for the fourth quarter of 2005 were $36.1 million compared to revenues of $18.1 million for the same period last year, an increase of 99%. Operating income for the fourth quarter of 2005 was $9.0 million compared to operating income of $4.9 million for the same period last year. Income before income taxes for the fourth quarter of 2005 was $6.6 million compared to $5.0 million for the same period last year. The provision for income taxes for the fourth quarter of 2005 increased to $1.4 million from $143,000 for the same period last year. Net income for the fourth quarter of 2005 was $5.4 million, or $0.15 per diluted share, compared to net income of $5.5 million, or $0.16 per diluted share, for the same period last year.Highlights for the year 2005 include:
- Revenues grew 101% to $124.6 million
- Operating income before depreciation and amortization grew 120% to $38.1 million
- Overall gross profit margins were 66%
- Overall operating margins grew to 25%
- Net income was $78.4 million, or $2.15 per diluted share. Net income for 2005 included a gain of $29.1 million, net of income taxes, related to the sale of Jupitermedia's Search Engine Strategies events and ClickZ.com Network, as well as a $23.5 million benefit from the reversal of a valuation allowance related to deferred income tax assets.
"Our financial results for the fourth quarter included record revenues and operating income" stated Jupitermedia's Chairman and CEO Alan M. Meckler. "We have been emphasizing the development of our Jupiterimages division and the fourth quarter illustrates continued organic and overall growth in the sales and distribution of commercial images. Jupitermedia continues to grow as a powerful creator and distributor of a wide range of commercial images. The improvement in gross margins and operating margins for our Jupiterimages division demonstrates the leverage of owning our own images and it also demonstrates the progress that we are making with the integration of our many recent acquisitions. The full benefit of this integration will be more apparent in future quarters. In the meantime we continue to evolve as a company making positive financial progress not only with Jupiterimages, but with our JupiterWeb and JupiterResearch divisions as well," added Meckler.
Jupitermedia Corporation 4th Quarter 2005 Financial Results Conference Call Alert
Jupitermedia Corporation invites you to participate in its conference call reviewing 2005 fourth quarter results, for Friday, March 10, 2006 at 11:00 am EST.
The conference call number is (800) 289-0544 for domestic participants and (913) 981-5533 for international participants; pass code "672 4305." 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, March 24, 2006. Replay call numbers are (888) 203-1112 for domestic participants and (719) 457-0820 for international participants: pass code: "672 4305."
Credit Facility
In December 2005, Jupitermedia announced that it closed a $100 million senior credit facility arranged by JPMorgan Securities, Inc. Jupitermedia borrowed $53 million under this credit facility to repay indebtedness under a previous credit facility with JPMorgan, and expects to use the remainder for potential acquisitions.
Acquisitions
- In October 2005, Jupitermedia acquired all of the shares of BananaStock Limited (www.bananastock.com) for approximately U.S. $19.0 million in cash, subject to certain post-closing adjustments. BananaStock, based in Oxfordshire, United Kingdom, is a leading resource for royalty free digital images for business users and creative professionals.
- In November 2005, Jupitermedia acquired all of the shares of PR Direct SAS (www.prdirect.fr), with offices in Paris and Menthon-St. Bernard, France, is a leading distributor of royalty-free digital images for business users and creative professionals. Terms of the acquisition were not disclosed.
- In December 2005, Jupitermedia acquired the assets of Bigshot Media (www.bigshotmedia.com) and BBM.net (www.BBM.net) in separate transactions. Bigshot Media is the world's first and largest collection of stock flash footage. BBM.net offers royalty-free flash music loops online. Terms of these acquisitions were not disclosed.
- In December 2005, Jupitermedia acquired all of the shares of Agence Images (www.agenceimages.com). Agence Images, with offices in Paris and Sophia Antipolis, France, is a leading distributor of rights-managed digital images for business users and creative professionals. Terms of the acquisition were not disclosed.
- In December 2005, Jupitermedia acquired the assets of Animation Factory, Inc., which includes the MediaBuilder Network of Web sites, (www.animationfactory.com) and (www.mediabuilder.com), from VA Software Corporation (Nasdaq: LNUX - News) for $9.35 million in cash and the assumption of certain liabilities. Animation Factory, based in Sioux Falls, South Dakota, offers paid online subscriptions for royalty-free 3D clip art, animated graphics, video backgrounds, Microsoft PowerPoint templates, and e-mail, and Web page backgrounds for business and personal use.
- In January 2006, Jupitermedia purchased a 49.7% equity investment in HAAP Media Ltd., based in Budapest, Hungary. HAAP Media operates two stock photo related Web sites: Stock.xchng (www.sxc.hu) and Stockxpert.com (www.stockxpert.com). Financial terms of the transaction were not disclosed.
- In February 2006, Jupitermedia acquired all of the shares of Stock Image SAS (www.stockimage.fr) for approximately U.S. $11.1 million in cash. Located in Paris, France, Stock Image is a leading resource for rights-managed images through its Stock Image brand and royalty-free images through its Pixland (www.pixland.fr) brand.
- In February 2006, Jupitermedia acquired the assets of The Beauty Archive (www.thebeautyarchive.com). The Beauty Archive is a leading provider of rights-managed images for business users and creative professionals in the editorial, advertising and design industries. Terms of the acquisition were not disclosed.
Divestiture and Discontinued Operations
In August 2005, Jupitermedia announced that it closed the sale of its Search Engine Strategies trade shows and its ClickZ.com Network of Web sites for $43 million in cash, subject to certain post-closing adjustments, to London Stock Exchange listed media company Incisive Media plc (INM.L). As a result of the sale of the Search Engine Strategies events, Jupitermedia's Events segment is now being presented as a discontinued operation in accordance with Statement of Financial Accounting Standards No. 144.
New Online Images Offerings
Jupitermedia continued to expand and strengthen its world-class proprietary Jupiterimages offerings with the addition of the following:
In December 2005, Jupitermedia announced the launch of a new image collection entitled (re)view. An archive of 4,000 retro, rights-managed images, (re)view is available at www.jupiterimages.com.
In January 2006, Jupitermedia announced an exclusive worldwide partnership with Photographic Youth Music Culture Archive (PYMCA), a rights-managed image company based in London, U.K. The PYMCA collection is available at www.jupiterimages.com.
In February 2006, Jupitermedia announced the launch of FlashKit's FlashFoundry.com (www.flashfoundry.com), a new paid subscription service offering over 100,000 professional-quality Flash components, video, buttons, animations and templates. Web designers and PowerPoint users can easily add Flash content to their Web sites and presentations in just minutes, rather than creating it from scratch.
Jupitermedia Corporation
Consolidated Statements of Operations
For the Three Months and Years Ended December 31, 2004 and 2005
(unaudited)
(in thousands, except per share amounts)
Three Months Ended Years Ended
December 31, December 31,
--------------------- ---------------------
2004 2005 2004 2005
---------- ---------- ---------- ----------
Revenues $ 18,144 $ 36,084 $ 61,959 $ 124,577
Cost of revenues 5,633 11,302 21,112 42,275
---------- ---------- ---------- ----------
Gross profit 12,511 24,782 40,847 82,302
---------- ---------- ---------- ----------
Operating expenses:
Advertising, promotion
and selling 3,481 6,709 13,010 24,312
General and
administrative 3,271 6,770 10,534 19,930
Depreciation 210 397 804 1,763
Amortization 689 1,872 2,166 4,816
---------- ---------- ---------- ----------
Total operating expenses 7,651 15,748 26,514 50,821
---------- ---------- ---------- ----------
Operating income 4,860 9,034 14,333 31,481
Gain on sale of assets and
other, net 66 35 190 13,259
Interest income 81 104 163 392
Interest expense (29) (2,543) (130) (3,508)
---------- ---------- ---------- ----------
Income before income
taxes, minority interests
and equity income (loss)
from investments, net 4,978 6,630 14,556 41,624
Provision (benefit) for
income taxes 143 1,398 288 (19,143)
Minority interests (32) 3 (89) (46)
Equity income (loss) from
investments, net 86 138 (31) 270
---------- ---------- ---------- ----------
Income from continuing
operations 4,889 5,373 14,148 60,991
Income from discontinued
operations, net of taxes 643 76 1,589 1,564
Gain (loss) on sale of
discontinued operations,
net of taxes - (10) - 15,844
---------- ---------- ---------- ----------
Net income $ 5,532 $ 5,439 $ 15,737 $ 78,399
========== ========== ========== ==========
Earnings per share:
Basic:
Continuing operations $ 0.15 $ 0.16 $ 0.48 $ 1.78
Discontinued operations 0.02 0.00 0.06 0.51
---------- ---------- ---------- ----------
$ 0.17 $ 0.16 $ 0.54 $ 2.29
========== ========== ========== ==========
Diluted:
Continuing operations $ 0.14 $ 0.15 $ 0.44 $ 1.67
Discontinued operations 0.02 0.00 0.05 0.48
========== ========== ========== ==========
$ 0.16 $ 0.15 $ 0.49 $ 2.15
========== ========== ========== ==========
Shares used in computing
earnings per share:
Basic 32,162 34,847 29,381 34,166
========== ========== ========== ==========
Diluted 35,569 37,129 31,801 36,498
========== ========== ========== ==========
Segment Information
The following tables summarize the results of the segments of
Jupitermedia for the three months and years ended December 31, 2004
and 2005 Online images consists of the Jupiterimages business that
includes BananaStock, Brand X, FoodPix, Botanica, Nonstock, Comstock
Images, Creatas Images, PictureQuest, Liquid Library, Thinkstock
Images, Thinkstock Footage, Bigshot Media, Goodshoot, ITStockFree,
Photos.com, Ablestock.com, PhotoObjects.net, Clipart.com and
AnimationFactory.com. Online media consists of the JupiterWeb business
that includes the internet.com, EarthWeb.com, DevX.com and
Graphics.com Networks. Research represents the JupiterResearch
business. Other includes corporate overhead, depreciation and
amortization.
(unaudited) Three Months Ended Years Ended
(in thousands) December 31, December 31,
--------------------- ---------------------
2004 2005 2004 2005
---------- ---------- ---------- ----------
Revenues:
Online images $ 7,526 $ 24,753 $ 22,571 $ 80,658
Online media 8,106 8,414 30,019 33,065
Research 2,501 2,911 9,323 10,824
Other 11 6 46 30
---------- ---------- ---------- ----------
18,144 36,084 61,959 124,577
---------- ---------- ---------- ----------
Cost of revenues:
Online images 1,523 7,354 4,551 24,751
Online media 2,815 2,647 11,366 12,090
Research 1,295 1,301 5,195 5,434
---------- ---------- ---------- ----------
5,633 11,302 21,112 42,275
---------- ---------- ---------- ----------
Gross profit:
Online images 6,003 17,399 18,020 55,907
Online media 5,291 5,767 18,653 20,975
Research 1,206 1,610 4,128 5,390
Other 11 6 46 30
---------- ---------- ---------- ----------
12,511 24,782 40,847 82,302
---------- ---------- ---------- ----------
Advertising, promotion and
selling:
Online images 978 4,407 3,228 14,116
Online media 1,691 1,477 6,737 6,888
Research 812 825 3,045 3,308
---------- ---------- ---------- ----------
3,481 6,709 13,010 24,312
---------- ---------- ---------- ----------
General and administrative:
Online images 493 1,469 1,298 5,063
Online media 389 391 611 586
Research 92 185 570 765
Other 2,297 4,725 8,055 13,516
---------- ---------- ---------- ----------
3,271 6,770 10,534 19,930
---------- ---------- ---------- ----------
Depreciation 210 397 804 1,763
Amortization 689 1,872 2,166 4,816
Operating income:
Online images 4,532 11,523 13,494 36,728
Online media 3,211 3,899 11,305 13,501
Research 302 600 513 1,317
Other (3,185) (6,988) (10,979) (20,065)
---------- ---------- ---------- ----------
$ 4,860 $ 9,034 $ 14,333 $ 31,481
---------- ---------- ---------- ----------
Jupitermedia Corporation
Consolidated Balance Sheets
December 31, 2004 and December 31, 2005
(in thousands, except share and per share amounts)
December 31, December 31,
2004 2005
------------ ------------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 30,179 $ 18,546
Accounts receivable, net of allowances
of $966 and $1,985, respectively 13,724 24,310
Unbilled accounts receivable 1,530 1,786
Prepaid expenses and other 2,633 3,955
Deferred income taxes - 447
Assets of discontinued operations 1,789 -
------------ ------------
Total current assets 49,855 49,044
Property and equipment, net of accumulated
depreciation of $9,256 and $10,431,
respectively 2,339 9,838
Intangible assets, net of accumulated
amortization of $5,371 and $9,982,
respectively 20,939 66,799
Goodwill 41,967 172,592
Deferred income taxes - 8,690
Investments and other assets 1,197 1,950
------------ ------------
Total assets $ 116,297 $ 308,913
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,060 $ 6,678
Accrued payroll and related expenses 1,666 2,400
Accrued expenses and other 4,642 13,528
Current portion of long-term debt - 16,000
Deferred revenues 12,023 17,846
Liabilities of discontinued operations 2,891 -
------------ ------------
Total current liabilities 23,282 56,452
------------ ------------
Long-term debt - 46,214
Deferred revenues 510 886
Deferred income tax liabilities 121 -
Other long-term liabilities 225 -
------------ ------------
Total liabilities 24,138 103,552
------------ ------------
Stockholders' equity:
Preferred stock, $0.01 par value,
million shares authorized, no shares
issued and outstanding - -
Common stock, $0.01 par value, shares
authorized, and 32,378,130 and
34,937,025 shares issued at December
31, 2004 and December 31, 2005,
respectively 324 349
Additional paid-in capital 215,648 251,919
Accumulated deficit (123,690) (45,290)
Treasury stock, 65,000 shares, at cost (106) (106)
Accumulated other comprehensive loss (17) (1,511)
------------ ------------
Total stockholders' equity 92,159 205,361
------------ ------------
Total liabilities and stockholders'
equity $ 116,297 $ 308,913
============ ============
Jupitermedia Corporation
Consolidated Statements of Cash Flows
Years Ended December 31, 2004 and 2005
(unaudited)
(in thousands)
Years Ended
December 31,
---------------------
2004 2005
---------- ----------
Cash flows from operating activities:
Net income $ 15,737 $ 78,399
Adjustments to reconcile income from
operations to net cash provided by operating
activities:
Depreciation and amortization 2,970 6,579
Benefit for losses on accounts receivable (134) (4)
Minority interests 89 46
Equity (income) loss from investments, net 31 (270)
Gain on sale of assets and other, net (190) (13,259)
Gain on sale of discontinued
operations, net of taxes - (15,844)
Deferred income taxes - (24,571)
Changes in current assets and liabilities (net
of businesses acquired):
Accounts receivable (2,909) (848)
Unbilled accounts receivable (518) (256)
Prepaid expenses and other 161 1,927
Accounts payable and accrued expenses (358) (6,489)
Deferred revenues 4,932 1,020
---------- ----------
Net cash provided by operating activities 19,811 26,432
---------- ----------
Cash flows from investing activities:
Additions to property and equipment (601) (2,225)
Acquisitions of businesses and other (36,487) (146,799)
Proceeds from sales of assets and other 211 14,911
Proceeds from sale of discontinued operations - 28,135
Distribution from internet.com venture funds 148 -
---------- ----------
Net cash used in investing activities (36,729) (105,978)
---------- ----------
Cash flows from financing activities:
Proceeds from issuance of common stock, net 30,337 -
Borrowings under credit facilities 13,000 150,212
Debt issuance costs - (2,030)
Repayment of borrowings under credit facility (13,000) (87,999)
Proceeds from exercise of stock options 7,200 7,953
---------- ----------
Net cash provided by financing activities 37,537 68,136
---------- ----------
Effect of exchange rates on cash (7) (223)
---------- ----------
Net increase (decrease) in cash and cash
equivalents 20,612 (11,633)
Cash and cash equivalents, beginning of period 9,567 30,179
---------- ----------
Cash and cash equivalents, end of period $ 30,179 $ 18,546
========== ==========
Supplemental disclosures of cash flow:
Cash paid for income taxes $ - $ 2,693
========== ==========
Cash paid for interest $ 131 $ 1,654
========== ==========
Non-cash investing activities:
Common stock issued for acquisitions $ 541 $ 21,611
========== ==========
Acquisition of property, plant and equipment $ - $ 251
========== ==========
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 Creatas, L.L.C., the parent company of
Dynamic Graphics, Inc., GraphicDesignForum.com, JGuru.com, Goodshoot
S.A.S, PictureArts Corporation, BananaStock Ltd., PR Direct SAS,
Bigshot Media, Agence Images and Animation Factory, and are subject to
change pending a final allocation of these amounts. The following
forward looking-statements reflect Jupitermedia's expectations as of
March 9, 2006. 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 Actual
per diluted share) Total 2005 Q1 2006 Total 2006
---------- ----------- -------------
(A) (A)
Revenues $ 124.6 $35.5-36.0 $166.0-170.0
Cost of revenues, advertising,
promotion & selling, and general
& administrative expenses $ 86.5 $25.4-25.9 $108.0-112.0
EBITDA (Earnings before interest,
taxes, depreciation and
amortization) $ 38.1 $ 10.1 $ 56.0-60.0
Depreciation and amortization $ 6.6 $ 2.8 $ 12.0
Gain on sale of assets and other,
net (B) $ 13.2 $ - $ -
Interest expense, net $ 3.1 $ 1.1 $ 4.0
Provision (benefit) for income
taxes (C) $ (19.1) $ 2.6 $ 16.0-18.0
Equity income $ 0.3 $ - $ 0.2-0.4
Income from continuing operations $ 61.0 $ 3.6 $ 24.3-26.3
Income (loss) from discontinued
operations, net of taxes (D) $ 1.6 $ - $ -
Gain of sale of discontinued
operations, net of taxes (B) $ 15.8 $ - $ -
Net income $ 78.4 $ 3.6 $ 24.3-26.3
Diluted share count 36.5 37.2 37.3
Earnings per diluted share:
Continuing operations $ 1.67 $ 0.10 $ 0.65-0.69
Discontinued operations $ 0.48 $ - $ -
Net income $ 2.15 $ 0.10 $ 0.65-0.69
Notes:
(A) This financial guidance does not include estimated share-based
compensation expense relating to employee stock options in the
amount of $0.02 per share and $0.08 per share for Q1 2006 and
Total 2006, respectively.
(B) The total gain related to the sale of our Search Engine Strategies
Events and ClickZ.com Network was $29.1 million, net of income
taxes. The gain related to the ClickZ.com portion of the sale was
recorded as part of continuing operations. The gain related to the
Search Engine Strategies Events portion of the sale was recorded
net of income taxes and is included as part of our discontinued
operations.
(C) During 2005, Jupitermedia recorded a benefit for income taxes of
$23.5 million from the reversal of a valuation allowance related
to deferred income tax assets consisting primarily of goodwill
related to Jupitermedia's Online Media business, which had
previously been expensed for book purposes.
(D) The results of our Events segment have been presented as part of
discontinued operations in accordance with Statement of Financial
Accounting Standards No. 144.
About Jupitermedia Corporation
Jupitermedia Corporation (Nasdaq: JUPM), (www.jupitermedia.com), headquartered in Darien, CT, is a leading global provider of original information, images and research for information technology, business 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, Brand X, FoodPix, Botanica, Nonstock, The Beauty Archive, Comstock Images, Creatas Images, PictureQuest, Liquid Library, Thinkstock Images, Thinkstock Footage, Bigshot Media, Goodshoot, ITStockFree, Stock Image, Pixland, Photos.com, Ablestock.com, PhotoObjects.net, Clipart.com and AnimationFactory.com; and JupiterWeb, the online media division of Jupitermedia which operates four distinct online networks: internet.com and EarthWeb.com for IT and business professionals; DevX.com for developers; and Graphics.com for creative professionals. JupiterWeb properties include more than 150 Web sites and over 150 e-mail newsletters that are viewed by over 20 million users and generate over 300 million page views monthly. Jupitermedia also includes: JupiterResearch, a leading international research advisory organization specializing in business and technology market research in over 30 business areas and vertical markets.
"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:
Lisa DiGiacomo
Marketing & Public Relations Associate
Jupitermedia Corporation
212-547-7939
[email protected]
