24/7 Real Media Reports Record Q2 Results
- Revenue of $33.9 million, an increase of 73% over the comparable period in 2004.Pro forma operating income of $0.05 per share compared with $0.02 per share in Q2 of 2004; GAAP net loss of $0.00 per share versus a GAAP profit of $0.03 per share in Q2 of 2004, which included a one-time gain of $0.07 per share.Continued successful roll-out of Decide DNA, our award-winning Search Engine Marketing platform.
- Winner of ClickZ.com Marketing Excellence Awards for Best Advertising Network, Best Ad-Server, and Best Behavioral Technology/Product.
Company Exceeds Second Quarter Revenue and Pro Forma Earnings Guidance
Raises Guidance for Full-Year 2005 and Introduces FY2006 Guidance
Second Quarter Highlights:
NEW YORK -- August 3rd, 2005 - 24/7 Real Media, Inc. (Nasdaq: TFSM), a pioneer in interactive marketing and technology, today announced financial results for the second quarter ended June 30, 2005. Revenue for the second quarter of 2005 was $33.9 million, an increase of 73% over the $19.6 million reported for the second quarter of 2004.
Pro forma operating income for the second quarter of 2005 was $2.3 million, or $0.05 per share. This compares with pro forma operating income of $0.7 million, or $0.02 per share, for the second quarter of 2004.
Net loss computed in accordance with generally accepted accounting principles (GAAP) for the second quarter of 2005 was a loss of $0.2 million, or $0.00 per share, compared with income of $1.5 million, or $0.03 per share, for the second quarter of 2004. GAAP net income for the second quarter of 2004 includes a one-time gain of $2.9 million from a legal settlement.
"24/7 Real Media enjoyed an outstanding second quarter, continuing on the success and momentum the company demonstrated in the first quarter," said David J. Moore, chairman and chief executive officer of 24/7 Real Media. "Our critically acclaimed Search Engine Marketing franchise, 24/7 Search, continues to gain traction throughout the largest markets worldwide, and our leading 24/7 Media and 24/7 Technology franchises were recently honored by members of the Internet advertising community."
"All our businesses are performing very well. We are poised to continue capitalizing on the positive trends in the market, including increased spending online and the rapid growth of paid search."
Segment Overview
Revenue in the Media Solutions segment climbed 35% to $16.7 million in the second quarter of 2005 from $12.4 million in the second quarter of 2004. Gross margins remained stable at 32.1%.
Search Solutions revenue advanced 362% to $11.7 million from $2.5 million in the second quarter of 2004. Gross margins for the segment increased to 33.8% in the second quarter of 2005. Year-over-year comparisons for this segment are influenced by the acquisition of Decide Interactive in the third quarter of 2004.
Technology Solutions revenue climbed 17% to $5.5 million in the second quarter of 2005 from $4.7 million in the second quarter of 2004. Technology gross margins were 78.6% in the second quarter of 2005.
Guidance
The Company expects third quarter revenue for 2005 to be between $32 million and $33 million, the mid-point of which represents an increase of 56% from third quarter 2004 revenue of $20.8 million. The Company expects diluted pro forma operating income per share in the third quarter of 2005 to be $0.04 per share.
The Company expects fourth quarter revenue for 2005 to be between $35 million and $37 million, the mid-point of which represents an increase of 31% from fourth quarter 2004 revenue of $27.5 million. The Company expects diluted pro forma operating income per share in the fourth quarter of 2005 to be between $0.05 and $0.06 per share.
The Company now anticipates full year 2005 revenue to be in the range of $130 million to $133 million, the mid-point of which represents an increase of 54% from revenue of $85.3 million in 2004. The Company now anticipates pro forma per share earnings for the full year of $0.17 to $0.18.
The Company expects full year 2006 revenue to be in the range of $165 million to $175 million and anticipates pro forma per share earnings for the full year of $0.28 to $0.32.
In conjunction with this release, a conference call will be held at 8:30 a.m. EDT on Thursday, August 4 to discuss these results. The call will be broadcast live over the Internet at www.247realmedia.com/about/investor. Please allow extra time to visit our Web site prior to the call and download the streaming media software required to listen to the Internet broadcast. The online replay of the broadcast should be available within two hours following the live call and will be available for three weeks.
24/7 Real Media, a pioneer in interactive marketing and technology, targets and delivers audiences for publishers and marketers. Our customers generate increased revenue and profits through media and search services, coupled with one seamless platform of serving, targeting, tracking and analytics technologies. The company is headquartered in New York, with offices in other major U.S. cities, Canada, Europe and Asia. For more information, please visit www.247realmedia.com. 24/7 Real Media: Delivering Today. Defining Tomorrow.
24/7 Real Media is a member of the NAI and adheres to the NAI privacy principles that have been applauded by the FTC. These principles are designed to help ensure Internet user privacy. For more information about online data collection associated with ad serving, including online preference marketing and an opportunity to opt-out of 24/7 Real Media cookies, go to: www.networkadvertising.org.
Caution concerning forward-looking statements:
Certain
statements in this news release are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995.
For instance, words such as "expects," "anticipates," "predicts,"
"guidance" and similar expressions identify forward-looking statements.
Forward-looking statements also include any other passages that relate
to expected future events or trends that can only be evaluated by
events or trends that will occur in the future. Some of the
forward-looking statements in this news release include, without
limitation, statements regarding the expected financial performance for
the third and fourth quarters of 2005 and for the full years 2005 and
2006. Investors 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, 24/7 Real Media undertakes no
obligation to update any forward-looking or other statements in this
news release, whether as a result of new information, future events or
otherwise. The forward-looking statements are based on the opinions and
estimates of management at the time the statements were made and are
subject to substantial risks and uncertainties that could cause actual
results to differ materially from those anticipated in the
forward-looking statements. These substantial risks and uncertainties
include, among others, the risks that the company may not successfully
complete the integration of Decide Interactive, which it acquired in
2004; that it may incur unforeseen expenses or loss of revenue relating
to such acquisitions; geopolitical, exchange rate and other risks
associated with international operations, which currently comprise a
significant portion of the Company's revenue; the potential loss of key
employees and inability to attract qualified new employees due to a
very competitive and tightening job market; risks that the Company's
technology will fail to scale to meet the increasing demands brought
about by increased business levels; risk that the Company's technology
services will be disrupted by terrorist attack or malicious intrusion,
and that the Company's back-up facilities and disaster recovery plans
will not be sufficient when needed; customer concentration risks;
unanticipated loss of clients or delays in anticipated business; the
potential for enhanced competition from companies with substantially
greater resources than those of the Company; potential deterioration or
slower-than-expected growth in the Internet advertising market; the
very short-term nature of the Company's contracts with clients; and the
uncertainties, potential costs, and possible business impacts of
potential new legislation, litigation or regulatory investigation
involving the Company. More information about factors that could cause
actual results to differ materially from those predicted in the
Company's forward-looking statements, as well as additional information
regarding the Company's business and financial results and condition,
is set out in its annual report on Form 10-K for the year ended
December 31, 2004, filed with the Securities and Exchange Commission,
and will be set out in its Quarterly Report on Form 10-Q for the three
months ended June 30, 2005, which the Company expects to file with the
Securities and Exchange Commission on or before August 9, 2005.
Investors are strongly encouraged to read the Company's Form 10-K,
Forms 10-Q and other filings with the Securities and Exchange
Commission in their entirety.
Investor Relations
Sushene Leitch
Director, Investor Relations
24/7 Real Media, Inc.
Telephone: 212-231-7990
Email: sushene.leitch@247realmedia.com
Media Relations
Eric Sokolsky
Weber Shandwick
Director
Telephone: 212.445-8081
Email: esokolsky@webershandwick.com
