Enliven Marketing Technologies Corporation Announces Second Quarter 2008 Financial Results

NEW YORK, N.Y., Aug. 8  /PRNewswire-FirstCall/ -- Enliven Marketing Technologies (NASDAQ:ENLV), a leading internet marketing technology company, today announced financial results for the second quarter ended June 30, 2008.

Enliven reported total revenue of $5.6 million for the second quarter 2008, a 28 percent increase as compared to $4.4 million in the first quarter 2008 and a 46 percent increase as compared to $3.8 million in the second quarter 2007.  Gross profit was $2.9 million for the second quarter of 2008, an increase of 56 percent as compared to the $1.8 million for the first quarter of 2008 and an increase of 21 percent as compared to $2.4 million for the second quarter of 2007.

Patrick Vogt, Chief Executive Officer, commented, "We are continuing to scale our company to support growth in the core business areas of Unicast and Springbox. These businesses drove a significant improvement in EBITDA performance despite a further decline in the search business.   Furthermore, we expect improvement in sales and EBITDA performance in the second half, which will truly provide the foundation for future growth.  We look forward to our merger with DG FastChannel announced in May.  We believe the combined companies will meet a wider set of customer needs and enable us to grow and expand in both the online and traditional advertising market."

Operating loss for the second quarter of 2008 was $3.2 million, as compared to an operating loss of $3.9 million in the first quarter of 2008 and as compared to an operating loss of $2.6 million for the second quarter of 2007. Operating expenses for the second quarter of 2008 were $6.0 million, a 6 percent increase as compared to $5.7 million in the first quarter of 2008 and a 21 percent increase as compared to $5.0 million in the second quarter of 2007.

Net loss for the second quarter of 2008 was $3.6 million, or $(0.04) per share, compared to a net loss of $7 thousand or $(0.00) per share in the first quarter 2008 and a net loss of $5.2 million or $(0.07) per share, in the second quarter of 2007.  Adjusted operating loss as defined below was $0.9 million for the second quarter of 2008, as compared to a loss of $2.3 million in the first quarter of 2008 and a loss of $1.5 million for the second quarter of 2007.

For the six months ended June 30, 2008, the Company reported revenue of $10.0 million, compared with $7.2 million for the same period in 2007.  For the six months ended June 30, 2008, gross profit remained flat, at $4.7 million versus the prior year period. Enliven's operating expenses for the six months ended June 30, 2008 were $11.8 million, which included $0.8 million of merger related costs, compared with $9.3 million for the six months ended June 30, 2007.

The Company's net loss for the six months ended June 30, 2008 of $3.6 million, or $(0.04) per share, was based on a loss from operations of $7.0 million, which included charges of $0.7 million for stock based compensation and $2.3 million for depreciation and amortization.  This compares to a net loss for the six months ended June 30, 2007 of $7.2 million, or $(0.10) per share, based on a loss from operations of $4.6 million, which included charges of $1.0 million for stock based compensation and $0.7 million for depreciation and amortization.  Adjusted operating loss for the first six months ended June 30, 2008 was $3.2 million as compared to an adjusted operating loss of $2.9 million for the first six months ended June 30, 2007.

Enliven's cash, cash equivalents, and marketable securities as of June 30, 2008 were $1.6 million compared to $2.2 million as of March 31, 2008 and compared to $5.7 million as of June 30, 2007.

Due to the pending merger with DG FastChannel, Inc. (NASDAQ:DGIT), which was announced on May 8, 2008, Enliven will not hold a conference call to discuss the financial results for the second quarter.

FINANCIAL INFORMATION

Management prepares and is responsible for the Company's consolidated financial statements which are prepared in accordance with accounting principles generally accepted in the United States.  The financial information contained in this press release, which is unaudited, is subject to revision and should not be considered final until the Company files its Quarterly Report on Form 10-Q.  At the present time, the Company has no reason to believe that there will be changes to the financial information contained herein.

FINANCIAL MEASURES

In addition to the results presented above in accordance with generally accepted accounting principles, or GAAP, the Company presents financial measures that are non-GAAP measures, specifically adjusted operating income. The Company believes that this non-GAAP measure, viewed in addition to and not in lieu of the Company's reported GAAP results, provides useful information to investors regarding its performance and overall results of operations. These metrics are an integral part of the Company's internal reporting to measure the performance of the Company and the overall effectiveness of senior management. Reconciliations to comparable GAAP measures are available in the accompanying schedules and on the Company's website. The financial measures presented are consistent with the Company's historical financial reporting practices. The non-GAAP measures presented herein may not be comparable to similarly titled measures presented by other companies, and are not identical to corresponding measures used in our various agreements or public filings.

ABOUT ENLIVEN MARKETING TECHNOLOGIES

Enliven Marketing Technologies Corporation (formerly Viewpoint Corporation) is a leading Internet Marketing Technology Company, offering Internet marketing and online advertising solutions through a powerful combination of proprietary visualization technology, and a Premium Rich Media advertising platform for the creation, delivery and reporting of PRM. Enliven's family of brands include Unicast, the Internet Marketing and Advertising Technology Group, and Springbox, the Creative Digital Marketing Solutions Group. The company's technology and online advertising solutions are leveraged by some of the world's most esteemed brands, including AOL, GE, Sony, and Toyota. More information can be found at http://www.enliven.com/. The company has approximately 140 employees with offices in New York, NY, Los Angeles, CA, Austin, TX and London, England.

Safe Harbor for Forward-Looking Statements

Statements in this Press Release may contain certain forward-looking statements relating to Enliven Marketing Technologies and its expectations for the proposed merger with DG FastChannel.  All statements included in this Press Release concerning activities, events or developments that Enliven Marketing Technologies expects, believes or anticipates will or may occur in the future are forward-looking statements.  Actual results could differ materially from the results discussed in the forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and involve known and unknown risks, uncertainties and other factors that may cause actual results and performance to be materially different from any future results or performance expressed or implied by forward-looking statements, including the following: the risk that the Merger will not close because of a failure to satisfy one or more of the closing conditions; the risk that Enliven Marketing Technologies' business will have been adversely impacted during the pendency of the Merger; the risk that the operations will not be integrated successfully; and the risk that the expected cost savings and other synergies from the transaction may not be fully realized, realized at all or take longer to realize than anticipated. Additional information on these and other risks, uncertainties and factors is included in Enliven Marketing Technologies' Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other documents filed with the SEC.

Additional Information

In connection with the proposed merger, DG FastChannel and Enliven Marketing Technologies have filed a proxy/registration statement and other related documents with the Securities and Exchange Commission (SEC). INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY/REGISTRATION STATEMENT, INCLUDING AMENDMENTS THERETO, WHEN THEY BECOME AVAILABLE, AS THEY CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER AND RELATED MATTERS.  INVESTORS AND SECURITY HOLDERS WILL HAVE ACCESS TO FREE COPIES OF THE PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC BY DG THROUGH THE SEC WEB SITE AT WWW.SEC.GOV.  THE PROXY/REGISTRATION STATEMENT AND RELATED MATERIALS MAY ALSO BE OBTAINED FOR FREE FROM DG FASTCHANNEL, INC. BY DIRECTING A REQUEST TO: DG FASTCHANNEL, INC. ATTN: INVESTOR RELATIONS DEPARTMENT, 750 WEST JOHN CARPENTER Freeway, Suite 700, Irving, TX  75039, telephone [phone].

Participants in the Solicitation

Enliven Marketing Technologies and its executive officers and directors and certain other members of management and employees may be deemed, under SEC rules, to be participants in the solicitation of proxies from Enliven Marketing Technologies' stockholders with respect to the proposed merger. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of the companies' stockholders in connection with the proposed merger are set forth in the proxy statement/prospectus filed with the SEC.  More detailed information regarding the identity of potential participants, and their direct or indirect interests, by securities, holdings or otherwise, is also set forth in the definitive proxy statement.  You can find more information about Enliven Marketing Technologies' executive officers and directors in Amendment No. 1 to its annual report on Form 10-K filed with the SEC on April 29, 2008.

Copyright (C) 2008 Enliven Marketing Technologies Corporation. All Rights Reserved. Enliven, Unicast, and Springbox are trademarks or registered trademarks of Enliven Marketing Technologies Corporation.

  Contact:
  Investor Relations:
  212-201-0800
  



                ENLIVEN MARKETING TECHNOLOGIES CORPORATION
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                 (in thousands, except per share amounts)
                               (Unaudited)

                                               Three Months Ended
                                           June 30,            March 31,
                                     2008            2007          2008
  Revenue:
   Advertising systems             $1,628          $1,426        $1,377
   Search                             729           1,726           958
   Services                         3,262             680         2,069
   Licenses                             1               5             -
  Total revenue                     5,620           3,837         4,404

  Cost of revenue:
   Advertising systems                702             873           717
   Search                              25              28            28
   Services                         1,882             481         1,693
   Licenses                             -               -             -
   Non-cash stock-based
    compensation charges               30              13            31
   Depreciation                        97              27            90
   Amortization of intangible
    assets                              -              28             -
  Total cost of revenue             2,736           1,450         2,559
  Gross profit                      2,884           2,387         1,845

  Operating expenses:
   Sales                              546             809           593
   Marketing                          272             422           257
   Research and development           783             778           835
   General and administrative       3,129           1,994         2,629
   Non stock-base compensation
    charges                           313             630           341
   Depreciation                       117             113           119
   Amortization of intangible assets  881             230           952


  Total operating expenses          6,041           4,976         5,726

  Loss from operations             (3,157)         (2,589)       (3,881)

  Other income (expense)
   Interest and other income, net      12              61            39
   Interest expense                  (208)           (200)         (208)
   Gain/(Loss) on Disposal of
    Fixed Assets                        -               -             -
   Loss on early extinguishment
    of debt                             -               -             -
   Loss on conversion of debt           -               -             -
   Changes in fair values of
    warrants to purchase common
    stock and conversion feature
    of convertible notes             (213)         (2,418)        4,055
  Total other income (expense)       (409)         (2,557)        3,886
  Gain/loss before provision for
   income taxes                    (3,566)         (5,146)            5

  Provision for income taxes            -              16            12
  Net Loss from continuing
   operations                      (3,566)         (5,162)           (7)

  Net Loss                        $(3,566)        $(5,162)          $(7)

  Basic and diluted net loss
   per common share               $ (0.04)         $(0.07)       $(0.00)

  Weighted average number of
   shares outstanding-basic and
   diluted                         99,088          76,577        99,079



                ENLIVEN MARKETING TECHNOLOGIES CORPORATION
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                 (in thousands, except per share amounts)
                               (Unaudited)

                                                       Six Months Ended
                                                           June 30,
                                                      2008           2007
  Revenue:
   Advertising systems                              $3,005         $2,536
   Search                                            1,687          3,211
   Services                                          5,331          1,399
   Licenses                                              1             11
  Total revenue                                     10,024          7,157

  Cost of revenue:
   Advertising systems                               1,419          1,285
   Search                                               53             71
   Services                                          3,575            937
   Licenses                                              -              -
   Non-cash stock-based compensation charges            61             24
   Depreciation                                        187             53
   Amortization of intangible assets                     -             56
  Total cost of revenue                              5,295          2,426
  Gross profit                                       4,729          4,731

  Operating expenses:
   Sales                                             1,139          1,531
   Marketing                                           529            809
   Research and development                          1,618          1,560
   General and administrative                        5,758          3,859
    Non stock-base compensation charges                654            957
    Depreciation                                       236            228
    Amortization of intangible assets                1,833            358
  Total operating expenses                          11,767          9,302

  Loss from operations                              (7,038)        (4,571)

  Other income (expense)
   Interest and other income, net                       51            112
   Interest expense                                   (416)          (404)
   Gain/(Loss) on Disposal of Fixed Assets               -              -

   Loss on early extinguishment of debt                  -              -

   Loss on conversion of debt                            -              -

   Changes in fair values of warrants
    to purchase common stock                         3,842         (2,261)
    and conversion feature of convertible notes
  Total other income (expense)                       3,477         (2,553)
  Gain/loss before provision for income taxes       (3,561)        (7,124)

  Provision for income taxes                            12             28
  Net Loss from continuing operations               (3,573)        (7,152)

  Net Loss                                         ($3,573)       ($7,152)

  Basic and diluted net loss per common share       ($0.04)         $0.10

  Weighted average number of shares
   outstanding-basic and diluted                    99,084         72,148



                ENLIVEN MARKETING TECHNOLOGIES CORPORATION
                       CONSOLIDATED BALANCE SHEETS
                 (in thousands, except per share amounts)
                               (Unaudited)

                                             June 30, 2008 December 31, 2007
  Assets
  Current assets:
  Cash and cash equivalents                        $ 1,351         $6,929
  Marketable securities                                293            311
  Accounts receivable, net of
   reserve of $229 and $202, respectively            5,872          7,701
  Prepaid expenses and other current assets            431            723
  Total current assets                               7,947         15,664

  Restricted cash                                      422            417
  Property and equipment, net                        2,392          1,403
  Goodwill                                          15,103         15,103
  Intangible assets, net                             7,735          9,553
  Other assets                                          99             61
  Total assets                                     $33,698        $42,201

  Liabilities and Stockholders' Equity
  Current liabilities:
  Accounts payable                                 $ 2,701        $ 4,712
  Accrued expenses                                     453            345
  Deferred revenue                                     273            234
  Current portion of notes payable                     389            488
  Current portion of warrants                           92            469
  Accrued incentive compensation                       545            545
  Current liabilities related to
   discontinued operations                             231            231
  Total current liabilities                          4,684          7,024

  Accrued expenses - Deferred Rent                     150            271

  Warrants to purchase common stock                  4,999          8,464
  Subordinate notes                                  2,801          2,616
  Unicast notes                                      1,307          1,381
  Springbox accrual                                  2,966          2,818

  Stockholders' equity
  Preferred stock                                        -              -

  Common stock                                          99             99
  Paid-in capital                                  320,385        319,644
  Treasury stock                                    (1,015)        (1,015)
  Accumulated other comprehensive loss                   5              9
  Accumulated deficit                             (302,683)      (299,110)
  Total stockholders' equity                        16,791         19,627
  Total liabilities and stockholders' equity       $33,698        $42,201



                ENLIVEN MARKETING TECHNOLOGIES CORPORATION


RECONCILIATION OF INCOME (LOSS) FROM OPERATIONS TO ADJUSTED OPERATING INCOME

                                  (LOSS)
                 (in thousands, except per share amounts)
                               (Unaudited)

                           Three Months Ended         Six Months Ended
                         June 30,       March 31,          June 30,
                      2008      2007        2008        2008      2007

  Income (Loss) from
   Operations      ($3,157)  ($2,589)    ($3,881)    ($7,038)  ($4,571)
  Plus:
  Stock based
   Compensation:
    COS-Ad Systems       4         4           4           8         8
    COS - Services      26         9          27          53        16
    Sales and marketing 76        91          88         164       177
    Research and
     development        26        26          33          59        54
    General and
     administrative    211       513         220         431       726
  Depreciation         214       140         209         423       281
  Amortization         881       258         952       1,833       414
  Acquisition Costs    843         0           0         843         0

  Adjusted Operating
   Income (Loss)     ($876)  ($1,548)    ($2,348)    ($3,224)  ($2,895)


DATASOURCE: Enliven Marketing Technologies



CONTACT:  Investor Relations, [phone], or 



Web site:  http://www.enliven.com/ 

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