Ivillage (NASDAQ:IVIL)
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iVillage Reports First Quarter 2005 Financial Results
iVillage.com Revenue Increased Approximately 40% Year-Over-Year, Company Posts
Sixth Consecutive Quarter of Positive Cash Flow From Operations and Raises 2005
Revenue and EBITDA Outlook
NEW YORK, May 4 /PRNewswire-FirstCall/ -- iVillage Inc. (NASDAQ:IVIL), The
Internet For Women(TM), a leading women's media company and the number one
source for women's content and community online, today announced financial
results for the first quarter ended March 31, 2005.
First quarter 2005 revenues were $17.3 million, an 11% increase when compared
to revenues of $15.5 million for the same period one year ago. iVillage.com
revenue increased approximately 40% year over year. iVillage reported a net
loss for the first quarter 2005 of $1.3 million, or $(0.02) per share, compared
to a net loss of $0.9 million or $(0.01) per share in the first quarter of
2004. Included in the first quarter 2005 net loss is $0.6 million in
amortization related to the Healthology acquisition. iVillage reported
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1) of
$0.1 million for the first quarter of 2005 compared to $0.7 million for the
first quarter 2004.
Douglas W. McCormick, Chairman & Chief Executive Officer, iVillage Inc., said,
"During the first quarter, we saw iVillage.com revenue grow approximately 40%
year-over-year. We also successfully strengthened our business model, the
results of which we believe will enhance our performance in the second half of
2005 and beyond. We significantly diversified our advertising base, replacing
some anchor tenants and the concentration of revenue they brought with them
with a roster of new clients. There were many other positive developments for
iVillage, including our completion of our site redesign and its improved
functionality. We are now well into the next phase of our strategy to grow our
top and bottom lines by continuing to deepen editorial content and by building
up iVillage's core assets. In particular, we bolstered our health offering
over the last few months through the acquisitions of Healthology and
HealthCentersOnline. Moving forward, video and search are two key areas we
have targeted for expansion on our site and, since the completion of the new
iVillage.com, we have already started to advance these product offerings."
Mr. McCormick continued, "We are very pleased to report the continued strength
of our online revenue as well as our sixth consecutive quarter of positive cash
flow from operations. The performance of iVillage.com during the quarter shows
that our online business is benefiting from the shift in advertising dollars
from traditional media to the Internet. As a result of our recent investments,
we believe iVillage is better positioned for growth in the latter half of 2005
and beyond. Consequently, we have increased our revenue and EBITDA outlook for
the full year."
At the end of the first quarter 2005, iVillage had $70.3 million in cash and
cash equivalents on its balance sheet. Cash from operations increased
approximately $1.5 million, marking the sixth consecutive quarter of positive
cash flow for the Company. iVillage continues to carry no debt.
Increased Fiscal Year 2005 Business Outlook
For the second quarter 2005, iVillage currently expects to generate revenues
between $20.0 million and $21.0 million. The Company anticipates reporting
EBITDA of $1.0 million to $1.5 million for the second quarter 2005.
Additionally, in the second quarter 2005, iVillage expects to report a net loss
of $0.5 million to $1.0 million.
For fiscal year 2005, iVillage is raising its revenue guidance and expects
revenue of $87.0 million to $89.0 million, an increase of approximately 30% to
33% in revenue as compared to revenue for fiscal year 2004. Additionally,
iVillage is increasing its EBITDA outlook for 2005 to between $17.0 million and
$18.0 million. This compares to a previously expected EBITDA of between $16.0
million and $17.0 million. Net income for 2005 is expected to be between $9.0
million and $10.0 million. iVillage reserves the right to update its financial
outlook at any time for any reason.
Company Highlights
-- On April 8, 2005, iVillage acquired all of the outstanding equity of
HealthCentersOnline, Inc., a privately-held, leading online destination
for physician-edited information on health conditions, treatments and
preventative care for patients.
-- HealthCentersOnline complements the January 7, 2005 acquisition of
Healthology, Inc., a leading producer and distributor of streaming
video health programs and physician-authored articles on the Internet.
iVillage is committed to expanding and deepening its healthcare
information vertical, as it is one of the top concerns for women.
Additionally, these acquisitions give the Company increased leverage
with health and pharmaceutical related advertisers.
-- We completed the acquisition of the iVillage.co.uk website and certain
related assets as of April 29, 2005. Currently, iVillage UK is one of
the top destinations in the region for women and the transaction
enables iVillage to move from a license deal to a 100 percent ownership
position.
-- The iVillage site redesign was launched on January 26, 2005.
-- Earlier this year, The MSN(R) network expanded its prior content
publication agreement with iVillage to feature iVillage content on its
new Health and Fitness Channel.
-- During the first quarter, iVillage added over 135 new advertisers and
brands. New marketers, or those deepening their iVillage relationship
by adding new brands, included American Media, Inc., Aventis, Fox
Broadcasting Company, Johnson & Johnson, Kraft Foods, Lowe's, Target,
and Wyeth Pharmaceuticals, to name a few.
Metrics
-- The iVillage Network is the 30th most visited Web site in the U.S.
according to comScore Media Metrix. During the first quarter 2005,
unique monthly visitors increased dramatically to approximately
17.3 million, when compared to approximately 15.3 million unique
monthly visitors during the same period a year ago. iVillage reaches
over 10.5% of the total U.S. online population and nearly 14% of women
18+ online. Visitors return more than 2 times per month on average.
-- iVillage is the #1 women's community site and the #4 community site
overall on the Web.
-- At the end of the first quarter 2005, iVillage.com had more than
13 million registered members.
-- For the first quarter 2005, iVillage delivered approximately
443 million average monthly page views, compared to approximately
370 million average monthly page views during the first quarter 2004.
Conference Call
iVillage will hold a conference call to discuss its first quarter 2005
financial results today at 4:30 PM (EDT). The conference call will be
broadcast live on the Internet and will be available on iVillage's Investor
Relations Web site, located at http://www.ivillage.com/investor, and on Street
Events, located at http://www.streetevents.com/. A replay of the conference
call will be available on the iVillage Investor Relations Web site
approximately one hour after the call ends on Wednesday, May 4, 2005 until 5:30
PM (EDT) on Wednesday, May 11, 2005. A transcript of the conference call will
be available on the iVillage Investor Relations Web site thereafter.
About iVillage Inc.
iVillage is "the Internet for women" and consists of several online and offline
media-based properties that seek to enrich the lives of women, teenage girls
and parents through the offering of unique content, community applications,
tools and interactive features. iVillage Inc. (NASDAQ:IVIL) was established in
1995 and is headquartered in New York City.
Average monthly page views for iVillage.com and its affiliate Web sites ("The
iVillage Network") totaled nearly 443 million for the quarter ended March 31,
2005. In March 2005, according to comScore Media Metrix, The iVillage Network
ranked 30th among the top 100 Web and Digital Media properties with
approximately 17.3 million unique visitors in the United States and had an
average reach of approximately 10.5% of the total online population and nearly
14% of women 18+ online. Also, according to the same report, The iVillage
Network was the number one "women's community site" and the number four
"community site" overall on the Web.
For more information about iVillage, visit http://www.ivillage.com/.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:
iVillage Inc. has included in this press release certain "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 concerning iVillage's business, operations and financial condition. The
words or phrases "can be," "expects," "may affect," "anticipates," "may
depend," "believes," "estimates," "plans," "projects" and similar words and
phrases are intended to identify such forward-looking statements. These
forward-looking statements are subject to various known and unknown risks and
uncertainties and iVillage cautions you that any forward-looking information
provided by or on behalf of iVillage is not a guarantee of future results,
performance or achievements. Actual results could differ materially from those
anticipated in these forward-looking statements due to a number of factors,
some of which are beyond iVillage's control. In addition to those risks
discussed in iVillage's other press releases, public filings and statements by
iVillage's management, factors that may cause iVillage's actual results,
performance or achievements to differ materially from any future results,
performance or achievements expressed or implied in such forward looking
statements include: (i) the volatile and competitive nature of the Internet
industry and the media industry, (ii) changes in domestic and foreign economic,
political and market conditions, (iii) the effect of federal, state and foreign
regulation on iVillage's business, (iv) the impact of recent and future
acquisitions and joint ventures on iVillage's business and financial condition,
(v) iVillage's ability to establish and maintain relationships with
advertisers, sponsors, and other third-party providers and partners, (vi)
iVillage's ability to maintain or increase user traffic levels, (vii) the loss
of one or more of iVillage's major customers, (viii) the effect of seasonal
fluctuations in traditional online advertising purchasing patterns on
iVillage's results of operations and (ix) the impact of pending litigation on
iVillage's business, results of operations and financial condition. All such
forward-looking statements are current only as of the date on which such
statements were made. iVillage does not undertake any obligation to publicly
update any forward-looking statement to reflect events or circumstances after
the date on which any such statement is made or to reflect the occurrence of
unanticipated events.
(1) To supplement its consolidated financial statements presented in accordance
with generally accepted accounting principles ("GAAP") in the United States,
iVillage uses non-GAAP measures of operating results and net income, such as
EBITDA (defined by iVillage as Earnings (Loss) Before Interest, Taxes,
Depreciation and Amortization), which are adjusted from results based on GAAP
to exclude certain expenses. These non-GAAP adjustments are provided to
enhance individuals' overall understanding of the Company's current financial
performance and its prospects for the future. Specifically, iVillage believes
the non-GAAP financial measures provide useful information to both management
and investors by excluding certain expenses that are not indicative of the
Company's core operating results. In addition, since iVillage has historically
reported non-GAAP results to the investment community, the Company believes the
inclusion of non-GAAP financial measures provides consistency in its financial
reporting. Further, these non-GAAP results are one of the primary indicators
management uses for planning and forecasting in future periods, as well as for
executive compensation. The presentation of this additional information is not
meant to be considered in isolation or as a substitute for results prepared in
accordance with GAAP. Please refer to iVillage's unaudited consolidated
financial statements accompanying this press release for a reconciliation of
any non-GAAP financial measures included in this press release to the
corresponding GAAP financial measures. Although EBITDA is frequently used as a
measure of operating performance, it is not necessarily comparable to other
similarly titled captions of other companies due to differences in methods of
calculation.
iVillage Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
Three months ended March 31,
2005 2004
Revenues $ 17,274 $ 15,507
Operating expenses:
Editorial, product development and technology 8,239 7,511
Sales and marketing 5,936 4,385
General and administrative 2,989 2,908
Depreciation and amortization 1,804 1,804
Total operating expenses 18,968 16,608
Loss from operations (1,694) (1,101)
Interest income, net 352 18
Other income, net - 52
Gain on sale of joint venture interest 76 167
Net loss $ (1,266) $ (864)
Basic and diluted (per share data):
Net loss $ (0.02) $ (0.01)
Weighted-average shares of common stock
outstanding used in computing basic and
diluted net loss per share 71,928 58,443
iVillage Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
March 31, December 31,
2005 2004
ASSETS:
Current assets:
Cash and cash equivalents $70,281 $83,046
Accounts receivable, net 10,115 9,708
Prepaid rent 318 318
Other current assets 4,118 3,740
Total current assets 84,832 96,812
Fixed assets, net 8,669 8,381
Goodwill and intangible assets, net 50,461 32,073
Prepaid rent, net of current portion 3,165 3,203
Other assets 79 79
Total assets $147,206 $140,548
LIABILITIES and STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable and accrued expenses $11,491 $10,142
Deferred revenue 7,019 2,080
Other liabilities 168 168
Total current liabilities 18,678 12,390
Deferred rent, net of current portion 1,304 1,339
Total liabilities 19,982 13,729
Commitments and contingencies
Stockholders' equity 127,224 126,819
Total liabilities and stockholders' equity $147,206 $140,548
iVillage Inc. and Subsidiaries
Quarterly Income Statement
($ in Million except for per share amounts)
(Unaudited)
Mar-04 Jun-04 Sep-04 Dec-04 FY 04 Mar-05
Revenue $15.507 $16.498 $16.698 $18.200 $66.903 $17.274
Growth q-q -2% 6% 1% 9% -5%
Growth Y/y 23% 25% 23% 15% 21% 11%
Editorial, product
development &
technology 7.511 7.013 7.740 6.639 28.903 8.239
% of Revenues 48% 43% 46% 36% 43% 48%
Sales and marketing 4.385 4.723 4.562 5.352 19.022 5.936
% of Revenues 28% 29% 27% 29% 28% 34%
General and
administrative 2.908 2.885 2.440 2.994 11.227 2.989
% of Revenues 19% 17% 15% 16% 17% 17%
Depreciation and
amortization 1.804 1.953 1.140 1.114 6.011 1.804
% of Revenues 12% 12% 7% 6% 9% 10%
Total operating
expenses 16.608 16.574 15.882 16.099 65.163 18.968
% of Revenues 107% 100% 95% 88% 97% 110%
(Loss) income from
operations (1.101) (0.076) 0.816 2.101 1.740 (1.694)
Interest income, net 0.018 0.050 0.236 0.338 0.642 0.352
Other income, net 0.052 0.034 0.011 0.110 0.207 -
Gain on sale of
joint venture
interest 0.167 0.076 0.076 0.076 0.395 0.076
Provision for income
taxes - - - (0.307) (0.307) -
Minority interest - - - - - -
(Loss) income from
continuing
operations (0.864) 0.084 1.139 2.318 2.677 (1.266)
Discontinued
operations - - - 0.069 0.069 -
Net (loss) income $(0.864) $0.084 $1.139 $2.387 $2.746 $(1.266)
Basic and diluted
(per share data):
(Loss) income from
continuing
operations $(0.01) $0.00 $0.02 $0.03 $0.04 $(0.02)
Income from
discontinued
operations - - - 0.00 0.00 -
Net (loss) income $(0.01) $0.00 $0.02 $0.03 $0.04 $(0.02)
Weighted average
shares of common
stock outstanding
- basic 58.4 59.1 70.9 71.7 65.1 71.9
Weighted average
shares of common
stock outstanding
- diluted 58.4 64.4 75.2 75.8 69.9 71.9
Additional Financial
Information
Revenue from barter 0.844 1.119 1.204 1.363 4.530 1.680
% of Revenues 5% 7% 7% 7% 7% 10%
iVillage Inc. and Subsidiaries
Supplemental Financial Data
(in thousands)
(unaudited)
Three months ended March 31,
2005 2004
EBITDA reconciliation:
Net loss $ (1,266) $ (864)
Addback: Depreciation and amortization 1,804 1,804
Interest income, net (352) (18)
Other income, net - (52)
Gain on sale of joint venture interest (76) (167)
EBITDA $ 110 $ 703
Revenues by property:
iVillage.com (1) $ 12,056 $ 8,616
Astrology.com 1,151 840
IVPN 3,404 5,377
PAG 663 674
Total revenues $ 17,274 $ 15,507
(1) Included in iVillage.com revenues are iVillage.com, Promotions.com,
Substance.com, Women.com, GardenWeb and Healthology properties and
gURL.com, iVillage Consulting and iVillage Solutions divisions.
iVillage Inc. and Subsidiaries
Quarterly Supplemental Financial Data
($ in Million except for per share amounts)
(Unaudited)
Mar-04 Jun-04 Sep-04 Dec-04 FY 04 Mar-05
EBITDA reconciliation:
Net (loss) income $(0.864) $0.084 $1.139 $2.387 $2.746 $(1.266)
Addback: Depreciation
and amortization 1.804 1.953 1.140 1.114 6.011 1.804
Interest income, net (0.018) (0.050) (0.236) (0.338) (0.642) (0.352)
Other income, net (0.052) (0.034) (0.011) (0.110) (0.207) -
Gain on sale of joint
venture interest (0.167) (0.076) (0.076) (0.076) (0.395) (0.076)
Provision for income
taxes - - - 0.307 0.307 -
Discontinued operations - - - (0.069) (0.069) -
EBITDA $0.703 $1.877 $1.956 3.215 $7.751 0.110
DATASOURCE: iVillage Inc.
CONTACT: Carl Fischer of iVillage Inc., +1-212-600-6502,
; or Carina Thate, , or Eliza Johnson,
, both The Abernathy MacGregor Group, +1-212-371-5999, for
iVillage
Web site: http://www.ivillage.com/