JumpTV Increases Revenue 34%

RNS Number:6363W
JumpTV Inc.
15 May 2007


JumpTV Increases Revenue 34% in Q1 Ended March 31, 2007 vs. Q4 2006


Revenue Up 34%, Subscriptions Up 23% to 34,496, ARPU Up 4%, Churn Down 53%, SAC
Up 32%


TORONTO -- (MARKET WIRE) -- May 15, 2007 -- JumpTV Inc. ("JumpTV" or the
"Company") (AIM: JTV) (TSX: JTV), the world's leading broadcaster of ethnic
television over the Internet, today announced quarterly results and selected
financial metrics for the quarter ended March 31, 2007.


For the quarter ended March 31, 2007 revenue increased 186% to US$1,003,146 from
US$350,508 in the same period a year ago. Sequentially, revenue increased 34%
from US$748,864 in the fourth quarter 2006 as the Company added to its
subscriber base.


Year over year net loss increased by 78% from $3,977,137 or US$0.21 per basic
and diluted share in March 31, 2006 to $7,085,166 or US$0.18 per basic and
diluted share for the three months ended March 31, 2007.


Quarter over quarter net loss decreased by 18.3% from US$8,676,543 or US$0.25
per basic and diluted share in the quarter ended December 31, 2006.


As of March 31, 2007 JumpTV had 280 channel partnerships compared to 254
channels as of December 31, 2006 and 138 channels as of March 31, 2006.


Subscriptions increased 22.6% to 34,496 from 28,138 in the fourth quarter 2006
and subscribers increased approximately 22.4% to 30,062 for the first quarter
2007 from 24,554 in the fourth quarter 2006.


Churn for the three months ended March 31, 2007 decreased to approximately 12.5%
from approximately 26.9% for the three months ended December 31, 2006. The
decrease in churn is attributable in part to the elimination of certain
marketing promotions in the fourth quarter. The Company's churn has also been
positively affected by subscribers opting for three-month subscriptions over
historically available one-month subscriptions.


For the first quarter of 2007, JumpTV's subscriber acquisition cost (SAC) was
US$51.72 compared to US$39.21 in the fourth quarter of 2006. The Company
experienced a rise in SAC as a result of ongoing tests including paid search
engine marketing (as opposed to natural search optimization) and television
advertising.


Average monthly revenue per user (ARPU) increased 4.3% to US$11.52 in the
quarter ending March 31, 2007 compared to US$11.04 in the fourth quarter of
2006. The Company attributes this to increasing subscriptions of higher-priced
multi-channel, country and region-specific bundles.


In Q3 2007 one of the Company's main initiatives will be to offer a significant
portion of its content in the United States on an ad-supported, free-to-consumer
basis. Certain premium content will remain subscription based in the United
States and virtually all content outside of the United States is expected at
this time to remain subscription based.


In light of these initiatives, the Company will likely replace and/or augment
certain subscriber-focused Key Performance Indicators to track
advertising-supported elements of its business.


During Q1 2007 there was significant progress in the implementation of
previously announced partnerships with leading ethnic Internet portals such as
Terra, Maktoob, MBC/Al Arabiya and LINKdotNET.


Additionally, JumpTV announced distribution partnerships with Joost, the
peer-to-peer online video platform which is currently in beta; blinkx, the
largest online video search index; Simply Media, a new IPTV set-top-box provider
launching in the UK in June 2007; and Nawaiya, a Dubai-based wireless
video-viewing device manufacturer.


In addition to the initiatives described above, the Company continues to pursue
an acquisition-focused growth strategy and is currently evaluating various
potential acquisition opportunities.


Subsequent to the quarter end, the Company took steps to reduce operating costs
by realigning headcount and overhead expenditures not considered core to the
Company's transition towards a multi-revenue stream model.


Kriss Bush, JumpTV's chief financial officer has elected to leave the company.
Since joining JumpTV in December 2005 Mr. Bush has been a valuable member of the
team and assisted the Company through its IPO and recent $100 million follow-on
equity financing.


Jason B. Reid, vice president of finance, who has been with the Company since
May 2005, will assume the role of interim chief financial officer. Mr. Reid is a
chartered accountant and has played an integral role in the development of
JumpTV's finance team since its inception, while also supporting the Company
through capital raises when private and its initial public offering in 2006. Mr.
Bush will continue in a consulting capacity throughout this transition.


G. Scott Paterson chairman and chief executive officer stated, "JumpTV has been
focused on executing our three-phased strategy. Although we have accomplished
our Phase I objective of attaining the most ethnic television channel
partnerships of any media company in the world, we continue to add top
broadcasters from around the world to our platform which at present includes
over 290 channels. In addition, we are currently focused on securing rights to
more top quality sports content.


Phase II of our strategy was to create a 'best-in-class' user experience and we
are delighted with the status of our capabilities in this regard and the daily
improvements that we are implementing.


Specifically, we would note that we continue to invest in the development of our
application programming interface (API) which has been launched in beta in
certain territories. This initiative is an important element of Phase III of our
strategy which is to monetize our content by way of advertising, sponsorships
and subscriptions," Paterson concluded.


Kaleil Isaza Tuzman, president and chief operating officer of JumpTV stated, "We
believe that in the United States there is a tremendous untapped audience for
our content and we are excited to transition towards a multi-revenue stream
business model in that market, including both advertising and subscriptions,
bringing value to our channel partners, our viewers and future advertising
partners."


Isaza Tuzman continued, "JumpTV has created this unique 'Many-to-Many' dynamic
-- where the power of being in the JumpTV family, whether as a broadcaster or as
a distribution partner, is tied to the existence of the other network
participants alongside. This is a key asset and very difficult to replicate."


The Company will broadcast highlights of the company presentation and report on
Q1 results from its annual general meeting (AGM) being held on Tuesday, May 15,
2007, on its investor relations section of the website. The Internet-broadcast
of the AGM will available on www.jumptv.com by Wednesday May 16, 2007 and will
be available for a period of 30 days.


About JumpTV


JumpTV (AIM: JTV) (TSX: JTV) is the world's leading broadcaster of ethnic
television over the Internet. With over 290 channels from 75+ countries, JumpTV
delivers its subscribers full-screen news, sports and entertainment content on a
real-time basis from all corners of the globe. JumpTV has subscribers in over
100 countries who view channels on the JumpTV online network via high-speed
Internet connections on their home computers, laptops, Internet-enabled
televisions and mobile phones.


Forward Looking Statements


This news release contains forward-looking statements that involve significant
risk, uncertainties and assumptions. Many factors could cause actual results,
performance or achievements to differ materially from the results discussed or
implied in the forward-looking statements. These factors should be considered
carefully and readers should not place undue reliance on the forward looking
statements. These forward looking statements are made as of the date of this
news release, and the Company assumes no obligation to update or revise them to
reflect new events or circumstances. Many factors could cause the actual
results, performance or achievements of the Company to be materially different
from any future results, performance and achievements that may be expressed or
implied by such forward looking statements, including: general economic and
market segment conditions, competitor activity, product capability and
acceptance, international risk and currency exchange rates and technology
changes. More detailed assessment of the risks that could cause actual results
to materially differ from current expectations is contained in the "Risk
Assessment" section included in the Company's MD&A in respect of the year ended
December 31, 2006 posted on www.sedar.com.


Key Performance Indicators and Other Measures


JumpTV is not aware of any uniform standards for calculating subscriptions,
subscribers, ARPU, SAC, Churn and channels signed and we believe that JumpTV's
presentation of these measures may not be calculated consistently with other
companies in the same or similar business. Moreover, these measures are of
operational performance and not measures of financial performance under
generally accepted accounting principles. All other financial measures
referenced herein have been prepared in accordance with Canadian generally
accepted accounting principles.


KEY PERFORMANCE INDICATORS

                                      Three months ended           Growth
                                      31-Mar-07       31-Dec-06     %
                                      -----------     ---------     ----
Revenue                               $ 1,003,146     $ 748,864     34.0%
Total Subscriptions                        34,496        28,138     22.6%
Total Subscribers                          30,062        24,554     22.4%
Channels Signed to date                       280           254     10.2%
Average Monthly Revenue per
 User (ARPU)                          $     11.52     $   11.04      4.3%
Subscriber Acquisition Costs (SAC)    $     51.72     $   39.21     31.9%
Subscriber Monthly Churn                     12.5%         26.9%   (53.4)%


JumpTV Inc.

                       CONSOLIDATED BALANCE SHEETS
                               (unaudited)
                       (Expressed in U.S. dollars)


As at                                            March 31,     December 31,
                                                   2007            2006
                                                     $               $
                                                -----------     ----------
ASSETS
Current
Cash                                            134,931,573     21,936,878
Short-term investments                              108,263     28,115,378
Other receivables                                   737,232        723,621
Prepaid expenses and deposits                       866,473      1,178,119
Funds held in trust                                 231,075             --
Due from related party                                7,421             --
                                                -----------     ----------
Total current assets                            136,882,037     51,953,996
                                                -----------     ----------
Property, plant and equipment, net                3,199,564      1,269,488
Intangible assets                                 1,624,673        312,140
Goodwill                                            116,591        102,069
Other assets                                        185,828        161,246
Deferred direct broadcast operating costs, net       52,806         61,605
                                                -----------     ----------
Total assets                                    142,061,499     53,860,544
                                                ===========     ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities          3,581,592      3,950,284
Bank loan                                                --      1,287,150
Due to related party                                     --         14,676
Accrued license fees                                150,578        106,916
Accrued professional fees                         1,536,647        371,782
Accrued stock appreciation rights                 1,149,112      1,087,760
Deferred revenue                                    276,895        205,314
Income taxes payable                                 77,250         61,800
                                                -----------     ----------
Total current liabilities                         6,772,074      7,085,682
                                                -----------     ----------
Deferred rent                                       136,036         18,502
                                                -----------     ----------
Total liabilities                                 6,908,110      7,104,184
                                                -----------     ----------
Shareholders' equity
Share capital                                   170,251,615     75,227,648
Contributed surplus                               3,403,562      2,937,219
Accumulated other comprehensive loss                (40,355)       (32,240)
Accumulated deficit                             (38,461,433)   (31,376,267)
                                                -----------     ----------
Total shareholders' equity                      135,153,389     46,756,360
                                                -----------     ----------
Total liabilities and shareholders' equity      142,061,499     53,860,544
                                                ===========     ==========


JumpTV Inc.

                  CONSOLIDATED STATEMENTS OF OPERATIONS
                               (unaudited)
        (Expressed in U.S. dollars, unless otherwise indicated)

                                                        Three months
                                                           ended
                                                          March 31
                                               ---------------------------
                                                   2007             2006
                                                     $                $
                                               ------------    -----------
Revenue                                           1,003,146        350,508
Direct broadcast operating costs                 (1,360,259)      (250,330)
                                               ------------    -----------
                                                   (357,113)       100,178
                                               ------------    -----------
Other costs and expenses
Selling, general and administrative               6,528,892      3,355,642
Stock-based compensation                          1,156,102        766,181
Amortization of property, plant and equipment        79,176         21,933
Amortization of intangible assets                     9,908             --
                                               ------------    -----------
                                                  7,774,078      4,143,756
                                               ------------    -----------
Loss before the following:                       (8,131,191)    (4,043,578)
Gain on foreign exchange                             45,814          8,324
Investment income, net                            1,015,661         71,117
                                               ------------    -----------
Loss before income taxes                         (7,069,716)    (3,964,137)
Provision for income taxes                           15,450         13,000
                                               ------------    -----------
Net loss for the period                          (7,085,166)    (3,977,137)
                                               ============    ===========
Loss per share - basic and diluted             $      (0.18)   $     (0.21)
                                               ============    ===========
Weighted average number of shares outstanding
 - basic and diluted                             40,387,397     18,783,631
                                               ============    ===========


JumpTV Inc.

                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (unaudited)
                        (Expressed in U.S. dollars)

                                                        Three months
                                                           ended
                                                          March 31
                                               ---------------------------
                                                    2007            2006
                                                     $               $
                                               ------------    -----------

OPERATING ACTIVITIES
Net loss for the period                          (7,085,166)    (3,977,137)
Adjustments to reconcile net loss to
 cash used in operating activities
   Amortization                                     176,029         40,532
   Stock based compensation, excluding change
    in accrued stock appreciation rights as
    noted below                                   1,104,483        766,181
   Amortization of deferred direct broadcast
    operating costs                                  31,395          8,800
                                               ------------    -----------
                                                 (5,773,259)    (3,161,624)
Changes in operating assets and liabilities
   Funds held in trust                             (231,075)            --
   Other receivables                                (40,052)       (14,424)
   Prepaid expenses, deposits and other assets      285,064       (153,099)
   Accounts payable and accrued liabilities        (359,341)       510,351
   Due to/from related party                        (22,097)        (7,363)
   Accrued license fees                              43,662        (34,282)
   Accrued stock appreciation rights                 61,352             --
   Accrued professional fees                      1,164,865          2,589
   Deferred revenue                                  71,581         10,696
   Income taxes payable                              15,450         13,000
   Deferred rent                                    117,534             --
                                               ------------    -----------
Cash used in operating activities                (4,666,316)    (2,834,156)
                                               ------------    -----------
INVESTING ACTIVITIES
Redemption of short-term investments, net        27,999,000             --
Purchase of equipment                            (2,079,935)      (258,415)
Acquisition, net of cash acquired of $3,308        (151,840)            --
                                               ------------    -----------
Cash provided by (used in) investing activities  25,767,225       (258,415)
                                               ------------    -----------

FINANCING ACTIVITIES
Proceeds from share issuances, net               93,104,671      8,003,963
Repayment of bank loan                           (1,287,150)            --
Redemption of Class C common share                       --             (1)
Proceeds from exercise of stock options              76,265        587,546
                                               ------------    -----------
Cash provided by financing activities            91,893,786      8,591,508
                                               ------------    -----------

Net increase in cash during the period          112,994,695      5,498,937
Cash, beginning of period                        21,936,878      5,475,052
                                               ------------    -----------
Cash, end of period                             134,931,573     10,973,989
                                               ============    ===========


PR / IR CONTACT INFORMATION:
Lewis Goldberg
KCSA Worldwide
[phone]
[e-mail]


Alex Mackey
Catullus Consulting
+ 44 7773 787 458
[e-mail]


NOMAD:
Canaccord Adams
Chris Bowman
T: [phone]
[e-mail]


SOURCE: JumpTV Inc.



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