NINE MONTH FISCAL 2013 RESULTS
| · | FY 2013 nine month revenues increased 13%, gross profit up 19% |
| · | Company plans to reduce annualized operating expenses from $4.0 to $2.5 million by late calendar 2013 |
| · | USPTO allowance for patent supporting advertising marketplace |
Woodland Hills, CA. March 14, 2013 --- One of the leading networks of forum communities on the Internet, CrowdGather, Inc. (OTCQB:CRWG), today announced financial results for the third quarter ended January 31, 2013.
The Company reported revenues of $508,689 for the three months ended January 31 of fiscal 2013, resulting in $1,523,623 in total revenue for the nine months ended January 31 of fiscal 2013, compared to $549,750 and $1,352,082, respectively, for the same periods in the prior fiscal year. Revenues for the third quarter of fiscal 2013 were 7% lower than the third quarter of fiscal 2012, but revenues increased by 13% when comparing the first nine months of fiscal 2013 to the first nine months of fiscal 2012. In the third quarter of fiscal 2013, effective advertising payouts per thousand impressions (an impression is the display of an ad unit on a web page viewed by an online user) decreased slightly when compared to the same period in fiscal 2012 due to lower advertising rates. As the Company’s revenues diversify and grow in the future, it expects the volatility in advertising payouts to diminish and have less of an impact on total revenues.
“We are pleased to report a strong performance for the first nine months of our 2013 fiscal year,” said Sanjay Sabnani, CrowdGather’s Chairman and CEO. “Although we experienced lower than expected market rates from advertising networks during our third fiscal quarter of 2013, we continue to analyze our network to identify monetization opportunities and remain optimistic as we move through 2013. Additionally, our advertising marketplace, Adisn, is intended to achieve two primary objectives: the first is to more efficiently manage our principal advertising inventory from our own properties and the second is to create a marketplace that connects advertisers to targeted verticals of niche publishers consisting primarily of forums. While we believe we achieved the first objective, our second objective of fully deploying the marketplace required more resources than we could devote during the 2012 calendar year. Although our advertising marketplace has yet to contribute to revenue growth, we expect to dedicate more resources toward the platform and anticipate a benefit during the 2013 calendar year.”
Gross profit was $482,937 and $1,478,655, respectively, for the three months and nine months ended January 31 of fiscal 2013, compared to $544,957 and $1,238,549 for the same periods in the prior fiscal year. On a quarterly basis, gross profit declined by 11% but increased 19% when comparing the first nine months of fiscal 2013 to the first nine months of fiscal 2012.
Net loss was $682,193, or $.01 per share, and $2,152,619, or $.04 per share, for the third quarter and nine months ended January 31 of fiscal 2013, compared to $746,980, or $.01 per share, and $2,375,948, or $.04 per share, for the same periods of fiscal 2012.
CrowdGather ended the third quarter of fiscal 2013 with approximately $0.5 million of cash and $14.6 million of shareholder’s equity.
“While staying focused on improving revenues, we are committed to reducing costs and are working toward creating automated solutions and efficiencies throughout our business that will allow us to reduce overhead significantly,” Sabnani said. “By October of 2013, we intend to reduce our annualized operating expenses from a $4.0 million run rate to approximately $2.5 million, which we believe we can achieve without significantly impacting our revenue and will move us closer to breakeven. As we move forward, we continue seeking avenues to grow our business, whether through improving advertising opportunities on our existing ad inventory or developing partnerships with third party publishers to improve monetization. We are also evaluating strategic options, including potential business combinations as well as debt and equity financing.”
