Exhibit 99.1
Greenfield Online Announces Second Quarter Financial Results
Net revenue increased 72% in the second quarter of 2004
over the prior year period to $10.2 million
Gross profit increased 102% in the second quarter of 2004
over the prior year period to $8.0 million
Operating income increased 178% in the second quarter of
2004 over the prior year period to $1.9 million
Net income increased 215% in the second quarter of 2004
over the prior year period to $1.7 million
WILTON, Conn., Aug. 11 /PRNewswire-FirstCall/ -- Greenfield Online, Inc.
(Nasdaq: SRVY), a leading provider of Internet survey solutions to marketing
research and consulting companies, today reported financial results for the
second quarter ended June 30, 2004.
Net revenue for the second quarter ended June 30, 2004 was $10.2 million,
a 72% increase compared to $5.9 million for the second quarter ended June 30,
2003, or an increase of 19% compared to $8.6 million for the first quarter
ended March 31, 2004. Revenue for the six months ended June 30, 2004 was $18.8
million, a 79% increase compared to $10.5 million for the six months ended
June 30, 2003.
Gross profit for the second quarter ended June 30, 2004 was $8.0 million,
or 79% of revenue and increased 102% compared to $4.0 million, or 67% of
revenue in the same period a year ago. Gross profit for the six months ended
June 30, 2004 was $13.9 million, or 74% of revenue and increased 97% compared
to $7.1 million, or 67% of revenue in the same period a year ago.
Operating income for the second quarter ended June 30, 2004 increased 178%
to $1.9 million compared to $701,000 in the same period a year ago. Operating
income for the six months ended June 30, 2004 increased 297% to $2.4 million
compared to $599,000 for the same period a year ago.
Adjusted EBITDA, a non-GAAP financial measure, for the second quarter
ended June 30, 2004 increased 93% to $2.5 million compared to $1.3 million in
the same period a year ago. Adjusted EBITDA for the six months ended June 30,
2004 increased 112% to $3.9 million compared to $1.8 million for the same
period a year ago. Adjusted EBITDA is reconciled to GAAP operating income in
the section entitled "Non-GAAP Financial Measure" below.
Net income for the second quarter of 2004 increased 215% to $1.7 million
compared to $549,000 for the second quarter of 2003, and increased 431%
compared to net income of $325,000 in the first quarter of 2004. Net income
for the six months ended June 30, 2004 increased 128% to $2.1 million compared
to $899,000 in the same period a year ago.
Dean Wiltse, Greenfield Online's President and Chief Executive Officer,
commented, "This was another strong quarter for us driven by increased
activity from existing customers and new relationships. There is a secular
shift underway as the marketing research industry moves away from offline to
online data collection. Our decision to exit the custom marketing research
business two years ago and to become a leading provider of Internet survey
solutions and proprietary panels to the marketing research industry has
worked. We have good momentum in our business and remain optimistic about our
future prospects as we enable the global marketing research industry to
complete surveys via the Internet."
Sales bookings in the second quarter, defined as new signed contracts for
online survey work, reached $12.4 million, up 86% over the same period a year
ago and up 14% from last quarter. Bid volume in the second quarter, defined
as the total value of projects requested for bid by clients for new online
survey work, during the three months ended June 30, 2004, was $67 million, up
139% over the same period a year ago and up 10% from last quarter. Third-
quarter backlog, defined as signed contracts for online survey projects to be
completed and delivered to clients during the three months ending September
30, 2004, is approximately $11.0 million today.
Bob Bies, Greenfield Online's Executive Vice President and Chief Financial
Officer, commented, "Our results reflect the significant operating leverage we
have achieved in our business. Our operating income for the second quarter
increased 178% to $1.9 million from $701,000 for the same period a year ago,
and increased 297% for the first six months of 2004 to $2.4 million compared
to $599,000 for the same period a year ago. We completed our IPO on July 16,
from which Greenfield Online received net proceeds of approximately $36
million after deducting proceeds to selling shareholders, underwriting
discounts and commissions, payments to preferred security holders and
estimated offering expenses. We now have the financial strength to execute on
our growth plan as we work to increase shareholder value."
Guidance Looking Forward
The following statements regarding future financial performance are based
on current expectations. These statements are forward looking. Actual
results may differ materially, especially in the current economic environment.
These statements do not reflect the potential impact of mergers, acquisitions
or other business combinations that may be completed by the Company after the
date of this release.
Wiltse commented, "As we enter the third quarter of 2004, we expect
continued sequential growth in revenue and operating income based on sales
bookings and our backlog. For the third quarter of 2004, we expect revenue in
the range of $11.7 to $12.0 million compared to $7.0 million in the third
quarter of 2003, representing growth of approximately 67% to 71%. We expect
operating income for the third quarter of 2004 to be in the range of $2.1 to
$2.3 million compared to $480,000 in the third quarter of 2003. We expect
adjusted EBITDA for the third quarter of 2004 to be in the range of $2.8 to
$3.0 million compared to $1.1 million in the third quarter of 2003. Net
income for the third quarter of 2004 is expected to be in the range of $1.0 to
$1.2 million compared to $335,000 in the third quarter of 2003. The third
quarter of 2004 will include a non-recurring, non-operating write-off of
approximately $1.1 million to related-party interest expense of a debt
discount on Series C-2 Preferred Stock redeemed at the Company's initial
public offering (see guidance below)."
"For the fiscal year 2004, we expect revenue in the range of $43.0 to
$45.0 million, versus $25.9 million for 2003, representing growth of
approximately 66% to 74%. We expect operating income for the fiscal year 2004
to be in the range of $6.6 to $7.1 million, versus $1.7 million in 2003. We
expect adjusted EBITDA for the fiscal year 2004 to be in the range of $9.5 to
$10 million, versus $4.4 million in 2003. Net income for the fiscal year 2004
is expected to be in the range of $5.0 million to $5.6 million (including the
aforementioned $1.1 million of Series C-2 Preferred Stock debt discount
write-off) versus $1.6 million in 2003. Overall, we believe our Company's
focused strategy as a leading provider of Internet survey solutions to
marketing research and consulting companies positions us well for continued
profitable growth and market share expansion."
Q3 and Year 2004 Guidance - EPS
In conjunction with the initial public offering, which was consummated on
July 16, 2004, the Company redeemed its Series C-2 Preferred Stock and
converted its Series B Preferred Stock into Common Stock.
The Series C-2 Preferred Stock carried an unamortized discount of
approximately $1.1 million as of the date of the IPO, which generally accepted
accounting principles require to be recorded to related party interest expense
as a one time charge. This charge will be taken in the third quarter of 2004.
The Series B Preferred Stock carried certain redemption features which
under GAAP required the Company to take a deduction below net income in
computing fully diluted EPS and net income available for common shareholders.
This adjustment amounts to approximately $19.7 million and reflects the
difference between the carrying value of the Series B Preferred Stock and the
value received by the Series B Preferred shareholders when the Series B
Preferred shares were converted to Common Stock at the IPO. This is a
non-recurring, non-operating and non-cash EPS adjustment.
For purposes of reflecting EPS guidance for the third quarter of 2004 and
for the full fiscal year 2004 the table below sets forth EPS guidance assuming
that the IPO occurred on January 1, 2004 in which 4.0 million new shares of
Common Stock were issued for cash and 10.4 million shares of Preferred Stock
were converted to Common Stock. In addition, the table sets forth EPS guidance
calculated using generally accepted accounting principles:
(All figures are unaudited and are in thousands except EPS data)
EPS Guidance Assuming Actual Actual Forecast Forecast Forecast
IPO at 1-01-04 Q-1 2004 Q-2 2004 Q-3 2004 Q-4 2004 Total 2004
Net Income $325 $1,727 $2,200 $2,248 $6,500
EPS - Basic $0.02 $0.10 $0.13 $0.13 $0.39
EPS - Fully Diluted $0.02 $0.10 $0.13 $0.13 $0.38
Weighted Average Shares
Outstanding
Basic 16,463 16,463 16,644 16,690 16,565
Fully Diluted 17,455 17,104 17,306 17,351 17,304
Note: These EPS calculations assumes that the IPO occurred at
January 1, 2004.
Actual Actual Forecast Forecast Forecast
GAAP EPS Guidance Q-1 2004 Q-2 2004 Q-3 2004 Q-4 2004 Total 2004
Net Income $325 $1,727 $2,200 $2,248 $6,500
Adjustments Related to
Preferred Securities
Required by GAAP
Write-off of Unamortized
Discount on C-2 Preferred (1,100) (1,100)
Charge to Common
Stockholders for Series B
Preferred Beneficial
Conversion at IPO (19,654) (19,654)
Cumulative Dividends on
Series B Preferred (168) (168) (48) (384)
Income Allocable to
Participating
Preferred Securities (131) (1,302) (112) (1,545)
Net Income Available
to Common Shareholders $26 $257 $(18,714) $2,248 $(16,183)
EPS Basic $0.01 $0.13 $(1.12) $0.13 $(1.73)
EPS Diluted $0.01 $0.10 -- $0.13 --
Weighted Average Shares
Outstanding
Basic 2,054 2,052 16,644 16,690 9,360
Fully Diluted 3,046 2,693 17,306 17,351 10,099
Non-GAAP Financial Measure
We define adjusted EBITDA as earnings before interest expense, income
taxes, depreciation and amortization, amortization of deferred stock based
compensation and other income (expense), which definition may not be
comparable to similarly titled measures reported by other companies. We are
presenting adjusted EBITDA because it provides an additional way to view our
operations, when considered with both our GAAP results and the reconciliation
to net income, which we believe provides a more complete understanding of our
business than could be obtained absent this disclosure. Adjusted EBITDA is
presented solely as a supplemental disclosure because: (i) we believe it is a
useful tool for investors to assess the operating performance of the business
without the effect of non-cash depreciation and amortization expenses; (ii) we
believe that investors will find it useful in assessing our ability to service
or incur indebtedness; (iii) we use adjusted EBITDA internally to evaluate the
performance of our personnel and also as a benchmark to evaluate our operating
performance or compare our performance to that of our competitors. The use of
adjusted EBITDA has limitations and you should not consider adjusted EBITDA in
isolation from or as an alternative to GAAP measures such as net income, cash
flows from operating activities and consolidated income or cash flow statement
data prepared in accordance with GAAP, or as a measure of profitability or
liquidity. The following table sets forth the reconciliation of adjusted
EBITDA, a non-GAAP financial measure, to net income (loss), our most directly
comparable financial measure presented in accordance with GAAP.
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
Operating Income $1,946 $701 $2,380 $599
Depreciation and Amortization 334 343 638 668
Stock-based Compensation 269 277 848 553
Adjusted EBITDA $2,549 $1,321 $3,866 $1,820
Midpoint
Guidance Actual Midpoint
3 Months 3 Months Guidance Actual
Sept 30, Sept 30, Year Year
2004 2003 2004 2003
Operating Income $2,200 $480 $6,850 $1,697
Depreciation and Amortization 400 354 1,488 1,398
Stock-based Compensation 269 276 1,386 1,282
Adjusted EBITDA $2,869 $1,110 $9,724 $4,377
Conference call and webcast access information
The Company has scheduled a conference call to discuss these results for
later this afternoon, Wednesday, August 11, 2004 at 5:00 PM EDT. Dean A.
Wiltse, CEO, will host the teleconference. Formal remarks will be followed by
a question and answer session.
The dial-in number for the live conference call beginning at 5:00 PM EDT
is (973) 935-2048. The password confirmation is 5028922. Please call in at
4:50PM EDT to avoid delays. A live web cast of the conference call will be
available on Greenfield Online's website at http://www.greenfield.com through
the "Investor Overview" link. This call will contain forward-looking
statements and other material information regarding the Company's financial
and operating results. In the event that any Non-GAAP financial measure is
discussed on the conference call that is not described in this release,
related complementary information will be made available at
http://www.greenfield.com, through the "Investor Overview" link as soon as
practicable after the conclusion of the conference call.
A replay of the call will be available from 7:00 PM EDT on Wednesday,
August 11 through midnight EDT on Wednesday, August 25 by telephone at (973)
341-3080. The password for the replay is 5028922. The webcast of the
conference call will be available for 30 days following the call at
http://www.greenfield.com, through the "Investor Overview" link.
About Greenfield Online
Greenfield Online, headquartered in Wilton, CT, is a leading provider of
Internet survey solutions to marketing research and consulting companies. The
company has built and actively manages the Greenfield Online panel, a 100%
double opt-in Internet-based panel of over 1.7 million households consisting
of more than 4.7 million people who participate in surveys. Using its panel,
Greenfield supplies its clients with diverse, demographically representative
survey research data. For more information visit http://www.Greenfield.com.
Company Contact:
Cynthia Brockhoff
Vice President - Investor Relations
Greenfield Online
Ph: (203)-846-5772
Cbrockhoff@Greenfield.com
Agency Contact:
David Pasquale
The Ruth Group
Ph: (646)-536-7006
Dpasquale@theruthgroup.com
Safe Harbor Statement
Certain statements in this presentation press release constitute are
forward-looking statements for purposes of the safe harbor provisions under
The Private Securities Litigation Reform Act of 1995. These statements
include, without limitation, predictions and guidance relating to the
Company's future financial performance and market share expansion, sales
bookings, bid volume, backlog, and Internet penetration of the global market
research industry. In some cases, you can identify forward-looking statements
by terminology such as, "may", "should", "expects", "plans", "anticipates",
"believes", "estimates", "predicts", "potential", "continue", or the negative
of these terms or other comparable terminology. The forward-looking
statements contained herein are based on the Company's current expectations
but they involve a number of risks and, uncertainties and do not reflect the
potential impact of mergers, acquisitions or other business combinations that
may be completed by the Company after the date of this release. Our actual
results and the timing of events could differ materially from those
anticipated in the forward-looking statements as a result of risks and
uncertainties, which include, without limitation, risks related to our ability
to maintain the size and demographic composition of the Greenfield Online
panel, our panelists' responsiveness to our surveys, our reliance of our
largest customers, our ability to compete with marketing research firms and
other potential competitors, our ability to manage our growth and
international expansion, our online business model, demand for our products
and services, the strength of our brand and other risks detailed in our
filings with the Securities and Exchange Commission available at
http://www.sec.gov, including the final Prospectus relating to our initial
public offering filed on July 16, 2004. You are urged to consider these
factors carefully in evaluating the forward-looking statements herein and are
cautioned not to place undue reliance on such forward-looking statements,
which are qualified in their entirety by this cautionary statement. The
forward-looking statements made herein speak only as of the date of this press
release and the Company undertakes no obligation to publicly update such
forward-looking statements to reflect subsequent events or circumstances.
GREENFIELD ONLINE, INC.
CONSOLIDATED BALANCE SHEETS
($ in thousands, except share data)
(Unaudited)
June 30, December 31,
2004 2003
ASSETS
Current assets:
Cash, restricted cash
and cash equivalents $2,067 $3,721
Accounts receivable trade
(net of allowances of $99 and
$219 at June 30, 2004 and
December 31, 2003, respectively) 7,738 4,234
Prepaid expenses and other
current assets 2,564 498
Total current assets 12,369 8,453
Property and equipment, net 3,020 2,420
Other intangible assets, net 309 311
Security deposits 797 745
Total assets $16,495 $11,929
LIABILITIES, TEMPORARY EQUITY
AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable $2,108 $1,563
Accrued expenses and other
current liabilities 4,803 4,579
Current portion of capital
lease obligations 1,080 874
Deferred revenue 463 394
Total current liabilities 8,454 7,410
Long-term debt 1,000 -
Capital lease obligations 369 705
Other long-term liabilities 25 84
Series C-2 redeemable preferred
stock (aggregate liquidation
preference $2,053) 999 943
Total liabilities 10,847 9,142
Series B convertible preferred
stock; par value $0.0001 per share;
30,211,595 shares authorized,
issued and outstanding 9,450 9,114
Commitments and contingencies
Stockholders' deficit:
Series A convertible preferred stock;
par value $0.0001 per share;
40,874,511 shares authorized;
40,817,166 and 40,874,511 shares
issued and outstanding (aggregate
liquidation preference of $5,953
as of June 30, 2004
and December 31, 2003) 4 4
Series C-1 convertible preferred
stock; par value $0.0001 per share;
74,627,182 shares authorized,
issued and outstanding (aggregate
liquidation preference of $9,127 as
of June 30, 2004 and
December 31, 2003) 7 7
Common stock; par value $0.0001
per share; 13,605,479 shares
authorized; 2,048,938 and 2,054,485
shares issued and outstanding at
June 30, 2004 and December 31, 2003,
respectively - -
Additional paid-in capital 81,951 82,440
Accumulated deficit (82,337) (84,389)
Unearned stock-based compensation (3,296) (4,258)
Treasury stock, at cost
Series A preferred stock - 57,345
and zero shares at June 30, 2004
and December 31, 2003,
respectively (56) -
Common stock - 5,547 and zero shares
at June 30, 2004 and December 31,
2003, respectively (75) -
Note receivable from stockholder - (131)
Total stockholders' deficit (3,802) (6,327)
Total liabilities, temporary
equity and stockholders' deficit $16,495 $11,929
GREENFIELD ONLINE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
($ in thousands, except per share data)
(Unaudited)
Three Months Six Months
Ended Ended
June 30, June 30,
2004 2003 2004 2003
Net revenue $10,229 $5,948 $18,852 $10,539
Cost of revenue (including
stock-based compensation
of $53 and $5, respectively
for the three months ended
June 30, 2004 and 2003,
and $106 and $9,
respectively for the six
months ended June 30, 2004
and 2003 and excluding
depreciation shown below) 2,180 1,956 4,993 3,487
Gross profit 8,049 3,992 13,859 7,052
Operating expenses:
Selling, general and
administrative (including
stock-based compensation
of $215 and $272,
respectively for the three
months ended June 30, 2004
and 2003, and $742 and $544,
respectively for the six
months ended June 30, 2004
and 2003) 5,109 2,478 9,363 4,889
Panel acquisition expenses 484 399 1,172 747
Depreciation and amortization 245 268 463 533
Research and development 265 146 481 284
Total operating expenses 6,103 3,291 11,479 6,453
Operating income 1,946 701 2,380 599
Other income (expense):
Interest expense, net (74) (113) (130) (239)
Related party interest
income (expense), net (13) 1 (40) 2
Other income (expense), net (11) - (16) 600
Total other income
(expense) (98) (112) (186) 363
Income before income taxes 1,848 589 2,194 962
Provision for income taxes 121 40 142 63
Net income 1,727 549 2,052 899
Less: Accretion of Series
C-2 redeemable preferred
stock dividends (31) (63)
Cumulative dividends on
Series B convertible
preferred stock (168) (168) (336) (336)
Income allocable to
participating preferred
securities (1,302) (292) (1,433) (417)
Net income available to
common stockholders $257 $58 $283 $83
Net income per share available
to common stockholders:
Basic $0.13 $0.03 $0.14 $0.04
Diluted $0.10 $0.02 $0.10 $0.04
Weighted average shares
outstanding:
Basic 2,052 2,054 2,053 2,054
Diluted 2,693 2,339 2,707 2,281
SOURCE Greenfield Online, Inc.
-0- 08/11/2004
/CONTACT: Cynthia Brockhoff, Vice President - Investor Relations of
Greenfield Online, +1-203-846-5772, Cbrockhoff@Greenfield.com; or David
Pasquale of The Ruth Group, +1-646-536-7006, Dpasquale@theruthgroup.com, for
Greenfield Online/
/Web site: http://www.greenfield.com /
(SRVY)
CO: Greenfield Online, Inc.
ST: Connecticut
IN: CPR ITE MLM
SU: ERN CCA