EXHIBIT 99.1
FOR RELEASE NOVEMBER 15, 2004 AT 4:00PM EDT
Contacts:
Paul Rosenbaum Investors
Rentrak Corporation PondelWilkinson Parham
Chairman & CEO Ron Parham
503-284-7581 503-924-1186
exitpoll@aol.com rparham@pondel.com
RENTRAK REPORTS SECOND QUARTER NET INCOME OF $1.8 MILLION
ON 85 PERCENT REVENUE RISE
PORTLAND, Ore. (November 15, 2004)--Rentrak Corp. (Nasdaq:RENT) today
announced net income of $1.8 million, or $0.17 per diluted share, for the second
fiscal quarter ended September 30, 2004, compared with a net loss of $1.5
million, or $(0.15) per diluted share, for the same period one year ago, as
restated.
Rentrak Chairman and Chief Executive Officer Paul Rosenbaum commented,
"We're extremely pleased with our second quarter results. Over the past 12
months, our revenue-sharing business, combined with early revenues from our
newly introduced business intelligence services, generated revenues of $96.9
million, earnings of $5.8 million, or $0.57 per diluted share, and operating
cash flow of $3.9 million. Capitalizing on that internally generated cash flow,
we've made tremendous progress developing and introducing our full suite of
Essentials services."
Consolidated revenues for the quarter grew 84.9 percent, to $27.0 million,
compared with $14.6 million in last year's restated second quarter, primarily
due to increased activity under new revenue-sharing agreements that took effect
during the past twelve months, increased revenue from the company's existing and
new information management services and the positive effect of a revenue-sharing
agreement with a large customer that was renegotiated in September 2003 and
expired September 30, 2004. It appears likely, although still not certain, that
this customer will adopt a studio-direct revenue-sharing arrangement similar in
nature to those employed by national chains. Under such an arrangement, Rentrak
would no longer generate revenues directly from this customer and would,
instead, realize revenue in lesser amounts from studios in exchange for
performing rental data collection, auditing and reporting services in support of
the customer's studio-direct revenue-sharing agreement."
Rentrak Fiscal 2005 Second Quarter Net Income $1.8 million on 85 Percent Revenue
Rise
Page 2 of 3
Mr. Rosenbaum continued, "We expect the movie rental industry to remain
healthy even as studios, rentailers and consumers experiment with new
distribution models, including subscription-based programs and on demand.
Despite the reduction in near-term revenues we expect due to the change in the
customer relationship mentioned above, we believe our revenue-sharing business
will continue to generate positive earnings and cash flow. Combined with our
current cash balance of over $13 million, this cash flow will provide the
capital necessary for us to continue investing in additional staff to support
the on-going development and expansion of our business intelligence and media
measurement services -- services which represent the future of Rentrak.
"This future holds great potential for Rentrak and we are intensely
focused on continuing to transform the company. Today we are engaged in trial
programs involving data acquisition and reporting in every one of our new
Essentials services. We are making steady progress gaining access to more data
from more channels of media distribution, moving us nearer the critical mass
necessary to begin generating ongoing revenues from each of these services. We
believe our success in acquiring broad access to industry sell-through data is
creating a powerful strategic advantage over potential competitors.
"For example, our OnDemand Essentials(TM) pilot programs with Comcast in
its Philadelphia market and with Insight Communications in all 12 of its on
demand-enabled markets are resulting in Rentrak's capture of over 7 million
anonymous on-demand viewing transactions each week. OnDemand Essentials collects
and aggregates anonymous on-demand viewership data and delivers in-depth
analysis of actual, real-time viewing patterns at a census level to help
studios, television networks, advertisers and cable companies better understand
viewer preferences for on-demand content. At present, no other independent
third-party aggregator is involved in similar trials within the on-demand
category."
Rosenbaum concluded, "We are committed to working closely with media,
entertainment, retail and advertising industry leaders to provide them with
state-of-the-art data collection, analysis and reporting technologies. Our
services are designed to provide not only superior measurement of media
consumption but, more importantly, to enable the deployment of new media
technologies that benefit from our advanced measurement technologies. We believe
our deep industry expertise, coupled with our proprietary data management and
analysis techniques, allow us to be more flexible and nimble than the legacy
approaches against which we compete in meeting the emerging needs of these new
media technologies."
Rentrak Fiscal 2005 Second Quarter Net Income $1.8 million on 85 Percent Revenue
Rise
Page 3 of 3
Conference Call
Rentrak has scheduled a conference call for 2 p.m. (PST) November 15, 2004
to discuss the company's financial performance. Shareowners, members of the
media and other interested parties may participate in the call by dialing
1-800-901-5226 from the U.S. or Canada, or 617-786-4513 for international
callers, passcode 39388575. This call is being webcast by CCBN and can be
accessed at Rentrak's web site at www.rentrak.com where it will be archived
through November 15, 2005. The webcast is also being distributed over CCBN's
Investor Distribution Network to both institutional and individual investors.
Individual investors can listen to the call through CCBN's individual investor
center at www.fulldisclosure.com or by visiting any of the investor sites in
CCBN's Individual Investor Network. Institutional investors can access the call
via CCBN's password-protected event management site, StreetEvents
(www.streetevents.com).
About Rentrak Corporation
Rentrak Corporation, based in Portland, Oregon, is the developer of the
Essentials(TM) suite of web-based information management and business
intelligence products used by clients in the media, entertainment, retail and
manufacturing industries. Vertical market editions of Essentials(TM)
applications are customizable to the needs of each licensee, allowing marketers
to collect, manage, analyze and make critical business decisions based on
detailed, real-time point-of-sale and supply chain data. The Essentials(TM)
suite of services offers competitive advantages to executives in selected
industries by providing timely and actionable insight into their own company's
performance in tandem with valuable perspective against aggregated industry-wide
data. For further information, please visit Rentrak's corporate web site at
http://www.rentrak.com.
Safe Harbor Statement
When used in this discussion, the words "anticipates," "expects,"
"intends" and similar expressions are intended to identify forward-looking
statements. Such statements relate to, among other things, the revenues and
results of operations for the company's PPT(R) and business intelligence
services and are subject to certain risks and uncertainties that could cause
actual results to differ materially from those projected. Factors that could
affect Rentrak's financial results include customer demand for movies in various
media formats subject to company guarantees, the company's ability to attract
new revenue-sharing customers and retain existing customers, the company's
success in maintaining its relationships with studios and other product
suppliers, the company's ability to successfully develop and market new services
to create new revenue streams, and Rentrak's customers continuing to comply with
the terms of their agreements. Additional factors that could affect Rentrak's
financial results are described in Rentrak's March 31, 2004 annual report on
Form 10-K and subsequent quarterly reports, filed with the Securities and
Exchange Commission. Results of operations in any past period should not be
considered indicative of the results to be expected for future periods.
Business outlook statements are based on current expectations. These
statements are forward-looking, subject to risks and uncertainties, and actual
results may differ materially. Readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the date of this
press release. The inclusion of any statement in this release does not
constitute a suggestion by the company or any other person that the events or
circumstances described in such statements are material. The company does not
undertake to publicly update or revise these forward-looking statements even if
experience or future changes make it clear that any projected results expressed
or implied in this release will not be realized.
# # #
(Financial Tables Follow)
RENTRAK CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
September 30, March 31,
2004 2004
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 13,891,499 $ 8,735,683
Accounts receivable, net of allowance for doubtful
accounts of $1,013,173 and $839,122 18,047,479 15,389,867
Advances to program suppliers, net of program
supplier reserves of $4,532,724 and $4,520,759 1,649,809 4,188,222
Income tax receivable 45,148 68,384
Deferred tax asset 402,166 2,262,186
Other current assets 1,135,419 1,160,952
------------ ------------
Total current assets 35,171,520 31,805,294
PROPERTY AND EQUIPMENT, net 2,828,256 2,466,668
DEFERRED TAX ASSET 1,221,074 1,099,660
OTHER ASSETS 647,982 831,617
------------ ------------
TOTAL ASSETS $ 39,868,832 $ 36,203,239
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 15,479,730 $ 15,446,818
Accrued liabilities 583,928 889,377
Accrued compensation 737,239 598,875
Deferred revenue 271,727 237,575
------------ ------------
Total current liabilities 17,072,624 17,172,645
------------ ------------
LONG-TERM LIABILITIES:
Lease obligations and deferred gain 156,756 234,922
COMMITMENTS AND CONTINGENCIES -- --
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value;
Authorized: 10,000,000 shares, none issued
Common stock, $.001 par value;
Authorized: 30,000,000 shares
Issued and outstanding: 9,850,466 shares
at Sept 30, 2004 and 9,739,537 at
March 31, 2003 9,850 9,740
Capital in excess of par value 41,742,044 41,093,976
Accumulated other comprehensive income 180,879 180,879
Accumulated deficit (19,293,321) (22,488,923)
------------ ------------
Total stockholders' equity 22,639,452 18,795,672
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 39,868,832 $ 36,203,239
============ ============
The accompanying notes are an integral part of these consolidated statements.
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended September 30,
2004 2003
----------- ----------
(Restated)
REVENUES 26,997,784 14,603,732
OPERATING EXPENSES:
Cost of sales 19,860,236 12,465,406
Selling and administrative 4,338,227 4,140,708
----------- ------------------
24,198,463 16,606,114
----------- ------------------
INCOME (LOSS) FROM OPERATIONS 2,799,321 (2,002,382)
OTHER INCOME (EXPENSE):
Interest income 52,812 67,428
Interest expense (1,165) (1,776)
----------- ------------------
51,647 65,652
----------- ------------------
INCOME (LOSS) BEFORE TAXES 2,850,968 (1,936,730)
PROVISION (BENEFIT) FOR INCOME TAXES 1,040,605 (484,182)
----------- ------------------
NET INCOME (LOSS) $ 1,810,363 $(1,452,548)
=========== ==================
NET INCOME (LOSS) PER SHARE:
Basic $ 0.18 $ (0.15)
=========== ===========
Diluted $ 0.17 $ (0.15)
=========== ===========
The accompanying notes are an integral part of these condensed consolidated
statements.
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Six Months Ended September 30,
2004 2003
----------- -----------
(Restated)
REVENUES 52,330,786 33,518,104
OPERATING EXPENSES:
Cost of sales 38,637,297 26,924,494
Selling and administrative 8,769,406 8,471,258
----------- ------------
47,406,703 35,395,752
----------- ------------
INCOME (LOSS) FROM OPERATIONS 4,924,083 (1,877,648)
OTHER INCOME (EXPENSE):
Interest income 110,657 122,867
Interest expense (2,296) (7,825)
----------- ------------
108,361 115,042
----------- ------------
INCOME (LOSS) BEFORE TAXES 5,032,444 (1,762,606)
PROVISION (BENEFIT) FOR INCOME TAXES 1,836,842 (440,652)
----------- ------------
NET INCOME (LOSS) $ 3,195,602 $ (1,321,954)
=========== ============
NET INCOME (LOSS) PER SHARE:
Basic $ 0.33 $ (0.14)
=========== ============
Diluted $ 0.31 $ (0.14)
=========== ============
The accompanying notes are an integral part of these condensed consolidated
statements.
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended September 30, 2004
----------------------------------------------
ENTERTAINMENT FULFILLMENT TOTAL
------------- ----------- -----------
REVENUES $ 26,997,784 $ -- $26,997,784
OPERATING EXPENSES:
Cost of sales 19,860,230 6 19,860,236
Selling and administrative 4,328,593 9,634 4,338,227
------------ -------- -----------
24,188,823 9,640 24,198,463
------------ -------- -----------
INCOME (LOSS) FROM OPERATIONS 2,808,961 (9,640) 2,799,321
------------ -------- -----------
OTHER INCOME (EXPENSE):
Interest income 19,215 33,597 52,812
Interest expense (1,165) -- (1,165)
------------ -------- -----------
18,050 33,597 51,647
------------ -------- -----------
INCOME BEFORE TAXES 2,827,011 23,957 2,850,968
PROVISION FOR INCOME TAXES 1,031,861 8,744 1,040,605
------------ -------- -----------
NET INCOME $ 1,795,150 $ 15,213 $ 1,810,363
============ ======== ===========
NET INCOME PER SHARE:
Basic $ 0.18 $ 0.00 $ 0.18
============ ======== ===========
Diluted $ 0.17 $ 0.00 $ 0.17
============ ======== ===========
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Six Months Ended September 30, 2004
--------------------------------------------
ENTERTAINMENT FULFILLMENT TOTAL
------------- ----------- -----------
REVENUES $ 52,330,786 $ -- $52,330,786
OPERATING EXPENSES:
Cost of sales 38,631,258 6,039 38,637,297
Selling and administrative 8,749,184 20,222 8,769,406
------------ -------- -----------
47,380,442 26,261 47,406,703
------------ -------- -----------
INCOME (LOSS) FROM OPERATIONS 4,950,344 (26,261) 4,924,083
------------ -------- -----------
OTHER INCOME (EXPENSE):
Interest income 42,009 68,648 110,657
Interest expense (2,296) -- (2,296)
------------ -------- -----------
39,713 68,648 108,361
------------ -------- -----------
INCOME BEFORE TAXES 4,990,057 42,387 5,032,444
PROVISION FOR INCOME TAXES 1,821,371 15,471 1,836,842
------------ -------- -----------
NET INCOME $ 3,168,686 $ 26,916 $ 3,195,602
============ ======== ===========
NET INCOME PER SHARE:
Basic $ 0.33 $ 0.00 $ 0.33
============ ======== ===========
Diluted $ 0.31 $ 0.00 $ 0.31
============ ======== ===========
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended September 30, 2003
-----------------------------------------------
(restated)
ENTERTAINMENT FULFILLMENT TOTAL
------------- ----------- -----------
REVENUES $ 14,099,116 $ 504,616 $14,603,732
OPERATING EXPENSES:
Cost of sales 10,444,120 2,021,286 12,465,406
Selling and administrative 3,870,115 270,593 4,140,708
------------ ----------- -----------
14,314,235 2,291,879 16,606,114
------------ ----------- -----------
INCOME (LOSS) FROM OPERATIONS (215,119) (1,787,263) (2,002,382)
------------ ----------- -----------
OTHER INCOME (EXPENSE):
Interest income 20,658 46,770 67,428
Interest expense (1,776) -- (1,776)
------------ ----------- -----------
18,882 46,770 65,652
------------ ----------- -----------
INCOME BEFORE TAXES (196,237) (1,740,493) 1,936,730)
PROVISION FOR INCOME TAXES (49,059) (435,123) (484,182)
------------ ----------- -----------
NET INCOME $ (147,178) $(1,305,370) $(1,452,548)
============ =========== ===========
NET INCOME PER SHARE:
Basic $ (0.02) $ (0.13) $ (0.15)
============ =========== ===========
Diluted $ (0.02) $ (0.13) $ (0.15)
============ =========== ===========
RENTRAK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Six Months Ended September 30, 2003
-----------------------------------------------
(restated)
ENTERTAINMENT FULFILLMENT TOTAL
-------------- ----------- -----------
REVENUES $ 28,893,805 $ 5,154,443(1) $33,518,104
OPERATING EXPENSES:
Cost of sales 21,201,605(1) 6,253,033 26,924,494
Selling and administrative 7,730,663 740,595 8,471,258
------------ ----------- -----------
28,932,268 6,993,628 35,395,752
------------ ----------- -----------
INCOME (LOSS) FROM OPERATIONS (38,463) (1,839,185) (1,877,648)
------------ ----------- -----------
OTHER INCOME (EXPENSE):
Interest income 51,703 71,164 122,867
Interest expense (3,429) (4,396) (7,825)
------------ ----------- -----------
48,274 66,768 115,042
------------ ----------- -----------
INCOME BEFORE TAXES 9,811 (1,772,417) (1,762,606)
PROVISION FOR INCOME TAXES 2,452 (443,104) (440,652)
------------ ----------- -----------
NET INCOME $ 7,359 $(1,329,313) $(1,321,954)
============ =========== ===========
NET INCOME PER SHARE:
Basic $ 0.00 $ (0.14) $ (0.14)
============ =========== ===========
Diluted $ 0.00 $ (0.14) (0.14)
============ =========== ===========
(1) - Includes Intercompany transactions of $530,144, which are eliminated in
consolidated total amounts.