Comtex News Network Release: IMMEDIATE
For: Comtex News Network
(Symbol: CMTX)
Contact: Amber Gordon
agordon@comtex.com
703-797-8011
COMTEX REPORTS SECOND QUARTER FISCAL 2009 EARNINGS
NEW YORK, NY, February 10, 2009 - Comtex News Network, Inc. (OTC BB: CMTX), a
leading provider of economically useful electronic real-time news, content and
SmarTrend(R) market products, today announced financial results for its second
fiscal quarter and the six month period ended December 31, 2008.
Comtex reported $43,000 of operating income and net income of $47,000, or
$0.00 per share, on revenues of $1.6 million for the second quarter ended
December 31, 2008, compared to operating income of $257,000 and net income of
$268,000, or $0.02 per share, on revenues of $1.8 million for the three months
ended December 31, 2007. The decrease was primarily due to a reduction in
database revenues caused by industry consolidations and current economic
conditions, plus increased marketing and technical operations costs.
For the six months ended December 31, 2008, Comtex reported $74,000 of
operating income and net income of $72,000, or $0.00 per share, on revenues of
$3.3 million compared to $564,000 of operating income and net income of
$510,000, or $0.03 per share, on revenues of $3.6 million for the six months
ended December 31, 2007. The decrease in net income was primarily due to a
reduction in database revenues caused by industry consolidations coupled with a
one time revenue pick up of $181,000 from prior periods recorded in the six
months ended December 31, 2007. Net income for the period ended December 31,
2008 was also impacted by an increase in marketing and technical operations
costs, offset by the extinguishment of an accrued liability of $138,000 on
October 30, 2008.
For the six months ended December 31, 2008, EBITDA (as defined and
explained in the accompanying note to the table below), excluding the effects of
stock-based compensation, was $167,000 compared to EBITDA of $607,000 for the
six months ended December 31, 2007. The decrease in EBITDA was due to reduced
revenues as discussed above, and increased expenses mainly in technical
operations, sales and marketing.
Chip Brian, Comtex's President and CEO, stated, "During these challenging
economic times, Comtex has thoroughly evaluated its financial structure and is
pleased to be one hundred percent debt-free. Furthermore, we are strengthening
our connections with customers by improving the value of our products, upgrading
our technology, and expanding our content distribution capabilities."
Comtex Announces 2nd Quarter Earnings Page 2
February 10, 2009
About Comtex
Comtex (www.comtex.com) provides real-time news, Comtex SmarTrend(R) Alerts and
economically useful information. Comtex customers receive select content from
key sources which is further enhanced with stock tickers and an extended lexicon
of relevant terms. With a specialization in the financial news and content
marketplace, Comtex receives, enhances, combines and filters news and content
received from national and international news bureaus, agencies and
publications, and distributes more than one million total stories per day.
Comtex's state-of-the-art technology delivers this relevant content and reliable
service in real-time. Comtex also provides several proprietary SmarTrend Alert
products to investors, including a daily stock market letter (Morning Call),
selected stock news (SmarTrend Spotlights), and SmarTrend Alerts (via
subscription at www.mysmartrend.com). Comtex has offices in New York City;
Boston, Massachusetts; and Alexandria, Virginia.
SmarTrend(R) is a registered trademark of Comtex News Network, Inc.
FINANCIAL TABLE FOLLOWS
Comtex Announces 2nd Quarter Earnings Page 3
February 10, 2009
Comtex News Network, Inc.
Selected Financial Data
(unaudited / amounts in thousands, except per share amounts)
Three Months Six Months
Ended December 31 Ended December 31
--------------------------------- ---------------------------------
2008 2007 2008 2007
--------------------------------- ---------------------------------
Revenues $1,653 $1,800 $ 3,316 $ 3,656
Operating Income 43 257 74 564
Net Income $ 47 $ 268 $ 72 $ 510
--------------------------------- ---------------------------------
Earnings Per Share
Basic and Diluted $ 0.00 $ 0.02 $ 0.00 $ 0.03
--------------------------------- ---------------------------------
Weighted Avg. # Shares:
Basic 15,446 15,294 15,583 15,294
--------------------------------- ---------------------------------
Diluted 15,450 15,463 15,791 15,462
--------------------------------- ---------------------------------
Reconciliation to EBITDA:
Net Income $ 47 $ 268 $ 72 $ 510
Stock-based compensation 35 - 35 3
Depreciation and Amortization 29 19 58 40
Interest/Other (Income) Expenses, net (6) (12) (11) 49
Income Taxes 1 1 13 5
--------------- ---------------- ----------------- --------------
EBITDA $ 106 $ 276 $ 167 $ 607
--------------- ---------------- ----------------- --------------
Please Note: EBITDA consists of earnings before stock-based compensation, debt
conversion expense, interest expense, interest and other income, unrealized and
realized gains (losses) in marketable securities, income taxes, and depreciation
and amortization. EBITDA is not a term defined by U.S. generally accepted
accounting principles, and as a result, our measure of EBITDA might not be
comparable to similarly titled measures used by other companies. However, we
believe that EBITDA is relevant and useful information, which is often reported
and widely used by analysts, investors and other interested parties in our
industry. Accordingly, we are disclosing this information to permit a more
comprehensive analysis of our operating performance.
Also Please Note: Except for the historical information contained herein, this
press release contains forward-looking statements within the meaning of Section
21E of the Securities and Exchange Act of 1934, as amended, that involve a
number of risks and uncertainties. These forward-looking statements may be
identified by reference to a future period by use of forward-looking terminology
such as "anticipate," "expect," "could," "intend," "may" and other words of a
similar nature. These statements involve risks and uncertainties that could
cause actual results to differ materially from those contemplated herein,
including the occurrence of unanticipated events or circumstances relating to
the fact that Comtex is in a highly competitive industry subject to rapid
technological, product and price changes. Other factors include the possibility
that demand for the Company's products may not occur or continue at sufficient
levels, changing global economic and competitive conditions, technological risks
and other risks and uncertainties, including those detailed in the Company's
filings with the Securities and Exchange Commission. Comtex undertakes no
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
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