EXHIBIT 99.3
SPORTSLINE.COM, INC.
INTRODUCTION TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
On December 6, 1999, SportsLine.com, Inc. (the "Company") acquired Daedalus
World Wide Corporation ("DWWC") for consideration valued at approximately
$31,780,000 consisting of $4,000,000 cash and 600,000 shares of the Company
valued at $27,780,000.
The Unaudited Pro Forma Combined Statements of Operations for the nine
months ended September 30, 1999 and the year ended December 31, 1998 give effect
to the acquisition of DWWC as if it had occurred on January 1, 1998. The
Unaudited Pro Forma Combined Balance Sheet as of September 30, 1999 gives effect
to the acquisition of DWWC as if it had occurred on that date.
The Unaudited Pro Forma Financial Information is intended for informational
purposes only and is not necessarily indicative of the future financial position
or future results of operations of the consolidated company after the
acquisition of DWWC that would have actually occurred had the acquisition of
DWWC been effected as of the dates described above.
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SPORTSLINE.COM, INC.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
SEPTEMBER 30, 1999
(IN THOUSANDS, EXCEPT SHARE DATA)
Pro Forma Pro Forma
SportsLine DWWC Adjustments Combined
---------- --------- ----------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents ......................... $ 64,509 $ 80 $ (4,000)(a) $ 60,589
Marketable securities ............................. 33,868 -- 33,868
Accounts receivable ............................... 8,866 -- (175)(c) 8,691
Deferred advertising and content costs ........... 21,538 -- 21,538
Prepaid expenses and other current assets ......... 11,655 11 (278)(b) 11,388
--------- --------- --------- ---------
Total current assets .......................... 140,436 91 (4,453) 136,074
RESTRICTED CASH EQUIVALENTS .......................... 12,989 -- 12,989
NONCURRENT MARKETABLE SECURITIES ..................... 66,918 -- 66,918
LICENSING RIGHTS ..................................... 5,950 -- 5,950
NONCURRENT DEFERRED ADVERTISING -AOL ................. 7,667 -- 7,667
NONCURRENT DEFERRED ADVERTISING AND CONTENT - CBS .... 33,038 -- 33,038
PROPERTY AND EQUIPMENT, net .......................... 7,718 145 7,863
GOODWILL ............................................. 11,185 -- 31,826(a) 43,011
OTHER ASSETS ......................................... 11,454 -- -- 11,454
--------- --------- --------- ---------
$ 297,355 $ 236 $ 27,373 $ 324,964
========= ========= ========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable .................................. $ 1,059 $ 2 $ 1,061
Accrued liabilities ............................... 8,890 30 8,920
Current portion of capital lease obligations ...... 275 -- 275
Current portion of note payable ................... -- 25 (25)(c) --
Deferred revenue .................................. 2,691 278 (278)(b) 2,691
--------- --------- --------- ---------
Total current liabilities .................... 12,915 335 (303) 12,947
NOTE PAYABLE, net of current portion ................. -- 150 (150)(c) --
ACCRUED AOL OBLIGATION ............................... 8,274 -- 8,274
CONVERTIBLE SUBORDINATED NOTES ....................... 90,000 -- -- 90,000
--------- --------- --------- ---------
Total liabilities ............................ 111,189 485 (453) 111,221
--------- --------- --------- ---------
MINORITY INTEREST .................................... 7,720 -- 7,720
SHAREHOLDERS' EQUITY:
Preferred stock, $0.01 par value,
1,000,000 shares authorized, none
issued and outstanding .......................... -- -- --
Common stock, $0.01 par value,
200,000,000 shares authorized,
23,590,885 issued and
outstanding actual, 24,190,885 issued
and outstanding pro forma ....................... 236 -- 6(a) 242
Additional paid-in capital ........................ 288,016 22 27,820(a) 315,858
Accumulated deficit ............................... (109,806) (271) -- (110,077)
--------- --------- --------- ---------
Total shareholders' equity .................... 178,446 (249) 27,826 206,023
--------- --------- --------- ---------
$ 297,355 $ 236 $ 27,373 $ 324,964
========= ========= ========= =========
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SPORTSLINE.COM, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1999
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
Pro Forma Pro Forma
SportsLine DWWC Adjustments Combined
------------ ------------ ------------- ------------
REVENUE ............................................ $ 39,236 $ 320 $ (320)(b) $ 39,236
COST OF REVENUE .................................... 20,498 23 (320)(b) 20,201
------------ ------------ ------------ ------------
GROSS MARGIN ....................................... 18,738 297 -- 19,035
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Product development .............................. 1,221 -- 1,221
Sales and marketing .............................. 25,595 291 25,886
General and administrative ....................... 13,946 172 14,118
Depreciation and amortization .................... 20,190 28 3,410(a) 23,628
------------ ------------ ------------ ------------
Total operating expenses ............... 60,952 491 3,410 64,853
------------ ------------ ------------ ------------
LOSS FROM OPERATIONS ............................... (42,214) (194) (3,410) (45,818)
INTEREST EXPENSE ................................... (3,895) (12) 12 (b) (3,895)
INTEREST AND OTHER INCOME, net ..................... 6,880 4 (177)(b)(d) 6,707
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAXES ........................... (39,229) (202) (3,575) (43,006)
INCOME TAX EXPENSE ................................. -- (1) 1(e) --
------------ ------------ ------------ ------------
NET LOSS FROM CONTINUING OPERATIONS (f) ............ $ (39,229) $ (203) $ (3,574) $ (43,006)
============ ============ ============ ============
NET LOSS FROM CONTINUING OPERATIONS
PER SHARE - BASIC AND DILUTED (f)................... $ (1.74) $ (1.85)
============ ============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC
AND DILUTED ........................................ 22,585,447 600,000(a) 23,185,447
============ ============ ============
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SPORTSLINE.COM, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1998
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
Pro Forma Pro Forma
SportsLine DWWC Adjustments Combined
------------ ------------ ------------ ------------
REVENUE ............................................ $ 30,551 $ 380 $ (199)(b) $ 30,732
COST OF REVENUE .................................... 17,231 24 (199)(b) 17,056
------------ ------------ ------------ ------------
GROSS MARGIN ....................................... 13,320 356 -- 13,676
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Product development .............................. 1,313 -- 1,313
Sales and marketing .............................. 20,482 245 20,727
General and administrative ....................... 14,259 129 14,388
Depreciation and amortization .................... 17,104 15 4,547 (a) 21,666
------------ ------------ ------------ ------------
Total operating expenses ............... 53,158 389 4,547 58,094
------------ ------------ ------------ ------------
LOSS FROM OPERATIONS ............................... (39,838) (33) (4,547) (44,418)
INTEREST EXPENSE ................................... (118) (10) 10 (b) (118)
INTEREST AND OTHER INCOME, net ..................... 4,447 5 (230)(b)(d) 4,222
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAXES ........................... (35,509) (38) (4,767) (40,314)
INCOME TAX EXPENSE ................................. -- (16) 16 (e) --
------------ ------------ ------------ ------------
NET LOSS ........................................... $ (35,509) $ (54) $ (4,751) $ (40,314)
============ ============ ============ ============
NET LOSS PER SHARE - BASIC AND DILUTED ............. $ (1.94) $ (2.13)
============ ============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC
AND DILUTED ........................................ 18,305,927 600,000 (a) 18,905,927
============ ============ ============
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SPORTSLINE.COM, INC.
UNAUDITED NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(a) In December 1999, SportsLine.com, Inc. (the "Company") acquired Daedalus
World Wide Corporation ("DWWC") for consideration valued at approximately
$31,780,000 consisting of $4,000,000 cash and 600,000 shares of the Company
valued at $27,780,000. The allocation of the purchase price to goodwill
amounted to $31,826,000 which will be amortized over seven years for an
annual expense of approximately $4,547,000.
(b) This pro forma adjustment is the elimination of transactions between the
Company and DWWC.
(c) This pro forma adjustment is the elimination of a note receivable/payable
between the Company and DWWC.
(d) This pro forma adjustment is the reduction of interest income due to the
expenditure of $4,000,000 interest earning cash in the purchase assuming
the acquisition had occurred at the beginning of the respective period.
(e) This pro forma adjustment is to eliminate income tax expense which would
have not been incurred assuming the acquisition had occurred at the
beginning of the respective period.
(f) An extraordinary gain of approximately $21,809,000 resulting from the
Company's early extinguishment of debt has been excluded from the Company's
unaudited historical statement of operations included in the pro forma
combined statement of operations for the nine months ended September 30,
1999 due to its non-recurring nature.
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