SportsLine.com, Inc. Reports Record First Quarter Financial ResultsDomestic Gross Margin Improves to 70% and Domestic EBITDA Loss Narrows to $2.3 Million | |||
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FORT LAUDERDALE, FL, -- SportsLine.com,
Inc. (Nasdaq: SPLN), the leading global Internet sports media company and
publisher of CBS SportsLine (http://cbs.sportsline.com), today announced
record
financial results for the first quarter ended March 31, 2000. Consolidated
revenue increased 105% to $22.7 million in the first quarter of 2000, compared
to $11.1 million in the same quarter of 1999. Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization and gain on sale of e-commerce subsidiaries) loss for the quarter was $8.1 million. The Company's domestic EBITDA loss for the quarter was $2.3 million, a 62% decrease from the domestic EBITDA loss of $6.0 million in the fourth quarter of 1999, and a 57% decrease from the EBITDA loss of $5.3 million in the first quarter of 1999. Additionally, the Company's gross margin on a consolidated basis grew to 62% compared to 51% for the same quarter in 1999 and 35% in the fourth quarter of 1999. Domestically, the Company's gross margin improved to an all-time high of 70% for the first quarter of 2000 compared to 51% for the same quarter in 1999 and 41% in the fourth quarter of 1999. The Company's consolidated net loss for the quarter was $7.2 million, or $0.28 per share, compared to a consolidated net loss of $10.1 million, or $0.47 per share in the same period last year. Excluding a one-time gain of $7.8 million on the sale of the Company's e-commerce subsidiaries to MVP.com, the Company's consolidated net loss for the quarter was $15.0 million, or $0.58 per share. For the month of March, Nielsen/NetRatings reported that SportsLine.com received more unique visitors and a higher reach percentage than any other Internet sports site, from both home (4.8 million unique visitors, 5.9% reach) and work (3.0 million unique visitors, 9.7% reach). Traffic to the Company's Web sites during the month of March averaged approximately 12 million page views per day. For the quarter, traffic grew 34% over the first quarter of 1999, averaging 9.1 million page views per day, compared to 6.8 million page views per day in the same quarter last year. Through the first half of April the upward trend is continuing with an average of more than 15 million page views per day. "With record revenue of $22.7 million, a domestic gross margin of 70%, just $2.3 million in domestic EBITDA loss this quarter, and more monthly unique visitors than any other sports site, we're feeling very confident about the health of our business," said Michael Levy, founder and CEO of SportsLine.com, Inc. "The strategic deals we've put in place and executed over the last 18 months are certainly paying dividends for us. Our business model is clearly working: we have more than $170 million in cash, a disciplined and highly effective strategy for growth, the proven ability to execute that strategy and we are on the cusp of achieving positive cash flow."
(a) Sports.com did not commence operations until the quarter ended September 30, 1999. (b) Excludes the one-time gain of approximately $7.8 million on the sale of e-commerce subsidiaries to MVP.com.
SportsLine.com's consolidated revenue of $22.7 million for the first quarter established a new quarterly high, and increased 105% compared to the $11.1 million posted in the first quarter of 1999. Advertising accounted for a record $18.9 million or 83% of the Company's consolidated revenue as compared to $5.9 million for the first quarter of 1999. SportsLine.com's gross margin on a consolidated basis grew to 62% from 35% last quarter and 51% from the first quarter of 1999; domestically the gross margin improved to an all-time high of 70% for the first quarter of 2000 compared to 41% in the fourth quarter of 1999 and 51% from the first quarter of 1999. Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization and gain on sale of e-commerce subsidiaries) loss for the quarter was $8.1 million. The Company's domestic EBITDA loss for the quarter was $2.3 million, a 62% sequential decrease from the domestic EBITDA loss of $6.0 million in the fourth quarter of 1999, and a 57% decrease from the $5.3 million EBITDA loss for the first quarter of 1999. Record Advertising and Traffic Set with NCAA Tournament Coverage Sponsorships for the NCAA Men's Basketball Championships in March totaled $4 million, representing SportsLine.com's largest sponsorship revenue for a single event. There were approximately 35 sponsors for the event, including Oldsmobile, Agilent, Budweiser, Conseco, E-Trade, Delta Faucets, Intel, Isuzu, Keen.com, Nasdaq, Nike and Nortel. The first two days of the 2000 Men's Basketball Championship resulted in SportsLine.com's top two days ever for page views. On Thursday, March 16, the opening day of the championship, the Company's Web sites received approximately 31.5 million page views, only to be topped the next day, Friday, March 17 with approximately 33 million page views. During the 23 days from CBS Sports' announcement of the tournament brackets through the championship game, the Company's Web sites averaged approximately 13.4 million page views per day. Additionally, according to Nielsen/NetRatings, during the first week of the tournament, SportsLine.com led all Internet sports sites with 2.5 million unique visitors from home, ranking 17th among all Internet properties. For the month of March, Nielsen/Net Ratings reported that SportsLine.com received more unique visitors and a higher reach percentage than any other Internet sports site, from both home (4.8 million unique visitors, 5.9% reach) and work (3.0 million unique visitors, 9.7% reach). MVP.com Agreement Closes SportsLine.com and MVP.com completed their agreement for MVP.com to acquire and operate SportsLine.com's domestic e-commerce business, effective January 1, 2000. SportsLine.com will receive $120 million in minimum cash payments over the next 10 years and a minority equity interest in MVP.com. A new sports and outdoor e-commerce destination, MVP.com was formed in partnership with Benchmark Capital, Freeman Spogli & Co., Galyan's Trading Company, John Elway, Michael Jordan and Wayne Gretzky. MVP.com has also entered into an $85 million media partnership with CBS Corp. (NYSE: CBS). Sports.com Launches WAP-enabled Web site Service in the UK for Mobile Phones Sports.com, along with Motorola and BT Cellnet's Genie Internet division, took the lead in providing a sports content service for Web phones in the UK via a WAP-enabled Web site that launched in March. Sports.com will supply both Motorola's Web W/O Wires Alliance Programme and BT Cellnet WAP-enabled phones with up-to-the minute information about football, rugby, cricket and Formula One. Sports.com Launches German, Italian and Spanish Sites In March, Sports.com launched sites providing extensive, local coverage of sports relevant to sports fans in Germany, Italy and Spain in each country's language. These sites offer original content, commerce and community and focus on in-depth coverage of six to eight sports for each country. Sports.com now has complete sports coverage in five countries: the United Kingdom, France, Germany, Italy and Spain. SportsLine.com Partners with the Financial Times' FT.com on Sports Channel SportsLine.com became a sports partner for FT.com, the Web site of the Financial Times in February. Both SportsLine.com and Sports.com are programming sports news and information for the channel, supplementing the Financial Times' own coverage of the business of sport. Sports.com Raises $52.5 Million In January, Sports.com Limited, a majority-owned subsidiary of SportsLine.com, Inc., raised gross proceeds of $52.5 million through the issuance of preferred stock. Superstar athletes Michael Jordan, Shaquille O'Neal and Tiger Woods joined the investor group as Sports Capital Partners, manager of the IMG/Chase Sports Capital funds, and affiliates of Soros Private Equity Partners LLC led the funding. Hicks, Muse, Tate & Furst Incorporated, the Goldman Sachs Group, Inc. (NYSE: GS), Chase Capital Partners, Aetna Life Insurance Company (NYSE: AET), Wit Capital's (Nasdaq: WITC), Arista Capital Partners, LP and existing Sports.com shareholders, including Reuters (Nasdaq: RTRSY) and Intel Corporation (Nasdaq: INTC), also participated in the funding. The newly issued preferred stock represents approximately 25% of Sports.com Limited's post-funding valuation. Asian Sports Internet Joint Venture Formed SportsLine.com and Sports.com in March announced a letter of intent to form a sports Internet joint venture with Asiacontent.com, Ltd. (Nasdaq: IASIA), a leading developer of Asian Internet content, advertising and e-commerce services. The joint venture will create, operate and market a family of SportsLine-branded Web sites targeted specifically to Asian audiences in relevant local languages. The joint venture will cover the People's Republic of China and all major Pacific Rim Internet markets outside of Japan, where additional opportunities are being explored. SportsLine.com and Sports.com will initially be granted a 20% ownership stake in the joint venture as well as options to increase their stake. SportsLine.com Partners with theglobe.com to Build Enhanced Community SportsLine.com and theglobe.com entered into a multi-year strategic partnership in February whereby theglobe.com will exclusively develop and operate community services for CBS SportsLine. The enhanced community launched in April with the beginning of the baseball season. SportsLine.com will receive a minimum guarantee of $5 million payable in theglobe.com stock, representing approximately 3% of the outstanding shares of theglobe.com, in exchange for prominent integration and extensive promotion of the enhanced community throughout the CBS SportsLine site. SportsLine.com also has the opportunity to receive additional payments in stock or cash, contingent upon the achievement of performance milestones. CBS Exercises Warrants to Purchase 500,000 Shares of SportsLine.com, Inc. Common Stock In February, CBS exercised warrants to purchase 500,000 shares of SportsLine.com, Inc.'s common stock at $23.00 per share, resulting in net proceeds to the Company of $11.5 million. Following exercise of the warrants, CBS owns approximately 4.54 million shares of SportsLine.com, Inc. common stock, or approximately 17% of the Company's current outstanding shares. Joe Ferreira Joins SportsLine.com as Vice President, Programming Joe Ferreira joined the Company in February from the National Football League, where he was the primary liaison with the NFL's television and radio broadcast partners and also oversaw network partner Internet promotions and facilitated overall television Internet interests. He will be SportsLine.com's liaison with CBS, the professional sports leagues, the NCAA and other sports governing bodies as the Company continues its quest to lead the marketplace in Internet sports content.
(a) Sports.com did not commence operations until the quarter ended September 30, 1999. (b) Excludes the one-time gain of approximately $7.8 million on the sale of e-commerce subsidiaries to MVP.com.
About SportsLine.com, Inc. SportsLine.com, Inc. is at the leading edge of media companies providing Internet sports content, community and e-commerce on a global basis. SportsLine.com, Inc.'s content includes more than one million pages of multimedia sports information, entertainment and merchandise. Founded in 1994 as SportsLine USA, Inc., the Company changed its name to SportsLine.com, Inc. in November 1999. Its flagship Internet sports service (http://cbs.sportsline.com) was renamed CBS SportsLine in March of 1997 as part of an exclusive promotional and content agreement with CBS. SportsLine.com, Inc. produces the official league Web sites for Major League Baseball, the PGA TOUR and NFL Europe League, and serves as the primary sports content provider for America Online, Netscape and Excite. In May 1999, the Company commenced operations in Europe through its majority-owned subsidiary, Sports.com Limited. Note: This press release contains forward-looking statements, which involve risks and uncertainties. SportsLine.com's actual results could differ materially from those anticipated in these forward-looking statements. Factors that might cause or contribute to such differences include, among others, competitive pressures, the growth rate of the Internet, constantly changing technology and market acceptance of the company's products and services. Investors are also directed to consider the other risks and uncertainties discussed in SportsLine.com's Securities and Exchange Commission filings, including those discussed under the caption "Risk Factors That May Affect Future Results" in SportsLine.com's latest Annual Report on Form 10-K. SportsLine.com undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For further Information, contact:
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