TheStreet.com Reports Third-Quarter Financial Results

Reminder: Conference Call Today at 4:30 p.m. ET

NEW YORK--(BUSINESS WIRE)--Oct. 29, 2008--TheStreet.com, Inc. (Nasdaq: TSCM), a leading financial media company, reported financial results for its third quarter and nine months ended September 30, 2008.

Third-Quarter and Year-to-Date 2008 Results

For the quarter ended September 30, 2008, TheStreet.com reported revenue of $16.7 million, an increase of 4% over revenue of $16.1 million for the third quarter of 2007.

TheStreet.com reported a third-quarter net loss of $1.1 million, or $0.04 per basic and diluted share, as compared to net income of $3.8 million (excluding the impact of a non-cash income tax benefit of $16 million taken in the third quarter of 2007), or $0.13 per basic and diluted share, in the third quarter of 2007. Net loss attributable to common stockholders for the third quarter of 2008, after deducting preferred stock dividends of $0.1 million, was $1.2 million, or $0.04 per fully diluted share.

Earnings before interest, taxes, depreciation and amortization, excluding stock compensation of $1.0 million ("Adjusted EBITDA"), was $1.2 million, a decrease of 74% over Adjusted EBITDA of $4.5 million in the third quarter of 2007, exclusive of $0.5 million of stock compensation.

"Our quarterly results reflect the revenue impact of the weakened online advertising market," said Thomas J. Clarke, Jr., chief executive officer of TheStreet.com. "While we remain committed to investing in our growth initiatives, we are reviewing our cost structure, as is prudent, in this difficult environment. Our strong balance sheet, with $80 million in cash and no bank debt, ensures we are particularly well positioned to navigate these headwinds."

For the nine months ended September 30, 2008, TheStreet.com reported revenue of $55.4 million, an increase of 22% over revenue of $45.5 million for the same period of 2007.

The Company reported net income of $3.7 million for the nine months ended September 30, 2008, as compared to $10.3 million (excluding the impact of a non-cash income tax benefit of $16 million taken in the third quarter of 2007) reported in the same period of 2007. Net income attributable to common stockholders for the first nine months of 2008, after deducting preferred stock dividends of $0.3 million, was $3.4 million, or $0.11 per fully diluted share.

Earnings before interest, taxes, depreciation and amortization, excluding stock compensation of $2.6 million ("Adjusted EBITDA"), was $9.6 million, a decrease of 20% over Adjusted EBITDA of $11.9 million for the same period of 2007, exclusive of $1.6 million of stock compensation.

    Third-Quarter Financial Highlights

    --  Marketing services revenue totaled $6.5 million for the third
        quarter of 2008, a decrease of 7% over revenue of $6.9 million
        for the third quarter of 2007.
            -- Advertising revenue totaled $5.4 million, an increase
             of 18% over revenue of $4.6 million in the quarter one
             year ago.

            -- Interactive marketing services revenue, derived from
             Promotions.com, which was acquired on August 2, 2007,
             totaled $1.0 million.

-- Paid services revenue totaled $10.2 million for the third

quarter of 2008, an increase of 11% over revenue of $9.2

million for the third quarter of 2007.

            -- Subscription revenue, excluding the impact of
             subscription revenue from TheStreet.com Ratings Print
             Directory business, which was outsourced in the second
             quarter of 2007, was $7.4 million, a decrease of 8% from
             $8.1 million in the year-ago quarter.

            -- Syndication, licensing and information services revenue
             totaled $2.8 million, an increase of 231% over revenue of
             $0.8 million in the quarter one year ago, primarily
             resulting from the acquisition of Bankers Financial
             Products Corp. in November 2007.


    --  During the quarter, the Company's cash flow from operations
        totaled $1.8 million, with a negative free cash flow of $0.1
        million.

    --  Interest income in the third quarter decreased $0.2 million,
        or 39%, year over year, as the effective yield on our cash
        balances declined to 1.71%, as compared to 5.12% in the
        year-ago quarter.

    --  The board of directors declared the Company's quarterly cash
        dividend, payable to all shareholders of record at the close
        of business on September 15, 2008. The cash dividend of $0.025
        per share was paid September 30, 2008.

    --  As of September 30, 2008, cash, cash equivalents, marketable
        securities and restricted cash was $80.1 million. The Company
        has no bank debt.

    Recent Company Highlights

    --  The Board of TheStreet.com has separated the positions of
        Chairman of the Board and Chief Executive Officer. Co-founder
        James J. Cramer has been appointed Chairman of the Board. This
        separation will allow Mr. Clarke to focus more of his efforts
        as Chief Executive Officer on navigating the company through
        this difficult economic environment.

    --  Earlier this month, TheStreet.com introduced performance-based
        advertising to its network of properties. This new revenue
        model debuted on BankingMyWay.com, through a partnership with
        Informa Research Services, and on Geezeo, with the launch of
        its Product Marketplace, where users can shop for custom-fit
        financial products.

    --  TheStreet.com remains the go-to network in challenging
        economic conditions, delivering year-over-year unique visitor
        growth of 27% and reaching an all-time high of 8 million
        average unique visitors per month during the quarter.

    --  TheStreet.com expanded its library of premium subscription
        products with the launch of BioTech Select in early September,
        a newsletter devoted to providing key insights into the
        biotechnology sector. Written by senior correspondent Adam
        Feuerstein, formerly a buy-side analyst and now the portfolio
        manager of Biotech Select, it leverages his long-time
        experience in analyzing the biotech space.

    --  TheStreet.com continued to aggressively pursue its mobile
        strategy during the quarter.

            -- In September, TheStreet.com began providing
             BlackBerry(R) smartphone users with automatic and free
             access to the latest stock market news, investing advice,
             stock picks and quotes. Features include: categorized
             content sections such as Latest News, Jim Cramer, Winners
             & Losers, Analyst Upgrades & Downgrades; personalized
             stock watch lists; quotes of the major indexes; and home-
             screen notification of new stories and updated content.
             The application, developed by mobile technology leader
             Polar Mobile, is available for download on a range of
             BlackBerry smartphones from Research In Motion.

            -- Leading mobile TV service provider MobiTV selected
             TheStreet.comTV to join its new business video product,
             Mobi4Biz, which combines live TV and Video-on-Demand
             content. Mobi4Biz also features user-driven programming,
             where the consumer creates a watch list, and all content
             discovery within the application is related to that list.
    --  TheStreet.comTV expanded on its previous relationship with
        Google's YouTube by entering into an agreement last month to
        provide content to YouTube's newly created branded channels,
        including Your Money. TheStreet.comTV's video is syndicated
        and featured on a YouTube-hosted carousel of financial news
        and analysis videos running through December of this year.

    --  On October 25th, TheStreet.com hosted an investment
        conference, 2009 Money Making Strategies. Geared towards
        active investors, experts from a number of TheStreet.com's
        subscription services provided insights on how to handle the
        recent unprecedented market volatility along with investment
        ideas for the coming year. This conference is the first in a
        series slated for 2009 that is designed to help investors
        prosper.

TheStreet.com will conduct a conference call today, October 29, 2008, at 4:30 p.m. ET to discuss these results. To participate in the call, dial 866.202.3048 (domestic) or 617.213.8843 (international). The passcode for the call is 93391485.

    To access the Web cast of the call please visit:

    http://www.thestreet.com/investor-relations/index.html?detail

    About TheStreet.com, Inc.

TheStreet.com is a leading financial media company. It engages audiences on video and digital platforms through some of the Web's best known sites: TheStreet.com, RealMoney.com, Stockpickr.com, BankingMyWay.com, MainStreet.com, Rate-Watch.com and Promotions.com. Through this network, the company produces and distributes content in all areas where life and money intersect to inform, engage and activate one of the most affluent, influential audiences on the Web today. For more information, please visit www.thestreet.com.

                         THESTREET.COM, INC.
                     CONSOLIDATED BALANCE SHEETS

                                         September 30,  December 31,
                                              2008           2007
                                         -------------- --------------
                 ASSETS
Current Assets:
Cash and cash equivalents                $  52,886,994  $  79,170,754
Marketable securities                       24,671,292              -
Accounts receivable, net of allowance
 for doubtful
   accounts of $649,279 at September 30,
    2008 and $242,807 at
   December 31, 2007                        12,466,670     11,133,957
Other receivables                            1,092,588      1,227,144
Deferred taxes                               5,800,000      5,800,000
Prepaid expenses and other current
 assets                                      1,861,873      1,652,608
                                         -------------- --------------
      Total current assets                  98,779,417     98,984,463

Property and equipment, net of
 accumulated depreciation
   and amortization of $19,801,825 at
    September 30, 2008
   and $17,493,847 at December 31, 2007      9,733,913      7,730,922
Marketable securities                        1,917,942              -
Long term investment                         1,392,976              -
Other assets                                   206,110        328,117
Goodwill                                    40,001,665     40,245,413
Other intangibles, net                      16,645,526     18,368,792
Deferred taxes                              10,200,000     10,200,000
Restricted cash                                618,660        576,951
                                         -------------- --------------
      Total assets                       $ 179,496,209  $ 176,434,658
                                         ============== ==============

  LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable                         $   3,371,859  $   2,189,259
Accrued expenses                             3,050,873      5,006,635
Deferred revenue                            16,068,563     16,240,008
Other current liabilities                      376,424        214,654
Current liabilities of discontinued
 operations                                    227,003        232,242
                                         -------------- --------------
      Total current liabilities             23,094,722     23,882,798
Other liabilities                               90,473         90,105
                                         -------------- --------------
      Total liabilities                     23,185,195     23,972,903
                                         -------------- --------------

Stockholders' Equity:
Preferred stock; $0.01 par value;
 10,000,000 shares
   authorized; 5,500 shares issued and
    5,500 shares
   outstanding at September 30, 2008 and
    December 31, 2007;
   the aggregate liquidation preference
    totals $55,000,000 as of
   September 30, 2008 and $55,096,424 as
    of December 31, 2007                            55             55
Common stock; $0.01 par value;
 100,000,000 shares
   authorized; 36,262,546 shares issued
    and 30,482,949
   shares outstanding at September 30,
    2008, and 36,006,137
   shares issued and 30,254,137 shares
    outstanding
   at December 31, 2007                        362,625        360,061
Additional paid-in capital                 271,244,914    270,752,308
Treasury stock at cost; 5,779,597 shares
 at September 30, 2008
   and 5,752,000 shares at December 31,
    2007                                    (9,359,200)    (9,033,471)
Accumulated deficit                       (105,937,380)  (109,617,198)
                                         -------------- --------------
      Total stockholders' equity           156,311,014    152,461,755
                                         -------------- --------------

      Total liabilities and
       stockholders' equity              $ 179,496,209  $ 176,434,658
                                         ============== ==============
Note: Cash and cash equivalents is primarily comprised of a JP Morgan
 money market fund that invests exclusively in U.S. Treasury bills,
 notes and other obligations issued or guaranteed by the U.S.
 Treasury, and repurchase agreements collateralized by such
 obligations. Current marketable securities represents a direct
 purchase of one year U.S. Treasury bills, while noncurrent marketable
 securities represents an investment in two municipal auction rate
 securities. Additionally, the Company has pledged cash as a security
 deposit for operating leases, and this cash is therefore classified
 as restricted.
                                               September    December
                                                 30, 2008    31, 2007
                                               ----------- -----------
Cash and cash equivalents                      $52,886,994 $79,170,754
Current marketable securities                   24,671,292           -
Noncurrent marketable securities                 1,917,942           -
Noncurrent restricted cash                         618,660     576,951
                                               ----------- -----------
Total cash and cash equivalents, marketable
 securities, and restricted cash               $80,094,888 $79,747,705
                                               =========== ===========
                         THESTREET.COM, INC.
                CONSOLIDATED STATEMENTS OF OPERATIONS

                     For the Three Months    For the Nine Months Ended
                             Ended                 September 30,
                         September 30,
                   ------------------------- -------------------------
                       2008         2007         2008         2007
                   ------------ ------------ ------------ ------------
Net revenue:
Paid services      $10,244,212  $ 9,188,329  $31,293,620  $28,031,229
Marketing services   6,478,367    6,930,030   24,065,875   17,493,982
                   ------------ ------------ ------------ ------------
     Total net
      revenue       16,722,579   16,118,359   55,359,495   45,525,211
                   ------------ ------------ ------------ ------------

Operating expense:
Cost of services     8,405,002    6,509,157   24,427,285   17,780,664
Sales and
 marketing           3,550,363    2,619,286   10,944,352    9,004,490
General and
 administrative      4,589,851    3,064,728   13,024,218    8,537,882
Depreciation and
 amortization        1,481,670      654,397    4,330,054    1,469,539
                   ------------ ------------ ------------ ------------
     Total
      operating
      expense       18,026,886   12,847,568   52,725,909   36,792,575
                   ------------ ------------ ------------ ------------
     Operating
      (loss)
      income        (1,304,307)   3,270,791    2,633,586    8,732,636
Net interest
 income                345,675      571,121    1,432,112    1,796,820
                   ------------ ------------ ------------ ------------
  (Loss) income
   from continuing
   operations
   before income
   taxes              (958,632)   3,841,912    4,065,698   10,529,456
(Provision)
 benefit for
 income taxes         (106,364)  15,923,174     (377,985)  15,789,445
                   ------------ ------------ ------------ ------------
  (Loss) income
   from continuing
   operations       (1,064,996)  19,765,086    3,687,713   26,318,901
                   ------------ ------------ ------------ ------------
Discontinued
 operations:
Loss on disposal
 of discontinued
 operations             (3,079)        (569)      (7,895)      (1,692)
                   ------------ ------------ ------------ ------------
  Loss from
   discontinued
   operations           (3,079)        (569)      (7,895)      (1,692)
                   ------------ ------------ ------------ ------------
Net (loss) income   (1,068,075)  19,764,517    3,679,818   26,317,209
Preferred stock
 cash dividends         96,424            -      289,272            -
                   ------------ ------------ ------------ ------------
Net (loss) income
 attributable to
 common
 stockholders      $(1,164,499) $19,764,517  $ 3,390,546  $26,317,209
                   ============ ============ ============ ============

Basic net (loss)
 income per share:
  (Loss) income
   from continuing
   operations      $     (0.04) $      0.68  $      0.12  $      0.92
  Loss on disposal
   of discontinued
   operations            (0.00)       (0.00)       (0.00)       (0.00)
                   ------------ ------------ ------------ ------------
  Net (loss)
   income                (0.04)        0.68         0.12         0.92
  Preferred stock
   cash dividends        (0.00)           -        (0.01)           -
                   ------------ ------------ ------------ ------------
     Net (loss)
      income
      attributable
      to common
      stockholders $     (0.04) $      0.68  $      0.11  $      0.92
                   ============ ============ ============ ============

Diluted net (loss)
 income per share:
  (Loss) income
   from continuing
   operations      $     (0.04) $      0.67  $      0.11  $      0.91
  Loss on disposal
   of discontinued
   operations            (0.00)       (0.00)       (0.00)       (0.00)
                   ------------ ------------ ------------ ------------
  Net (loss)
   income                (0.04)        0.67         0.11         0.91
  Preferred stock
   cash dividends        (0.00)           -            -            -
                   ------------ ------------ ------------ ------------
     Net (loss)
      income
      attributable
      to common
      stockholders $     (0.04) $      0.67  $      0.11  $      0.91
                   ============ ============ ============ ============

Weighted average
 basic shares
 outstanding        30,482,949   29,085,700   30,442,955   28,488,315
                   ============ ============ ============ ============
Weighted average
 diluted shares
 outstanding        30,482,949   29,544,323   34,713,061   28,936,043
                   ============ ============ ============ ============

To supplement the Company's financial statements presented in accordance with generally accepted accounting principles ("GAAP"), TheStreet.com uses non-GAAP measures of certain components of financial performance, including "EBITDA", "Adjusted EBITDA" and "free cash flow". EBITDA is adjusted from results based on GAAP to exclude interest, taxes, depreciation and amortization. This non-GAAP measure is provided to enhance investors' overall understanding of the Company's current financial performance and its prospects for the future. Specifically, the Company believes that the non-GAAP EBITDA results are an important indicator of the operational strength of the Company's business and provide an indication of the Company's ability to service debt and fund capital expenditures. EBITDA eliminates the uneven effect of considerable amounts of noncash depreciation of tangible assets and amortization of certain intangible assets that were recognized in business combinations. Adjusted EBITDA further eliminates the impact of noncash stock compensation expense. A limitation of these measures, however, is that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the Company's businesses. Management evaluates the investments in such tangible and intangible assets through other financial measures, such as capital expenditure budgets and investment spending levels. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measure included in this press release has been reconciled to the nearest GAAP measure.

                     For the Three Months
                             Ended           For the Nine Months Ended
                         September 30,             September 30,
                   ------------------------- -------------------------
                       2008         2007         2008         2007
                   ------------ ------------ ------------ ------------
Adjusted EBITDA    $ 1,160,360  $ 4,507,493  $ 9,594,953  $11,934,806
Less stock
 compensation         (986,076)    (536,898)  (2,639,208)  (1,608,479)
                   ------------ ------------ ------------ ------------
EBITDA                 174,284    3,970,595    6,955,745   10,326,327
Add net interest
 income                345,675      571,121    1,432,112    1,796,820
Less taxes            (106,364)  15,877,198     (377,985)  15,663,601
Less depreciation
 and amortization   (1,481,670)    (654,397)  (4,330,054)  (1,469,539)
                   ------------ ------------ ------------ ------------
Net (loss) income  $(1,068,075) $19,764,517  $ 3,679,818  $26,317,209
                   ============ ============ ============ ============

"Free cash flow" means net (loss) income plus non-cash expenses less changes in working capital and capital expenditures. TheStreet.com believes that this non-GAAP financial measure is an important indicator of the Company's financial results because it gives investors a clear view of the Company's ability to generate cash. The presentation of this non-GAAP financial measure should be considered in addition to TheStreet.com's GAAP results and is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

                       For the Three Months     For the Nine Months
                               Ended                    Ended
                          September 30,            September 30,
                     ------------------------ ------------------------
                            2008         2007        2008         2007
                     ------------ ----------- ------------ -----------
Free cash flow       $   (93,202) $   805,819 $ 4,376,486  $ 5,903,160
Non-cash expenses     (2,838,490)  14,808,312  (7,525,732)  12,892,142
Changes in working
 capital                 (18,574)   3,344,365   2,452,512    4,157,536
Capital expenditures   1,882,191      806,021   4,376,552    3,364,371
                     ------------ ----------- ------------ -----------
Net (loss) income    $(1,068,075) $19,764,517 $ 3,679,818  $26,317,209
                     ============ =========== ============ ===========

Statements contained in this news release not related to historical facts may be deemed forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties (described in the Company's SEC filings) that could cause actual results to differ.

CONTACT: Investor Relations:
TheStreet.com, Inc.
Rebecca Updegraph, 212-321-5008
IR@TheStreet.com

SOURCE: TheStreet.com, Inc.

TheStreet, Inc.: (TST)   $0.91

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