MediaMind Technologies Reports 2010 Fourth Quarter and Year-End Results
2/8/2011

MediaMind Technologies Inc. (Nasdaq:MDMD), the leading independent global provider of integrated digital advertising solutions, today announced its financial results for the fourth quarter and year ended December 31, 2010.

Summary Results

-- Revenues of $25.9 million for the fourth quarter of 2010, up 15% from Q4 2009; Revenues of $80.8 million in 2010, up 24% from 2009.

-- Q4 2010 non-GAAP net income of $6.4 million, or diluted EPS of $0.30; Q4 2010 GAAP net income of $5.5 million, or diluted EPS of $0.26.

-- Q4 2010 adjusted EBITDA of $9.1 million and full year adjusted EBITDA of $19.9 million.

-- Positive operating cash flow of $4.9 million for Q4 2010 and $11.8 million for full year 2010.

-- Significant market momentum reflected in increased customer base, volume growth and solid performance across all regions

-- Successful introduction of MediaMind v2.0 product suite with strong market acceptance Fourth Quarter and Full Year 2010

For the 2010 fourth quarter, revenues increased 15% to $25.9 million compared to $22.4 million in the prior-year period. Full year revenues were $80.8 million, an increase of 24% compared to revenues of $65.1 million for 2009. Year-over-year revenue growth for both periods was attributable to the addition of new advertising customers and higher volumes of ad impressions driven by increased momentum in our key markets and strong demand from our large advertising partners. Gross profit margin was 95% for the 2010 fourth quarter compared to 96% in the prior-year period.

Net income attributable to Common stockholders for the 2010 fourth quarter was $5.5 million, or diluted earnings per share of $0.26, compared to $5.5 million, or diluted earnings per share of $0.39, in the fourth quarter of 2009. Net income attributable to Common stockholders for the full year was $8.7 million, or diluted earnings per share of $0.54, compared to $8.2 million, or diluted earnings per share of $0.68, in 2009.

Net income for the 2010 fourth quarter on a non-GAAP basis was $6.4 million, or non-GAAP diluted earnings per share of $0.30, compared to $6.3 million, or non-GAAP diluted earnings per share of $0.40, in the fourth quarter of 2009. Net income for the 2010 full year on a non-GAAP basis was $12.4 million, or non-GAAP diluted earnings per share of $0.68, compared to $10.9 million, or non-GAAP diluted earnings per share of $0.76, in 2009.

Adjusted EBITDA for the 2010 fourth quarter was $9.1 million versus $8.1 million in the prior-year period. Adjusted EBITDA for the full year of 2010 was $19.9 million versus $16.7 for 2009. See the reconciliation between GAAP and non-GAAP financial measures provided in the financial data below.

Cash flow provided by operating activities was $4.9 million in the fourth quarter of 2010 and $11.8 million for the full year.

Management Comments and Outlook for 2011
"We exhibited strong momentum in the seasonally important fourth quarter with solid gains in revenues and profitability," commented Gal Trifon, President and CEO of MediaMind. "During the fourth quarter, we continued to increase our customer base and grow across all regions. We also rolled out MediaMind v2.0, our latest platform iteration, focusing on new data driven products which allow our customers to reach their audience, optimize their messaging and make more informed, cost effective decisions on their media buys. These data-driven offerings complement our existing products and position us for meaningful growth in this emerging category in 2011."

Mr. Trifon continued, "In the coming quarters, we look forward to building on our efforts to grow MediaMind v2.0 and related data-driven offerings, increase our base of large advertisers, and expand our global operations while more efficiently meeting the demands of our growing advertiser base. As part of this expansion, we are strengthening our customer-facing service organization and we recently established a new technical support center in the Philippines."

For the first quarter of 2011, which is the company's seasonally slowest period, MediaMind expects to generate revenues in the range of $18.1 to $19.1 million. Net income is expected to be in the range of $150,000, or diluted earnings per share of $0.01, to $750,000, or diluted earnings per share of $0.04. Non-GAAP net income is expected to be in the range of $1.0 million, or non-GAAP diluted earnings per share of $0.04, to $1.6 million, or non-GAAP diluted earnings per share of $0.07. Adjusted EBITDA for the 2011 first quarter is expected to be in the range of $2.0 million to $2.6 million.

"With positive market trends and a strong foundation in place, we expect healthy revenue gains for the full year 2011," concluded Mr. Trifon. "We are excited to move forward with our outlined initiatives, and we expect only minimal impact from these investments to adjusted EBITDA margins for full year 2011 when compared to 2010 levels. As an industry leader, now is the opportune time to invest in the growth and efficiency of our business and position MediaMind for sustainable success. At the same time, we are focused on driving long-term margin performance as we work towards achieving profitability consistent with our target operating model."

Conference Call
The Company will host a conference call today at 4:30 p.m. ET to discuss 2010 fourth quarter and full year results as well as its 2011 first quarter outlook. To access the call, please dial 877-269-7756 (U.S.) or 201-689-7817 (international) approximately 10 minutes prior to the start of the call. The teleconference will also be available via live webcast on the investor relations portion of MediaMind's website, at http://ir.mediamind.com. If you are unable to listen to the live teleconference, a replay will be available through February 10, 2011, and can be accessed by dialing 877-660-6853 (U.S.) or 201-612-7415 (international). Callers will be prompted for replay account number 379# followed by conference ID number 365391#. An archived version of the webcast will also be available under the investor relations section of MediaMind's website at http://ir.mediamind.com.

About MediaMind
MediaMind is a leading global provider of digital advertising campaign management solutions to advertising agencies and advertisers. MediaMind provides media and creative agencies, advertisers and publishers with an integrated platform to manage campaigns across digital media channels and a variety of formats, including rich media, in-stream video, display and search. Headquartered in New York, MediaMind delivered during 2010 campaigns for approximately 9,000 brand advertisers, servicing approximately 3,800 media agencies and creative agencies across approximately 8,200 global web publishers in 64 countries throughout North America, South America, Europe, Asia Pacific, Africa and the Middle East. For more information on MediaMind, visithttp://www.MediaMind.com

Use of Non-GAAP Financial Measures
We believe that non−GAAP financial measures can provide useful information to both management and investors by excluding certain non−cash expenses that are not indicative of our core operating results. These measures should only be viewed in conjunction with corresponding GAAP measures.

MediaMind's non−GAAP financial measures exclude the effect of stock−based compensation and the tax benefit resulting from it. The reconciliation between GAAP and non−GAAP financial measures is provided in the financial data below.

Forward-Looking Statements
This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts are forward-looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Company or its officers with respect to the future consolidated results of operations and financial condition of the Company, the continued global growth of digital advertising, and the Company's ability to continue to gain market share and capitalize on the anticipated global growth of digital advertising. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance or achievements to be materially different from those expressed or implied in the forward-looking statements as a result of various factors and assumptions, including factors discussed under the heading "Risk Factors" in our final prospectus related to our initial public offering filed on August 12, 2010 and additional reports we file with the Securities and Exchange Commission.

                                               MEDIAMIND TECHNOLOGIES INC.
                                UNAUDITED GAAP CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                      (in thousands except share and per share data)

                                                                                        Three months
                                                                                           ended           Year ended
                                                                                        December 31,      December 31,
                                                                                     -----------------------------------
                                                                                       2009     2010     2009     2010
                                                                                     -----------------------------------

  Revenues                                                             $22,432  $25,900  $65,075  $80,846
  Cost of revenues                                                         838      1,347       3,306       4,289
                                                                                     -----------------------------------

  Gross profit                                                               21,594   24,553   61,769   76,557
                                                                                     -----------------------------------

  Operating expenses:
   Research and development                                     1,760    2,277    6,844    9,148
   Selling and marketing                                              11,333   13,049   36,530   45,932
   General and administrative                                       1,614    2,044    6,201    8,259
                                                                                     -----------------------------------

  Total operating expenses                                          14,707   17,370   49,575   63,339
                                                                                     -----------------------------------

  Operating income:                                                         6,887    7,183   12,194   13,218
  Financial income, net                                                       166      283       80      577
                                                                                     -----------------------------------

  Income before income taxes                                            7,053    7,466   12,274   13,795
  Income taxes                                                                          1,075    1,937    2,446    3,843
                                                                                     -----------------------------------

  Net income                                                                            5,978    5,529    9,828    9,952

  Accretion of Preferred stock dividend preference           (491)       --  (1,617)  (1,292)
                                                                                     -----------------------------------

  Net income attributable to Common stockholders   $5,487   $5,529   $8,211   $8,660
                                                                                     ===================================

  Net earnings per share:
   Basic                                                                                $0.65    $0.30    $0.98    $0.70
                                                                                     ===================================
   Diluted                                                                              $0.39    $0.26    $0.68    $0.54
                                                                                     ===================================

  Weighted average number of shares of Common stock used in computing earnings per
   share (in thousands):
   Basic                                                                                8,404   18,520    8,397   12,394
                                                                                     ===================================
   Diluted                                                                             15,512   21,440   14,352   18,273
                                                                                     ===================================


                     MEDIAMIND TECHNOLOGIES INC.
         UNAUDITED GAAP CONDENSED CONSOLIDATED BALANCE SHEETS
                            (in thousands)

                                                      December 31,
                                                  ------------------
                                                    2009      2010
                                                  ------------------

                       ASSETS

  CURRENT ASSETS:
   Cash and cash equivalents                       $15,363   $21,484
   Short-term deposit                               18,357    75,873
   Restricted cash                                     769     1,180
   Trade receivables                                22,104    25,604
   Other accounts receivable and prepaid expenses    1,972     2,926
                                                  ------------------

  Total current assets                              58,565   127,067
                                                  ------------------

  LONG-TERM ASSETS:
   Marketable securities                             2,077     2,043
   Deferred taxes, net                               1,289     2,146
   Severance pay fund                                1,517     2,267
   Other long-term assets                            1,015     1,092
                                                  ------------------

  Total long-term assets                             5,898     7,548
                                                  ------------------

  PROPERTY AND EQUIPMENT, NET                        2,427     5,014
                                                  ------------------

  Total assets                                     $66,890  $139,629
                                                  ==================


                       MEDIAMIND TECHNOLOGIES INC.
           UNAUDITED GAAP CONDENSED CONSOLIDATED BALANCE SHEETS
                              (in thousands)

                                                         December 31,
                                                     -------------------
                                                        2009      2010
                                                     -------------------

         LIABILITIES AND STOCKHOLDERS' EQUITY

  CURRENT LIABILITIES:
   Trade payables                                       $1,001      $756
   Employees and payroll accruals                        4,686     3,996
   Other accounts payable                                4,053     5,094
                                                     -------------------

  Total current liabilities                              9,740     9,846
                                                     -------------------

  LONG-TERM LIABILITIES:
   Accrued severance pay and other employee accruals     2,335     3,413
                                                     -------------------

  Total long-term liabilities                            2,335     3,413
                                                     -------------------

 

  STOCKHOLDERS' EQUITY:
   Stock capital:
    Common stock of $ 0.001 par value --
   Common stock                                             12        22
   Series A-1 Convertible Preferred stock                    2        --
   Additional paid-in capital                           48,450   109,927
   Treasury stock at cost                             (23,213)  (23,213)
   Accumulated other comprehensive loss                  (558)     (440)
   Retained earnings                                    30,122    40,074
                                                     -------------------

  Total stockholders' equity                            54,815   126,370
                                                     -------------------

  Total liabilities and stockholders' equity           $66,890  $139,629
                                                     ===================


                                               MEDIAMIND TECHNOLOGIES INC.
                               UNAUDITED GAAP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
                                                      (in thousands)

                                                                                        Three months
                                                                                           ended           Year ended
                                                                                        December 31,      December 31,
                                                                                    ------------------------------------
                                                                                       2009     2010     2009     2010
                                                                                    ------------------------------------
  Cash flows from operating activities:

  Net income                                                               $5,978   $5,529   $9,828   $9,952
  Adjustments to reconcile net income to net cash provided by operating activities:
   Depreciation                                                             315      889    1,211    2,239
   Compensation related to options granted to employees 936    1,009    3,292    4,489
   Increase in trade receivables                                     (7,390)  (4,407)  (5,853)  (3,574)
   Decrease (increase) in other accounts receivable, prepaid expenses and other                                                                                385      925    (217)    (776)
   Decrease (increase) in deferred taxes                  (25)      317    (226)    (814)
   Decrease (increase) in other long-term assets   (46)     (25)       13     (66)
   Decrease in trade accounts payable                        (34)    (589)     (79)    (295)
   Increase (decrease) in employee and payroll accruals 974    (107)    1,327    (678)
   Increase in other payables                                            639    1,515    1,419    1,171
   Increase (decrease) in accrued severance pay and other employee accruals, net                                                                                           83        3    (261)      335
   Increase in accrued interest                                         (111)    (165)    (111)    (109)
   Gain on disposal of property and equipment             (21)       --     (32)     (50)
                                                                                    ------------------------------------

  Net cash provided by operating activities               1,683    4,894   10,311   11,824
                                                                                    ------------------------------------


                                       MEDIAMIND TECHNOLOGIES INC.
                      UNAUDITED GAAP CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
                                             (in thousands)

                                                                 Three months ended      Year ended
                                                                    December 31,        December 31,
                                                                ---------------------------------------
                                                                   2009      2010      2009      2010
                                                                ---------------------------------------
  Cash flows from investing activities:

  Investments in marketable securities                                 --        --   (2,124)        --
  Proceeds from redemption of marketable securities      48        --       591        --
  Investments in short-term deposits                          (600)  (33,115)  (18,250)  (79,453)
  Proceeds from maturity of short-term deposits               --     3,000        --    22,050
  Restricted cash                                                                  --        --     (765)   (2,080)
  Proceeds from release of restricted cash                             --        --        --     1,664
  Purchase of property and equipment                                (321)   (1,156)   (1,251)   (4,347)
  Proceeds from sale of property and equipment                   79        --       166        11
                                                                ---------------------------------------

  Net cash provided by investing activities                         (794)  (31,271)  (21,633)  (62,155)
                                                                ---------------------------------------

  Cash flows from financing activities:

  Acquisition of treasury stock                                        --        --        --     (533)
  Proceeds from initial public offering, net of costs                  --     (440)        --    55,962
  Proceeds from exercise of stock options and warrants       29        83        45     1,034
                                                                ---------------------------------------

  Net cash provided by (used in) financing activities            29     (357)        45    56,463

  Increase (decrease) in cash and cash equivalents   918  (26,734)  (11,277)     6,132
  Effects of exchange rate changes on cash and cash equivalents       
                                                                                                        40      (13)       480      (11)
  Cash and cash equivalents at the beginning of the year          
                                                                                            14,405    48,231    26,160    15,363
                                                                ---------------------------------------

  Cash and cash equivalents at the end of the year               
                                                                                     $15,363   $21,484   $15,363   $21,484
                                                                =======================================


                               NON-GAAP NET INCOME AND NON-GAAP EARNINGS PER SHARE (Note 1)
  -----------------------------------------------------------------------------------------------------------------------
                                           (in thousands, except per share data)
                                                                    Three months                          Three months
                                                                       ended            Year ended           ended
                                                                     December 31       December 31          March 31
                                                                 -------------------------------------------------------
                                                                   2009     2010      2009      2010     2011     2011
                                                                 -------------------------------------------------------
                                                                                                          Min      Max
  Net income attributable to Common stockholders                  
                                                              $5,487   $5,529    $8,211    $8,660     $150     $750
  Stock Based Compensation                                           
                                                                    936    1,009     3,292     4,489    1,050    1,050
  Tax benefit resulting from Stock Based Compensation              
                                                                     (171)    (113)     (587)     (721)    (200)    (200)
                                                                 -------------------------------------------------------
  Non?GAAP net income                                             
                                                       $6,252   $6,425   $10,916   $12,428   $1,000   $1,600
                                                                 -------------------------------------------------------
  Shares used in computing non?GAAP basic earnings per share       
                                                         8,404   18,520     8,397    12,394   19,000   18,500
                                                                 =======================================================
  Shares used in computing non?GAAP diluted earnings per share    
                                                      15,512   21,440    14,352    18,273   22,400   21,400
                                                                 =======================================================
  Non?GAAP basic earnings per share                                
                                                            $0.74    $0.35     $1.30     $1.00    $0.05    $0.09
  Non?GAAP diluted earnings per share                              
                                                             $0.40    $0.30     $0.76     $0.68    $0.04    $0.07

  Note 1 - To supplement our unaudited condensed consolidated financial statements presented on a basis consistent with
   GAAP, we disclose non?GAAP net income and non?GAAP earnings per share. These supplemental measures exclude
   stock?based compensation net of resulting taxes. These non?GAAP measures are not in accordance with and do not serve
   as an alternative for GAAP.

  We believe that these non?GAAP measures have limitations in that they do not reflect all of the amounts associated
   with our GAAP results of operations. These non?GAAP measures should only be viewed in conjunction with corresponding
   GAAP measures. We compensate for the limitations of non?GAAP financial measures by relying upon GAAP results to gain
   a complete picture of our performance.

  We believe that non?GAAP financial measures can provide useful information to both management and investors by
   excluding certain non?cash expenses that are not indicative of our core operating results. Among other uses, our
   management uses non?GAAP measures to compare our performance relative to forecasts and to benchmark our performance
   externally against competitors.

SOURCE: MediaMind Technologies Inc.

CONTACT:  Investor Contacts:
Jonathan Schaffer
The Blueshirt Group
T: 212.551.1453
ir@mediamind.com
Media Contact:
Alex Wellins
The Blueshirt Group
T: 415.217.5861
ir@mediamind.com

 


 




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