May 21st, 2007
MARINA DEL REY, CA--(MARKET WIRE)--May 22, 2007 -- InfoSearch Media, Inc. (OTC BB:ISHM.OB - News), a leading Internet marketing firm that delivers search-targeted video and text content, has announced financial results for its first quarter ended March 31, 2007.
InfoSearch Media reported revenue of $1.3 million for the first quarter of 2007, compared to $2.9 million for the first quarter of 2006. The first quarter of 2006 revenues included the recognition of $1.4 million of deferred revenue from the Company's discontinued ArticleInsider product. Gross margins improved 340 basis points to 63.5% for the first quarter of 2007 compared to 60.1% for the first quarter of 2006.
Total operating costs and expenses in the first quarter of 2007 decreased to $1.6 million from $2.4 million in the first quarter of 2006. The Company reported a GAAP net loss of $0.4 million, or $0.01 per share (basic and diluted) for the first quarter of 2007, compared to GAAP net income of $0.1 million, or $0.00 per share (basic and diluted) for the first quarter of 2006.
"During the quarter, we made important progress on signing major beta partners for our new search-targeted video product, while re-branding our core product lines as TrafficBuilder Text and TrafficBuilder Video to appeal to an even wider customer base," said George Lichter, President and CEO, InfoSearch Media. "This re-branding follows the completion of an in-depth client value study that established the overall effectiveness and ROI of our traffic-building capabilities as compared to mainstream pay-per-click search marketing products. Based on our experience and research findings, we plan to launch a number of new initiatives throughout the year to bolster market awareness and understanding of our traffic-building capabilities and capture customers away from competitors' pay-per-click products. As always, we are strategically focused on broadening our product portfolio and expanding our customer base to drive revenue growth and improve profitability."
During the first quarter, InfoSearch Media introduced, in limited availability, its Internet video product, TrafficBuilder Video, which leverages the Company's existing search-targeting platform and uses a scalable, proprietary production process to provide Internet video at an affordable price. The Company intends to announce signed beta partners in the coming weeks and TrafficBuilder Video is now being made widely available to on-line publishers and businesses through the InfoSearch Media sales force.
About InfoSearch Media
InfoSearch Media, an Internet marketing company, is the largest dedicated provider of search-targeted text and video content for the Internet designed to obtain more cost-effective traffic for customers of every size. InfoSearch Media's network of professional writers, editors, technical specialists and video producers also helps businesses succeed on the web by implementing text and video content-based Internet marketing solutions. Whether a business needs local traffic in 100 cities or is a content publisher who understands the need for targeted on-line content, InfoSearch Media offers the outsourced solutions, capacity and reputation to help it win the audience it needs on the Internet.
Safe Harbor Statement
This release contains "forward-looking statements" that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Management assumes no obligation to comment on or provide an update to its stock purchases or sales in the future except as specifically required by law and by the Securities and Exchange Commission. Factors that might cause such differences include, but are not limited to the challenges of attracting new customers and maintaining existing customers and developing, deploying and delivering InfoSearch services; competition from existing and new competitors; the ability to generate sufficient cash flow or otherwise obtain funds to repay new or outstanding indebtedness; the loss or decline in business from our key customers and other risks described from time to time in InfoSearch's filings with the Securities and Exchange Commission. In particular, see InfoSearch's recent quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available upon request from InfoSearch. InfoSearch does not assume any obligation to update the forward-looking information contained in this press release.
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INFOSEARCH MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
March 31, 2007
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,646,442
Restricted cash 376,715
Accounts receivable 63,808
Due from related parties 15,704
Prepaid and other current assets 205,886
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TOTAL CURRENT ASSETS 2,308,555
PROPERTY AND EQUIPMENT, NET 146,886
SECURITY DEPOSIT 37,500
EQUITY WARRANT ASSET 330,708
TOTAL ASSETS $ 2,823,650
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 50,434
Accrued bonuses 192,907
Accrued salaries and expenses 135,190
Capital leases 8,918
Deferred revenue 751,633
Provision for refunds payable/chargebacks 26,851
Current tax liability 1,250
-----------
TOTAL CURRENT LIABILITIES 1,167,181
INCOME TAX PAYABLE 156,000
FAIR VALUE OF WARRANT LIABILITY 1,121,882
-----------
TOTAL LIABILITIES 2,445,065
-----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' (DEFICIT):
Preferred stock, undesignated, par value $.001 per
share, 25,000,000 shares authorized; no shares
issued and outstanding; -
Common stock, $.001 par value, authorized 200,000,000
shares; issued and outstanding 52,336,909 52,337
Committed stock, 0 shares -
Additional paid in capital 11,264,929
Accumulated deficit (10,938,681)
-----------
TOTAL STOCKHOLDERS' EQUITY: 378,585
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,823,650
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INFOSEARCH MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended March
31,
------------------------
2007 2006
----------- -----------
CONTENTLOGIC SALES $ 1,275,915 $ 1,463,083
WEB PROPERTIES SALES 30,950 1,390,481
----------- -----------
NET SALES 1,306,865 2,853,564
CONTENTLOGIC COST OF SALES 461,175 411,310
WEB PROPERTIES COST OF SALES 15,321 726,122
----------- -----------
COST OF SALES 476,496 1,137,432
----------- -----------
GROSS PROFIT 830,369 1,716,132
----------- -----------
OPERATING EXPENSES
General & administrative 1,022,275 1,940,011
Sales & marketing 534,127 414,916
----------- -----------
TOTAL COSTS AND EXPENSES 1,556,402 2,354,927
LOSS FROM OPERATIONS (726,034) (638,795)
CHANGE IN FAIR VALUE OF WARRANTS 296,203 666,774
INTEREST INCOME (NET) 16,780 32,290
----------- -----------
EARNINGS (LOSS) BEFORE TAX (413,050) 60,269
TAXES 2,050 -
----------- -----------
NET EARNINGS (LOSS) $ (415,100) $ 60,269
=========== ===========
EARNINGS (LOSS) PER SHARE
BASIC $ (0.01) $ 0.00
=========== ===========
DILUTED $ (0.01) $ 0.00
=========== ===========
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 51,825,450 45,123,401
=========== ===========
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 51,825,450 45,141,583
=========== ===========
INFOSEARCH MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Three Months Ended March
31,
------------------------
2007 2006
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss) $ (415,100) $ 60,269
Adjustment to reconcile net earnings (loss)
to net cash used in operating activities
Depreciation and
amortization 23,529 205,173
Equity based compensation 109,479 874,207
Change in fair value of
warrant liability (274,332) (666,774)
Change in fair value of
equity warrant asset (21,871) -
Changes in assets and liabilities:
Accounts receivable 5,132 (30,934)
Due from related parties 35,028 -
Prepaid expenses and other
current assets (3,281) (144,962)
Accounts payable, accrued
expenses and other
liabilities (565,463) 65,215
Current tax liability 1,250 -
Provision for refunds (3,991) 64,152
Deferred revenue 296,891 (1,769,655)
----------- -----------
Total adjustments (234,435) (1,403,758)
NET CASH USED IN OPERATING ACTIVITIES: (812,730) (1,343,489)
CASH FLOWS FROM INVESTING ACTIVITIES:
Restricted cash 3,815 -
Acquisition of Answerbag - (174,400)
Capital expenditures - fixed assets (35,193) (18,611)
Capital expenditures - content development - (49,360)
----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (31,378) (242,371)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments of capital lease
obligations (8,703) (7,971)
Gross proceeds from private placements 3,600 -
----------- -----------
NET CASH PROVIDED BY (USED IN) FINANCING
ACTIVITIES (5,103) (7,971)
Net increase (decrease) in cash and cash
equivalents (849,212) (1,593,831)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 2,495,654 4,828,560
----------- -----------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 1,646,442 $ 3,234,729
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ 841 $ 1,982
=========== ===========
Income tax paid $ 800 $ -
=========== ===========Investor Contact:
Brinlea Johnson
The Blueshirt Group, for InfoSearch Media
415-217-5861
Email Contact
Media Contact:
Heather Gore
310-437-7380 x7741
Email Contact
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