August 21st, 2007
MARINA DEL REY, CA--(MARKET WIRE)--Aug 21, 2007 -- InfoSearch Media, Inc. (OTC BB:ISHM.OB - News), a leading Internet marketing firm that delivers search optimized video and text content, has announced financial results for its second quarter ended June 30, 2007.
InfoSearch Media reported revenues of $1.2 million for the second quarter of 2007, compared to $1.6 million for the second quarter of 2006. The second quarter of 2006 revenues included the recognition of remaining deferred revenue from the Company's discontinued ArticleInsider product.
The Company reported a GAAP net loss of $1.1 million, or $0.02 per share (basic and diluted) for the second quarter of 2007, compared to a GAAP net loss of $3.8 million, or $0.08 per share (basic and diluted) for the second quarter of 2006. Gross margins declined to 61% for the second quarter of 2007 as compared to 66% for the second quarter of 2006.
Total operating costs and expenses in the second quarter of 2007 decreased 69% to $1.8 million from $5.8 million in the second quarter of 2006. The Company implemented a number of cost reductions during the quarter which will result in further reductions to operating expenses going forward.
"During the second quarter, we focused on a number of strategic initiatives that strengthened our business model and significantly improved our operational efficiencies," said George Lichter, President and CEO, InfoSearch Media. "Leveraging recent research, we implemented a new product and sales strategy focused on what our customers care about most -- attracting traffic less expensively than through pay-per-click marketing programs. In support of this strategy, we launched a new website with a full e-commerce offering that we believe will position us to build market awareness and understanding of our traffic-building capabilities. Additionally, we have developed a number of offerings that will enable us to capture additional customers away from competitors' pay-per-click products. We will continue to look for opportunities to broaden our product portfolio and partner with leading service organizations to drive revenue growth and improve profitability throughout the year."
Recent Company Highlights:
- Launch of New Website with E-Commerce Capabilities -- the Company launched its new website in July with a full e-commerce platform, offering customers the ability to configure and buy packages of traffic-building text and video content online. Customers now can choose from specially designed packages, custom configure them to include value-added, optional services and directly order and complete their purchases online via a secure e-commerce platform.
- Expansion of Complementary Services -- the Company launched two complementary services, TrafficBuilder SEO Rx and TrafficBuilder Directory Submit, to provide clients with additional, robust search engine visibility solutions which have already begun getting traction with clients. TrafficBuilder SEO Rx is a streamlined website analysis providing clients with a review of all primary "on-page" (internal) website aspects as well as key "off-page" (external) issues. TrafficBuilder Directory Submit is a service that manually and professionally submits client websites to the best SEO-friendly web directories.
- Conclusion of TrafficBuilder Video Pilot -- the Company concluded its successful pilot program for TrafficBuilder Video, having worked closely with several clients including Rodale Publications, to deliver a diverse series of search-targeted videos across a broad range of customer-identified topics. TrafficBuilder Video is the only search-targeted online video product available industry-wide, providing clients with affordable, high-quality, site-enhancing and traffic-building online videos based on custom topics. InfoSearch Media TrafficBuilder Video spots are available for viewing on Rodale Publications' menshealth.com website.
View The Video
About InfoSearch Media
InfoSearch Media is a leading Internet marketing company and the largest dedicated provider of traffic-targeted online text and video content. InfoSearch Media's network of professional writers, editors, technical specialists and video producers helps businesses succeed on the Web by implementing cost-effective Internet marketing solutions designed to deliver more traffic for customers of every size. Whether a business needs more local traffic in 100 cities or is a content publisher with an ongoing need for fresh, targeted Web 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.
INFOSEARCH MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
For the Three Months For six months ended
Ended June 30, June 30,
------------------------ ------------------------
2007 2006 2007 2006
----------- ----------- ----------- -----------
CONTENT SALES $ 1,120,194 $ 1,585,098 $ 2,396,109 $ 3,048,182
WEB PROPERTIES SALES 39,799 58,787 70,749 1,449,268
----------- ----------- ----------- -----------
NET SALES 1,159,993 1,643,885 2,466,858 4,497,449
----------- ----------- ----------- -----------
CONTENT COST OF SALES 438,752 529,214 899,927 978,409
WEB PROPERTIES COST OF
SALES 16,900 23,210 32,221 762,032
----------- ----------- ----------- -----------
COST OF SALES 455,652 552,424 932,148 1,740,441
----------- ----------- ----------- -----------
GROSS PROFIT 704,341 1,091,461 1,534,710 2,757,008
----------- ----------- ----------- -----------
OPERATING EXPENSES
General &
administrative 1,349,193 5,104,821 2,371,469 6,994,247
Sales & marketing 427,384 667,629 961,511 1,082,545
----------- ----------- ----------- -----------
TOTAL COSTS AND
EXPENSES 1,776,577 5,772,450 3,332,979 8,076,793
----------- ----------- ----------- -----------
LOSS FROM OPERATIONS (1,072,236) (4,680,990) (1,798,269) (5,319,785)
----------- ----------- ----------- -----------
CHANGE IN FAIR VALUE OF
WARRANTS (61,745) 1,348,209 234,458 2,014,983
LIQUIDATED DAMAGES - (356,310) - (356,310)
OTHER EXPENSES - (25,000) - (25,000)
INTEREST INCOME 18,503 20,245 36,124 54,518
INTEREST EXPENSE (317) (4,952) (1,158) (6,934)
----------- ----------- ----------- -----------
LOSS FROM CONTINUING
OPERATIONS BEFORE TAX (1,115,796) (3,698,797) (1,528,846) (3,638,528)
TAXES FROM CONTINUING
OPERATIONS 825 1,735 2,875 1,735
----------- ----------- ----------- -----------
NET LOSS FROM
CONTINUING OPERATIONS (1,116,621) (3,700,532) (1,531,721) (3,640,263)
DISCONTINUED OPERATIONS
Loss from discontinued
operations of
Answerbag, Inc. (net
of tax, $ 9,137) - 89,623 - 89,623
----------- ----------- ----------- -----------
LOSS BEFORE TAXES (1,116,621) (3,790,155) (1,531,721) (3,729,886)
----------- ----------- ----------- -----------
Tax Provision
----------- ----------- ----------- -----------
NET LOSS $(1,116,621) $(3,790,155) $(1,531,721) $(3,729,886)
=========== =========== =========== ===========
LOSS PER SHARE FROM
CONTINUING OPERATIONS
BASIC $ (0.02) $ (0.08) $ (0.03) $ (0.08)
=========== =========== =========== ===========
DILUTED $ (0.02) $ (0.08) $ (0.03) $ (0.08)
=========== =========== =========== ===========
LOSS PER SHARE FROM
DISCONTINUED
OPERATIONS
BASIC $ - $ - $ - $ -
=========== =========== =========== ===========
DILUTED $ - $ - $ - $ -
=========== =========== =========== ===========
LOSS PER SHARE
BASIC $ (0.02) $ (0.08) $ (0.03) $ (0.08)
=========== =========== =========== ===========
DILUTED $ (0.02) $ (0.08) $ (0.03) $ (0.08)
=========== =========== =========== ===========
WEIGHTED AVERAGE SHARES
OUTSTANDING - BASIC 52,547,662 46,169,256 52,132,276 45,882,067
WEIGHTED AVERAGE SHARES
OUTSTANDING - DILUTED 52,547,662 46,169,256 52,132,276 45,882,067
INFOSEARCH MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
June 30, December
2007 31, 2006
----------- -----------
(unaudited)
CURRENT ASSETS:
Cash $ 573,453 $ 2,495,654
Restricted cash 380,245 380,530
Accounts receivable 50,385 68,941
Due from related parties 16,309 50,732
Prepaid and other current assets 151,752 201,604
----------- -----------
TOTAL CURRENT ASSETS 1,172,144 3,197,461
EMPLOYEE ADVANCE 4,700 1,000
CONTENT DEVELOPMENT - 4,083
PROPERTY AND EQUIPMENT, NET 139,351 131,139
SECURITY DEPOSIT 37,500 37,500
EQUITY WARRANT ASSET 143,561 308,837
----------- -----------
TOTAL ASSETS $ 1,497,256 $ 3,680,020
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 188,106 $ 204,271
Accrued salaries and bonuses 69,449 264,515
Accrued expenses 333,475 400,052
Accrued expenses Answerbag acquisition - 75,156
Capital leases 459 17,621
Deferred revenue 417,416 454,741
Provision for refunds payable/chargebacks 14,360 30,842
Current tax liability 1,250 -
----------- -----------
TOTAL CURRENT LIABILITIES 1,024,515 1,447,198
INCOME TAX PAYABLE 156,000 -
FAIR VALUE OF WARRANT LIABILITY 997,990 1,396,215
----------- -----------
TOTAL LIABILITIES 2,178,505 2,843,413
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (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; 52,659 51,491
issued and outstanding 52,658,337 and
51,491,197, respectively
Committed stock, 0 and 164,282 shares - 22,586
Additional paid in capital 11,321,393 11,130,109
Accumulated deficit (12,055,301)(10,367,580)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT): (681,249) 836,606
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 1,497,256 $ 3,680,020
=========== ===========
INFOSEARCH MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudtied)
Period ended June 30,
2007 2006
============ ============
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,531,721) $ (3,729,886)
Adjustment from Discontinued Operations - 89,623
------------ ------------
Net Loss From Continuing Operations (1,531,721) (3,640,263)
Adjustment to reconcile net loss to net
cash used in operating activities
Depreciation and amortization 60,038 404,492
Equity based compensation 169,718 4,505,680
Loss from disposal of fixed assets - 9,462
Change in fair value of warrants (232,949) (2,014,983)
Changes in assets and liabilities:
Accounts receivable 19,183 (120,740)
Due from related parties 34,423 -
Prepaid expenses and other current assets 49,852 (99,865)
Employee Advances (3,700) -
Accounts payable, accrued expenses
and other liabilities (352,964) 374,754
Income Tax Payable 1,250 -
Provision for refunds (16,482) (15,351)
Deferred revenue (37,325) (1,873,531)
------------ ------------
Total adjustments (305,763) 1,169,918
NET CASH USED IN CONTINUING OPERATIONS: (1,840,677) (2,470,345)
Net loss from discontinued operations - (89,623)
------------ ------------
NET CASH USED IN DISCONTINUED OPERATIONS - (89,623)
NET CASH USED IN OPERATING ACTIVITIES (1,840,677) (2,559,968)
CASH FLOWS FROM INVESTING ACTIVITIES:
Restricted cash 288 -
Intangible assets - (180,728)
Capital expenditures - fixed assets (68,250) (31,632)
Capital expenditures - content development - (49,361)
------------ ------------
NET CASH USED IN CONTINUING INVESTMENT
ACTIVITIES (67,962) (261,721)
Change in intangible assets held for sale
from discontinued investing activities - (466,025)
------------ ------------
NET CASH USED IN DISCONTINUED INVESTMENT
ACTIVITIES - (466,025)
NET CASH USED IN INVESTING ACTIVITIES (67,962) (727,746)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments of capital lease
obligations (17,162) (15,930)
Warrants Exercise 3,600 -
------------ ------------
NET CASH USED IN FINANCING ACTIVITIES (13,562) (15,930)
Net decrease in cash and cash equivalents (1,922,201) (3,303,644)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 2,495,654 4,828,560
------------ ------------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 573,453 $ 1,524,916
============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION
Cash paid for interest $ 292 $ 3,866
============ ============
Income tax paid $ 2,875 $ 1,755
============ ============
NON-CASH SUPPLEMENTAL DISCLOSURE OF INVESTING
AND FINANCING ACTIVITIES:
Stock issued or committed to be issued for
the acquisition of Answerbag $ - $ 237,031
============ ============Investor Contact:
Scott Brogi
CFO
310.822.1103
scott@ishm.com
Media Contact:
Heather Gore
Vice President
310.437.7562
heather.gore@infosearchmedia.com
Need Help?