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Source: DAG Media, Inc.
DAG Media, Inc. Reports Year 2003 Consolidated Financial Statements
Wednesday, February 25, 4:01 pm ET
NEW
YORK, Feb. 25 /PRNewswire-FirstCall/ -- DAG Media Inc. (Nasdaq:
DAGM
- News)
Dag Media, Inc., a leading independent publisher of print and online
business directories, announced today that consolidated net advertising
revenue for the year ended December 31, 2003 was $9,086,000 versus
advertising revenues of $6,530,000 for year 2002, an increase of $2,556,000
or 39.14%. The increase derives from general increase in sales and
growth of business. For the year ended December 31, 2003, the Company
published three Blackbook's business directories compared to only
one in 2002, recognizing revenues of $2,165,000 in connection with
Blackbook compared to $364,000 in 2002.
Gross profit increased
to $6,968,000 in 2003 from $4,800,000 in the twelve months period
ending December 31, 2002.
For the year ended
December 31, 2003, consolidated income before provision for income
taxes was $1,887,000 compared to a loss of $353,000 in 2002. Net income
after cumulative effect of change in accounting principal was $1,599,000
versus net loss of $1,093,000 in 2002. This increase of $2,692,000
attributable to the $1,208,000 gain from sale of the New Yellow directory,
improved results of operations and the absence of 2002 charge of $895,000
related to the cumulative effect of change in accounting principle.
Basic and diluted
net income per common share was $0.55 and $0.53 in 2003 versus net
loss of $0.37 in 2002.
As of December
31, 2003, the Company also reported $8,781,000 or approximately $
2.99 per share in cash, cash equivalent, marketable securities and
short term investments, current assets of $13,164,000, and total assets
of $14,451,000 and deferred revenues of $4,000,000.
Assaf Ran, Chairman
of the board and CEO stated, "The sale of our New Yellow directory
created a number of new opportunities for the Company. We have reinforced
the Kosher Yellow Pages, launched the Complete Industry Directory
of Blackbook as well as blackbookstock.com. Their success cleared
the road for the inception of more exciting ventures. I'm confident
that these new fronts will contribute more to our success than New
Yellow."
"I would
like to express my appreciation to our dedicated sales forces and
employees for a job well done in 2003 and to encourage them to accomplish
our challenges for year 2004," added Mr. Ran.
DAG Media
publishes and distributes Yellow Pages directories in print and online
as well as photography, illustration and design directories. We also
operate several web sites that complement our directories at http://www.newyellow.com,
http://www.blackbook.com,
and at http://www.blackbookstock.com.
Forward-looking
statements in this release are made pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that such forward-looking statements involve
risks and uncertainties, including, without limitation, continued
acceptance of the Company's products, increased levels of competition,
new products introduced by competitors, changes in the rates of subscriber
acquisition and retention, and other risks detailed from time to time
in the Company's periodic reports filed with the Securities and Exchange
Commission.
DAG MEDIA, INC.
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2003
Assets
Current assets:
Cash and cash equivalents $1,201,819
Marketable securities 6,560,805
Short term investment - insurance annuity
contract - at fair value 1,018,536
Total cash and cash equivalents, marketable
securities and short term investments 8,781,160
Trade accounts receivable, net of allowance
for doubtful accounts of $567,000 2,330,555
Directories in progress 1,833,903
Other current assets 218,118
Total current assets 13,163,736
Property and equipment, net 286,633
Goodwill 458,131
Trademarks and other intangibles, net 419,274
Other assets 123,412
Total assets $14,451,186
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses $734,961
Commissions payable 782,254
Advanced billing for unpublished directories 4,000,483
Dividends payable 744,113
Income taxes payable 89,000
Total current liabilities 6,350,811
Deferred income taxes 76,216
Total liabilities 6,427,027
Commitments and contingencies (Note 9)
Shareholders' equity:
Preferred shares - $.01 par value; 5,000,000
shares authorized; no shares issued --
Common shares - $.001 par value; 25,000,000
authorized; 3,045,190 issued and
2,976,460 outstanding 3,045
Additional paid-in capital 8,054,827
Treasury stock, at cost- 68,730 shares (231,113)
Deferred compensation (81,000)
Accumulated other comprehensive income 102,185
Retained earnings 176,215
Total shareholders' equity 8,024,159
Total liabilities and shareholders' equity $14,451,186
The accompanying notes are an integral part of these financial statements.
DAG MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
2003 2002
Advertising revenues $9,085,670 $6,529,605
Publishing costs 2,117,907 1,729,993
Gross profit 6,967,763 4,799,612
Operating costs and expenses:
Selling expenses 3,313,867 2,336,710
General and administrative
expenses 3,233,817 3,056,713
Total operating costs and expenses 6,547,684 5,393,423
Income (loss) from operations 420,079 (593,811)
Interest income 233,099 246,540
Gain from the sale of the New
Yellow directory 1,207,997 -----
Realized gain (loss) on
marketable securities 26,043 (5,854)
Total other income, net 1,467,139 240,686
Income (loss) before income taxes 1,887,218 (353,125)
Provision (benefit) for income taxes 288,254 (155,131)
Income (loss) before cumulative effect
of change in accounting principle 1,598,964 (197,994)
Cumulative effect of change in
accounting principle ------ (895,000)
Net income (loss) $1,598,964 $(1,092,994)
Income (loss) per common share:
Basic -
Income (loss) before cumulative effect
of change in accounting principle $0.55 $(0.07)
Cumulative effect of change in
accounting principle ---- (0.30)
Net income (loss) $0.55 $(0.37)
Diluted-
Income (loss) before cumulative effect
of change in accounting principle $0.53 $(0.07)
Cumulative effect of change in
accounting principle ---- (0.30)
Net income (loss) $0.53 $(0.37)
Weighted average number of common
shares outstanding
Basic 2,933,164 2,917,973
Diluted 3,037,155 2,917,973
The accompanying notes are an integral part of these financial statements.
DAG MEDIA, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
Additional
Common Stocks Paid-in Treasury Shares
Shares Amount Capital Shares Cost
Balance December
31, 2001 2,976,190 $2,976 $7,896,953 68,730 $(231,113)
Stock option
exercise 20,000 20 21,180
Issuance of options
to consultants 152,843
Amortization of
deferred
compensation
Cancellation of
options issued
to consultants (58,029)
Unrealized gains on
preferred stocks
and other marketable
securities, net
of taxes
Net loss for the
year ended
December 31, 2002
Balance,
December 31, 2002 2,996,190 $2,996 $8,012,947 68,730 $(231,113)
Stock Option
exercise 49,000 49 71,531
Amortization of
deferred
compensation
Cancellation of
options issued
to consultants (29,650)
Unrealized gains on
preferred stocks
and other marketable
securities, net of
income taxes
Dividend declared to
be paid at 1/5/2004
($0.25 per share)
Net income for the
year ended
December 31, 2003
Balance,
December 31, 2003 3,045,190 $3,045 $8,054,827 68,730 $(231,113)
Deferred Accumulated Retained Totals
Compensation other Earnings
comprehensive
income
Balance
December 31, 2001 $(49,678) $15,361 $414,358 $8,048,857
Stock option exercise 21,200
Issuance of options
to consultants (152,843) ----
Amortization of
deferred compensation 18,606 18,606
Cancellation of options
issued to consultants 58,029 ----
Unrealized gains on
preferred stocks and
other marketable
securities, net of taxes 7,057 7,057
Net loss for the year
ended December 31,
2002 (1,092,994) (1,092,994)
Balance,
December 31, 2002 (125,886) $22,418 $(678,636) $7,002,726
Stock Option exercise 71,580
Amortization of deferred
compensation 15,236 15,236
Cancellation of options
issued to consultants 29,650 ----
Unrealized gains on
preferred stocks and
other marketable
securities, net of
income taxes 79,767 79,767
Dividend declared to be
paid at 1/5/2004
($0.25 per share) (744,113) (744,113)
Net income for the
year ended
December 31, 2003 1,598,964 1,598,964
Balance,
December 31, 2003 $(81,000) $102,185 $176,215 $8,024,159
The accompanying notes are an integral part of these financial statements.
DAG MEDIA, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
2003 2002
Cash flows from operating activities:
Net income (loss) $1,598,964 $(1,092,994)
Adjustment to reconcile net income
(loss) to net cash provided by operating
activities -
Gain on sale of New Yellow directory (1,207,997)
Cumulative effect of change in
accounting principle ---- 895,000
Depreciation and amortization 159,028 114,493
Amortization of deferred compensation 15,236 18,606
Bad debt expense 883,740 1,232,738
Deferred taxes 515,320 (248,132)
Realized (gain) loss on marketable securities ---- 5,854
Changes in operating assets and liabilities -
Accounts receivable (548,198) (1,176,338)
Directories in progress 276,924 (608,867)
Other current and non current assets (86,783) 28,270
Accounts payable and accrued expenses (17,244) (301,406)
Accrued Interest Income ---- (8,782)
Commissions payable (25,798) 163,092
Advanced billings for unpublished directories (781,069) 1,231,611
Income taxes payable (181,549) 4,198
Advances to employees ---- (22,876)
Net cash provided by operating activities 600,574 234,467
Cash flows from investing activities:
Investment in Dune Medical Devices (100,000) (70,537)
Investment in preferred stocks, other
marketable securities and annuity contract (8,573,154) (6,796,164)
Cash received on sale of New Yellow
directory, net of expenses 1,207,997
Proceeds from sale of preferred stocks
and marketable securities 7,901,498 3,681,343
Sale of property and equipment 46,200
Purchase of property and equipment (155,296) (97,068)
Net cash provided by (used in) investing
activities 327,245 (3,282,426)
Cash flows from financing activities:
Stock option exercise 71,580 21,200
Net cash provided by financing activities 71,580 21,200
Net increase (decrease) in cash and cash
equivalents 999,399 (3,026,75)
Cash and cash equivalents, beginning of year 202,420 3,229,179
Cash and cash equivalents, end of year $1,201,819 $202,420
Supplemental Cash Flow Information:
Taxes paid during the year $21,936 $88,801
Dividends declared but not paid $744,113 -------
Acquisition of subsidiary company:
Assets acquired $652,278
Liabilities assumed $(991,967)
Goodwill and other intangibles $633,132
$293,443
Less - cash acquired $(211,406)
Less - accrued acquisition costs $(11,500)
Net cash paid $70,537
The accompanying notes are an integral part of these financial statements.
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