Press Releases
DAG Media, Inc. Reports Year 2003 Consolidated Financial Statements
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 athttp://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
|
|
Common Stocks |
Additional Paid-in Capital |
Treasury Shares |
||
|
|
Shares |
Amount |
|
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 Compensation |
Accumulated other comprehensive income |
Retained Earnings |
Totals |
|
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.