MeetMe Reports Second Quarter 2013 Financial Results

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MeetMe Reports Second Quarter 2013 Financial Results

$9.5 million quarterly revenue driven by record mobile revenue

NEW HOPE, Pa.--(BUSINESS WIRE)-- MeetMe®, Inc. (NYSE MKT: MEET), the public market leader in social discovery, today reported financial results for the second quarter ended June 30, 2013.


Second Quarter 2013 Financial Highlights

  • Revenue was $9.5 million, up 21.5 percent sequentially. Previously the company announced that it anticipated Q2 revenues of approximately $9.0 million.
  • Mobile revenue reached an all-time high at $2.6 million, up 37 percent sequentially and 98 percent year-over-year, and exceeding the previous record set in the seasonally-strong fourth quarter of 2012 by 18.8 percent.
  • Net loss was $2.1 million or $0.05 per share, compared with a net loss of $3.8 million or $0.11 per share in the second quarter of 2012.
  • Adjusted EBITDA was a positive $384,000, up over $2 million sequentially from an Adjusted EBITDA loss of $1.7 million in the first quarter. (See the important discussion about the presentation of non-GAAP financial measures, and reconciliation to the most directly comparable GAAP financial measures, below.)
  • Cash and Cash Equivalents totaled $8.3 million at June 30, 2013.

Geoff Cook, CEO of MeetMe, said, "In the second quarter we believe we demonstrated the strength and potential of our mobile business, while at the same time demonstrating stability in our online business. Sequential revenue growth was significant, and we posted an adjusted EBITDA profit."

Mr. Cook continued, "We are seeing increasing traction with the new mobile advertising products. Since launching additional native mobile ads on iPhone in July, native advertising impressions increased more than fourfold on that platform compared to the week prior to launch. This launch contributed to the 43% increase in overall iPhone advertising revenue during the same period. With the recent launch of these units on Android, we now reach 90% of our mobile audience with our highest-monetizing and best-performing advertising units."

"Having spent the last year building out much of the infrastructure of mobile monetization with various advertising, freemium, and subscription products, we believe we now monetize our mobile audience at industry-leading rates," Mr. Cook noted. "To accelerate growth from here, we must continue to sustain our mobile monetization gains while also rapidly growing our mobile audience. Our team is working on driving increased engagement and usage with significant new product launches over the coming two quarters."

Operating and Business Highlights

  • Monthly active users (MAUs) increased nearly 70 percent, averaging 5.37 million in the second quarter of 2013 compared to 3.18 million average MAUs in the second quarter of 2012. Mobile MAUs increased 61 percent to 2.69 million in the second quarter of 2013 from 1.67 million in the second quarter of 2012.
  • Daily active users (DAUs) increased 15 percent, averaging 1.18 million in the second quarter of 2013 compared to 1.03 million in the second quarter of 2012. Average mobile DAUs improved 31 percent to 789,000 in the second quarter of 2013 from 603,000 in the second quarter of 2012.
  • Revenue attributed to mobile products was $2.6 million in the second quarter of 2013, an approximately 100 percent increase from $1.3 million in the second quarter of 2012, with 43 percent of mobile revenue in the second quarter of 2013 attributed to virtual currency. Mobile average revenue per daily active user (ARPDAU) increased 48 percent from $0.025 to $0.037 during the same period.

David Clark, Chief Financial Officer of MeetMe, added, "We believe the positive revenue trends and our emphasis on cost controls allowed us to drive positive adjusted EBITDA in the second quarter. We are encouraged by our mobile revenue growth, which represented 32 percent of total revenues this quarter versus 17 percent a year ago. We ended the quarter with an increased cash balance of $8.3 million."

 
MEETME, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
   
June 30,December 31,
20132012
Assets
Current Assets
Cash and cash equivalents$8,335,444$5,022,007
Accounts receivable, net of allowance of $447,000 and $547,000, at
June 30, 2013 and December 31, 2012, respectively6,830,79815,744,789
Notes receivable58,512111,569
Prepaid expenses and other current assets 854,606  870,881 
Total current assets16,079,36021,749,246
 
Goodwill70,646,03670,646,036
Intangible assets, net5,767,1076,746,273
Property and equipment, net3,866,8704,772,632
Other assets 490,498  520,480 
Total assets$96,849,871 $104,434,667 
 
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable$2,201,054$3,528,607
Accrued expenses and other liabilities4,256,2373,211,681
Current liabilities from discontinued operations-1,434
Deferred revenue739,682392,612
Accrued dividends69,45569,455
Current portion of long-term debt 3,807,907  2,551,941 
Total current liabilities11,074,3359,755,730
 
Long term debt, net of discount 4,672,064  9,156,788 
Total liabilities 15,746,399  18,912,518 
 
Commitments and Contingencies
 
Stockholders' Equity:
Preferred stock, $.001 par value, authorized 5,000,000 shares:
Convertible preferred stock Series A-1, $.001 par value; authorized - 5,000,000 shares;
1,000,000 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively1,0001,000
Common stock, $.001 par value; authorized - 100,000,000 shares; 38,127,737
and 37,046,405 shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively38,13137,050
Additional paid-in capital280,297,474275,261,794
Accumulated deficit(198,638,774)(189,211,750)
Accumulated other comprehensive loss (594,359) (565,945)
Total stockholders' equity 81,103,472  85,522,149 
Total liabilities and stockholders' equity$96,849,871 $104,434,667 
 
 
MEETME, INC. AND SUBSIDIARIES
Consolidated Statements of Operations and Comprehensive Loss (Unaudited)
   

For the Three Months Ended
June 30,

For the Six Months Ended
June 30,

2013201220132012
 
Revenues$9,482,960 $13,054,861 $17,288,592 $23,450,590 
Operating Costs and Expenses:

 

Sales and marketing1,542,9771,676,2433,529,6703,442,639
Product development and content6,342,5768,224,74912,726,02014,721,208
General and administrative1,822,3002,379,3134,222,5594,323,846
Depreciation and amortization1,089,043965,1552,171,9871,863,539
Restructuring costs646,479247,8772,540,896537,944
Loss on debt restructure -  -  1,174,269  - 
Total Operating Costs and Expenses 11,443,375  13,493,337  26,365,401  24,889,176 
Loss from Operations (1,960,415) (438,476) (9,076,809) (1,438,586)
Other Income (Expense):
Interest income3,0974,3185,3539,892
Interest expense(141,728)(288,216)(355,568)(586,284)
Other income (expense), net -  497  -  1,030 
Total other income (expense) (138,631) (283,401) (350,215) (575,362)
Loss before income taxes(2,099,046)(721,877)(9,427,024)(2,013,948)

Income taxes

 -  -  -  - 
Net loss from continuing operations$(2,099,046)$(721,877)$(9,427,024)$(2,013,948)
Loss from discontinued operations, net of taxes$- $(3,114,040)$- $(3,680,627)
Net Loss Allocable To Common Shareholders$(2,099,046)$(3,835,917)$(9,427,024)$(5,694,575)
 
Basic and diluted net loss per common shareholders:
Continuing operations$(0.05)$(0.02)$(0.25)$(0.06)
Discontinued operations$- $(0.09)$- $(0.10)
Basic and diluted net loss per common shareholders$(0.05)$(0.11)$(0.25)$(0.16)
Weighted Average Number of Shares
Outstanding, Basic and Diluted: 38,127,737  36,240,472  37,749,772  36,306,886 
 
Net Loss$(2,099,046)$(3,835,917)$(9,427,024)$(5,694,575)
Foreign currency translation adjustment (45,741) (144,458) (28,414) (92,425)
Comprehensive Loss$(2,144,787)$(3,980,375)$(9,455,438)$(5,787,000)
 
    
MEETME, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income (Loss) from Continuing Operations to Adjusted EBITDA
 

Three Months Ended June 30,

Six Months Ended June 30,
2013201220132012
 
Net loss from continuing operations allocable to common shareholders$(2,099,046)$(721,877)$(9,427,024)$(2,013,948)
 
Interest expense141,728288,216355,568586,284
Depreciation and amortization1,089,043965,1552,171,9871,863,539
Amortization of stock based compensation605,7761,068,5051,910,9241,878,586
Acquisition and restructuring costs
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