-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FKEuqUG2XIgbhtr18B8EjPCs4jJsomVjdfpGGr2ln2NCRVKrCGKXfzst9ZhAoibq VeDPbGFVTbRdlQV8L0e4lQ== 0000950130-99-006797.txt : 19991201 0000950130-99-006797.hdr.sgml : 19991201 ACCESSION NUMBER: 0000950130-99-006797 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991130 FILED AS OF DATE: 19991130 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BID COM INTERNATIONAL INC CENTRAL INDEX KEY: 0001079171 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: SEC FILE NUMBER: 001-14835 FILM NUMBER: 99766774 BUSINESS ADDRESS: STREET 1: 6725 AIRPORT RD STE 201 STREET 2: MISSISSAUGA ONTARIO CITY: CANADA L4V 1V2 BUSINESS PHONE: 9056727469 MAIL ADDRESS: STREET 1: 6725 AIRPORT RD STE 201 STREET 2: MISSISSAUGA ONTARIO CITY: CANADA L4V 1V2 6-K 1 FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K Report of Foreign Issuer PURSUANT to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 Filing No. 2 for the month of November, 1999 Bid.Com International Inc. -------------------------- (Exact name of Registrant) 6725 Airport Road, Suite 201, Mississauga, ON, Canada L4V 1V2 ------------------------------------------------------------- (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F Form 20-F X Form 40-F --- --- Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes No X ___ --- BID.COM INTERNATIONAL INC. On or about November 30, 1999, the Company mailed to all registered shareholders its Third Quarter 1999 Report. Exhibit 1. Third Quarter 1999 Report. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BID.COM INTERNATIONAL INC. Date: November 30, 1999 By: /s/ Paul Hart ------------- Name: Paul Hart Title: Chief Financial Officer EX-1 2 THIRD QUARTER 1999 REPORT Dear Shareholder, During the quarter, we continued to concentrate on developing our technology licensing and business to business relationships to supplement our consumer based business and build for the future. We expanded the reach of our "powered ------------------------- by Bid.Com" e-commerce solutions, which includes our patented "Dutch" auction technology and multiple e-commerce platforms. Third Quarter Results for the 3 Months Ending September 30, 1999* Revenue in the third quarter of 1999 increased by approximately 33% to $8.3 million compared to $6.3 million in the third quarter of 1998 and the second quarter of 1999. Revenues are derived from merchandise sales and shipping revenue from products sold on www.bid.com and fees from the provision of Bid.Com's licensed technology and related services. The gross profit in the third quarter, including licensing and related services, was $2.0 million, or 23.4% of revenue, compared to a gross profit of $195,000, or 3.1% of revenue, in the third quarter of 1998, and $1.3 million, or 20.3% of revenue, in the second quarter of 1999. Advertising and promotional expenses in the current quarter were $3.4 million, or 40.9% of revenues, compared to $3.3 million, or 53.1% of revenues, in the third quarter of 1998. Compared to the second quarter of 1999, advertising and promotional expenses increased by 83.2% from $1.9 million, or 29.8% of sales. The increase is primarily attributable to a more aggressive promotional pricing strategy to maintain site traffic during the traditionally slower summer months and other paid advertising. Other operating expenses in the third quarter increased by 14.7% from $3.2 million in the second quarter of 1999 to $3.7 million in the third quarter of 1999. Other operating expenses were $1.7 million in the third quarter of 1998. The increase from the second quarter of 1999 to the third quarter of 1999 relates primarily to a one-time charge, with the balance related to an increase in depreciation, amortization and software development and other expenses. The net loss for the third quarter of 1999 was $5.0 million, or $0.10 per basic share, compared to a net loss of $4.8 million, or $0.23 per basic share, in the comparable period of 1998 and a net loss of $3.6 million, or $0.07 per basic share, in the second quarter of 1999. Including cash of $29.9 million, working capital at September 30, 1999 was $33.3 million. During the quarter, Bid.Com received $16 million (net of expenses) of additional capital through issuance of special purchase warrants through a private placement. The special warrants, consisting of a unit of one common share and one share purchase warrant were issued for $9.25. It was subsequently agreed among the parties that the share purchase warrant be revised from a half warrant at $12.00 to a full warrant at $10.00. * All figures are in Canadian dollars. As of September 30, 1999, the exchange rate was Cdn$1.486 to US$1.00. Notable Activities --MORE-- 1 We are extremely pleased with the calibre of relationships which we developed in the third quarter. Our company continues to move toward a multi-revenue stream business that includes business-to-business and technology licensing arrangements. Our various agreements generally include, among other benefits, an ongoing revenue sharing component. Ultimately, we believe, this will yield a more sustainable, profitable business. . We strengthened our position in the heavy equipment sector by exercising an option to increase our stake in Point2 Internet Systems to 51%, one of the leading heavy equipment dealer listing services in North America. . We entered into an exclusive three-year technology licensing and services agreement with ValueVision Interactive Inc., an affiliate of NBC. ValueVision is pursuing the delivery of the brand SnapTV.com as the first live, interactive, web-based shopping experience in over 34 million households in the U.S. Bid.Com will receive a percentage of gross transaction revenues from the SnapTV declining price auction service in return for Bid.Com providing a complete e-commerce solution for VVI's "Dutch Auction" component of ValueVision Interactive's recently announced "Snap TV" brand. Bid.Com will also be a partner in several future projects involving television and Internet convergence. . To establish a presence in the automotive sector, we entered into a technology licensing and services agreement with Megawheels.com Inc. Megawheels provides an e-commerce solution to automotive dealers for the sale of new and used vehicles through its web-site www.megawheels.com and supports one of Canada's largest automotive online databases. The Company has also taken an equity position and will receive a percentage of net revenues from sales generated from the Megawheels auction service. . We strengthened our presence in the sports memorabilia marketplace by signing a technology licensing and marketing agreement with Today's Communications, Inc., which owns www.TodaysSports.com, a prominent sports portal on the Internet. The new three-year online partnership, which includes a revenue sharing arrangement, will link the two companies' websites and provide a significant sports-oriented audience with access to thousands of sports products and collectibles available for purchase. We also improved the website design by introducing improved navigational features, a new fixed price purchasing option, a brighter image and new corporate logo. Visitors to www.bid.com will also find an improved customer service section and greater product selection. The ability to offer fixed price purchasing complements Bid.Com's patented declining price and rising price auction formats and provides additional opportunities for the Company to enter into co-branding relationships. Thanks to the ongoing growth of the relationship between Bid.Com and Rogers, the Company expects its two millionth visitor to the Canadian website by the end of November. As we continue to build the business through partnerships, licensing agreements and global growth, we are most optimistic about our prospects as we approach the new millennium. Yours truly, Jeff Lymburner, President and CEO The Company does not believe that it has material exposure to Year 2000 complications with respect to its own information systems since its existing systems correctly define the Year 2000. The Year 2000 issue is the result of computer programs being written using two digits rather than four to define the applicable year. As a result, 2 date-sensitive software may recognize a date using "00" as the year 1900 rather than the Year 2000. This could result in system failures or financial miscalculations causing disruptions of operations, including, among others, a temporary inability to process transactions, send invoices or engage in similar normal business activities. The Company has conducted an analysis to determine the extent to which its major suppliers', service providers' and marketing and advertising partners' systems (insofar as they relate to the Company's business) are subject to the Year 2000 issue. However, the Company is currently unable to predict the extent to which the Year 2000 issue will affect its suppliers, service providers and marketing or advertising partners, or the extent to which it would be vulnerable to such parties' failure to remedy any Year 2000 issues on a timely basis. The failure of a major supplier, service provider or marketing or advertising partner subject to the Year 2000 issue to convert its systems on a timely basis, or the conversion of these systems that is incompatible with the Company's systems, could have a material adverse effect on the Company's business, results of operations, cash flow, financial condition and prospects. Most of the purchases from the Company's auctions are paid for using credit cards. If the bank systems used to process credit card transactions for a significant portion of transactions on Bid.Com's auction site are not Year 2000 compliant, the Company's operations may be materially and adversely affected to the extent customers are unable to use their credit cards to make purchases. Total costs attributable to Year 2000 compliance efforts, both for past efforts and present and anticipated future efforts, will be approximately $270,000. These amounts are expensed as incurred. Full copies of Bid.Com's Press Releases are available on the Investor Information Section of its website www.bid.com. ----------- This quarterly report may include comments that do not refer strictly to historical results or actions and may be deemed to be forward-looking within the meaning of the Safe Harbor provisions of the U.S. federal securities laws. These include, among others, statements about expectations of future revenues and cash flows. Forward-looking statements are subject to risks and uncertainties that may cause the Company's results to differ materially from expectations. These risks include the Company's ability to further develop its business-to-business and licensing businesses, the Company's ability to develop appropriate strategic alliances and successful development and implementation of technology, acceptance of the Company's products and services, competitive factors, new products and technological changes, and other such risks as the Company may identify and discuss from time to time, including those risks disclosed in the Company's amended Form 20-F filed with the Securities and Exchange Commission. Accordingly, there is no certainty that the Company's plans will be achieved. (Financial Tables follow) 3 BID.COM International Inc. Statement of Operations (expressed in thousands of Canadian dollars, except per share amounts) (Canadian GAAP, unaudited - prepared by management)
Nine Months Ended Three Months Ended September 30 September 30 ------------------------------------------------------------------------------------------ 1999 1999 1998 1999 1999 1998 -------------- ------------------ ------------- --------- ---------------- --------- ------------------------------------------------------------------------------------------ (translated into (translated into US$ at $US = US$ at $US = Cdn$1.486 for Cdn$1.486 for convenience) convenience) Revenue $ 19,595 $ 13,186 $ 13,676 $ 8,330 $ 5,606 $ 6,281 - ---------------------------------------------------------------------------------------------------------------------------- Direct expenses 15,886 10,690 13,422 6,377 4,291 6,086 General and administrative 8,481 5,707 3,635 3,205 2,157 1,420 Advertising and promotion 6,681 4,496 8,902 3,408 2,293 3,334 Software development and expense 750 505 494 273 184 171 Depreciation and amortization 425 286 136 245 165 69 32,223 21,684 26,589 13,508 9,090 11,080 - ---------------------------------------------------------------------------------------------------------------------------- Interest income 531 357 37 168 113 9 Net loss ($12,097) ($8,141) ($12,876) ($5,010) ($3,371) ($4,790) - ---------------------------------------------------------------------------------------------------------------------------- Loss per basic share ($0.25) ($0.17) ($0.64) ($0.10) ($0.07) ($0.23) - ---------------------------------------------------------------------------------------------------------------------------- Weighted average common shares outstanding 48,066 48,066 20,768 50,111 50,111 20,826 - ---------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------- September 30, September 30, December 31, Balance Sheet Data: 1999 1999 1998 -------------------------------------------------- (unaudited) (unaudited) (unaudited) (translated into US$ at $US = Cdn$1.486 for convenience) Cash and marketable securities $ 29,861 $ 20,095 $ 16,598 Other current assets 7,639 5,141 3756 Other assets 4,464 3,004 693 Total assets $ 41,964 $ 28,240 $ 21,047 ========= ======== ========= Total current liabilities 4,599 3,095 2425 Total stockholders' equity 37,365 25,145 18,622 Total liabilities and $ 41,964 $ 28,240 $ 21,047 shareholders' equity ========= ======== =========
4 BID.COM INTERNATIONAL INC. Consolidated Statements of Cash Flows Expressed in thousands of Canadian dollars (unaudited - prepared by Management) - -------------------------------------------------------------------------------
-------------------------------------------------------------------------- Nine Months Three Months NET INFLOW (OUTFLOW) OF CASH RELATED Ended Ended September 30 September 30 TO THE FOLLOWING ACTIVITIES 1999 1999 1998 1999 1999 1998 -------------------------------------- ---------------------------------- translated into translated into US$ = Cdn$1.486 US$ = Cdn$1.486 for convenience for convenience OPERATING Net loss for the period ($12,097) ($8,141) ($12,876) ($5,010) ($3,371) ($4,790) Item not affecting cash Depreciation and amortization 425 286 136 245 165 69 - ---------------------------------------------------------------------------------------------------------------------------- (11,672) (7,855) (12,740) (4,765) (3,206) (4,721) Change in long-term deferred revenue 361 243 - 361 243 Change in non-cash operating working capital items (3,918) (2,637) 3,163 80 54 (335) - ---------------------------------------------------------------------------------------------------------------------------- (15,229) (10,249) (9,577) (4,324) (2,909) (5,056) - ---------------------------------------------------------------------------------------------------------------------------- INVESTING Purchase of capital assets (454) (306) (273) (100) (67) (96) Purchase of trademarks and intellectual property (574) (386) (70) (528) (355) 0 Marketable securities and investments (3,113) (2,095) - 5,025 3,381 (25) - ---------------------------------------------------------------------------------------------------------------------------- (4,141) (2,787) (343) 4,397 2,958 (121) - ---------------------------------------------------------------------------------------------------------------------------- FINANCING Issuance of common shares (net of expenses) 12,293 8,273 14,644 1,165 784 12,678 Issuance of special warrants (net of expenses) 16,047 10,799 - 16,047 10,799 - Special warrants receivable 2,311 1,555 2,189 - - ---------------------------------------------------------------------------------------------------------------------------- 30,651 20,627 16,833 17,212 11,583 12,678 - ---------------------------------------------------------------------------------------------------------------------------- NET CASH INFLOW DURING THE PERIOD $11,281 $7,591 $6,913 $17,285 11,632 $7,501 CASH, BEGINNING OF PERIOD 9,792 $6,590 2,177 3,788 2,549 1,589 - ---------------------------------------------------------------------------------------------------------------------------- CASH, END OF PERIOD $21,073 $14,181 $9,090 $21,073 $14,181 $9,090 - ----------------------------------------------------------------------------------------------------------------------------
CORPORATE DIRECTORY
Directors, Officers and Managing Directors Investor Relations Financial Relations Board 675 Third Avenue, Paul Godin* David Pamenter New York, NY. Chairman Assistant Secretary and Director 10017 Director Partner, Gowling, Strathy & Henderson Member of Corporate Governance Committee Jeffrey Lymburner* Auditors President and Chief Executive Officer James I. Moskos Deloitte & Touche LLP Director Executive Vice President, Technology Chartered Accountants Director Toronto, Ontario, Canada T. Christopher Bulger* Executive Vice-President, Business Development Paul Hart Lawyers Director Chief Financial Officer Gowling, Strathy & Henderson Partner, HDL Capital Corporation Toronto, Ontario, Canada Member of Audit Committee1 Mark Wallace, Executive Vice President and General Baer Marks & Upham LLP Counsel New York, New York, USA Corporate Secretary Charles Walker Gregory Bewsh CEO and President, Walker Group Inc., Vice President, Investor Relations Stock Exchange Listings Director Toronto Stock Exchange Member of Audit Committee/1/ Robert W.A. Joynt Symbol BII Senior Vice President, Merchandising Michael Abramsky Nasdaq President, Rogers New Media Aidan Rowesome, Symbol BIDS Director Managing Director, European Operations Member of Corporate Governance Committee Offices of Bid.com Dr. Duncan Copeland 6725 Airport Road, Suite 201 President, Copeland and Company Mississauga, Ontario, Web Sites Director Canada L4V 1V2 www.bid.com Member of Audit Committee/1/ and 905-672-SHOP(7467) www.internetliquidators.com Corporate Governance Committee www.dutchauction.com 2701 North Rocky Point Drive, Suite 510 Hamish Sutherland, Tampa, Florida 33609-1013 Registrar & Transfer Agent Managing Director, Australia and Asia Pacific 813-636-8205 CIBC Mellon Trust Company PO Box 70390 125 Lower Baggot Street, Toronto Station A Dublin 2, Toronto, Ontario, Canada Ireland M5W 2X5 * Member of Executive Committee Shares Outstanding /1/ The Audit Committee performs the functions of (September 30, 1999) the Compensation and Stock Option Issued 50,605,444 Committee which are no longer separately Fully Diluted 54,873,918 constituted.
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