Exhibit 99.1
Exhibit 99.1
Rediff.Com Reports Results for the Second Quarter Ended September 30, 2011
Mumbai, India, October 21, 2011
Our overall revenues for the quarter ended September 30, 2011 were $5.1 million, an increase of
approximately 1% over the corresponding quarter last fiscal year. Within this, revenues from India
Online increased 1% while our U.S. Publishing business was relatively unchanged, all compared to
the corresponding period last fiscal year.
We continue to focus our resources to position Rediff for the future by investing in our
infrastructure and by partnering with technology leaders and operators to gain a competitive edge.
The Indian Government, through its recently introduced, Draft National Telecom Policy, has
announced aggressive plans to increase the broadband user base multifold, while significantly
improving download speeds in both the short and long term. Additionally, plans were disclosed to
bring fiber optic networks to rural areas and regions that have not experienced this technology
before, which we believe bodes well for the telecom industry at large, and will have a positive
impact on Rediffs market position for years to come.
Throughout the year, we have continued to build out our service offerings, focusing on customer
retention and growing our user base. Our recently announced daily deals service Rediff Deal Ho
Jaye!, now has close to 4,000 merchants and is gaining traction every day. We are now looking to
drive user adoption through mass media campaigns, while at the same time, providing support to
participating merchants to help grow their business.
Our Rediff Local TV ad network is now live in 5 cities Mumbai, Pune, Ahmedabad, Surat and Baroda
and provides a solution that small merchants need, and a future sales channel for our Company.
In regard to Rediffmail NG, our paid mobile mail business, we are in the process of technical and
billing integration with our telecom partners, and looking to grow our presence with small and
medium sized enterprises. Additionally, we remain in discussions with several operators as we look
to expand our reach throughout the mass India market.
Lastly, we have recently introduced a micro blogging service that enables users to broadcast
messages and participate in conversations with other users, while providing the ability to shorten
URLs on the fly. The service is integrated with our social media initiative MyPage.
We are confident that all of these initiatives will position us for meaningful growth in the
future; one that we believe is not so far away given increased investments in technology and
throughout Indias infrastructure. We are equally encouraged by the renewed and aggressive
commitment from the Indian Government to spearhead broadband adoption and improve quality and
service. This is why we continue to invest in our business and expand the reach of the Rediff
brand, said Ajit Balakrishnan, Chairman and CEO of Rediff.com.
Our cash balance stood at $29.4 million, as of September 30, 2011, and we continue to invest
approximately $2.0 $2.5 million per quarter in our business. With cash on hand, we believe we
have sufficient working capital to meet our liquidity needs and to execute on our strategy,
including investments in product development, sales diversification and the entrance into new
markets.
Further details of Rediff.coms results for the second fiscal quarter ended September 30, 2011 are
appended in tabular form to this press release. A script of the earnings result conference call
held on October 21, 2011 will also be made available on Rediffs Investor Information website at
investor.rediff.com.
About Rediff.com
Rediff.com (NASDAQ: REDF) is one of the premier worldwide online providers of news, information,
communication, entertainment and shopping services to Indians worldwide. Founded in 1996,
Rediff.com is headquartered in Mumbai, India with offices in New Delhi, India and New York, USA.
Safe Harbor
Except for historical information and discussions contained herein, statements included in this
release may constitute forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and reflect our current expectations. Forward-looking statements are identified by certain
words or phrases such as may, will, aim, will likely result, believe, expect, will
continue, anticipate, estimate, intend, plan, contemplate, seek to, future,
objective, goal, project, should, will pursue and similar expressions or variations of
such expressions. These statements involve a number of risks, uncertainties and other factors that
could cause actual results to differ materially from those that may be projected by these forward
looking statements. These risks and uncertainties include but are not limited to the slowdown in
the economies worldwide and in the sectors in which our clients are based, the slowdown in the
Internet and IT sectors world-wide, competition, success of our past and future acquisitions,
attracting, recruiting and retaining highly skilled employees, technology, acceptance of new
products and services, the development of broadband Internet and 3G networks in India, legal and
regulatory policies, managing risks associated with customer products, the wide spread acceptance
of the Internet as well as other risks detailed in the Form 20-F and other reports filed by
Rediff.com India Limited with the U.S. Securities and Exchange Commission. Rediff.com India Limited
and its subsidiaries may, from time to time, make additional written and oral forward looking
statements, including statements contained in the Companys filings with the Securities and
Exchange Commission and our reports to shareholders. Rediff.com India Limited does not undertake to
update any forward-looking statement that may be made from time to time by or on behalf of the
Company.
TABLES TO FOLLOW
STATEMENT OF OPERATIONS
QUARTER ENDED SEPTEMBER 30, 2011
(All figures are in US$ million, unless otherwise indicated below)
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Quarter ended September 30 |
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2011 |
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2010 |
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Revenues |
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|
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|
India Online |
|
|
4.18 |
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|
4.15 |
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US Publishing |
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|
0.92 |
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|
0.92 |
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Total Revenues |
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5.10 |
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|
5.07 |
|
Cost of Revenues * |
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|
(2.81 |
) |
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|
(2.59 |
) |
Gross Margin |
|
|
2.29 |
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|
2.48 |
|
Gross Margin % |
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|
45 |
% |
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|
49 |
% |
Operating Expenses * |
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(4.60 |
) |
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|
(3.80 |
) |
Operating EBITDA |
|
|
(2.31 |
) |
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(1.32 |
) |
Depreciation / Amortization |
|
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(0.93 |
) |
|
|
(0.87 |
) |
Interest Income |
|
|
0.76 |
|
|
|
0.86 |
|
Other Income |
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|
|
|
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|
0.08 |
|
Foreign Exchange gain (loss) |
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(0.07 |
) |
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|
0.04 |
|
Equity in net loss of equity method investee |
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(0.09 |
) |
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(0.38 |
) |
Net loss before income taxes |
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(2.64 |
) |
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(1.59 |
) |
Tax |
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Net loss |
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(2.64 |
) |
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(1.59 |
) |
Net loss per ADS (in US dollars) |
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(0.096 |
) |
|
|
(0.057 |
) |
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Net loss per ADS (in US dollars) diluted |
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(0.096 |
) |
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|
(0.057 |
) |
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Weighted average ADS Outstanding (in millions) |
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27.57 |
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27.73 |
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* Stock based Compensation included in: |
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Cost of revenue |
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0.02 |
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0.03 |
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Operating expenses |
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0.23 |
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0.21 |
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Notes
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Each ADS represents one half of an equity share. |
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The above numbers are subject to audit and while no significant changes are anticipated,
an audit could result in adjustments which would result in the audited numbers varying from
the numbers set forth above. |
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During the Fiscal year ended March 31, 2010 the company established an ESOP trust for
the benefit of the employees and purchased 750,000 shares (equivalent to 1,500,000 ADS).
During the quarter ended December 31, 2010 Trust purchased an additional 265,000 shares
(equivalent to 530,000 ADS). These shares are treated as treasury stock and therefore are
excluded from the EPS calculations. |
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During the fiscal year ended March 31, 2011 the Company acquired Vubites India Private
Limited and consolidated its result of operations. |
Non-GAAP Measures Note
Operating EBITDA, non-GAAP operating expenses, impairments related to long-lived assets are the
non-GAAP measures in this press release. These measurements are not recognized under generally
accepted accounting principles (GAAP).
Operating EBITDA represents loss from operations prior to adjustments for depreciation/
amortization, non-recurring items and other income or expense and tax. However, other companies may
calculate operating EBITDA differently. Operating EBITDA is not intended to represent cash flows as
defined by generally accepted accounting principles and should not be considered as an indicator of
cash flow from operations. We have included information concerning operating EBITDA in this press
release because management and our board of directors use it as a measure of our performance. In
addition, future investment and capital allocation decisions are based on operating EBITDA.
Investors and industry analysts use operating EBITDA to measure the Companys performance to
historic results and our peer group. The reconciliation between operating EBITDA and net loss, the
GAAP measure, is as follows:
RECONCILIATION FROM OPERATING EBITDA TO NET INCOME
QUARTER ENDED SEPTEMBER 30, 2011
(All figures are in US$ million)
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Quarter ended September 30 |
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|
2011 |
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|
2010 |
|
Operating EBITDA (Non GAAP) |
|
|
(2.31 |
) |
|
|
(1.32 |
) |
Depreciation / Amortization |
|
|
(0.93 |
) |
|
|
(0.87 |
) |
Interest Income |
|
|
0.76 |
|
|
|
0.86 |
|
Other Income |
|
|
|
|
|
|
0.08 |
|
Foreign Exchange gain (loss) |
|
|
(0.07 |
) |
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|
0.04 |
|
Equity in net loss of equity method investee |
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(0.09 |
) |
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(0.38 |
) |
Net loss before income taxes |
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(2.64 |
) |
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|
(1.59 |
) |
Tax |
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|
|
|
|
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Net loss (GAAP) |
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(2.64 |
) |
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(1.59 |
) |
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Non-GAAP operating expenses represent our operating expenses comprised of sales and marketing,
product development and general and administrative expenses excluding depreciation and
amortization. We have used the non-GAAP operating expense to compute our operating EBITDA. A
reconciliation of the GAAP operating expense to non-GAAP operating expense is as follows:
RECONCILIATION FROM GAAP TO NON-GAAP OPERATING EXPENSES
QUARTER ENDED SEPTEMBER 30, 2011
(All figures are in US$ million)
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Quarter ended September 30 |
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|
2011 |
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2010 |
|
Operating Expenses (GAAP) |
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5.53 |
|
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4.67 |
|
Depreciation/Amortization |
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(0.93 |
) |
|
|
(0.87 |
) |
Operating Expense (Non-GAAP) |
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|
4.60 |
|
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|
3.80 |
|
For further details contact:
Mandar Narvekar
Rediff.com India Ltd.
Investor Relations and Corporate Affairs Contact
Tel.: +91-22-24449144
Email: investor@rediff.co.in
Glenn Wiener and Jay Morakis
GW Communications (U.S.A.)
Tel. 212.786.6011 / 212.786.6037
Email: gwiener@GWCco.com / jmorakis@GWCco.com