EX-99 7 ex99.htm EXHIBIT 99.1 Converted by EDGARwiz

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EXHIBIT 99.1


FOR IMMEDIATE RELEASE  


Think Partnership 4th Quarter and FY2006 Financial Results

Q4 2006 Revenues up 95% over same year ago period

4th Consecutive Year of Record Revenue of $71.9 million, up 78% over 2005

Record Annual EBITDA of $8.8 million in 2006, up 267% over 2005

CLEARWATER, Fla. – March 29, 2007 – Think Partnership Inc. (AMEX:THK), an international leader in interactive performance-based marketing and related Internet technologies, reported financial results for the fourth quarter and year ended December 31, 2006.

Q4 2006 Financial Results

As compared to the previous quarter and same period a year ago:

·

Revenues totaled $19.0 million, a decrease of 12% from $21.6 million in the previous quarter and up 96% from $9.7 million a year ago.

·

Net Income from operations was $0.3 million, a decrease of 68% from $0.9 million in the previous quarter and up from a loss of ($1,743,249) a year ago.

·

Basic and fully diluted earnings per common share totaled a loss of $(0.14), a decrease from a loss of ($0.01) in the previous quarter, and a decrease from a loss of ($0.03) per share in the same period a year ago. The loss per common share is primarily due to charges relating to the Series A Convertible Preferred Stock of $7.2 million and $10.2 million for the quarter ended and year ended December 31, 2006 respectively.

·

Earnings before interest, taxes, depreciation and amortization expenses ("EBITDA") was $2.7 million, down 30% from $3.8 million reported in the previous quarter, and up from a loss of ($1.0 million) reported the same period a year ago. A reconciliation of EBITDA to income from operations is included at the end of this release.

Full Year 2006 Financial Results

·

Revenues totaled a record $71.9 million, an increase of 78% from $40.4 million in 2005.

·

Income before taxes was $1.4 million, an increase from $33 thousand in 2005.

·

Basic and fully diluted earnings per common share totaled a loss of $(0.20), compared to 0.00 in 2005. The loss is primarily due to preferred stock charges of $10.2 million.

·

Earnings before interest, taxes, depreciation and amortization expenses ("EBITDA") was a record $8.8 million, up 272% from $2.4 million reported in 2005.

"While we have enjoyed another year of record revenue and EBITDA, this has also been a period of substantial investment in new technologies and products designed to fuel our growth in the coming year," said Think Partnership's president and CEO, Scott P. Mitchell. "Think Partnership has generated almost $72 million in revenue and $9 million in EBITDA in 2006.  Although our fourth and first quarter results were impacted by certain operating challenges, we strongly believe these issues have been permanently resolved and are nonrecurring. As we anticipate healthy industry-wide expansion also contributing to


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accelerated organic growth, we reiterate our revenue forecast to top $100 million in 2007, with EBITDA margin ranging from 20-22% of revenue."


Other Q4 2006 Highlights

·

Think Partnership initiated conversion of all outstanding preferred stock to common, which was completed in the first quarter 2007. The conversion eliminated $19.1 million of preferred stock from the balance sheet, as well as eliminated an estimated $5.9 million in annual preferred dividend payments and accretion in 2007. The company expects the conversions to increase net income applicable to common share holders by approximately $0.11 per share.

·

Intuit Inc. selected Think’s KowaBunga!® MyAffiliateProgram™ (MYAP™) affiliate tracking and management solution for Intuit’s Quicken and QuickBooks affiliate programs.

·

Introduced Second Bite, an automated solution that offers online merchants the ability to recover lost sales and revenue attributed to online shopping cart abandonment.

·

Released ValidClick DirectAds™, an advanced private-label pay-per-click (PPC) platform featuring Think Partnership's highly accurate, patent-pending click fraud prevention technology.

Financial Details

Beginning in the third quarter of 2006, the company aligned its subsidiaries along four market segments, Think Network, Think Direct, Think Advertising, and Think Consumer, and reports its financial results accordingly:


Think Network

PrimaryAds, Ozline, Litmus Media, and Kowabunga! marketing subsidiaries comprise this segment, which is primarily engaged in performance-based Internet ad distribution using proprietary technology. Network revenues for the quarter totaled $3.9 million, down 26% from $5.3 million in the previous quarter and up 177% from $1.4 million a year ago. This contributed 21% of total revenues, down from 24% in the previous quarter, and up from 15% in the same quarter a year ago. Network EBITDA was $1.5 million, down 31% from $2.1 million reported in the previous quarter and up from a loss reported a year ago.


For the full year 2006, revenue from the Network segment increased 228% to $16.7 million. The acquisitions of Litmus Media, Inc. contributed approximately $7.0 million in revenue during the current year. The remaining growth was due to increased revenue derived from the company’s affiliate networks and affiliate software licensing.


Think Direct

iLead Media and Morex comprise this segment, and are primarily engaged in interactive direct marketing of internally generated and 3rd party offers. Direct revenues for the quarter totaled $6.1 million, down 4% from $6.3 million in the previous quarter. This contributed 32% of total revenues, which was up from 29% in the previous quarter. Direct EBITDA was $1.8 million, down 25% from $2.4 million reported in the previous quarter.


For the full year 2006, the Direct segment contributed revenue of $17.7 million. There are no comparable periods because the company entered this segment in January 2006 with the acquisition of Morex Marketing Group, LLC and expanded further in May with the acquisition of iLead Media, Inc.



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Think Advertising

MarketSmart Interactive, MarketSmart Advertising, and Web Diversity comprise this segment, and offer traditional advertising agency services (online and offline). Advertising revenues for the quarter totaled $6.3 million, down 10% from $7.0 million in the previous quarter and up 5% from $6.0 million a year ago. This contributed 33% of total revenues, the same as the previous quarter and a decrease from 62% in the same quarter a year ago. Advertising EBITDA was a loss of $0.2 million, down 202% from $0.2 million in the previous quarter, and up 59% from a loss of $0.5 million reported a year ago.


For the full year 2006, revenue from the Advertising segment decreased 7% to $25.3 million. Revenue from the company’s MarketSmart Interactive business decreased by approximately $8.8 million during 2006 as compared to 2005. This was offset by increased revenue from the addition of Web Diversity Ltd. in April 2006 of approximately $6.2 million and increased revenue from our advertising agency of approximately $0.8 million in 2006 as compared to 2005.  


Think Consumer

Cherish, Inc., Vintacom Media Group, Personals Plus, Inc., and Real Estate School Online, Inc. comprise various online destinations for consumers in this segment. Consumer revenues for the quarter totaled $2.8 million, down 14% from $3.2 million in the previous quarter and up 8% from $2.6 million a year ago. Consumer EBITDA was $0.6 million, no change from $0.6 million reported in the previous quarter, and up 18% from $0.5 million reported a year ago.


The full year 2006 revenue from this segment increased approximately 49% from the previous year to $12.9 million. The increase was primarily due to the addition of three companies in 2005 that contributed approximately $5.6 million of revenue in 2006. This was offset by a decrease in revenue at the company’s Cherish division of approximately $1.6 million.


EBITDA, other

There were certain costs that occurred on the corporate level that were factored into the company’s total EBITDA. These costs amounted to $1.0 million for the fourth quarter, down from $1.5 million in the previous quarter, and virtually unchanged from the same year-ago quarter. For the full year 2006, this amounted to $5.2 million, up 110% from 2005.


2007 Guidance

Management maintains its currently issued forecasts for revenue in 2007 to exceed $100 million, with EBITDA margin to range between 20%-22%.


Conference Call

The company will hold a conference call later today to discuss its fourth quarter and year-end 2006 financial results. Think Partnership CEO Scott Mitchell and CFO Jody Brown will host the presentation, which will be followed by a question and answer period.

  

Date: Thursday, March 29, 2007

Time: 4:30 pm Eastern (1:30 pm Pacific)

Toll-Free Dial-In Number: (800) 922-9655

Toll/International: (973) 935-2407

Conference ID#: 8571307


Internet Simulcast: http://viavid.net/dce.aspx?sid=00003CA0

(Windows Media Player needed for simulcast)



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Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization and ask you to wait until the call begins. If you have any difficulty connecting with the conference call, please contact the Liolios Group at (949) 574-3860.


A replay of the conference call will be available starting at 7:30 PM Eastern and until midnight, April 12, 2007:


Toll-free replay number: (877) 519-4471

Toll/International replay number: (973) 341-3080

Replay PIN Number: 8571307


About Think Partnership

Think Partnership Inc. is an international leader in interactive performance-based marketing and related Internet technologies. Think provides a comprehensive and integrated set of scalable and cost-effective marketing solutions for both advertisers and publishers. These solutions increase customer retention and revenues through a diverse set of related marketing channels, including affiliate marketing, click-fraud-protected pay-per-click advertising, lead generation, interactive direct marketing, integrated offline advertising, campaign management, public relations, and branding. Think also operates several direct-to-consumer services including online dating, online education, and home business opportunities. High-profile brands include ValidClick™, PrimaryAds™, iLead Media, KowaBunga!®, BabyToBee, Second Bite™ and MarketSmart. For more information, visit www.thinkpartnership.com.


Regarding Forward Looking Statements

Statements made in this press release that express the company's or management's intentions, plans, beliefs, expectations or predictions of future events, are forward-looking statements. Those statements are based on many assumptions and are subject to many known and unknown risks, uncertainties and other factors that could cause the company's actual activities, results or performance to differ materially from those anticipated or projected in such forward-looking statements. For a discussion of these risks, see the company's report, as filed with the Securities and Exchange Commission on Form 10-K, filed March 29, 2007, under the section headed "Risk Factors.” The company cannot guarantee future financial results, levels of activity, performance or achievements; and investors should not place undue reliance on the company's forward-looking statements.

Contacts

Jody Brown, CFO

Think Partnership Inc.

Tel 727.324.0046, ext. 123

Email: jody.brown@thinkpartnership.com

or


Eric Souders or

Geoffrey Plank

The Liolios Group, Inc.

949.574.3860

Email:  scott@liolios.com


 



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Financial Tables

 THINK PARTNERSHIP INC.

CONSOLIDATED STATEMENT OF OPERATIONS

Years Ended December 31, 2006, 2005 and 2004

 

 

2006

 

2005

 

2004

Net Revenue

$71,882,328 

 

$40,440,729 

 

$17,621,100 

Cost of Revenue

27,692,914 

 

13,853,863 

 

4,091,939 

Gross Profit

44,189,414 

 

26,586,866 

 

13,529,161 

Operating Expenses

 

 

 

 

 

Selling, General and Administrative

39,111,579 

 

24,922,388 

 

10,585,315 

Amortization of Purchased Intangibles

3,451,372 

 

1,546,859 

 

108,489 

Income from Operations

1,626,463 

 

117,619 

 

2,835,357 

Other Income(Expense)

 

 

 

 

 

Interest Income

15,495 

 

78,140 

 

22,164 

Interest Expense

(908,439)

 

(172,704)

 

(44,603)

Other Income, Net

671,538 

 

10,299 

 

24,863 

Income Before Income Taxes

1,405,057 

 

33,354 

 

2,837,781 

Income Tax Expense

839,866 

 

36,975 

 

1,063,793 

Net Income (Loss)

565,191 

 

(3,621)

 

1,773,988 

Other Comprehensive Income

 

 

 

 

 

    Unrealized Gain on Securities

78,675 

 

94,004 

 

Comprehensive Income

643,866 

 

$90,383 

 

$1,773,988 

 

 

 

 

 

 

Net (Loss) Income Per Common Share

 

 

 

 

 

Basic(see Note 12)

($0.20)

 

$0.00 

 

$0.07 

Fully Diluted(see Note 12)

($0.20)

 

$0.00 

 

$0.06 

 

 

 

 

 

 

Weighted Average Shares (Basic)

48,722,284 

 

33,809,371 

 

24,332,967 

Weighted Average Shares (Fully Diluted)

48,722,284 

 

39,467,062 

 

30,264,304 

 

The accompanying notes to the condensed consolidated financial statements available in the company quarterly statement for the period ended December 31, 2006, as filed with the Securities and Exchange Commission, are an integral part of these statements.

 



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THINK PARTNERSHIP INC.

CONSOLIDATED BALANCE SHEET

December 31, 2006 and 2005

  

2006

 

2005

Assets

 

 

 

Current Assets

 

 

 

Cash and Cash Equivalents

$3,031,488 

 

$2,609,114 

Restricted Cash

1,164,216 

 

828,804 

Accounts Receivable

11,466,681 

 

4,256,879 

Allowance for Doubtful Accounts

(68,920)

 

(33,280)

Notes Receivable – Related Party

 

280,175 

Refundable Corporate Income Taxes

715,814 

 

1,526,968 

Deferred Tax Asset

 

205,361 

Prepaid Expenses and Other Current Assets

856,726 

 

734,544 

Total Current Assets

17,166,005 

 

10,408,565 

Property And Equipment, Net

4,010,647 

 

3,253,078 

Other Assets

 

 

 

Goodwill

79,140,787 

 

32,959,252 

Intangible Assets

19,819,652 

 

10,300,248 

Other Assets

260,048 

 

573,176 

Total Other Assets

99,220,487 

 

43,832,676 

Total Assets

$120,397,139 

 

$57,494,319 

 

 

 

 

Liabilities And Shareholders’ Equity

 

 

 

Current Liabilities

 

 

 

Notes Payable – Current Portion

$208,333 

 

$5,262 

Notes Payable – Related Party

37,326 

 

429,761 

Accounts Payable

6,335,623 

 

3,443,603 

Deferred Revenue

2,076,537 

 

2,831,656 

Client Prepaid Media Buys

168,002 

 

774,877 

Accrued Expenses

1,206,776 

 

1,305,322 

    Deferred Tax Liabilities

613,965 

 

    Other Current Liabilities

496,731 

 

3,979 

Total Current Liabilities

11,143,293 

 

8,794,460 

Long-Term Liabilities

15,930,020 

 

10,052,329 

Series A Redeemable Preferred — 26,500 shares authorized, 5,000 issued and outstanding

3,859,785 

 

 

 

 

 

Shareholders’ Equity

 

 

 

Preferred Stock, $.001 Par Value:

 

 

 

Authorized Shares – 5,000,000 – None Issued Or Outstanding

 

Common Stock, $.001 Par Value:

 

 

 

Authorized Shares – 200,000,000

 

 

 

Issued Shares – 66,876,794 in 2006 and 38,222,030 In 2005

 

 

 

Outstanding Shares – 64,228,120 In 2006 and 35,722,030 In 2005

66,877 

 

38,222 

Additional Paid In Capital

103,055,090 

 

42,375,320 

Accumulated Deficit

(12,986,723)

 

(3,320,016)

Accumulated Other Comprehensive Income

172,678 

 

94,004 

Treasury Stock

(843,881)

 

(540,000)

Total Shareholders’ Equity

89,464,041 

 

38,647,530 

Total Liabilities And Shareholders’ Equity

$120,397,139 

 

$57,494,319 


 

The accompanying notes to the condensed consolidated financial statements available in the company quarterly statement for the period ended December 31, 2006, as filed with the Securities and Exchange Commission, are an integral part of these statements.



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Revenue and Reconciliation of Pre-Tax Income to Adjusted EBITDA by Segment

In addition to other measures, management evaluates the operating results of each of its segments based upon revenue and "EBITDA," which is defined as net income before depreciation and amortization, interest expense and income taxes, each of which is presented on the company's Consolidated Statements of Operations. The company's presentation of EBITDA may not be comparable to similarly-titled measures used by other companies. It is not practical to provide a reconciliation of forecasted EBITDA margin for the full year 2007 to the most directly comparable GAAP measure, pre-tax income, because certain items cannot be reasonably estimated or predicted at this time. Any of these items could be significant to the company’s financial results. The following tables summarize revenues and EBITDA for reportable segments, as well as reconcile EBITDA to pre-tax income, for the last eight quarterly periods:

 

2006

Quarters Ended

 

March 31

June 30

September 30

December 31

Revenue by Segment

 

 

 

 

Network

$1,762,926 

$5,730,807 

$5,264,785 

$3,898,977 

Direct

1,339,689 

3,910,549 

6,319,560 

6,096,065 

Advertising

5,318,811 

6,666,458 

7,023,294 

6,300,977 

Consumer

3,793,214 

3,125,640 

3,233,813 

2,794,971 

Elimination

(164,246)

(131,818)

(280,731)

(121,413)

Total Revenue

$12,050,394 

$19,301,636 

$21,560,721 

$18,969,577 

 

 

 

 

 

EBIDTA Reconciliation

 

 

 

 

Pre tax

($1,155,133)

$125,094 

$1,483,589 

$951,507 

Amortization

781,634 

1,243,778 

1,510,157 

1,628,089 

Amortization- Stock Options

162,534 

138,506 

192,100 

(179,027)

Depreciation

278,007 

297,272 

326,360 

362,529 

Net Interest Expense

241,521 

190,156 

230,717 

230,550 

Derivative Adjustment

24,940 

36,656 

(340,966)

TOTAL EBIDTA

$308,563 

$2,019,746 

$3,779,579 

$2,652,682 

 

 

 

 

 

EBIDTA By Segment

 

 

 

 

Network

$341,063 

$1,741,963 

$2,118,252 

$1,458,719 

Direct

844,443 

1,686,777 

2,390,968 

1,796,325 

Advertising

181,315 

27,054 

207,080 

(211,147)

Consumer

227,840 

(17,673)

577,065 

603,578 

Corporate

(1,286,098)

(1,418,375)

(1,513,786)

(994,793)

Total EBIDTA

$308,563 

$2,019,746 

$3,779,579 

$2,652,682 







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2005

Quarters Ended

 

March 31

June 30

September 30

December 31

Revenue by Segment

 

 

 

 

Network

$193,236 

$1,526,928 

$1,942,160 

$1,409,220 

Direct

Advertising

7,152,012 

6,919,853 

7,068,655 

5,977,075 

Consumer

1,869,944 

1,934,949 

2,327,007 

2,581,640 

Elimination

(42,713)

(66,924)

(88,583)

(263,729)

Total Revenue

$9,172,479 

$10,314,806 

$11,249,239 

$9,704,206 

 

 

 

 

 

EBIDTA Reconciliation

 

 

 

 

Pre tax

$543,373 

$373,098 

$941,681 

($1,824,798)

Amortization

178,346 

385,204 

477,252 

506,057 

Amortization- Stock Options

Depreciation

114,354 

148,801 

191,466 

224,982 

Net Interest Expense

(43,562)

815 

55,704 

81,607 

Derivative Adjustment

TOTAL EBIDTA

$792,511 

$907,918 

$1,666,103 

($1,012,152)

 

 

 

 

 

EBIDTA By Segment

 

 

 

 

Network

$23,768 

$527,913 

$634,737 

($16,315)

Direct

Advertising

770,843 

224,835 

548,177 

(512,689)

Consumer

520,251 

679,772 

924,625 

510,610 

Corporate

(522,351)

(524,602)

(441,436)

(993,758)

Total EBIDTA

$792,511 

$907,918 

$1,666,103 

($1,012,152)






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