SOURCE: MediaNet Group Technologies, Inc.

MediaNet Group Technologies, Inc.

May 25, 2010 08:00 ET

MediaNet Group Technologies Announces Results for Second Quarter and First Half of 2010

Revenues Increased 41% in Second Quarter and 77% for the Six Month Period

BOCA RATON, FL--(Marketwire - May 25, 2010) - MediaNet Group Technologies, Inc. (OTCBB: MEDG), a worldwide marketing firm, today announced financial results for the second quarter and six months ended March 31, 2010. 

For the second quarter ended March 31, 2010, revenues increased 41% to $7,030,213 compared to $4,999,126 for the second quarter ended March 31, 2009. Gross profit in the second quarter was $2,665,566, or 38% of revenues, compared to $1,958,549, or 39% of revenues, in the same period of 2009, an increase of 36% over the second quarter of 2009. Net income in the second quarter was $836,601 resulting in earnings per basic share of $0.03 and per fully diluted share of $0.00, as compared to net income for the second quarter of 2009 of $676,382, and earnings per basic share and fully diluted share of $0.03. In the second quarter of 2010, the weighted average number of basic and fully diluted shares outstanding was 28,484,206 and 339,037,717, respectively. In the same period of 2009, the weighted average number of shares outstanding was 20,674,802 on both a basic and fully diluted basis. The increase in basic shares outstanding between the periods is primarily attributable to the exercise of warrants. The substantial increase in fully diluted shares outstanding is due to our issuance of 5 million shares of Series A Convertible Preferred Stock in October 2009.

For the six months ended March 31, 2010, revenues increased 77% to $14,520,401 compared to $8,187,410 for the six months ended March 31, 2009. Gross profit in the six month period ended March 31, 2010 was $5,098,205, or 35% of revenue, compared to $2,930,317, or 36% of revenue, in same period of 2009, an increase of 36% over 2009. Net income in the first six months of 2010 was $1,293,470 resulting in earnings per basic share of $0.05 and per fully diluted share of $0.00, as compared to net income for the first six months of 2009 of $562,286, and earnings per basic and fully diluted share of $0.02. In the first six months of 2010, the weighted average number of basic and fully diluted shares outstanding was 28,484,206 and 277,167,462, respectively, as compared to the same period of 2009, when the weighted average number of shares outstanding was 20,674,802 on both a basic and fully diluted basis.

Commenting on the first half of 2010 results, Michael Hansen, President and Chief Executive Officer, stated, "We are excited that our unique operating strategy successfully maintained momentum and growth during the first half of 2010. We have successfully commenced our US operations to one single location in Boca Raton. We believe that the execution of our prudent and measurable operating strategy will continue to widen the gap between DubLi and any potential competitors during a time where many established shopping portals are struggling due to lack of flexibility and scalability. Our comprehensive operating, growth and financial strategies of the entire DubLi universe are all designed to maximize our relationship with the end consumer and provide them with the best possible experience when visiting our site. We continue to deliver a superior product that has genuine value to the consumer which we believe will drive them to return to our model. One of our competitive advantages is that our business model allows us to offer whatever is in demand at a particular moment in time, regardless of economic issues, and without having to consider ties to any vendor or manufacturer."

Kent Lee Holmstoel, Chief Operating Officer, continued "While executing on growth strategy we have simultaneously been investing considerable time, resources and capital into technology that we believe will set new trends for Internet shopping in the future. These investments include providing proper training and support of our sales and marketing engine, DubLi Network, as well as developing our global auction portal that will allow us to capitalize from consumers all over the globe. We are also focused on continuing to identify and take advantage of the changing dynamics of consumer behavior by giving them tangible aspects from which to continue to return to our portals."

The following Table summarizes the Company's results of operations for the three and six months ended March 31, 2010 and 2009:

  For the three months ended March 31,   Percent Change   For the six months ended March 31,   Percent Change  
  2010   2009       2010   2009      
                         
  Revenues $ 7,030,213   $ 4,999,126   41 % $ 14,520,401   $ 8,187,410   77 %
  Direct cost of revenues   4,364,647     3,040,577   44 %   9,422,196     5,257,094   79 %
  Gross Profit   2,665,566     1,958,549   36 %   5,098,205     2,930,317   74 %
  Operating Expenses   1,392,484     1,353,720   3 %   2,857,758     2,439,584   17 %
  Income (loss) from operations   1,273,083     604,829   110 %   2,240,447     490,733   357 %
  Interest income (expense) -net   (5,506 )   (3,437 ) 60 %   (7,002 )   (3,437 ) 104 %
  Provision for income taxes   (430,976 )   -         (939,976 )   -      
  Gain from sale of subsidiary   -     74,990         -     74,990      
  Net income $ 836,601   $ 676,382   24 % $ 1,293,470   $ 562,286   130 %

About MediaNet Group Technologies, Inc.:

MediaNet Group Technologies, Inc. (OTCBB: MEDG) through its wholly owned subsidiaries is a global marketing company that sells high end branded merchandise to consumers through Internet-based auctions conducted under the trade name "DubLi.com." These auctions are designed to offer consumers real savings on these high end goods. The Company, through its BSP Rewards subsidiary, also offers private branded loyalty and reward web malls where members receive rebates (rewards) on products and services from participating merchants.

DubLi is a worldwide online auction portal. It is composed of two very unique and individual business models; DubLi.com -- a reverse auction portal for high level branded merchandise offered at highly competitive prices and DubLi Network -- the business opportunity where individuals around the world can establish their own business in a competitive market. The success behind DubLi.com's 'reverse auction' lies in the formula of being able to drive down prices incrementally with bids placed by consumers. It is a value based proposition where a consumer will buy when the price reaches a point of interest to the buyer.

BSP Rewards is an extremely affordable Private Branded "customer relationship marketing program" and "communications solution" that utilizes our proprietary loyalty and internet rewards mall platform and applications. The BSP Rewards Mall licenses our proprietary rewards online mall platform, and builds "merchant funded" private branded programs both for profit and non-profit organizations. 

Except for historical matters contained herein, statements made in this press release are forward-looking. The quotes by Michael Hansen and Kent Lee Holmstoel, in particular, are forward-looking statements. Without limiting the generality of the foregoing, words such as "may," "will," "to," "plan," "expect," "believe," "anticipate," "intend," "could," "would," "estimate," or "continue" or the negative other variations thereof or comparable terminology are intended to identify forward-looking statements.

Investors and others are cautioned that a variety of factors, including certain risks, may affect our business and cause actual results to differ materially from those set forth in the forward-looking statements. These risk factors include, without limitation, the risk of (i) an inability to establish and/or maintain a large, growing base of business associates; (ii) an inability to develop and/or maintain brand awareness for our online auctions; (iii) a failure to maintain the competitive bidding environment for our online auctions; (iv) a failure to adapt to technological change; and (v) a failure to improve our internal controls. The Company is also subject to the risks and uncertainties described in its filings with the Securities and Exchange Commission, including its Quarterly Report on Form 10-Q for the quarter ended March 31, 2010.

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