SOURCE: MeetMe, Inc.

MeetMe, Inc.

August 08, 2012 16:00 ET

MeetMe, Inc. Reports Record Results for the Second Quarter of 2012

NEW HOPE, PA--(Marketwire - Aug 8, 2012) - MeetMe, Inc. (NYSE MKT: MEET), the public market leader for social discovery, today reported its financial results for the second quarter ended June 30, 2012.

  • Record second quarter revenue of $13.1 million, up 706% year-over-year.
    • Second quarter represents a 47% increase over the $8.9 million of combined revenue, a non-GAAP measure, of Quepasa and myYearbook during the same period a year ago.
  • Net Loss Allocable To Common Shareholders totaled $3.8 million or 11 cents per basic and diluted share in the second quarter of 2012, compared with a Net Loss Allocable To Common Shareholders of $2.3 million or 14 cents per basic and diluted share during the second quarter of 2011.
  • Adjusted EBITDA from Continuing Operations, a non-GAAP measure, totaled $1.8 million, an improvement from an Adjusted EBITDA loss of $275 thousand in the year ago period.
  • Mobile revenue grew 73% sequentially to $1.3 million, and 152% versus the same period a year ago.
  • On June 5 the company announced the rebrand of myYearbook to MeetMe and the name change of the company from Quepasa Corporation to MeetMe, Inc.
  • In June, meetme.com was the 18th most trafficked website in the U.S. by page views, according to comScore, and the 3rd most trafficked social network.

"MeetMe successfully executed its rebrand in the second quarter and is now positioned to bring our growing mobile products to an international audience in the third quarter," said John Abbott, CEO of MeetMe. "In our July traffic metrics, we are seeing early signs of the power of the MeetMe brand to become the leading social network for meeting new people. We are pleased to see the virtual currency products launched during the first quarter drove more than 50% of mobile revenue in the second quarter. While we feel we are still early in our mobile monetization efforts, we see significant upside ahead."

"In July, our first full calendar month since the announcement of the rebrand, all the key measuring sticks for the business increased," noted Geoff Cook, COO of MeetMe. "MeetMe DAU increased 3% over the second quarter average to 1.058 million while mobile DAU increased 6% to over 642 thousand. MAU increased 7% vs. the second quarter average both overall and on mobile while new registrations leaped 28%. We signed up just shy of 1 million new users in July alone, and 37% of them came from mobile. Later this month, we look forward to launching MeetMe in Spanish and Portuguese and beginning the transition of Quepasa's users to MeetMe by the end of September."

Second Quarter 2012 Financial Highlights

  • Revenue from Continuing Operations: MeetMe revenue for the second quarter of 2012 was $13.1 million, up 706% from the $1.6 million recorded in the same period of 2011, and up 26% compared to $10.4 million in the first quarter of 2012.
  • Net Loss: MeetMe net loss allocable to common shareholders for the second quarter of 2012 was $3.8 million or $0.11 per share, an increase from the net loss allocable to common shareholders of $2.3 million or $0.14 per share in the same period of 2011.
  • Adjusted EBITDA: MeetMe Adjusted EBITDA from Continuing Operations for the second quarter of 2012 was $1.8 million or $0.05 per basic and diluted share, an increase from an Adjusted EBITDA loss of $275 thousand or $0.02 per basic and diluted share, for the same period in 2011. (See the important discussion about the presentation of non-GAAP financial measures, and a reconciliation to the most directly comparable GAAP financial measures, below.)
  • Balance Sheet: MeetMe cash and cash equivalents totaled $5.9 million at June 30, 2012.

Operating and Business Highlights

  • Core Platform (MeetMe) monthly active users (MAUs) totaled 3.18 million as of June 30, 2012, an increase of 30% year-over-year.
  • Core Platform daily active users (DAUs) totaled 1.03 million as of June 30, 2012, an increase of 38% year-over-year.
  • Mobile MAUs were 1.67 million as of June 30, 2012, an increase of 94% year-over-year.
  • We also completed the rebrand of myYearbook to MeetMe across the company's major platforms, including the web, iPhone, Android, and mobile web. This was a major undertaking involving the entire company. We achieved our internal deadline and delivered one month ahead of the July expectations we set with investors.
  • TechCrunch carried our Rebrand Launch Announcement. To mark the occasion, we also created a YouTube video called MeetMe at the Bar which received over 1 million views reaching as high as #11 in YouTube's list of "Most Popular Videos Around the Web."
  • Mobile revenue grew 73% sequentially over the first quarter and 152% vs. the same period a year ago, to $1.3 million. Mobile Spotlight products launched in Q1 contributed to 51.5% of mobile revenue.
  • The Games studio in Brazil was shutdown in June. The division was closed in order to aggressively accelerate the core mission of building the leading social network for meeting new people, and to focus on growing the core MeetMe platform globally.
  • We launched mobile offer walls on iPhone and Android to enhance virtual currency monetization and enable users to earn virtual currency by completing Offers such as installing Android apps or watching incented iPhone videos.

Summary Financial Information and Operational Metrics(1)

                 
    2Q11     2Q12   Change  
2Q Financial Highlights (millions)                    
  Revenue - Advertising   $ 0.1     $ 6.9   6,800 %
  Revenue - Virtual Currency   $ 1.5     $ 6.2   313 %
  Revenue - Total(2)   $ 1.6     $ 13.1   706 %
  Net Loss Allocable To Common Shareholders   $ 2.3     $ 3.8   65 %
  Adjusted EBITDA   $ (0.3 )   $ 1.8   n/a  
                     
2Q Web and Mobile Metrics (millions)     2Q11       2Q12   Change  
  Registered Users - New in 2Q     4.6       3.0   (33 %)
  Registered Users - Cumulative     38.2       84.6   121 %
  Core Platform Monthly Active Users - Average(3)     2.8       3.2   15 %
  Total Visits (4)     48.4       338.2   599 %
  Total Page Views (4)     583.1       9,762.0   1,574 %
                     
Reconciliation of Combined Revenue (millions)(5)     2Q11       2Q12      
  MeetMe, Inc. - As Reported   $ 1.6     $ 13.1      
  myYearbook - pre-merger   $ 7.3       n/a      
  Combined Revenue   $ 8.9     $ 13.1      
                       
(1) Summary Financial Information and Operational Metrics reflect MeetMe, Inc. as the reporting entity, and not combined data, unless otherwise noted.
(2) Figures may not add due to rounding.
(3) Core platform for 2Q11 represents quepasa.com. Core platform for 2Q12 represents meetme.com and its mobile applications.
(4) Excludes iOS application and device metrics
(5) See Use of Non-GAAP Financial Information below for important disclosure on combined revenue.
   

Webcast and Conference Call Details

MeetMe will host a conference call to discuss its second quarter 2012 financial results this afternoon at 4:30 p.m. ET. The conference call can be accessed by dialing toll-free 1-888-846-5003, or toll/international 1-480-629-9856. A webcast will also be available at the following link: http://public.viavid.com/index.php?id=101162. A replay of the call will also be available at the investors section of meetmecorp.com for one year.

   
MEETME, INC. AND SUBSIDIARIES  
Consolidated Balance Sheets  
   
    June 30,     December 31,  
    2012     2011  
Assets   (Unaudited)        
Current Assets                
  Cash and cash equivalents   $ 5,886,970     $ 8,271,787  
  Accounts receivable, net of allowance of $486,510 and $270,210, at June 30, 2012 and December 31, 2011, respectively    
14,696,770
     
10,293,752
 
  Notes receivable - current portion, including $0 and $559 of accrued interest, at June 30, 2012 and December 31, 2011, respectively    
139,010
     
169,955
 
  Prepaid expenses and other current assets     1,056,786       1,082,184  
  Restricted cash     -       275,000  
  Current asset from discontinued operations     54,955       149,796  
    Total current assets     21,834,491       20,242,474  
                   
  Goodwill, net     70,646,036       70,646,036  
  Goodwill from discontinued operations, net     -       2,402,446  
  Intangible assets, net     7,725,743       8,567,772  
  Property and equipment, net     5,034,901       4,318,619  
  Property and equipment from discontinued operations, net     15,409       90,075  
  Other assets     379,474       385,683  
  Other assets from discontinued operations     -       151,591  
    Total assets   $ 105,636,054     $ 106,804,696  
                 
Liabilities and Stockholders' Equity                
Current Liabilities:                
  Accounts payable   $ 2,559,196     $ 2,054,851  
  Accrued expenses and other liabilities     2,885,897       1,318,594  
  Current liabilities from discontinued operations     702,018       629,620  
  Deferred revenue     226,337       316,863  
  Accrued dividends     69,455       169,455  
  Unearned grant income     8,380       9,040  
  Current portion of long-term debt     2,616,252       2,405,191  
    Total current liabilities     9,067,535       6,903,614  
                   
  Long term debt, net of discount     9,267,239       9,255,508  
    Total liabilities     18,334,774       16,159,122  
                 
Commitments and Contingencies                
                 
Stockholders' Equity:                
  Preferred stock, $.001 par value, authorized 5,000,000 shares:                
  Convertible preferred stock Series A, $.001 par value; authorized - 1,000,000 shares; no shares issued and outstanding at June 30, 2012, Liquidation preference of $2,500,000    
-
     
-
 
                   
  Convertible preferred stock Series A-1, $.001 par value; authorized - 5,000,000 shares; 1,000,000 shares issued and outstanding at June 30, 2012 and December 31, 2011    
1,000
     
1,000
 
                   
  Common stock, $.001 par value; authorized - 100,000,000 shares; 36,372,578 and 36,145,084 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively    
36,374
     
36,146
 
                   
  Additional paid-in capital     272,417,267       269,974,789  
  Accumulated deficit     (184,597,987 )     (178,903,412 )
  Accumulated other comprehensive loss     (555,374 )     (462,949 )
    Total stockholders' equity     87,301,280       90,645,574  
    Total liabilities and stockholders' equity   $ 105,636,054     $ 106,804,696  
   
   
MEETME, INC. AND SUBSIDIARIES  
Consolidated Statements of Operations and Comprehensive Loss  
                         
    For the Three Months Ended     For the Six Months Ended  
    June 30,     June 30,  
    2012     2011     2012     2011  
                                 
Revenues   $ 13,054,861     $ 1,620,473     $ 23,450,590     $ 3,864,037  
Operating Costs and Expenses:                                
  Sales and marketing     1,676,243       280,048       3,442,639       627,846  
  Product development and content     8,224,749       1,436,700       14,721,208       3,059,795  
  General and administrative     2,379,313       944,449       4,323,846       1,850,271  
  Depreciation and amortization     965,155       93,521       1,863,539       179,691  
  Acquisition and restructuring costs     247,877       69,166       537,944       436,917  
                                 
Total Operating Costs and Expenses     13,493,337       2,823,884       24,889,176       6,154,520  
Loss from Operations     (438,476 )     (1,203,411 )     (1,438,586 )     (2,290,483 )
Other Income (Expense):                                
  Interest income     4,318       17,474       9,892       34,034  
  Interest expense     (288,216 )     (151,219 )     (586,284 )     (301,205 )
  Other income (expense), net     497       574       1,030       1,170  
Total other income (expense)     (283,401 )     (133,171 )     (575,362 )     (266,001 )
Loss before income taxes     (721,877 )     (1,336,582 )     (2,013,948 )     (2,556,484 )
  Income taxes     -       -       -       -  
Net loss from continuing operations   $ (721,877 )   $ (1,336,582 )   $ (2,013,948 )   $ (2,556,484 )
  Loss from discontinuing operations, net of taxes   $ (3,114,040 )   $ (970,026 )   $ (3,680,627 )   $ (1,239,250 )
Net loss   $ (3,835,917 )   $ (2,306,608 )   $ (5,694,575 )   $ (3,795,734 )
  Preferred stock dividends     -       (12,830 )     -       (40,705 )
Net Loss Allocable To Common Shareholders   $ (3,835,917 )   $ (2,319,438 )   $ (5,694,575 )   $ (3,836,439 )
                                 
Basic and diluted net loss per common shareholders:                                
  Continuing operations   $ (0.02 )   $ (0.08 )   $ (0.06 )   $ (0.16 )
  Discontinued operations   $ (0.09 )   $ (0.06 )   $ (0.10 )   $ (0.08 )
Basic and diluted net loss per common shareholders:   $ (0.11 )   $ (0.14 )   $ (0.16 )   $ (0.23 )
Weighted Average Number of Shares Outstanding, Basic and Diluted:     36,240,472       16,037,343       36,306,886       16,344,063  
                                 
Net Loss   $ (3,835,917 )   $ (2,319,438 )   $ (5,694,575 )   $ (3,836,439 )
  Foreign currency translation adjustment     (144,458 )     213,296       (92,425 )     244,770  
  Comprehensive Loss   $ (3,980,375 )   $ (2,106,142 )   $ (5,787,000 )   $ (3,591,669 )
 
 
  MEETME, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income (Loss) from Continuing Operations to Adjusted EBITDA
                                                       
    For the Three Months Ended     For the Three Months Ended     For the Three Months Ended  
    June 30, 2012     Per Basic Share     Per Diluted Share     June 30, 2011     Per Basic Share     Per Diluted Share     March 31, 2012     Per Basic Share     Per Diluted Share  
                                                                         
                                                                         
Net loss from continuing operations allocable to common shareholders   $ (721,877 )   $ (0.02 )   $ (0.02 )   $ (1,336,582 )   $ (0.08 )   $ (0.08 )   $ (1,292,071 )   $ (0.03 )   $ (0.03 )
  Interest expense     288,216       0.01       0.01       151,219       0.01       0.01       298,068       0.01       0.01  
  Depreciation and amortization     965,155       0.02       0.02       93,521       0.01       0.01       898,384       0.02       0.02  
  Amortization of stock based compensation     1,068,505       0.03       0.03       747,737       0.05       0.04       810,081       0.02       0.02  
  Acquisition and restructuring costs     247,877       0.01       0.01       69,166       0.00       0.00       290,067       0.01       0.01  
Adjusted EBITDA   $ 1,847,876     $ 0.05     $ 0.05     $ (274,939 )   $ (0.02 )   $ (0.02 )   $ 1,004,529     $ 0.03     $ 0.03  
                                                                         
Weighted average number of shares outstanding, Basic     36,240,472                       16,037,343                       36,189,173                  
                                                                         
Weighted average number of shares outstanding, Dilutive     40,414,856                       16,037,343                       41,800,383                  
                                     
                                     
    For the Six Months Ended     For the Six Months Ended  
    June 30, 2012     Per Basic Share     Per Diluted Share     June 30, 2011     Per Basic Share     Per Diluted Share  
                                                 
Net loss from continuing operations allocable to common shareholders   $ (2,013,948 )   $ (0.06 )   $ (0.05 )   $ (2,556,484 )   $ (0.16 )   $ (0.16 )
  Interest expense     586,284       0.02       0.01       301,205       0.02       0.02  
  Depreciation and amortization     1,863,539       0.05       0.05       179,691       0.01       0.01  
  Amortization of stock based compensation     1,878,586       0.05       0.05       1,550,914       0.09       0.09  
  Acquisition and restructuring costs     537,944       0.02       0.01       436,917       0.03       0.03  
Adjusted EBITDA   $ 2,852,405     $ 0.08     $ 0.07     $ (87,757 )   $ (0.01 )   $ (0.01 )
                                                 
                                                 
Weighted average number of shares outstanding, Basic     36,306,886                       16,344,063                  
                                                 
Weighted average number of shares outstanding, Dilutive     41,803,967                       16,344,063                  
                                                 

About MeetMe, Inc.
MeetMe® is the leading social network for meeting new people in the US and the public market leader for social discovery (NYSE MKT: MEET). MeetMe makes meeting new people fun through social games and apps, monetized by both advertising and virtual currency. The MeetMe brand grew out of the merger of myYearbook and Quepasa in November 2011. With 60% of traffic coming from mobile, MeetMe is transforming how people discover one another in a mobile-first world. The company operates MeetMe.com, Quepasa.com, and MeetMe apps on iPhone and Android.

Cautionary Note Regarding Forward Looking Statements
Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including the internationalization of our mobile products, beliefs regarding mobile monetization, the anticipated launch of MeetMe in Spanish and Portuguese and the transition of Quepasa.com users to MeetMe.com. All statements other than statements of historical facts contained herein, including statements regarding the continued growth in our core platform, are forward-looking statements. The words "believe," "may," "estimate," "continue," "anticipate," "intend," "should," "plan," "could," "target," "potential," "is likely," "will," "expect" and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include: the risk that unanticipated events affect the internationalization of our mobile products, the acceptance of our new brand internationally, issues that affect the functionality of our mobile application with popular mobile operating systems, any changes in such operating systems that degrade our mobile application's functionality and other unexpected issues which could adversely affect usage on mobile devices, the effectiveness of our mobile software on smartphones and tablets, the willingness of our users to purchase virtual credits on their mobile devices, the willingness of users to try new product offerings and the willingness of Quepasa.com users to change to the MeetMe.com brand. Further information on our risk factors is contained in our filings with the SEC, including the Form 10-Q for the quarter ended March 31, 2012 and the Form 10-K for the year ended December 31, 2011. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Important Disclosures

  • Approximately 31% of MeetMe revenues for the three months ended June 30, 2012 came from one company of which a director of MeetMe is an officer or director.

Regulation G - Non-GAAP Financial Measures
The Company uses financial measures which are not calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP") in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparison. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company presents these non-GAAP financial measures because it believes them to be an important supplemental measure of performance that is commonly used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We refer you to the reconciliations above. 

On November 10, 2011, Quepasa Corporation and Insider Guides, Inc., owner of social network myYearbook, merged. The combined revenue results for the first quarter 2011 give effect to the merger as if it had been completed as of January 1, 2011. The combined revenue data is for informational purposes only and does not purport to present what our results would actually have been had the merger actually occurred on the dates presented or to project our results for any future period. The Company believes that evaluation of its financial performance can be enhanced by a presentation of combined results in order to evaluate its prior, current or future period results on a more meaningful, consistent year-over-year basis.

The Company defines Adjusted EBITDA from continuing operations as earnings (or loss) before interest expense, income taxes, depreciation and amortization, and amortization of non-cash stock-based compensation, non-recurring acquisition and restructuring expenses and the goodwill impairment charges. The Company excludes stock-based compensation because it is non-cash in nature.

Non-GAAP financial measures should not be considered as an alternative to net income, operating income, cash flow from operating activities, as a measure of liquidity or any other financial measure. They may not be indicative of the historical operating results of the Company nor is it intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as a substitute for performance measures calculated in accordance with GAAP.

Contact Information

  • Contact:
    Robin Shallow
    EVP Communications & Public Relations
    MeetMe, Inc.
    (215) 862-7823
    robin@meetme.com
    Follow us on Twitter @meetme

    Investor Contact:
    E. Brian Harvey
    Vice President of Capital Markets and Investor Relations
    MeetMe, Inc.
    (215) 862-1162 x266
    brian@meetme.com
    Follow us on Twitter @meetmecorp