STAMPS.COM REPORTS FOURTH QUARTER 1999 FINANCIAL RESULTS
Company Signs Up 87,360 Customers in Just 10 Weeks
SANTA MONICA, Calif. – January 27, 2000 – Stamps.com(TM) (Nasdaq: STMP), the leader in Internet Postage(TM), today reported an operating loss of $34.8 million for the fourth quarter ended Dec. 31, 1999. Net loss applicable to common shareholders was $33.4 million, or $0.91 per share, based on the weighted average number of 36.6 million common shares outstanding. Excluding the non-cash deferred compensation charge of $3.2 million, net loss would have been $30.2 million, or $0.82 per common share.
“Stamps.com finished 1999 with a lot of positive momentum and is very well positioned entering into the new millennium,” said Stamps.com CEO John Payne. “Following the national launch of our service during the fourth quarter, we signed up 87,360 licensed customers in only 10 weeks. The acquisition of iShip.com doubles our market opportunity to include all Internet shipping and mailing services. The formation of our EncrypTix subsidiary positions us to expand the use of our technology and our addressable market to include the authenticated online printing of tickets, vouchers, and certificates. In 1999, we firmly established ourselves as unique in the marketplace.”
Summary of Recent Events
Jan. 18, 2000 – Stamps.com announced a distribution and marketing alliance with Hewlett-Packard Company to provide the cost-effectiveness and time savings of Internet Postage to new HP customers and the more than 100 million existing HP printer owners.
Jan. 13, 2000 – Stamps.com announced a marketing alliance with US WEST, the largest DSL supplier in the country, to provide Stamps.com’s service to small businesses and consumers across the country.
Dec. 13, 1999 – Stamps.com announced that its follow-on public offering, which closed on Dec. 10, 1999, resulted in net proceeds of $309.2 million through the sale of five million shares of Stamps.com common stock. Stamps.com also announced that the underwriters exercised their option to purchase 750,000-shares to cover over-allotments, which resulted in additional net proceeds to Stamps.com of $46.3 million.
Nov. 22, 1999 – Stamps.com announced a new, consolidated pricing plan for its Internet Postage service. The new plan combined Stamps.com’s existing two-tiered pricing structure into one “Simple Plan” under which customers pay a service fee of 10 percent of the monthly postage printed, with a $1.99 minimum and $19.99 maximum per month.
Nov. 16, 1999 – Stamps.com announced the formation of EncrypTix Inc., a new subsidiary created to focus on highly secure, authenticated online printing of tickets, vouchers, certificates and other forms of bearer value for the events, travel and financial services industries.
Oct. 25, 1999 – Stamps.com announced an agreement to acquire privately-held iShip.com, a leading provider of Internet-based shipping technology. The acquisition will establish Stamps.com as the only online service that can offer small business, consumer and corporate enterprise customers a single source for all their mailing and shipping needs. iShip.com’s investors and strategic partners include Mail Boxes Etc., eBay and UPS.
Founded in 1996, Santa Monica-based Stamps.com is the only commercially approved true Internet Postage service. The company’s innovative technology eliminates the need for specialized hardware by giving customers the flexibility to print postage over the Internet – securely, accurately and fast. Through partnerships with major companies like America Online, Hewlett-Packard, IBM, Microsoft, Office Depot, Quicken.com and 3M, Stamps.com has tremendous reach into the small office/home office and consumer markets. More information about the company can be found at sdcmainprod.wpengine.com.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This release may contain forward-looking statements that involve risks and uncertainties. Important factors, which could cause actual results to differ materially from those in the forward-looking statements, are detailed in filings with the Securities and Exchange Commission made from time to time by Stamps.com, including its Form 10-Q for the quarter ended September 30, 1999 and its registration statement on Form S-4, as amended, that was filed with the SEC on January 7, 2000. Stamps.com undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Internet Postage, Stamps.com and the Stamps.com logo are trademarks of Stamps.com Inc. All other brands and names are property of their respective owners.
STAMPS.COM INC. (A DEVELOPMENT STAGE COMPANY) CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended Year Ended Dec. 31, Dec. 31, Dec. 31, Dec. 31, 1999 1998 1999 1998 Net revenues $ 357,738 $ - $ 357,738 $ - Cost of net revenues $2,429,658 $ - $2,429,658 $ - Gross profit ($2,071,920) $ - ($2,071,920) $ - Operating expenses: Research and development 2,313,981 983,611 7,363,439 1,531,811 Sales and marketing 24,351,601 632,349 35,207,688 632,349 General and administrative 6,058,136 890,346 14,333,830 2,015,930 Total operating expenses 32,723,717 2,506,306 56,904,957 4,180,090 Loss from operations (34,795,638) (2,506,306) (58,976,877) (4,180,090) Other income (expense): Interest expense (50,689) (22,810) (172,657) (27,624) Interest income 1,462,005 9,152 2,662,128 11,834 Net loss ($33,384,322) ($2,519,964) ($56,487,406)($4,195,880) Basic and diluted net loss per share ($0.91) ($0.44) ($2.59) ($0.85) Weighted average shares outstanding used in basic and diluted per-share calculation 36,611,000 5,788,000 21,823,600 4,955,913 Condensed Consolidated Balance Sheets December 31, 1999 December 31, 1998 (unaudited) ASSETS Current assets: Cash and cash equivalents $326,820,158 $ 3,470,207 Short-term investments 47,925,751 - Prepaid advertising 21,529,665 - Prepaid expenses and other current assets 2,487,436 48,118 Total current assets 398,763,010 3,518,325 Property and equipment, net 9,701,679 670,301 Other assets 1,977,354 237,193 Total assets $410,442,043 $ 4,425,819 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Total current liabilities 8,406,636 2,133,525 Capital lease obligations, less current portion 438,537 265,070 Redeemable preferred stock - 5,978,344 Total stockholder's equity (deficit) 401,596,870 (3,951,120) Total liabilities and stockholders' equity (deficit) $410,442,043 $ 4,425,819