STAMPS.COM REPORTS THIRD QUARTER 2001 FINANCIAL RESULTS
Company Received USPS Approval Today for Beta Test to Print Generic Postage
SANTA MONICA, Calif. – October 24, 2001 – Stamps.com(TM) (Nasdaq: STMP) today announced that revenue in the third quarter of 2001 was $4.6 million and gross margin was 55%. Third quarter cash net loss from continuing operations was $1.9 million, which excludes non-cash charges, restructuring and write down charges, and loss related to the sale of iShip; this compares to a loss of $5.2 million in the second quarter of 2001. On a per share basis, the equivalent continuing operations loss for the third quarter 2001 was $0.04 per share based on the weighted average common shares outstanding of 49.5 million. Cash and cash equivalents as of September 30, 2001 were $194.6 million, or $3.93 per weighted average share.
Stamps.com acquired 29 thousand gross customers and ended the quarter at 285 thousand active customers. For the third quarter 2001, total sales and marketing expenditures were $1.3 million compared with $2.9 million in the second quarter of 2001, and per customer acquisition cost including promotional costs for the third quarter was $58. EBITDA for the third quarter was a loss of $2.4 million, excluding non-cash charges, restructuring and write down charges, and losses from Encryptix or from the sale of iShip; this compares to EBITDA on an equivalent basis of a loss of $5.4 million in the second quarter of 2001, and a loss of $41.8 million in the third quarter of 2000.
The USPS today approved Stamps.com to begin beta testing its technology that allows customers to print sheets of generic postage that are not tied to a destination address and have no expiration date, on ordinary inkjet or laser printers. Generic postage also has the added security protection of the identity of the sender embedded in their “intelligent” 2-dimensional bar codes.
“We are the first company to ever receive beta approval for this product and we see this as a tremendous break-through in our product offering,” said President and CEO Ken McBride. “We expect this product to have a positive effect on customer acquisition as well as to reduce customer cancellation rates. In addition, this product could revolutionize the way secure postage is issued since it embeds intelligence about the sender within the bar code.”
The company expects postage revenue to be up slightly in the fourth quarter 2001 versus the third quarter. Gross margins are expected to be above 70% in the fourth quarter as labor costs decrease and the efficiency in customer support operations increases. Sales and marketing and R&D expenses are expected to be flat with third quarter levels, and G&A is expected to be down another half million from Q3 levels. Cash EPS is expected to continue to improve from the third quarter to a loss of two cents.
Stamps.com (Nasdaq: STMP) is the leading provider of Internet-based postage services. Its flagship product, Stamps.com Internet Postage, enables customers to print U.S. Postal Service-approved postage via a computer and Internet connection.
“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, including the company’s ability to achieve profitability, 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 annual report on Form 10-K /A for the fiscal year ended December 31, 2000, its quarterly reports on Form 10-Q for the fiscal quarters ending March 31, 2001 and June 30, 2001, and its Current Reports on Form 8-K. 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.