UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark one)
ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2003
or
o TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-14355
24/7 Real Media, Inc.
(Exact name of registrant as specified in its charter)
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DELAWARE |
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13-3995672 |
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(STATE OR OTHER JURISDICTION OF |
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(IRS EMPLOYER |
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7319 |
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(STANDARD INDUSTRIAL CLASSIFICATION CODE) |
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1250 BROADWAY, NEW YORK, NY |
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10001 |
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) |
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(ZIP CODE) |
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(212) 231-7100 |
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(REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA CODE) |
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Indicate by check mark whether the registrant has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ý NO o
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
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CLASS |
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OUTSTANDING AT November 11, 2003 |
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Common Stock, par value $.01 per share |
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114,420,438 Shares |
24/7 REAL MEDIA, INC.
SEPTEMBER 30, 2003
FORM 10-Q
INDEX
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Consolidated Balance Sheets as of September 30, 2003 (unaudited) and December 31, 2002 |
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Notes to Unaudited Interim Consolidated Financial Statements |
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. Quantitative and Qualitative Disclosure about Market Risk |
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2
PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
24/7 REAL MEDIA, INC.
(in thousands, except share data)
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September
30, |
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December
31, |
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(unaudited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
11,779 |
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$ |
7,674 |
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Restricted cash |
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12,000 |
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— |
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Accounts receivable, less allowances of $1,453 and $1,369, respectively |
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10,150 |
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9,799 |
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Notes and amounts receivable from disposition |
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240 |
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720 |
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Prepaid expenses and other current assets |
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973 |
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1,565 |
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Total current assets |
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35,142 |
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19,758 |
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Property and equipment, net |
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3,160 |
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3,988 |
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Goodwill |
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2,621 |
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2,621 |
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Intangible assets, net |
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5,295 |
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6,007 |
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Notes and amounts receivable from disposition |
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1,359 |
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1,045 |
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Other assets |
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1,978 |
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548 |
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Total assets |
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$ |
49,555 |
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$ |
33,967 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
5,471 |
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$ |
4,039 |
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Accrued liabilities |
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8,663 |
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12,015 |
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Current installments of obligations under capital leases |
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55 |
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47 |
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Deferred revenue |
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2,750 |
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2,748 |
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Total current liabilities |
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16,939 |
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18,849 |
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Obligations under capital leases, excluding current installments |
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23 |
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66 |
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Subordinated convertible debentures, 2%, due 2006 |
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13,167 |
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— |
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Loan payable - related party |
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— |
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7,876 |
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Other long term liabilities |
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332 |
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292 |
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Total liabilities |
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30,461 |
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27,083 |
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Commitments and contingencies |
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Stockholders’ equity: |
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Preferred stock; $.01 par value; 10,000,000 shares authorized, 995,250 and 925,000 shares issued and outstanding, respectively (liquidation preference of $10 per share) |
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10 |
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9 |
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Common stock; $.01 par value; 350,000,000 shares authorized; 108,040,264 and 59,219,844 shares issued and outstanding, respectively |
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1,080 |
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592 |
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Additional paid-in capital |
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1,109,426 |
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1,089,575 |
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Deferred stock compensation |
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(359 |
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(209 |
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Accumulated other comprehensive income |
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376 |
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358 |
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Accumulated deficit |
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(1,091,439 |
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(1,083,441 |
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Total stockholders’ equity |
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19,094 |
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6,884 |
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Total liabilities and stockholders’ equity |
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$ |
49,555 |
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$ |
33,967 |
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See accompanying notes to unaudited interim consolidated financial statements.
3
24/7 REAL MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, expect share and per share data)
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Three months ended September 30, |
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Nine months ended September 30, |
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2003 |
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2002 |
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2003 |
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2002 |
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(unaudited) |
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(unaudited) |
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Revenues: |
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Integrated media solutions |
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$ |
7,953 |
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$ |
6,379 |
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$ |
24,657 |
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$ |
21,224 |
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Technology solutions |
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4,081 |
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3,340 |
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11,351 |
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9,825 |
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Total revenues |
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12,034 |
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9,719 |
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36,008 |
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31,049 |
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Cost of revenues: |
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Integrated media solutions |
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4,762 |
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4,334 |
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15,357 |
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14,435 |
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Technology solutions (exclusive of $10, $0, $20 and $7, respectively, reported below as stock-based compensation |
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957 |
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847 |
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3,183 |
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2,586 |
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Total cost of revenues |
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5,719 |
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5,181 |
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18,540 |
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17,021 |
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