HSW International Reports Fourth Quarter and Full Year 2010 Results
29 Março 2011 - 5:35PM
HSW International, Inc. (Nasdaq:HSWI), a leading developer and
operator of next-generation web publishing platforms combining
traditional web publishing with social media, today reported its
financial results for the fourth quarter and year ended December
31, 2010.
For the fourth quarter of 2010, HSW International reported
revenue of $1.8 million, compared to $2.0 million for the fourth
quarter of 2009, when the company recognized six months of revenue
for web services provided to Sharecare. The fourth-quarter 2010
loss from operations was $(1.5) million, an improvement from the
loss from operations of $(2.0) million in the comparable period of
2009. The net loss for the fourth quarter of 2010 improved to
$(1.7) million, or $(0.31) per share, compared to the net loss of
$(2.5) million, or $(0.47) per share, that was reported in the
fourth quarter of 2009.
For the full year 2010, HSW International reported revenue of
$6.7 million, compared to $2.3 million for the full year of 2009.
The 194% increase is due to providing a full year of web services
for Sharecare, a Web 3.0 healthcare platform launched in October
2010, as well as web services to other customers. Gross profit for
the year was $1.3 million, compared to a loss of $(0.6) million in
2009. The 2010 loss from operations was $(4.5) million, an
improvement from the loss from operations of $(12.0) million for
the full year of 2009. The net loss for the year 2010 was $(5.9)
million, or $(1.10) per share, compared to $(11.9) million for
2009, or $(2.22) per share, for 2009. Included in the net loss for
both periods is a net loss associated with the company's stake in
Sharecare in the amount of $(1.5) million for 2010 and $(0.8)
million for 2009.
"2010 was a transition year for HSWI as we shifted our focus
back to the U.S. from our overseas ventures in order to get in
front of a new growth curve that we believe is taking shape in the
web publishing industry," said Greg Swayne, chairman and chief
executive officer of HSW International. "Social media is changing
the landscape for digital publishers, creating burgeoning
opportunities for the development of new concepts. Having developed
the platform for clients including Sharecare, HSWI has proven
expertise in bringing to fruition Web 3.0 concepts that combine
traditional web publishing with social media."
The company also announced that it has signed a web services
agreement with Discovery Communications. The agreement calls for
HSWI to design, develop and operate a website for Discovery
Communications' Curiosity Initiative based on the Web 3.0 platform
that HSWI developed for Sharecare. The agreement runs through the
end of 2011.
Discovery Communications' Curiosity Initiative is a global
programming initiative designed to tackle fundamental questions and
underlying mysteries of our time. "We're excited to be chosen as a
key player in its development and look forward to continuing to
work with Discovery Communications," said Mr. Swayne.
"As a pioneer in innovative web publishing strategies and
technology, our primary objective in 2011 is to validate and scale
the Web 3.0 concept by actively pursuing other web services
agreements and developing platforms for verticals other than health
and wellness, starting with personal finance," added Mr. Swayne.
"Our proven expertise in Web 3.0 platform development combined with
HSWI's deep roots in content development and editorial processes
that incorporate social media, positions us to become a dominant
player in the next generation web publishing space."
About HSW International
HSW International, Inc. (Nasdaq:HSWI) is a leading developer and
operator of next-generation web publishing platforms combining
traditional web publishing with social media. The company's Web 3.0
platform is revolutionizing the way people search and exchange
information over the Internet. HSW International's Web 3.0 platform
powers Sharecare, which provides a simple, easy way for consumers
to get high quality answers to the questions of health, provided by
trusted experts. HSW International is a co-founder of Sharecare
along with Dr. Mehmet Oz, Harpo Productions, Discovery
Communications, Sony Pictures Television and Jeff Arnold, the
founder of WebMD. HSW International is currently developing other
content areas that lend themselves to the Web 3.0 platform. HSW
International is also the exclusive licensee in China and Brazil
for the publication of translated content from Discovery
Communications' HowStuffWorks.com. For more information visit the
company's website at www.hswinternational.com.
Forward-Looking Statements
This press release contains "forward-looking statements," as
defined in Section 27A of the Securities Act of 1993, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements may be in the future tense, and often
include words such as "anticipate", "expect", "project", "believe",
"plan", "estimate", "intend", "will" and "may". These statements
are based on current expectations, but are subject to certain risks
and uncertainties, many of which are difficult to predict and are
beyond the control of HSW International. Relevant risks and
uncertainties include those referenced in HSW International's
filings with the SEC, and include but are not limited to: our
losses and potential need to raise capital; successfully supporting
the Sharecare platform; reliance on third parties such as our
largest shareholder Discovery Communications, as well as Sharecare
and its other founders and contributors; restrictions on
intellectual property under agreements with Sharecare and third
parties; challenges inherent in developing an online business;
reliance on key personnel; risks of business in foreign countries,
notably China and Brazil, including obtaining regulatory approvals
and adjusting to changing political and economic policies;
governmental laws and regulations, including unclear and changing
laws and regulations related to the internet sector in foreign
countries, especially China; general industry conditions and
competition; and general economic conditions, such as advertising
rate, interest rate and currency exchange rate fluctuations. These
risks and uncertainties could cause actual results to differ
materially from those expressed in or implied by the
forward-looking statements, and therefore should be carefully
considered. HSW International assumes no obligation to update any
forward-looking statements as a result of new information or future
events or developments, except as required by law.
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Three Months
Ended December 31, |
Twelve Months
Ended December 31, |
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2010 |
2009 |
2010 |
2009 |
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Operating Revenue |
$ 1,802,554 |
$ 1,954,265 |
$ 6,655,064 |
$ 2,259,816 |
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Cost of services |
1,444,866 |
1,712,824 |
5,405,128 |
2,869,509 |
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Gross margin |
357,688 |
241,441 |
1,249,936 |
(609,693) |
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Operating expenses |
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Selling, general and administrative |
1,330,013 |
1,407,004 |
4,983,981 |
10,136,353 |
Other operating expenses |
562,135 |
854,605 |
784,089 |
1,215,434 |
Total operating expenses |
1,892,148 |
2,261,609 |
5,768,070 |
11,351,787 |
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Loss from operations |
(1,534,460) |
(2,020,168) |
(4,518,134) |
(11,961,480) |
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Total non-operating
income |
1,948 |
7,606 |
14,514 |
209,661 |
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Loss before income
taxes |
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and equity in loss of equity-method
investment |
(1,532,512) |
(2,012,562) |
(4,503,620) |
(11,751,819) |
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Income tax benefit |
122,140 |
295,110 |
121,238 |
688,630 |
Equity in loss of equity-method
investment, net of taxes |
(279,639) |
(818,087) |
(1,522,697) |
(818,087) |
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Net loss |
$ (1,690,011) |
$ (2,535,539) |
$ (5,905,079) |
$ (11,881,276) |
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Basic and diluted loss per share |
$ (0.31) |
$ (0.47) |
$ (1.10) |
$ (2.22) |
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Basic and diluted weighted average shares
outstanding |
5,368,476 |
5,361,916 |
5,368,419 |
5,361,767 |
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CONTACT: Investor Relations Contact:
Stephanie Prince/Jody Burfening
Lippert/Heilshorn & Associates
T: 212-838-3777
sprince@lhai.com
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