Getty Images Reports First Quarter 2001 Financial Results

Apr 25, 2001, 01:00 ET from Getty Images, Inc.

    SEATTLE, April 25 /PRNewswire/ -- Getty Images, Inc. (Nasdaq: GETY), the
 leading e-commerce provider of imagery and related products and services,
 today announced financial results for the first quarter ended March 31, 2001.
     Revenue for the first quarter of 2001 was $125.8 million, up 20 percent
 over revenue of $104.8 million for the first quarter of 2000.  On a currency
 neutral basis, revenue for the quarter increased 25 percent over the first
 quarter of 2000.  E-commerce revenue in the quarter was $52.6 million,
 representing an increase of 65 percent over the first quarter of 2000 and
 almost 42 percent of total revenue for the company.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010116/SFTU175LOGO )
     EBITDA increased 106 percent over the first quarter of 2000 to
 $28.6 million.  The EBITDA margin increased from 13.2 percent in the first
 quarter of 2000 to 22.8 percent in the first quarter of 2001.  After-tax cash
 flow per share for the first quarter was 40 cents, compared with 24 cents per
 share in the first quarter of 2000, an increase of 67 percent.  The net loss
 for the quarter was down 55 percent to $14.6 million, or 28 cents per share,
 compared to a net loss of $32.3 million, or 68 cents per share, for the same
 period in 2000.
     "We remain cautious about our expectations for 2001, and have developed
 targeted strategies to maximize our bottom-line objectives," said
 Jonathan Klein, co-founder and chief executive officer of Getty Images.
 "However, we are also focused on the future and believe we are well positioned
 to manage through this challenging economic environment and to capitalize on
 the tremendous opportunities that lie ahead.  We are most fortunate in that we
 have a large customer base, the leading market position, strong operating cash
 flow and a solid business model."
     "One of our primary objectives for 2001 is to improve our margins, and we
 are gratified that, despite the economic slowdown, we were able to decrease
 S,G&A expenses as a percentage of sales from 57.6 percent in the first quarter
 of 2000 to 48.9 percent in the first quarter of 2001.  We also reduced our
 S,G&A costs in absolute dollar terms from the fourth quarter of 2000, and
 generated an EBITDA margin of nearly 23 percent," said Liz Huebner, senior
 vice president and chief financial officer of Getty Images.  "The results we
 achieved in the first quarter give us continued confidence that we can attain
 our key financial goal of reaching positive free cash flow in 2001."
 
     Business Outlook
     The following forward-looking statements reflect Getty Images'
 expectations as of April 25, 2001.  The company intends to continue its
 practice of not updating forward-looking statements until the next quarterly
 results announcement, other than in publicly available statements.
     In light of the current economic environment, the company anticipates that
 2001 revenue will be in the range of $510 million to $540 million.  The
 company expects to generate an EBITDA margin of between 24 and 26 percent for
 2001.
     For the second quarter of 2001, the company expects to report revenue of
 $120 million to $130 million.  The gross margin is expected to be
 approximately 71 percent and the EBITDA margin is anticipated to be
 approximately 23 percent.
     "EBITDA" is defined as earnings before income taxes, depreciation,
 amortization, interest, exchange gains and losses and, when applicable, loss
 on impairment, debt conversion expense, integration and restructuring costs,
 extraordinary items and other income and expenses. EBITDA should not be
 considered as an alternative to operating income, as defined by generally
 accepted accounting principles, as an indicator of our operating performance,
 or to cash flows as a measure of our liquidity.
     This press release is based on preliminary financial results, which are
 subject to further review or adjustment, and contains forward-looking
 statements based on current expectations, forecasts and assumptions that
 involve risks and uncertainties that could cause actual results to differ
 materially.  These risks and uncertainties include, among others, the risk
 associated with changes in the economic environment; the developmental nature
 of the visual content industry; competition; risks associated with
 integration; unpredictability of future revenues; potential fluctuations in
 quarterly operating results; potential fluctuations in currency exchange
 rates; potential growth of online products and potential strategic alliances.
 For more information concerning such risks and uncertainties, we urge you to
 review the reports filed by Getty Images with the Securities and Exchange
 Commission, in particular our Annual Report on Form 10-K for the fiscal year
 ended December 31, 2000.  Getty Images disclaims any obligation to update or
 revise any forward-looking statements, whether as a result of new information,
 future developments or other events.
 
     Webcast information
     The company will host a conference call today at 2:00 p.m. PDT.  The
 dial-in number for the call is 800-530-8983.  There will also be a live
 Webcast of the conference call, which can be accessed from the Investors
 section of the Getty Images Website at www.gettyimages.com .  A replay of the
 conference call can be accessed by calling 800-633-8284, reservation number
 18419047, until Friday, April 27 at 5:00 p.m. PDT.  The Webcast will be
 archived on the Getty Images Website and will be available until May 25, 2001.
 
     About Getty Images
     Getty Images, Inc. is the leading e-commerce provider of imagery and
 related products and services.  The company provides high-quality, branded
 imagery, meeting the distinctly different needs of creative professionals in
 advertising, design agencies, Web design and corporate marketing; press and
 editorial professionals in magazines, newspapers, book publishers and Web
 publishers and the business user, or the self-publisher, with business
 communications and small-office, home-office (SOHO) needs.
     Headquartered in Seattle, the company has 2,500 employees worldwide.  For
 more information on Getty Images and its market-leading brands please visit
 the company's Website at http://www.gettyimages.com .
 
      Contacts:
      Investors:
      Kira Bacon, Vice President of Investor Relations
      206-268-1745
      kira.bacon@gettyimages.com
 
      Media:
      Brien Lautman, Vice President of Corporate Communications
      206-268-1914
      brien.lautman@gettyimages.com
 
      Rosanne Marks, MWW Savitt
      206-689-8505
      rmarks@mww.com
 
 
                                 GETTY IMAGES, INC.
                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (unaudited)
 
                                                  Three months ended March 31,
     (In thousands, except per share amounts)            2001           2000
 
     Sales                                           $125,787       $104,825
     Cost of sales                                     35,624         30,518
 
       Gross profit                                    90,163         74,307
 
     Selling, general and administrative expenses      61,526         60,429
     Amortization of intangible assets                 19,278         25,035
     Depreciation                                      13,229         10,202
     Integration costs                                  3,977          4,191
 
       Loss from operations                           (7,847)       (25,550)
     Interest expense                                 (4,389)        (2,323)
     Interest income                                      518          1,241
     Debt conversion expense                               --        (6,689)
     Exchange losses                                    (301)          (515)
     Other income (expense), net                           91           (19)
 
       Loss before income taxes and
        extraordinary item                           (11,928)       (33,855)
     Income tax (expense) benefit                     (2,631)          1,134
 
       Loss before extraordinary item                (14,559)       (32,721)
     Extraordinary item, net of tax                        --            384
 
     Net loss                                       $(14,559)      $(32,337)
 
     EBITDA (A)                                       $28,637        $13,878
 
     Loss per share before extraordinary
      item - basic and diluted                        $(0.28)        $(0.69)
 
     Extraordinary item                                    --           0.01
 
     Net loss per share - basic and diluted           $(0.28)        $(0.68)
 
     Loss per share before integration
      costs - basic and diluted                       $(0.24)        $(0.63)
 
     Average shares outstanding - basic and diluted    51,447         47,569
 
 
     (A) "EBITDA" is defined as earnings before income taxes, depreciation,
 amortization, interest, exchange gains and losses and, when applicable, loss
 on impairment, debt conversion expense, integration and restructuring costs,
 extraordinary items and other income and expenses. EBITDA should not be
 considered as an alternative to operating income, as defined by generally
 accepted accounting principles, as an indicator of our operating performance,
 or to cash flows as a measure of our liquidity.
 
                                 GETTY IMAGES, INC.
                       CONDENSED CONSOLIDATED BALANCE SHEETS
                                    (unaudited)
                                                      March 31,     Dec. 31,
                                                        2001          2000
     (In thousands)
 
     ASSETS
      Current assets
       Cash and cash equivalents                        $52,020      $65,894
       Other current assets, net                        140,665      138,131
 
         Total current assets                           192,685      204,025
 
      Property and equipment, net                       140,024      140,793
      Intangible assets, net                            687,931      707,408
      Investments                                         4,741        4,751
      Deferred income taxes, net                         44,205       43,659
 
     Total assets                                    $1,069,586   $1,100,636
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities
       Current portion of long-term debt                   $808         $739
       Other current liabilities                        125,478      141,923
 
         Total current liabilities                      126,286      142,662
 
     Long-term debt                                     274,467      274,427
     Stockholders' equity                               668,833      683,547
 
       Total liabilities and stockholders' equity    $1,069,586   $1,100,636
 
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X51115215
 
 

SOURCE Getty Images, Inc.
    SEATTLE, April 25 /PRNewswire/ -- Getty Images, Inc. (Nasdaq: GETY), the
 leading e-commerce provider of imagery and related products and services,
 today announced financial results for the first quarter ended March 31, 2001.
     Revenue for the first quarter of 2001 was $125.8 million, up 20 percent
 over revenue of $104.8 million for the first quarter of 2000.  On a currency
 neutral basis, revenue for the quarter increased 25 percent over the first
 quarter of 2000.  E-commerce revenue in the quarter was $52.6 million,
 representing an increase of 65 percent over the first quarter of 2000 and
 almost 42 percent of total revenue for the company.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010116/SFTU175LOGO )
     EBITDA increased 106 percent over the first quarter of 2000 to
 $28.6 million.  The EBITDA margin increased from 13.2 percent in the first
 quarter of 2000 to 22.8 percent in the first quarter of 2001.  After-tax cash
 flow per share for the first quarter was 40 cents, compared with 24 cents per
 share in the first quarter of 2000, an increase of 67 percent.  The net loss
 for the quarter was down 55 percent to $14.6 million, or 28 cents per share,
 compared to a net loss of $32.3 million, or 68 cents per share, for the same
 period in 2000.
     "We remain cautious about our expectations for 2001, and have developed
 targeted strategies to maximize our bottom-line objectives," said
 Jonathan Klein, co-founder and chief executive officer of Getty Images.
 "However, we are also focused on the future and believe we are well positioned
 to manage through this challenging economic environment and to capitalize on
 the tremendous opportunities that lie ahead.  We are most fortunate in that we
 have a large customer base, the leading market position, strong operating cash
 flow and a solid business model."
     "One of our primary objectives for 2001 is to improve our margins, and we
 are gratified that, despite the economic slowdown, we were able to decrease
 S,G&A expenses as a percentage of sales from 57.6 percent in the first quarter
 of 2000 to 48.9 percent in the first quarter of 2001.  We also reduced our
 S,G&A costs in absolute dollar terms from the fourth quarter of 2000, and
 generated an EBITDA margin of nearly 23 percent," said Liz Huebner, senior
 vice president and chief financial officer of Getty Images.  "The results we
 achieved in the first quarter give us continued confidence that we can attain
 our key financial goal of reaching positive free cash flow in 2001."
 
     Business Outlook
     The following forward-looking statements reflect Getty Images'
 expectations as of April 25, 2001.  The company intends to continue its
 practice of not updating forward-looking statements until the next quarterly
 results announcement, other than in publicly available statements.
     In light of the current economic environment, the company anticipates that
 2001 revenue will be in the range of $510 million to $540 million.  The
 company expects to generate an EBITDA margin of between 24 and 26 percent for
 2001.
     For the second quarter of 2001, the company expects to report revenue of
 $120 million to $130 million.  The gross margin is expected to be
 approximately 71 percent and the EBITDA margin is anticipated to be
 approximately 23 percent.
     "EBITDA" is defined as earnings before income taxes, depreciation,
 amortization, interest, exchange gains and losses and, when applicable, loss
 on impairment, debt conversion expense, integration and restructuring costs,
 extraordinary items and other income and expenses. EBITDA should not be
 considered as an alternative to operating income, as defined by generally
 accepted accounting principles, as an indicator of our operating performance,
 or to cash flows as a measure of our liquidity.
     This press release is based on preliminary financial results, which are
 subject to further review or adjustment, and contains forward-looking
 statements based on current expectations, forecasts and assumptions that
 involve risks and uncertainties that could cause actual results to differ
 materially.  These risks and uncertainties include, among others, the risk
 associated with changes in the economic environment; the developmental nature
 of the visual content industry; competition; risks associated with
 integration; unpredictability of future revenues; potential fluctuations in
 quarterly operating results; potential fluctuations in currency exchange
 rates; potential growth of online products and potential strategic alliances.
 For more information concerning such risks and uncertainties, we urge you to
 review the reports filed by Getty Images with the Securities and Exchange
 Commission, in particular our Annual Report on Form 10-K for the fiscal year
 ended December 31, 2000.  Getty Images disclaims any obligation to update or
 revise any forward-looking statements, whether as a result of new information,
 future developments or other events.
 
     Webcast information
     The company will host a conference call today at 2:00 p.m. PDT.  The
 dial-in number for the call is 800-530-8983.  There will also be a live
 Webcast of the conference call, which can be accessed from the Investors
 section of the Getty Images Website at www.gettyimages.com .  A replay of the
 conference call can be accessed by calling 800-633-8284, reservation number
 18419047, until Friday, April 27 at 5:00 p.m. PDT.  The Webcast will be
 archived on the Getty Images Website and will be available until May 25, 2001.
 
     About Getty Images
     Getty Images, Inc. is the leading e-commerce provider of imagery and
 related products and services.  The company provides high-quality, branded
 imagery, meeting the distinctly different needs of creative professionals in
 advertising, design agencies, Web design and corporate marketing; press and
 editorial professionals in magazines, newspapers, book publishers and Web
 publishers and the business user, or the self-publisher, with business
 communications and small-office, home-office (SOHO) needs.
     Headquartered in Seattle, the company has 2,500 employees worldwide.  For
 more information on Getty Images and its market-leading brands please visit
 the company's Website at http://www.gettyimages.com .
 
      Contacts:
      Investors:
      Kira Bacon, Vice President of Investor Relations
      206-268-1745
      kira.bacon@gettyimages.com
 
      Media:
      Brien Lautman, Vice President of Corporate Communications
      206-268-1914
      brien.lautman@gettyimages.com
 
      Rosanne Marks, MWW Savitt
      206-689-8505
      rmarks@mww.com
 
 
                                 GETTY IMAGES, INC.
                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (unaudited)
 
                                                  Three months ended March 31,
     (In thousands, except per share amounts)            2001           2000
 
     Sales                                           $125,787       $104,825
     Cost of sales                                     35,624         30,518
 
       Gross profit                                    90,163         74,307
 
     Selling, general and administrative expenses      61,526         60,429
     Amortization of intangible assets                 19,278         25,035
     Depreciation                                      13,229         10,202
     Integration costs                                  3,977          4,191
 
       Loss from operations                           (7,847)       (25,550)
     Interest expense                                 (4,389)        (2,323)
     Interest income                                      518          1,241
     Debt conversion expense                               --        (6,689)
     Exchange losses                                    (301)          (515)
     Other income (expense), net                           91           (19)
 
       Loss before income taxes and
        extraordinary item                           (11,928)       (33,855)
     Income tax (expense) benefit                     (2,631)          1,134
 
       Loss before extraordinary item                (14,559)       (32,721)
     Extraordinary item, net of tax                        --            384
 
     Net loss                                       $(14,559)      $(32,337)
 
     EBITDA (A)                                       $28,637        $13,878
 
     Loss per share before extraordinary
      item - basic and diluted                        $(0.28)        $(0.69)
 
     Extraordinary item                                    --           0.01
 
     Net loss per share - basic and diluted           $(0.28)        $(0.68)
 
     Loss per share before integration
      costs - basic and diluted                       $(0.24)        $(0.63)
 
     Average shares outstanding - basic and diluted    51,447         47,569
 
 
     (A) "EBITDA" is defined as earnings before income taxes, depreciation,
 amortization, interest, exchange gains and losses and, when applicable, loss
 on impairment, debt conversion expense, integration and restructuring costs,
 extraordinary items and other income and expenses. EBITDA should not be
 considered as an alternative to operating income, as defined by generally
 accepted accounting principles, as an indicator of our operating performance,
 or to cash flows as a measure of our liquidity.
 
                                 GETTY IMAGES, INC.
                       CONDENSED CONSOLIDATED BALANCE SHEETS
                                    (unaudited)
                                                      March 31,     Dec. 31,
                                                        2001          2000
     (In thousands)
 
     ASSETS
      Current assets
       Cash and cash equivalents                        $52,020      $65,894
       Other current assets, net                        140,665      138,131
 
         Total current assets                           192,685      204,025
 
      Property and equipment, net                       140,024      140,793
      Intangible assets, net                            687,931      707,408
      Investments                                         4,741        4,751
      Deferred income taxes, net                         44,205       43,659
 
     Total assets                                    $1,069,586   $1,100,636
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities
       Current portion of long-term debt                   $808         $739
       Other current liabilities                        125,478      141,923
 
         Total current liabilities                      126,286      142,662
 
     Long-term debt                                     274,467      274,427
     Stockholders' equity                               668,833      683,547
 
       Total liabilities and stockholders' equity    $1,069,586   $1,100,636
 
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X51115215
 
 SOURCE   Getty Images, Inc.