Rentabiliweb: Excellent Results in 2010

Mar 31, 2011, 02:45 ET from Rentabiliweb

    BRUSSELS, March 31, 2011 /PRNewswire-FirstCall/ --
    - Continued very strong growth in profitability
    - 37.6% increase in revenues to EUR 90 million
    - 39.4% growth in EBITDA to EUR 16.8 million
    - 18.6% EBITDA margin compared to 18.4% in 2009
    - 36.2% increase in operating income to EUR 15.5 million
    - EUR 63 million in shareholder equity

The Rentabiliweb Group (ISIN BE0946620946 - Mnemo BIL) is today publishing its yearly results, showing excellent performance for 2010. This confirms the profitability of its models and of its solutions, once again showing growth in EBITDA margin.

"With pro forma income of nearly EUR 100 million and even higher profitability in 2010, we are in line with our commitments and ahead of our roadmap," commented Jean-Baptiste Descroix-Vernier, Chairman of the Rentabiliweb Group. "We have indentified Rentabiliweb's main growth levers for the next three years and we have finalized our development plan. We are going to make our business organization even stronger in this period of sustained growth."

Driven by a 37.6% increase in its revenues and by rigorous, efficient management of its costs and investments, the Group's EBITDA is up 39.4% to EUR16.8 million, its current operating income has increased 36.2% to EUR15.5 million and its net income has risen 7.6% to over EUR8 million.

    K Euros                    2010     2009     Var.

    Revenues                   90 040   65 444   + 37,6%

    Gross margin               41 932   33 663   + 24,6%
    as a % of revenues           46,6%    51,4%

    EBITDA                     16 784   12 042   + 39,4%
    as a % of revenues           18,6%    18,4%

    Current operating income   15 465   11 358   + 36,2%
    as a % of revenues           17,2%    17,4%

    Operating income           12 985   11 114   + 16,8%
    Taxes on income           - 4 896  - 3 639   + 34,5%

    Net income                  8 015    7 452   +  7,6%

A key year in the B-to-B sector with record growth and the first accreditation as a pay institution for cashing online bankcard payments.

The monetization services (B-to-B) business is continuing to show strong growth, up 53.9% to EUR 38.5 million, consistent with the management's aims. The contribution of Vidalia, incorporated into the consolidated accounts from October 1st, is not substantial, at a little more than one million Euros in 2010 revenues.

The EBITDA for the B-to-B activity has grown to EUR 1.1 million, compared to EUR 1 million in 2009.

Its positioning as a "one-stop-shop" has enabled the Group to provide a full range of optimized solutions for publishing and online retail clients and to cover all of their needs, from payment and micropayment to telecoms and company telephone services to direct marketing and acquisition of targeted profiles and prospects.

Other noteworthy developments for the year include the substantial strengthening of the sales teams, namely in the direct marketing business, and the first step in a new technical organization of the telecom services in order to fully capitalize on the synergies and economies of scale created by incorporating Vidalia.

For several years, the Group has observed that profits on micropayments have tended to decline to the benefit of online publishers and telecoms operators. At the same time, it has seen that Internet users' buying habits are changing and that they are no longer reticent, as was the case 5 years ago, to pay small amounts online using their bankcard. As a result, Rentabiliweb is orienting its payment activity towards credit card e-payment.

In order to give the company the best possible position on Europe's deregulated payment services market, in 2009 the Group decided to enrich its "one-stop-shop" of payment and monetization solutions by obtaining permanent status as a bank, also referred to as a "payment establishment". This accreditation was confirmed on 3 January 2011 and on 31 March 2011, the Group obtained final accreditation for Germany, the United Kingdom and Luxembourg - a first in France.

This strategy has enabled Rentabiliweb to be part of a strong trend in the industry that is seeing publishers and content producers now give priority to more economical payment solutions that enable them to generate customer loyalty by focusing on subscriptions. Indeed, Rentabiliweb is anticipating a gradual shift from sales of digital content in small average amounts, from telephone bills, to bank account billing, which creates more loyalty and is more flexible and economical.

A lucrative, profitable strategy in the publishing of entertainment content for Internet.

The year 2010 was highlighted by the enrichment of the Group's range of entertainment products with the creation of a "Women's & Well-Being" segment and a "Mainstream Humor" segment, complementary to the family games, dating and community services segments that are generally the fastest growing.

The digital content publishing (B-to-C) business grew 27.5% over the year, to EUR 51.6 million. The contribution of Edencast, a performance-based advertising broker specialized in paid search engine optimization, incorporated into the accounts on 1 July 2010, is not significant but remains consistent with the Group's forecasts, reaching just over EUR 4 million in revenues.

The fast, successful incorporation of Edencast, the synergies created for all of the Group's publishing content and the capacity to optimize acquisition costs have enabled the B-to-C gross margin to be maintained at 62.4% of revenues, with 42% growth in the EBITDA for 2010, to EUR 15.6 million. The EBITDA margin also rose three points during the year, to 30.4% of revenues in 2010 compared to 27.3% in 2009.

A stronger financial situation.

The Group has reached a critical size that enables it to optimize its technical infrastructures and variable costs related to marketing and advertising investments. The success of its cross-selling strategy that has helped to substantially reduce marketing and management expenses has enabled Rentabiliweb to compensate for a carefully controlled increase in personnel expenses.

The Group's payroll amounted to 6.8% of income in 2010 compared to +6.5% in 2009.

The current operating income, not including negative goodwill and the cost of warrants and free shares, reached EUR15.5 million, an increase of 36.2%.

Net profits for 2010 reached EUR 8 million, a 7.6% increase. Minus the exceptional items (separation from one part of the founders of Montorgueil, a dispute with a foreign financial partner, the first phase of reorganizing the Romania and Bulgaria offices and centralization of financial operations between the head office and French offices), the corrected net income reached EUR 10.2 million, an increase of 37%.

Net cash flow as of 31 December 2010 stood at EUR 18.5 million, up 21.6% despite the three acquisitions completed in 2010 (Edencast, Vidalia and Clic Bien-Etre) and paid for primarily in cash.

Rentabiliweb has once again demonstrated its capacity to acquire assets with high value added and to maintain the funding capacity required to meet its ambitions despite difficult market conditions.

It is to be noted that during the financial year, there was a variation in the need for working capital, which returned to its normal levels after delayed payments in 2009 resulting from the balance sheet dates of certain clients for which there was no risk (telecoms operators).

Confirmed ambitions for 2011.

In 2011, in order to speed up its development and to capitalize on its advantageous position as a payment institution, the Group has decided to continue and to ramp up its technical and marketing investments in order to surpass the security requirements stipulated by the French Banking and Financial Code. The Group has finalized a deployment plan to be marketed as planned between the end of the first half and the beginning of the second half of 2011.

Alongside this, the Group, as announced in its half-yearly results, will continue the structural, organizational and accounting reorganization of its offices in Eastern Europe. The Financial Division has begun a large-scale fiscal optimization and cash management project that illustrates its international ambitions.

In terms of operational prospects, the Group is confident in its ability to establish its "one-stop-shop" of monetization solutions amongst professionals of all types, from webmasters and media to retailers on Internet and mobile networks. It is continuing its organic investments in digital content publishing, namely in the gaming, dating well-being and women's arenas. Rentabiliweb also plans to speed up its development by focusing on tactical, small-scale external growth operations in order to strengthen its entertainment range, as well as to enrich its content and targeted databases, namely in the mainstream astrology sphere.

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About Rentabiliweb

Founded in 2002, the Rentabiliweb Group offers Internet professionals and webmasters the largest platform of website traffic monetization services, namely payment and micropayment solutions. It has been accredited as a Payment Institution by Banque de France to provide online payment solutions. It also runs affiliate programs, offers online advertising space brokerage and interactive voice services for offline media and provides renowned expertise in loyalty programs and Direct Marketing.

Rentabiliweb is also one of the premier French-language publishers, with a package of services spanning the full range of mass-market entertainment, from community services, family games and services for the general public to recommendations for Internet users, personal ads, dating services and more.

Listed on Compartment B of the Euronext Brussels and Paris stock markets, the Group today has 17 subsidiaries in Europe, Canada and Asia, employing 200 staff members around the world. In 2010, Rentabiliweb's revenues topped EUR 90 million with an EBITDA of EUR16.9 million, a 39.4% increase.

Rentabiliweb is a socially responsible company in its sectors of activity, strictly applying the ten principles laid out by the UN Global Compact. Awarded the "Innovative Company" label by OSEO, the French Innovation Agency, the Group is eligible for Innovation Mutual Funds (FCPIs), and has received PCI-DSS certification for its bankcard payment platform.

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