Rentabiliweb: Record Growth in Sales and Income in H1

Aug 31, 2010, 02:44 ET from Rentabiliweb

    BRUSSELS, August 31, 2010 /PRNewswire-FirstCall/ --
    - Extremely High Organic Growth: Sales up 39%
    - Excellent Rise in Operating Performance: EBITDA and COI up 52%
    - Forecasted 30% Increase in Annual Growth in Sales for 2010

In the second quarter of 2010, the Rentabiliweb Group confirmed the strong business growth seen at the beginning of the year, with an increase in sales of 39.2% over the first six months of the year, reaching EUR 41.1 million, compared to EUR 29.5 million in the first six months of 2009. Sales have risen in all of the Group's activities, with nearly even growth in both of its main businesses. The B-to-B (monetization services) business is up 37.0% to EUR 16.9 million, while the B-to-C (publishing) activity has grown 40.7%, reaching EUR 24.2.

During this period, Rentabiliweb capitalized on somewhat more favorable e-commerce and e-marketing sectors. Nonetheless, this increased growth stems above all from its carefully-tailored strategic positioning, which combines one-stop monetization solutions with a loyalty-generating, profitable digital entertainment package. The synergy between the businesses - enrichment of the audience from one site to another, targeting and use of the databases, self-promotion, cross sales and other achievements - has strongly boosted the Group's various activities.

Thanks to this growth and to economies of scale on expenses - the fruit of careful, thorough financial management - the Group's EBITDA has risen 51.6% to EUR 8.2 million, and its current operating income is up 51.7% to EUR 7.9 million.

Net profits were impacted by exceptional expenses of EUR 1.7 million, yet nonetheless climbed 18.9%, to EUR 4.1 million.

At the end of June, cash flow stood at nearly EUR 28 million, which helped to absorb the acquisition of Edencast, completed in August, and has left a significant amount of leeway for any potential transactions in the future.

    "The results for the first half of 2010 illustrate the virtue of our
business model," stated Jean-Baptiste Descroix-Vernier, Chairman of the
Rentabiliweb Group. "The synergies we are building between our different
business units, both in terms of cross-sales and resource optimization, have
helped to boost our sales and profitability. This strategy, combined with
targeted, high value-added external growth - such as the recent acquisition
of Edencast - is going to quickly help us break EUR 100 million in sales with
maximum profitability."

    In thousands of EUR        30.06.2010   30.06.2009   Variation

    Sales                        41,080       29,521       +39.2%
    Gross profits                20,276       15,491       +30.9%
    as % of sales                49.4%        52.5%          --
    EBITDA                       8,226        5,425        +51.6%
    As % of sales                20.0%        18.4%          --
    Current operating income     7,879        5,195        +51.7%
    As % of sales                19.2%        17.6%          --
    Operating income             6,033        5,127        +17.7%
    Tax on profits              (1,906)      (1,668)       +14.3%
    Net profits                  4,097        3,447        +18.9%
    As % of sales                10.0%        11.7%         ---

Growth for all of the Group's activities

After several years of strong growth in the Group's B-to-C activities, both sectors now have comparable growth rates, and the balance of activities has evened out, at around 41% for B-to-B (nearly EUR 17 million) and 59% for B-to-C (EUR 24 million). While the Group is active on buoyant segments in both of these sectors, this success also stems from the synergies between its various activities. Indeed, Rentabiliweb's B-to-B expertise enables it to develop and target its own audience. At the same time, growth in the B-to-C sector is helping to enrich the databases and available inventory, thus boosting sales in the B-to-B sector.

The Publishing business

The rise in B-to-C sales (up 40.7% for the first half of the year) stems both from the growth in the audience and from the increase in average order value.

This expanding audience comes primarily from the Group's successful sales policy, namely from affiliate networks, from the growing success of cross-sales between the Group's various sites, and from its constant innovation in terms of content and technical features (including the video chat feature progressively being added to the Group's various

dating sites and the inclusion of its range of games on social networking platforms).

The increase in income per customer stems from these new features as well as from a more active up-selling strategy.

Gross profits for the publishing business increased 28% to EUR 14.6. This figure reflects a slight drop in the gross profit rate stemming from the large share of payouts for affiliation. Nonetheless, thanks to tightly-controlled overheads and salary expenses, as well as minimized technical expenses, the EBITDA for the B-to-C sector was up strongly, rising 61.7% to EUR 7.1 million, fully benefitting from the economies of scale resulting from growth of the business.

The Monetization Services business

For the B-to-B sector, the strong growth in sales (+37.0%) is in part related to an improved economic climate for advertisers, and especially to the growing attractiveness of the solutions offered by the Group, thanks to the excellent results it has obtained. Its positioning as a one-stop monetization solutions provider has helped to develop cross sales between various solutions, as the contract with the Lagardère Group illustrates. Signed in September 2009 in the field of Interactive Voice Services (IVS) for radio station Europe 1, it has today been extended to the Group's various micropayment and direct marketing solutions, for several of its brands (Hachette, Lagardère Jeunesse and others).

The development of its performance marketing solutions, namely the e-mail and SMS loyalty programs and cashback solutions such as, is continuing with growth rates of around 100%. Mailorama is France's leader in cashback solutions, with a critical mass that enables it to bring online shops a significant level of sales, and provides Internet users with the widest possible range of products and services.

For micropayment, new significant contracts were signed during the first half of the year, namely with France Television, Concoursmania, Plus Belle la Vie and Libération. These examples illustrate the attractiveness of the Rentabiliweb Group's micropayment solutions for top-name companies.

The B-to-B business accounted for EUR 5.7 million of the gross profits (+39%) and EUR 1.1 million of the EBITDA (+9.5%). The slower growth of the EBITDA can be explained by continued investment, mainly designed to increase technical capacity.

Continued strong growth in profitability

Without sacrificing its investments in audiences and technical capacities, the Group has now reached a critical size enabling it to benefit from large economies of scale. The success of its cross-selling strategy, for example, has helped to substantially reduce marketing and management expenses.

The EBITDA stands at EUR 8.2 million, up 1.6 points compared to the first half of 2009.

Operating income for the period increased in the same proportion, to EUR 7.9 million.

Operating income was impacted by exceptional costs of slightly less than EUR 1.7 million, due to the stock market transfer, to a dispute with a foreign financial partner and to separation from one part of Montorgueil's founders. It stands at EUR 6.0 million, an increase of 17.7%. After tax expenses of EUR 1.9 million, up 14%, net profits reached EUR 4.1 million, an 18.9% increase.

At the end of June, cash flow stood at EUR 28 million, an increase of EUR 13 million compared to the end of 2009, thanks to the capital increase of EUR 9.8 million carried out during the transfer onto the NYSE Euronext market. This solid balance sheet should enable the Group to continue its targeted organic and external growth strategy.

One of the largest French-language opt-in databases

Today, after the acquisitions of Edencast in August and Clic Bien Etre in late June, and thanks to the fast, continuing growth of Mailorama, Rentabiliweb can offer direct marketing services built upon a targeted database of more than 7 million opt-in members. This database is composed of 100% online buyers, 90% of whom are between 18 and 54 years of age, 90% of whom are in medium and high income groups, and 50% of whom are women. This database gives the Rentabiliweb Group unparalleled power in direct marketing, and the quality of its services is demonstrated by a high conversion rate at the end of each campaign. This is an excellent illustration of the virtue of Rentabiliweb's development model, with tools that become increasingly powerful the more they are used. The high performance of Rentabiliweb's Direct Marketing solutions is recognized by major French companies such as the Orange Group, PMU, Fnac, Française des Jeux, Bouygues Telecom, M6 Group, SFR Group, la Redoute and others.

    Favorable prospects for growth boosted by the Group's new stature
    During the coming months, the Group will base its growth on:

    - continued use of its databases
    - development of new tools, namely in the dating, social
      networks and games markets
    - continuing the cross-selling strategy
    - beginning to market B-to-B solutions abroad, in Belgium,
      Switzerland and Spain
    - the new synergies created by the recent acquisition of

Given the fact that the second half of 2009 was particularly buoyant, Rentabiliweb is making a prudent forecast for growth in sales of around 30% for the year.

The Group will be on hand at the 2010 E-Commerce Exhibition, to be held at the Paris Porte de Versailles Exhibition Center from 21 to 23 September 2010. Rentabiliweb will be presenting its full range of monetization solutions at stand E36.

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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 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 C of the Euronext Brussels and Paris stock markets, the Group today has 13 subsidiaries in Europe, Canada and Asia, employing 150 staff members around the world. In 2009, Rentabiliweb's sales topped EUR 65 million, with net profits of EUR 7.5 million.

Rentabiliweb is also a socially responsible company in its sectors of activity, and rigorously applies the ten principles laid out by the UN Global Compact.

    For more information, visit:

    Corporate Communications
    Anne Auchatraire
    Grégoire Lucas

    Financial - Investor Communications
    Mathieu Calleux

SOURCE Rentabiliweb