RoweCom Reports Positive First Quarter Results

EBITDA Improves 45.4% and Operating Expenses Decrease 26.4%



Company on Track for Positive Cash Flow from Operations for 2001



Apr 26, 2001, 01:00 ET from RoweCom, Inc.

    WESTWOOD, Mass., April 26 /PRNewswire/ -- RoweCom Inc. (Nasdaq:   ROWE), a
 leader in knowledge resource management and acquisition services, today
 reported financial results for the three months ended March 31, 2001.  Results
 were in line with previous expectations reported April 4, 2001.
     Gross profits were $5.3 million, an increase of 18.7% over the same period
 last year.  Revenues for the first quarter were $61.7 million, an increase of
 19.2% compared with the first quarter of 2000.  EBITDA showed a 45.4%
 improvement with a loss of $5.8 million or $.46 per share, compared to a loss
 of $10.6 million or $1.02 per share for the same period a year ago.  Revenues
 for the first quarter were $114.0, including a $52.3 million carryover from
 the last quarter of 2000.  The adjusted numbers were reported in order to
 provide a more meaningful year over year comparison of the company's true
 performance for the quarter.
     Operational expenses for first quarter 2001 decreased 26.4% to $11.1
 million compared to $15.0 million for the same period in 2000.
     "We're pleased with our results this quarter as they are in line with our
 growth strategy and further support our clients' responses to the high quality
 of service we are providing," said James Krzywicki, chief operating officer,
 RoweCom Inc.  "RoweCom's operational expenses have now decreased for five
 consecutive quarters primarily due to consolidation of operations from
 previous acquisitions, the company's continued productivity gains and realized
 synergies from its prior year acquisitions. We expect to be cash positive for
 the year," Krzywicki emphasized.
     "These results demonstrate RoweCom's underlying strength as a business and
 its strong commitment to providing outstanding services to all of our clients
 on a worldwide basis," said Richard Rowe, chairman and chief executive
 officer.  "Organizations, both public and private, are realizing the
 advantages of using online services to manage their knowledge resources more
 effectively, which has resulted in rapid international growth for RoweCom."
 
     About RoweCom Inc.
     RoweCom provides high-quality service and e-commerce solutions for
 purchasing and managing the acquisition of magazines, newspapers, journals and
 e-journals, books and other sources of comprehensive knowledge resources.
 With clients ranging from academic libraries to Fortune 1000 companies,
 RoweCom serves communities with intensive knowledge requirements and high-
 volume purchases. Faxon, a long-established leader in academic information
 services, joined RoweCom in October 1999 and continues to serve its clients by
 offering expanded Internet and e-commerce tools as well as new levels of
 control, convenience, and cost-savings. For more information, visit
 www.rowe.com.
     Except for the historical information contained herein, the matters
 discussed in this news release may contain forward-looking statements made
 under the safe harbor provisions of the Private Securities Litigation Reform
 Act of 1995. All forward-looking statements involve risks and uncertainties.
 RoweCom's actual results may differ materially from the results discussed in
 the forward-looking statements. For a discussion of the factors that might
 cause such a difference see "Risk Factors" in RoweCom's filings with the
 Securities and Exchange Commission including the Form 10-K filed on April 17,
 2001.
 
                                  RoweCom Inc.
                          Consolidated Balance Sheets
 
                                 (In thousands)
 
                                                At March 31,  At December 31,
                                                        2001            2000
 
     ASSETS:
     Current assets:
      Cash and cash equivalents                        $6,497        $26,597
      Accounts receivable, net                         68,810         94,429
      Other current assets                              2,615          3,503
 
       Total current assets                            77,922        124,529
 
     Property and equipment, net                        9,386          9,734
     Goodwill, intangible and other assets, net        17,201         19,523
 
       Total assets                                   104,509        153,786
 
 
     LIABILITIES AND STOCKHOLDERS' DEFICIT:
     Current liabilities:
      Loans payable                                    48,018         28,961
      Accounts payable                                 27,212         61,104
      Accrued expenses                                  7,025         11,025
      Accrued compensation                                732            815
      Customer advances                                 9,845         24,609
      Deferred revenue                                 12,052         22,915
 
       Total current liabilities                      104,884        149,429
 
     Long term debt, net of current portion             8,057          6,135
 
     Commitments and contingencies
 
     Stockholders' deficit:
      Common stock                                        124            124
      Additional paid-in capital                      113,235        113,235
      Treasury stock, at cost                             (53)           (53)
      Accumulated deficit                            (118,886)      (113,319)
      Accumulated other comprehensive loss             (2,852)       (1,765)
 
       Total stockholders' deficit                     (8,432)        (1,778)
 
       Total liabilities and stockholders' deficit   $104,509       $153,786
 
 
                                  RoweCom Inc.
                     Consolidated Statements of Operations
 
                    (In thousands, except per share amounts)
 
                                                         Three Months Ended
                                                             March 31,
                                                       2001           2000
 
     Revenues                                        $114,033        $51,787
     Cost of revenues                                 104,556         47,340
       Gross profit                                     9,477          4,447
 
     Operating expenses:
      Sales and marketing                               6,642          8,446
      Research and development                          1,425          2,586
      General and administrative                        2,999          4,012
       Total departmental expenses                     11,066         15,044
 
        EBITDA                                        (1,589)       (10,597)
 
      Depreciation                                        942            750
      Amortization of goodwill and intangibles          1,213          1,613
 
       Loss from operations                           (3,744)       (12,960)
 
      Interest expense                                (2,187)        (1,821)
 
       Loss before income taxes                       (5,931)       (14,781)
 
      Provision (benefit) for income taxes              (364)            220
 
       Net loss                                      ($5,567)      ($15,001)
 
 
      Basic and diluted net loss per share            ($0.45)        ($1.44)
 
      Shares used in computing basic and
       diluted net loss per share                      12,453         10,386
 
 
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SOURCE RoweCom, Inc.
    WESTWOOD, Mass., April 26 /PRNewswire/ -- RoweCom Inc. (Nasdaq:   ROWE), a
 leader in knowledge resource management and acquisition services, today
 reported financial results for the three months ended March 31, 2001.  Results
 were in line with previous expectations reported April 4, 2001.
     Gross profits were $5.3 million, an increase of 18.7% over the same period
 last year.  Revenues for the first quarter were $61.7 million, an increase of
 19.2% compared with the first quarter of 2000.  EBITDA showed a 45.4%
 improvement with a loss of $5.8 million or $.46 per share, compared to a loss
 of $10.6 million or $1.02 per share for the same period a year ago.  Revenues
 for the first quarter were $114.0, including a $52.3 million carryover from
 the last quarter of 2000.  The adjusted numbers were reported in order to
 provide a more meaningful year over year comparison of the company's true
 performance for the quarter.
     Operational expenses for first quarter 2001 decreased 26.4% to $11.1
 million compared to $15.0 million for the same period in 2000.
     "We're pleased with our results this quarter as they are in line with our
 growth strategy and further support our clients' responses to the high quality
 of service we are providing," said James Krzywicki, chief operating officer,
 RoweCom Inc.  "RoweCom's operational expenses have now decreased for five
 consecutive quarters primarily due to consolidation of operations from
 previous acquisitions, the company's continued productivity gains and realized
 synergies from its prior year acquisitions. We expect to be cash positive for
 the year," Krzywicki emphasized.
     "These results demonstrate RoweCom's underlying strength as a business and
 its strong commitment to providing outstanding services to all of our clients
 on a worldwide basis," said Richard Rowe, chairman and chief executive
 officer.  "Organizations, both public and private, are realizing the
 advantages of using online services to manage their knowledge resources more
 effectively, which has resulted in rapid international growth for RoweCom."
 
     About RoweCom Inc.
     RoweCom provides high-quality service and e-commerce solutions for
 purchasing and managing the acquisition of magazines, newspapers, journals and
 e-journals, books and other sources of comprehensive knowledge resources.
 With clients ranging from academic libraries to Fortune 1000 companies,
 RoweCom serves communities with intensive knowledge requirements and high-
 volume purchases. Faxon, a long-established leader in academic information
 services, joined RoweCom in October 1999 and continues to serve its clients by
 offering expanded Internet and e-commerce tools as well as new levels of
 control, convenience, and cost-savings. For more information, visit
 www.rowe.com.
     Except for the historical information contained herein, the matters
 discussed in this news release may contain forward-looking statements made
 under the safe harbor provisions of the Private Securities Litigation Reform
 Act of 1995. All forward-looking statements involve risks and uncertainties.
 RoweCom's actual results may differ materially from the results discussed in
 the forward-looking statements. For a discussion of the factors that might
 cause such a difference see "Risk Factors" in RoweCom's filings with the
 Securities and Exchange Commission including the Form 10-K filed on April 17,
 2001.
 
                                  RoweCom Inc.
                          Consolidated Balance Sheets
 
                                 (In thousands)
 
                                                At March 31,  At December 31,
                                                        2001            2000
 
     ASSETS:
     Current assets:
      Cash and cash equivalents                        $6,497        $26,597
      Accounts receivable, net                         68,810         94,429
      Other current assets                              2,615          3,503
 
       Total current assets                            77,922        124,529
 
     Property and equipment, net                        9,386          9,734
     Goodwill, intangible and other assets, net        17,201         19,523
 
       Total assets                                   104,509        153,786
 
 
     LIABILITIES AND STOCKHOLDERS' DEFICIT:
     Current liabilities:
      Loans payable                                    48,018         28,961
      Accounts payable                                 27,212         61,104
      Accrued expenses                                  7,025         11,025
      Accrued compensation                                732            815
      Customer advances                                 9,845         24,609
      Deferred revenue                                 12,052         22,915
 
       Total current liabilities                      104,884        149,429
 
     Long term debt, net of current portion             8,057          6,135
 
     Commitments and contingencies
 
     Stockholders' deficit:
      Common stock                                        124            124
      Additional paid-in capital                      113,235        113,235
      Treasury stock, at cost                             (53)           (53)
      Accumulated deficit                            (118,886)      (113,319)
      Accumulated other comprehensive loss             (2,852)       (1,765)
 
       Total stockholders' deficit                     (8,432)        (1,778)
 
       Total liabilities and stockholders' deficit   $104,509       $153,786
 
 
                                  RoweCom Inc.
                     Consolidated Statements of Operations
 
                    (In thousands, except per share amounts)
 
                                                         Three Months Ended
                                                             March 31,
                                                       2001           2000
 
     Revenues                                        $114,033        $51,787
     Cost of revenues                                 104,556         47,340
       Gross profit                                     9,477          4,447
 
     Operating expenses:
      Sales and marketing                               6,642          8,446
      Research and development                          1,425          2,586
      General and administrative                        2,999          4,012
       Total departmental expenses                     11,066         15,044
 
        EBITDA                                        (1,589)       (10,597)
 
      Depreciation                                        942            750
      Amortization of goodwill and intangibles          1,213          1,613
 
       Loss from operations                           (3,744)       (12,960)
 
      Interest expense                                (2,187)        (1,821)
 
       Loss before income taxes                       (5,931)       (14,781)
 
      Provision (benefit) for income taxes              (364)            220
 
       Net loss                                      ($5,567)      ($15,001)
 
 
      Basic and diluted net loss per share            ($0.45)        ($1.44)
 
      Shares used in computing basic and
       diluted net loss per share                      12,453         10,386
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X31567856
 
 SOURCE  RoweCom, Inc.