Rediff.com India Limited (NASDAQ: REDF), one of the leading worldwide online providers of news, information, communication, entertainment and shopping services to Indians worldwide, today announced its financial results for the second quarter ended September 30, 2007.
Performance Highlights :
Financial Results for the Quarter Ended September 30, 2007
-- Revenues for the quarter ended September 30, 2007 totaled US$7.86 million, an increase of 18% over revenues from the quarter ended September 30, 2006.
-- India Online revenues, which include advertising and fee-based revenues, for the quarter ended September 30, 2007 totaled US$5.73 million, an increase of 22% compared to India Online revenues for the quarter ended September 30, 2006.
-- US Publishing revenues for the quarter ended September 30, 2007 totaled US$2.13 million, an increase of 9% over US Publishing revenues for the quarter ended September 30, 2006.
-- Gross margins increased to 82% for the quarter ended September 30, 2007, compared to 80% for the quarter ended September 30, 2006.
-- Operating EBITDA decreased marginally to US$1.04 million for the quarter ended September 30, 2007, compared to US$1.14 million for the quarter ended September 30, 2006.
-- Net income for the quarter ended September 30, 2007 was US$0.89 million, or 3.04 cents per ADS, compared to a net income of US$1.50 million, or 5.14 cents per ADS, for the quarter ended September 30, 2006.
Registered Users
-- Registered users grew to 59.8 million as of September 30, 2007, a 25% increase over the number of registered users as of September 30, 2006.
Advertising Revenues
-- Highlights and trends for the India Online advertising business include:
1. The number of companies advertising on Rediff’s website for the quarter ended September 30, 2007 totaled approximately 190, as compared to approximately 160 during the same quarter in the prior fiscal year.
2. The following five industry categories accounted for 56% of the Company’s advertising revenues for the quarter ended September 30, 2007: Consumer Finance, Employment, Travel, Matrimonial and Insurance.
3. For the quarter ended September 30, 2007, the top 10 advertisers contributed approximately 45% of advertising revenue for the India Online advertising business, compared to 57% during the same period in the prior fiscal year.
Product Innovation
-- The Company’s video platform iShare launched last quarter has gathered momentum. The Company continued to enhance the platform: a new video and audio player with auto play, facility to view videos in full screen mode and a lighter version of the iShare client are some of the new features added.
The Company is beta testing Rediff Language Search in eight Indian languages. It allows users to enter Indian language queries using QWERTY keyboards and obtain results in their desired language.
-- The Company enhanced its Consumer Finance Channel, Moneywiz with Market Voices, a live running commentary. This commentary is updated every few minutes during the trading hours of the Indian stock markets.
Financial Results
Revenues
Revenues for the quarter ended September 30, 2007 increased by 18% to US$7.86 million, as compared to US$6.66 million in the same quarter last fiscal year.
Revenues from India Online, which comprised online advertising and fee-based services, increased by 22% to US$5.73 million during the quarter ended September 30, 2007 compared to US$4.71 million during the same quarter last fiscal year.
Revenues from US Publishing for the quarter ended September 30, 2007 increased by 9% to US$2.13 million from US$1.95 million during the same quarter last fiscal year.
Gross Margin
Gross margins increased to 82% for the quarter ended September 30, 2007 as compared to 80% for the quarter ended September 30, 2006.
Operating Expenses
Operating expenses increased by 29% to US$5.39 million for the quarter ended September 30, 2007, compared to US$4.19 million for the same quarter last fiscal year, primarily due to higher product development and general and administrative costs. Operating expenses for the quarter ended September 30, 2007 included a charge of US$0.41 million on account of stock-based compensation cost compared to US$0.23 million for the same quarter last year.
Operating EBITDA
Operating EBITDA decreased marginally to US$1.04 million for the quarter ended September 30, 2007 as compared to an Operating EBITDA of US$1.14 million for the corresponding quarter last fiscal year.
Depreciation, Interest Income and Foreign Exchange
Depreciation and amortization expenses increased to US$1.46 million for the quarter ended September 30, 2007 compared to US$0.60 million for the same quarter last fiscal year.
Interest income increased to US$1.44 million for the quarter ended September 30, 2007 compared to US$0.91 million for the same quarter last fiscal year.
There was a foreign exchange loss of US$0.12 million during the quarter ended September 30, 2007 arising from the conversion of cash deposits and other balances held in US Dollars into the Company’s functional currency (the Indian Rupee) for financial reporting purposes due to the strengthening of the Indian Rupee against the US Dollar.
Net Income
Net income for the quarter ended September 30, 2007 was US$0.89 million, or 3.04 cents per ADS, compared to a net income of US$1.50 million, or 5.14 cents per ADS, for the same quarter last fiscal year.
Total cash and cash equivalents and short term deposits with banks as of September 30, 2007 was approximately US$59.1 million.
About Rediff.com
Rediff.com (NASDAQ: REDF) is one of the premier worldwide online providers of news, information, communication, entertainment and shopping services to Indians worldwide. Rediff.com provides a platform for Indians worldwide to connect with one another online. Founded in 1996, Rediff.com is headquartered in Mumbai, India with offices in New Delhi and New York, USA.
Safe Harbor
Except for historical information and discussions contained herein, statements included in this release may constitute “forward-looking statements.” These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those that may be projected by these forward looking statements. These risks and uncertainties include but are not limited to the slowdown in the U.S. and Indian economies and in the sectors in which our clients are based, the slowdown in the Internet and IT sectors world-wide, competition, success of our past and future acquisitions, attracting, recruiting and retaining highly skilled employees, technology, legal and regulatory policy, managing risks associated with customer products, the wide spread acceptance of the Internet as well as other risks detailed in the reports filed by Rediff.com India Limited with the U.S. Securities and Exchange Commission. Rediff.com India Limited and its subsidiaries may, from time to time, make additional written and oral forward-looking statements, including statements contained in its filings with the U.S. Securities and Exchange Commission and its reports to shareholders. Rediff.com India Limited does not undertake to update any forward-looking statement that may be made from time to time by it or on its behalf.
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