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Rediff.com Reports Results For The Third Fiscal Quarter Ended December 31, 2012

“While broadband growth in India continues to progress, albeit at a slow pace, the mobile user base in India is growing fast and holds vast potential for our Company. As per Nielsen Informate Mobile Insight, there are already 27 million smartphone users in urban India and this market has grown rapidly. As a part of our strategy of positioning Rediff for future growth, we are focusing our efforts to drive usage of our services among mobile phone users, in addition to our traditional internet offerings. As a step in this direction, our popular services including Mail and News are now available in the form of mobile applications on leading operating systems such as Android, iOS, Blackberry, Windows, Symbian and Java,” Mr. Balakrishnan continued.

The Company reported an Operating EBITDA loss of $2.0 million for the 2012 fiscal third quarter as compared to an Operating EBITDA loss of $1.73 million in the comparable year-ago period.

The Company also reported a net loss of $3.0 million for the 2012 fiscal third quarter, including a non-cash goodwill impairment charge of $2.0 million arising from our acquisition of the print newspaper “India Abroad” in the United States in 2001, offset by a one time gain of US$ 1.4 million from the sale of an investment. The charge does not impact our cash or liquidity position.

(Operating EBITDA is a non-GAAP financial measure. Please see further below in a tabular form in this release, the reconciliation of Operating EBITDA to net income.)

Further details of Rediff.com’s results for the third fiscal quarter ended December 31, 2012 are appended in tabular form to this press release. A script of the earnings results conference call held on January 24, 2013 will also be made available on Rediff’s Investor Information website at investor.rediff.com.

About Rediff.comRediff.com (NASDAQ: REDF) is one of the premier worldwide online providers of news, information, communication, entertainment and shopping services to Indians worldwide. Founded in 1996, Rediff.com is headquartered in Mumbai, India with offices in New Delhi, India and New York, USA.

Safe Harbor

Except for historical information and discussions contained herein, statements included in this release may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and reflect our current expectations. Forward-looking statements are identified by certain words or phrases such as "may," "will," "aim," "will likely result," "believe," "expect," "will continue," "anticipate," "estimate," "intend," "plan," "contemplate," "seek to," "future," "objective," "goal," "project," "should," "will pursue" and similar expressions or variations or negatives of such expressions. 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 economies worldwide and in the sectors in which our clients are based, the slowdown in Internet and IT sectors worldwide, competition, the success of our past and future acquisitions, attracting, recruiting and retaining highly skilled employees, technology, acceptance of new products and services, the development of broadband Internet and 3G networks in India, legal and regulatory policies, managing risks associated with customer products and the widespread acceptance of the Internet as well as other risks detailed in the annual report on Form 20-F and other 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 the Company's filings with the U.S. Securities and Exchange Commission and our 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 or on behalf of the Company.

STATEMENT OF OPERATIONS

QUARTER ENDED DECEMBER 31, 2012

 

(All figures are in US$ millions, unless otherwise indicated below)

 
    Quarter ended December 31
    2012   2011
Revenues        
India Online   3.20   3.89
US Publishing   0.77   0.92
Total Revenues   3.97   4.81
Cost of Revenues *   (2.45)   (2.54)
Gross Margin   1.52   2.27
Gross Margin %   38%   47%
Operating Expenses *   (3.52)   (4.00)
Operating EBITDA   (2.00)   (1.73)
Depreciation / Amortization   (0.93)   (0.81)
Interest Income   0.51   0.56
Other Income (refer note below)   1.41   0.83
Goodwill impairment charge   (2.00)   -
Foreign Exchange gain (loss)   0.01   (0.04)
Equity in net loss of equity method investee   -   (0.01)
Net loss before income taxes   (3.00)   (1.20)
Tax   -   -
Net loss (refer to note below)   (3.00)   (1.20)
Net loss per ADS (in US dollars)   (0.109)   (0.043)
Net loss per ADS (in US dollars) diluted   (0.109)   (0.043)
         
Weighted average ADS Outstanding (in millions)   27.59   27.59
         
* Stock based Compensation included in:        
Cost of revenue   0.01   0.01
Operating expenses   0.15   0.21
 

Notes

  • Each ADS represents one half of an equity share.
  • The above numbers are subject to audit. An audit could result in adjustments which would result in the audited numbers varying from the numbers set forth above.
  • The company established an ESOP trust for the benefit of employees, which has acquired 1,015,000 shares (equivalent to 2,030,000 ADSs). These shares are treated as treasury stock and therefore are excluded from the EPS calculations.
  • During the quarter ended December 31, 2012 the company exited from one of its equity investments, which accounted for a one time gain from the sale of the investment of US$ 1.4 million included under the heading Other Income.

Non-GAAP Measures Note

Operating EBITDA and non-GAAP operating expenses are the non-GAAP measures in this press release. These measurements are not recognized under generally accepted accounting principles (“GAAP”).

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