EX-99.1 2 g69307ex99-1.txt PRESS RELEASE DATED MAY 14, 2001 1 EXHIBIT 99.1 PRESS RELEASE Company Contact: IR Contact: ---------------- ----------- Stu Roberson Corey Cutler iPIX Morgen-Walke (925)242-4050 (212) 850-5696 stu.roberson@ipix.com ccutler@morgenwalke.com iPIX REPORTS FIRST QUARTER RESULTS Narrows Recurring Operating Loss to $0.18 per share - Secures Commitment for Financing SAN RAMON, CA, and OAK RIDGE, TN -- May 14, 2001--Internet Pictures Corporation (Nasdaq: IPIX; "iPIX"), today announced financial results for its first quarter ending March 31, 2001. Revenues for the first quarter were $9.5 million, compared to $8.3 million for the same quarter last year. Excluding merger expenses, restructuring and impairment expenses, extraordinary items, loss on the disposal of assets and non-cash charges related to stock-based compensation and goodwill amortization of intangible assets, net loss for the quarter was $11.4 million or $0.18 per share compared to a net loss of $18.9 million or $0.41 per share for the same period last year. iPIX(R) has made gains on the plans management announced in October 2000 to focus on higher margin revenue and address the costs associated with operating the full-service real estate business. During the first quarter of 2001, iPIX sold the sales and marketing rights and certain assets for the U.S. residential real estate market to Homestore.com(TM) for cash and recurring revenues. As a result of these efforts, gross margin for the quarter also improved to 50%, up from 42% for the same period last year. Jim Phillips, chairman and CEO of iPIX commented, "The strategies we put into place last October are beginning to bear fruit. We are committed to continuing improvements of gross margins and reaching profitability. iPIX dynamic imaging technology has achieved global brand recognition and leadership in key markets including real estate, travel and hospitality, and auctions." In a separate press release today, the Company also announced it has secured a commitment for up to $30 million in a private financing (see iPIX release, "iPIX Receives Investment Commitment Led by Paradigm Capital Partners and The Memphis Angels"). iPIX will hold a conference call regarding first quarter earnings and the recent financing at 10:00am EDT Monday, May 14. Interested parties may listen to the call by dialing (952) 556-2834 or (800) 960-1012. A replay of the call will be available starting May 14, until May 31, 2000 by dialing (703) 326-3020 or (800) 615-3210 and using pass code 5238317. 2 ABOUT IPIX Internet Pictures Corporation (iPIX(R)) provides Internet imaging solutions to facilitate commerce, communication and entertainment. The Company's end-to-end solutions include the capture, processing, management and distribution of digital imaging and the associated data to make the images meaningful. iPIX's solutions encompass many types of rich media content, including still images, 360(degree) by 360(degree) immersive images, video, animation, text and audio. A broad array of industries -- including real estate, auctions, travel, government, education, automotive, sports and entertainment -- are capitalizing on iPIX dynamic imaging to give viewers better information, more interaction and a richer online experience. Twenty-two of Media Metrix's top twenty-five web sites use iPIX to make their sites more dynamic. The company is headquartered in Oak Ridge, Tennessee, with co-headquarters in San Ramon, California. http://www.ipix.com ### Internet Pictures and iPIX are trademarks and service marks of Internet Pictures Corporation. The securities to be sold in the investment have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbors under those sections. In some cases, you can identify forward-looking statements by terminology such as "expect," "may," "will," "plans," and "anticipate," or the negative of such terms or comparable terminology. Forward-looking statements appearing herein include statements concerning operating and profitability plans and goals, restructuring efforts, and the timing and amount of private investment proceeds, and are based on current expectations. Actual results may differ materially from those projected in the forward-looking statements based upon a number of factors including (i) the inability to close on a portion of the proposed investment, (ii) changes in the demand for iPIX products and services, (iii) the loss of existing, or an inability to attract new, iPIX customers, (iv) technological changes, (v) general economic, financial or market changes or developments, and (vi) an inability to successfully implement restructuring and profitability plans. The matters discussed in this press release also involve risks and uncertainties described from time to time in Internet Pictures Corporation's filings with the Securities and Exchange Commission. In particular, see "Risk Factors" in the annual report filed on Form 10-K with the SEC on April 2, 2001 (www.sec.gov). 3 INTERNET PICTURES CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, ------------------------------- 2000 2001 ----------- ----------- (In thousands, except per share data) Revenues $ 8,283 $ 9,523 Cost of revenues 4,766 4,745 ----------- ----------- Gross profit 3,517 4,778 ----------- ----------- Operating expenses: Sales and marketing 15,507 9,719 Research and development 2,365 2,472 General and administrative 5,478 3,814 Stock-based compensation 2,774 1,218 Goodwill amortization -- 608 Restructuring and impairment -- 3,000 Loss on disposal of assets -- 1,769 Merger expenses 15,175 -- ----------- ----------- Total operating expenses 41,299 22,600 ----------- ----------- Loss from operations (37,782) (17,822) Interest and other income, net 892 (187) ----------- ----------- Net loss before extraordinary gain (36,890) (18,009) Extraordinary gain -- 901 Net loss $ (36,890) $ (17,108) =========== =========== Basic and diluted net loss per common share $ (0.79) $ (0.27) =========== =========== Shares used to calculate net loss per share 46,645 63,677 =========== =========== Net loss, excluding merger expenses, restructuring and impairment expenses, extraordinary items, loss on the disposal of assets and non-cash charges related to stock-based compensation and goodwill amortization $ (18,941) $ (11,414) =========== =========== Basic and diluted net loss per common share, excluding merger expenses, restructuring and impairment expenses extraordinary items, loss on the disposal of assets and non-cash charges related to stock-based compensation and goodwill amortization $ (0.41) $ (0.18) ----------- -----------
4 INTERNET PICTURES CORPORATION CONSOLIDATED BALANCE SHEETS
DECEMBER 31, MARCH 31, 2000 2001 ----------- ----------- (In thousands) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 5,322 $ 6,718 Securities available-for-sale 5,713 -- Accounts receivable, net 13,732 9,677 Inventory, net 1,061 734 Prepaid expenses and other current assets 6,790 3,807 ----------- ----------- Total current assets 32,618 20,936 Property and equipment, net 20,965 7,608 Other assets 1,555 397 Goodwill and other intangible assets 5,476 4,868 ----------- ----------- Total assets $ 60,614 $ 33,809 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 4,077 $ 6,668 Accrued liabilities 16,682 12,323 Deferred revenue 9,077 1,384 Current portion of promissory note and obligations under capital lease 1,608 1,584 ----------- ----------- Total current liabilities 31,444 21,959 ----------- ----------- Promissory note and obligations under capital lease, net of current portion 957 455 STOCKHOLDERS' EQUITY 28,213 11,395 ----------- ----------- Total liabilities and stockholders' equity $ 60,614 $ 33,809 ----------- -----------