-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Vt9MZW7XPdXcLEC9aFpuc87zbt0j3wuVYV5cXCFEK+0c/m1uldznJszBcxBRyHWX xR0HXPDHuGkV30MgBSW0uA== 0001104659-03-025327.txt : 20031110 0001104659-03-025327.hdr.sgml : 20031110 20031110152806 ACCESSION NUMBER: 0001104659-03-025327 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031110 ITEM INFORMATION: FILED AS OF DATE: 20031110 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OVERSTOCK COM INC CENTRAL INDEX KEY: 0001130713 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 870634302 STATE OF INCORPORATION: UT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-49799 FILM NUMBER: 03988223 BUSINESS ADDRESS: STREET 1: 6322 SOUTH 3000 EAST STREET 2: STE 100 CITY: SALT LAKE CITY STATE: UT ZIP: 84121 BUSINESS PHONE: 8019473100 MAIL ADDRESS: STREET 1: 6322 SOUTH 3000 EAST STREET 2: STE 100 CITY: SALT LAKE CITY STATE: UT ZIP: 84121 8-K 1 a03-5137_18k.htm 8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

 

November 10, 2003

Date of Report (date of earliest event reported)

 

Overstock.com, Inc.

(Exact name of Registrant as specified in its charter)

 

Delaware

000-49799

87-0634302

(State or other jurisdiction of
incorporation or organization)

(Commission File Number)

(I.R.S. Employer
Identification Number)

 

 

 

6322 South 3000 East, Suite 100
Salt Lake City, Utah 84121

(Address of principal executive offices)

 

 

 

(801) 947-3100

(Registrant’s telephone number, including area code)

 

 

 

(Former name or former address, if changed since last report)

 

 

 

Item 12. Results of Operations and Financial Condition

 

The attached Press Release discussing Overstock.com, Inc.’s 2003 3rd quarter results is furnished herewith as Exhibit 99.1. Pursuant to the rules and regulations of the Securities and Exchange Commission, such exhibit and the information set forth therein and herein shall be deemed “furnished” and not “filed” for purpose of Section 18 of the Securities Exchange Act of 1934, as amended, and such exhibit and information shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

 

 

Exhibit
Number

 

Description

 

 

 

99.1

 

Press Release issued October 30, 2003.

 

2

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

OVERSTOCK.COM, INC.

 

 

 

 

By:

/s/ David K. Chidester

 

 

David K. Chidester

 

 

Acting Chief Financial Officer

 

 

 

 

Date: November 10, 2003

 

3

 

EXHIBIT INDEX

 

Exhibit
Number

 

Description

 

 

 

99.1

 

Press Release issued October 30, 2003.

 

4

 EX-99.1 3 a03-5137_1ex99d1.htm EX-99.1

Exhibit 99.1

 

For Immediate Release

 

Investor Contact:
Kathryn Huang
Investor Relations
+1 (801) 947-3282
khuang@overstock.com

 

Media Contact:
Scott Blevins
Public Relations
+1 (801) 947-3133
sblevins@overstock.com

 

OVERSTOCK.COM ANNOUNCES 3Q 2003 FINANCIAL RESULTS

 

•         Gross merchandise sales: $61.0 million, up 57% year-over-year, 19% sequentially

 

•         GAAP revenue: $57.8 million

 

•         Expenses increased due to completion of infrastructure scaling and first national radio and television advertising campaign

 

•         GAAP loss: $3.7 million

 

SALT LAKE CITY, Utah—October 29, 2003—Overstock.com® (Nasdaq: OSTK) today announced financial results for the third quarter ended September 30, 2003.

 

The Company reported year-over-year gross merchandise sales grew 57% to $61.0 million this quarter from $38.8 million for the same period last year. GAAP total revenue was $57.8 million for the quarter. Net loss for the third quarter was $3.7 million or $0.23 loss per share compared to $371,000 or $0.03 loss per share a year earlier.

 

“While our revenue took a sharp turn upward this quarter, I am concerned by our loss; however, much of our incremental expenses during the quarter reflect investments in the business that I believe make us a much stronger company,” said Patrick M. Byrne, president and CEO of Overstock.com.

 

“Clearly I executed poorly in some areas: we have addressed our internal processes and I will discuss these in detail in the call. In addition, my decision to super-size our systems to support growth creates drag on gross margins at our current size. Lastly, in the Q2 conference call I alluded to four Q3 projects: the first three were a new search engine, our first nationwide radio and television advertising campaign, and a travel tab (alas, the fourth project is not quite ready to be unveiled). I believe the investments we made this quarter in scale and in these projects are the right decisions for creating long-term shareholder value.”

 

2

 

More information about the strategic initiatives mentioned above can be found at the following links:

 

Overstock.com Announces Second Quarter Results

http://www.shareholder.com/overstock/ReleaseDetail.cfm?ReleaseID=115177

 

Overstock.com Enhances Website with Advanced Search Technology

http://www.shareholder.com/overstock/ReleaseDetail.cfm?ReleaseID=118681

 

Overstock.com Launches National Advertising Campaign

http://www.shareholder.com/overstock/ReleaseDetail.cfm?ReleaseID=119733

 

Overstock.com Launches Discount Travel Store

http://www.shareholder.com/overstock/ReleaseDetail.cfm?ReleaseID=119920

 

Key financial and operating metrics

Note: Due to a change in Overstock.com customer return policies and procedures announced last quarter, we will record revenue from sales transactions from our fulfillment partners on a gross basis instead of on a net basis. As a result, GAAP revenue increased significantly and gross margins decreased significantly this reporting period compared to previous reporting periods. Therefore, gross merchandise sales comparisons year-over-year may be more relevant than GAAP revenue comparisons. Moreover, we believe gross profit dollar comparisons year-over-year may be more relevant than gross margin comparisons.

 

GAAP total revenue – Overstock.com reported GAAP revenue of $57.8 million for the three-month period ending September 30, 2003.

 

GAAP gross profit – Overstock.com reported GAAP gross profit of $4.3 million for the three-month period ending September 30, 2003, a 7% decrease compared to the $4.6 million recorded in the same period a year ago.

 

GAAP gross margins – GAAP gross margins were 7% for the three-month period ending September 30, 2003.

 

GAAP net loss – Overstock.com reported a GAAP net loss of $3.7 million or $0.23 loss per share for the three-month period ending September 30, 2003, compared to $371,000 million or $0.03 loss per share for the same period a year earlier.

 

Overstock.com had cash and marketable securities of $20.7 million as of September 30, 2003.

 

Gross merchandise sales (non-GAAP) – Overstock.com reported gross merchandise sales (GMS) of $61.0 million for the third quarter 2003, a 57% increase over the $38.8 million GMS reported for the

 

3

 

third quarter 2002, and a 19% increase over the $51.3 million GMS reported in the second quarter 2003.

 

Gross merchandise sales represents the gross sales price of all sales transactions, including those for which the company only records a commission under generally accepted accounting principles, and therefore differs from GAAP revenue. The following table reconciles total revenue to gross merchandise sales:

 

 

 

Three months ended
(millions)

 

 

 

Sept. 30,
2002

 

Sept. 30,
2003

 

Total revenue

 

$

23.8

 

$

57.8

 

Add: Obligations payable to third parties upon sale of third-party merchandise

 

$

12.5

 

—

 

Add: Sales returns and discounts

 

$

2.5

 

$

3.2

 

Gross merchandise sales (non-GAAP)

 

$

38.8

 

$

61.0

 

 

About Overstock.com

 

Overstock.com Inc. is an online “closeout” retailer offering discount, brand-name merchandise for sale over the Internet. The company offers its customers an opportunity to shop for bargains conveniently, while offering its suppliers an alternative inventory liquidation distribution channel. Overstock.com is a publicly traded company listed on the NASDAQ National Market System, headquartered in Salt Lake City, and can be found online at www.overstock.com.

 

# # #

 

Overstock.com is a registered trademark of Overstock.com, Inc.

 

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, statements regarding the company’s strength and growth, future performance and value for customers and shareholders, and customer service enhancements. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ, including, but not limited to, our limited operating history, our ability to manage growth, a general downturn in economic conditions, and such other risks as identified in our Prospectus dated May 29, 2002, filed with the Securities and Exchange Commission and all subsequent filings with the Securities and Exchange Commission, including our Form 10- K for the year ended December 31, 2002, and our Prospectus dated February 12, 2003, which contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

 

4

 

Overstock.com, Inc.

Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

 

 

Three months ended

 

 

 

Sept. 30,
2002

 

Dec. 31,
2002

 

Mar. 31,
2003

 

Jun. 30,
2003

 

Sept. 30,
2003

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct revenue

 

$

20,759

 

$

35,302

 

$

24,962

 

$

25,159

 

$

29,011

 

Commission revenue

 

2,857

 

5,633

 

3,966

 

3,431

 

28,504

 

Warehouse revenue

 

192

 

594

 

236

 

243

 

273

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

23,808

 

41,529

 

29,164

 

28,833

 

57,788

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

19,238

 

32,382

 

24,539

 

24,030

 

53,537

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

4,570

 

9,147

 

4,625

 

4,803

 

4,251

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing expenses

 

2,083

 

4,054

 

3,848

 

2,572

 

3,855

 

General and administrative expenses

 

2,372

 

3,456

 

4,545

 

3,367

 

4,059

 

Amortization of stock-based compensation

 

674

 

577

 

328

 

112

 

171

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

5,129

 

8,087

 

8,721

 

6,051

 

8,085

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

(559

)

1,060

 

(4,096

)

(1,248

)

(3,834

)

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

229

 

103

 

152

 

142

 

98

 

Interest expense

 

(7

)

(10

)

(7

)

(55

)

(8

)

Other income (expense), net

 

63

 

(66

)

10

 

25

 

79

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

(274

)

1,087

 

(3,941

)

(1,136

)

(3,665

)

Deemed dividend related to redeemable common stock

 

(97

)

(92

)

(77

)

(78

)

(59

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to common shares

 

$

(371

)

$

995

 

$

(4,018

)

$

(1,214

)

$

(3,724

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

 

 

 

 

 

 

 

 

 

 

- basic

 

$

(0.03

)

$

0.07

 

$

(0.26

)

$

(0.07

)

$

(0.23

)

- diluted

 

$

(0.03

)

$

0.06

 

$

(0.26

)

$

(0.07

)

$

(0.23

)

Weighted average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

- basic

 

14,447

 

14,486

 

15,486

 

16,384

 

16,419

 

- diluted

 

14,447

 

15,696

 

15,486

 

16,384

 

16,419

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of total revenue (GAAP) to gross merchandise sales (non-GAAP)

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

$

23,808

 

$

41,529

 

$

29,164

 

$

28,833

 

$

57,788

 

Add: Obligations payable to third parties upon sale of third-party merchandise

 

12,488

 

21,969

 

20,527

 

19,399

 

—

 

Add: Sales returns and discounts

 

2,476

 

3,719

 

2,579

 

3,083

 

3,230

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross merchandise sales (non-GAAP)

 

$

38,772

 

$

67,217

 

$

52,270

 

$

51,315

 

$

61,018

 

 

5

 

Overstock.com, Inc.

Consolidated Statements of Operations

(in thousands, except per share amounts)

 

 

 

Nine months ended September 30,

 

 

 

2002

 

2003

 

 

 

 

 

 

 

Direct revenue

 

$

42,641

 

$

79,132

 

Commission revenue

 

6,746

 

35,901

 

Warehouse revenue

 

868

 

752

 

 

 

 

 

 

 

Total revenue

 

50,255

 

115,785

 

 

 

 

 

 

 

Cost of goods sold

 

41,059

 

102,106

 

 

 

 

 

 

 

Gross profit

 

9,196

 

13,679

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Sales and marketing expenses

 

4,615

 

10,275

 

General and administrative expenses

 

7,369

 

11,971

 

Amortization of stock-based compensation

 

2,326

 

611

 

 

 

 

 

 

 

Total operating expenses

 

14,310

 

22,857

 

 

 

 

 

 

 

Operating loss

 

(5,114

)

(9,178

)

 

 

 

 

 

 

Interest income

 

300

 

392

 

Interest expense

 

(455

)

(70

)

Other income (expense), net

 

(378

)

114

 

 

 

 

 

 

 

Net loss

 

(5,647

)

(8,742

)

 

 

 

 

 

 

Deemed dividend related to redeemable common stock

 

(314

)

(214

)

Deemed dividend related to beneficial conversion feature of preferred stock

 

(6,607

)

—

 

 

 

 

 

 

 

Net loss attributable to common shares

 

$

(12,568

)

$

(8,956

)

 

 

 

 

 

 

Net loss per common share

 

$

(0.99

)

$

(0.56

)

Weighted average common shares outstanding

 

12,644

 

16,100

 

 

Overstock.com, Inc.

Consolidated Balance Sheet Data

(in thousands)

 

 

 

December 31,
2002

 

September 30,
2003

 

 

 

 

 

 

 

Cash and marketable securities

 

$

32,662

 

$

20,714

 

Inventories, net

 

13,954

 

24,945

 

Working capital

 

35,679

 

49,459

 

Total liabilities

 

20,322

 

14,088

 

Total stockholders’ equity

 

39,271

 

57,553

 

 

6

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