8-K 1 form8k.txt FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of Earliest Event Reported) July 29, 2003 Medialink Worldwide Incorporated (Exact Name of Registrant as Specified in Its Charter) Delaware 52-1481284 (State or Other Jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 708 Third Avenue, New York, NY 10017 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (212)682-8300 -------------------------------------------------------------------------------- Registrant's telephone number, including area code Item 9. Regulation FD Disclosure The Registrant furnishes, pursuant to Regulation FD, its earnings news release dated July 29, 2003, entitled "Medialink 2003 Second Quarter Revenue Exceeds Guidance," a copy of which is below. Medialink FOR IMMEDIATE RELEASE For more information: Ryan Barr Director of Corporate Development and Communications Medialink Worldwide Inc. (212) 682-8300 rbarr@medialink.com MEDIALINK 2003 SECOND QUARTER REVENUE EXCEEDS GUIDANCE NEW YORK, July 29, 2003 - Medialink Worldwide Incorporated (Nasdaq: MDLK), a global leader in corporate media communications services, today announced that revenue for the second quarter ended June 30, 2003, exceeded the Company's guidance. Revenue for the second quarter ended June 30, 2003, was $11.7 million compared to $12.8 million for the comparable period in 2002, and above the $11 million to $11.5 million guidance the Company issued on April 29, 2003. Net loss for the second quarter was $598,000, or $0.10 per share, compared to a net loss of $244,000, or $0.04 per share. Loss before Interest, Taxes, Depreciation and Amortization was $53,000 for the quarter, compared to a profit of $698,000 in the same period in 2002. Operating Cash Flow, defined as Earnings before Interest, Taxes, Depreciation, and Amortization (EBITDA), not including loss from Teletrax(TM), was $587,000 for the quarter, compared to $916,000 in the same period in 2002. Selling, general and administrative costs include approximately $432,000 attributable to employee termination costs during the second quarter of 2003. Medialink considers EBITDA and Operating Cash Flow to be important financial indicators of the Company's operational strength, performance of its business and ability to service its line of credit, as well as to make new investments in its existing services. Revenue for the six months ended June 30, 2003, was $22.7 million compared to $23.9 million for the comparable period in 2002. Net loss for the six-month period was $1.3 million or $0.21 per share, as compared to a net loss of $941,000, or $0.16 per share in 2002. Loss before Interest, Taxes, Depreciation and Amortization was $203,000 for the six-month period, compared to a profit of $540,000 in the same period in 2002. Operating Cash Flow, defined as EBITDA, not including loss from Teletrax(TM), was $1.0 million for the six-month period, compared to $758,000 for the same period in 2002. "We are pleased to report that second quarter revenue exceeded our previous guidance and we are beginning the second half of 2003 with an enviable market position, which we will build upon to deliver even greater value to our clients," stated Laurence Moskowitz, Chairman, President and Chief Executive Officer of Medialink. "Our gross margin performance illustrates how we continue to effectively control our costs, even as we upgraded our service offerings and substantially completed the rollout of Teletrax, the first global video broadcast tracking service, for the news and entertainment industries." "Teletrax will be a key growth driver for Medialink as we were monitoring 550 channels globally at the end of the quarter compared to 175 at the end of 2002," Moskowitz added. "This deployment allows us to accelerate our marketing campaign, expanding the use of digital watermarking to monitor and track the usage of news and programming content broadcast by television networks and stations around the world." For the second quarter ended June 30, 2003, Teletrax recorded revenue, excluding Teletrax related equipment sales, of $114,000 compared to $63,000 for the second quarter in 2002. Loss from Teletrax operations, excluding depreciation and amortization, was $640,000 for the second quarter of 2003 compared to $218,000 in 2002. "While the public relations marketplace remains challenged, our existing and developing services provide for significant competitive advantages for our Broadcast Group, as well as Delahaye, our market-leading communications research company, and our U.S. Newswire division, the leading national wire service for distributing government and public interest news," added J. Graeme McWhirter, Executive Vice President and Chief Financial Officer. "Medialink is committed to offering the industry's most comprehensive suite of services and we will continue to introduce new and enhanced media communications solutions throughout the remainder of 2003 and moving forward as we maintain our position as the industry leader and innovator." "Medialink's goal has always been to be the first choice of every public relations agency and communications executive, however, with the cross-industry acceptance of Teletrax, we have begun to penetrate the news and entertainment industries as well," concluded Moskowitz. "For the third quarter ending September 30, 2003, historically a seasonally softer quarter than the second, we expect to report revenue in the range of $10.25 million to $10.75 million." Medialink will host a teleconference and a simultaneous webcast at 11:00 a.m. Eastern Time today to discuss the Company's second quarter financial results. To access the teleconference, please dial 11-800-613-4984 (domestic) or 1-706-643-7872 (international) or listen to it live via the Internet by accessing the Company's Web site (www.medialink.com). About Medialink: Medialink (www.medialink.com) is a global leader in providing comprehensive and compelling multimedia communication solutions and services for more than 3,000 corporations and other organizations seeking to communicate news to their audiences through television, radio, print and the Internet. The company provides production and satellite distribution of video and audio news, multimedia webcasting services, press release newswire distribution, photography production and digital distribution, and strategic corporate communications consulting. Medialink also provides media monitoring and analysis and public relations research to help clients determine return on investment from their communications efforts. Based in New York, Medialink has 12 offices worldwide including an international hub in London. For additional investor and financial information, please visit the recently launched Investor Relations section of the Company's Web site (www.medialink.com). # # # With the exception of the historical information contained in the release, the matters described herein contain certain "forward-looking statements" that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. These statements are based on management's current expectations and are naturally subject to uncertainty and changes in circumstances. We caution you not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Actual results may vary materially from those expressed or implied by the statements herein. Such statements may relate, among other things, to our ability to respond to economic changes and improve operational efficiency, the benefits of our products to be realized by our customers, or our plans, objectives, and expected financial and operating results. Forward-looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances or using words such as: will, believe, anticipate, expect, could, may, estimate, project, plan, predict, intend or similar expressions that involve risk or uncertainty. These risks and uncertainties include, among other things, our recent history of losses, our ability to achieve or maintain profitability; worldwide economic weakness; geopolitical conditions and continued threats of terrorism; effectiveness of our cost reduction programs; our ability to develop new services and market acceptance of such services, such as Teletrax; the volume and importance of breaking news which can have the effect of crowding out the content we produce and deliver to broadcast outlets on behalf of our clients; our ability to develop new products and services that keep pace with technology; our ability to develop and maintain successful relationships with critical vendors; the potential negative effects of our international operations on the Company; future acquisitions or divestitures may adversely affect our operations and financial results; the absence of long term contract with customers and vendors; and increased competition may have an adverse effect on pricing, revenues, gross margins and our customer base. More detailed information about these risk factors is set forth in filings by Medialink Worldwide Incorporated with the Securities and Exchange Commission, including the Company's registration statement, most recent quarterly report on Form 10-Q, most recent annual report on Form 10-K and other publicly available information regarding the Company. Medialink Worldwide Incorporated is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise. (Please See Attached Financial Tables) MEDIALINK WORLDWIDE INCORPORATED AND SUBSIDIARIES Summary Financial Information (In thousands except per share data) (unaudited)
For the three Months Ended June 30, ----------------------- 2003 2002 -------- -------- Revenue $ 11,694 $ 12,785 Direct costs 3,836 4,569 -------- -------- Gross profit 7,858 8,216 Selling, general and administrative costs 8,404 8,262 Loss from Joint Venture 87 75 -------- -------- Operating loss (633) (121) Interest expense, net (65) (41) -------- -------- Net loss before income taxes and other charges (698) (162) Income tax (benefit) expense (100) 82 -------- -------- Net loss $ (598) $ (244) ======== ======== Diluted loss per share $ (0.10) $ (0.04) Weighted average number of common shares outstanding and dilutive potential common shares 5,990 5,955 Supplemental financial information EBITDA (a) $ (53) $ 698 Depreciation and amortization 580 819 Operating cash flow (b) 587 916 Loss from Teletrax operations (net of $101,000 and $5,000, respectively, of depreciation and amortization) 640 218 Revenue Detail Media Communications Services 9,472 10,306 Media Research Services 2,049 2,358 Teletrax 173 121
(a) EBITDA is defined as earnings before interest, taxes, depreciation and amortization (b) Operating Cash Flow is defined as EBITDA, not including loss from Teletrax MEDIALINK WORLDWIDE INCORPORATED AND SUBSIDIARIES Summary Financial Information (In thousands except per share data) (unaudited)
For the six Months Ended June 30, ----------------------- 2003 2002 -------- -------- Revenue $ 22,654 $ 23,860 Direct costs 7,385 8,449 -------- -------- Gross profit 15,269 15,411 Selling, general and administrative costs 16,404 16,321 Loss from Joint Venture 187 175 -------- -------- Operating loss (1,322) (1,085) Interest expense, net (154) (74) -------- -------- Net loss before income taxes and other charges (1,476) (1,159) Income tax benefit (200) (218) -------- -------- Net loss $ (1,276) $ (941) ======== ======== Diluted loss per share $ (0.21) $ (0.16) Weighted average number of common shares outstanding and dilutive potential common shares 5,952 5,927 Supplemental financial information EBITDA (a) $ (203) $ 540 Depreciation and amortization 1,119 1,625 Operating cash flow (b) 1,002 758 Loss from Teletrax operations (net of $162,000 and $5,000, respectively, of depreciation and amortization) 1,205 218 Revenue Detail Media Communications Services 18,054 19,057 Media Research Services 4,331 4,682 Teletrax 269 121
(a) EBITDA is defined as earnings before interest, taxes, depreciation and amortization (b) Operating Cash Flow is defined as EBITDA, not including loss from Teletrax MEDIALINK WORLDWIDE INCORPORATED AND SUBSIDIARIES Summary Financial Information (in thousands)
June 30, December 31, 2003 2002 ------- ------- (unaudited) (audited) ASSETS Current Assets: Cash and cash equivalents $ 3,056 $ 6,390 Accounts receivable, net 8,122 6,571 Prepaid expenses and other current assets 2,406 2,101 Prepaid and refundable income taxes 2,641 2,270 Deferred tax assets 199 199 ------- ------- Total current assets 16,424 17,531 ------- ------- Property and equipment, net 6,343 5,890 Goodwill, customer list and other intangibles, net 13,334 12,994 Investment in joint venture 495 682 Deferred tax assets 1,405 1,655 Other assets 1,369 1,892 ------- ------- Total assets $39,370 $40,644 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Current portion of long-term debt $ 14 $ 45 Line of credit - bank 6,000 6,537 Accounts payable and accrued liabilities 7,113 6,858 ------- ------- Total current liabilities and total liabilities 13,127 13,440 ------- ------- Stockholders' Equity 26,243 27,204 ------- ------- Total liabilities and stockholders' equity $39,370 $40,644 ======= =======
Supplemental Financial Information (In thousands) (unaudited) Reconciliation Between Net Loss to EBITDA and Operating Cash Flow For the three months Ended June 30, 2003 2002 ----------------- Net loss $(598) $(244) Depreciation and amortization 580 819 Interest expense, net 65 41 Income tax (benefit) expense (100) 82 ----------------- EBITDA (53) 698 Loss from Teletrax operations 741 223 Depreciation included in Teletrax operations (101) (5) ----------------- Operating cash flow $ 587 $ 916 ================= Supplemental Financial Information (In thousands) (unaudited) Reconciliation Between Cash Flows from Operating Activities to EBITDA and Operating Cash Flow For the three months Ended June 30, ----------------- 2003 2002 ----- ----- Net cash (used in) provided by operating activities $ (33) $ 259 Equity loss from joint venture (87) (75) Deferred income taxes (125) -- Changes in operating assets and liabilities 227 391 Interest expense, net 65 41 Income tax (benefit) expense (100) 82 ----- ----- EBITDA (53) 698 Loss from Teletrax operations 741 223 Depreciation included in Teletrax operations (101) (5) ----- ----- Operating cash flow $ 587 $ 916 ===== ===== Supplemental Financial Information (In thousands) (unaudited) Reconciliation Between Net Loss to EBITDA and Operating Cash Flow For the six months Ended June 30, 2003 2002 --------------------- Net loss $(1,276) $ (941) Depreciation and amortization 1,119 1,625 Interest expense, net 154 74 Income tax benefit (200) (218) --------------------- EBITDA (203) 540 Loss from Teletrax operations 1,367 223 Depreciation included in Teletrax operations (162) (5) --------------------- Operating cash flow $ 1,002 $ 758 ===================== Supplemental Financial Information (In thousands) (unaudited) Reconciliation Between Cash Flows from Operating Activities to EBITDA and Operating Cash Flow For the six months Ended June 30, 2003 2002 ----------------------- Net cash (used in) provided by operating activities $(1,384) $ 394 Equity loss from joint venture (187) (175) Deferred income taxes (250) -- Changes in operating assets and liabilities 1,664 465 Interest expense, net 154 74 Benefit from income taxes (200) (218) ----------------------- EBITDA (203) 540 Loss from Teletrax operations 1,367 223 Depreciation included in Teletrax operations (162) (5) ----------------------- Operating cash flow $ 1,002 $ 758 ======================= 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. Medialink Worldwide Incorporated (Registrant) /s/ J. Graeme McWhirter ------------------------------ Name: J. Graeme McWhirter Title: Chief Financial Officer August 4, 2003