Preliminary results for first quarter of 2012

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Nuremberg, Amsterdam, April 23, 2012 – ad pepper media International N.V. started the new financial year with subdued sales growth of 3.5 percent to EUR 13,313k in the first quarter of 2012 (Q1 2011: EUR 12,859k). This was mainly due to developments in the ad pepper media segment, which fell short of expectations. Sales here suffered from the sudden collapse in the display market, falling by EUR 1,320k, or 21.6 percent, to EUR 4,780k. This development underlines the importance of the investments made in ad pepper media’s real-time advertising platform adEXplorer, which the company expects to significantly improve its market position in the medium term.
Sales in the Webgains segment grew year-on-year by 7.6 percent, or EUR 373k, to EUR 5,260k, while the ad agents segment once again posted substantial sales growth of EUR 1,400k, or 74.8 percent, to EUR 3,273k.

Despite the Group’s slight sales growth, the segment-specific margin structure led to a decline in gross profit, which fell around 5.2 percent, or EUR 283k, short of the equivalent figure for the previous year (Q1 2011: EUR 5,410k). As a percentage of sales, the gross margin declined correspondingly to 38.5 percent (Q1 2011: 42.1 percent).

Thanks to substantial reductions in operating expenses, it was possible to more than offset the lower margin. Operating expense cuts totaling EUR 613k, or 9.2 percent were achieved in the first three months (Q1 2011: EUR 6,635k), thus enabling the company to post a significant year-on-year improvement in its key profitability figures. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to EUR -778k in the first quarter of 2012 (Q1 2011: EUR -1,090k). Earnings before interest and taxes (EBIT) amounted to EUR -896k, as against EUR -1,225k in the previous year’s quarter. Earnings before taxes (EBT) showed a particularly marked improvement, and amounted to EUR -551k in the first three months of the financial year (Q1 2011: EUR -936k). Net income for the period amounted to EUR -691k (Q1 2011: EUR -1,151k).

Liquid funds (including securities measured at fair value and time deposits) fell to EUR 16,811k (31 March 2011: EUR 21,061k). Compared with the end of 2011, however, this corresponds to growth of 3.5 percent (31 December 2011: EUR 16,247k). The company still has no liabilities to banks. The equity ratio remained stable at 70.2 percent (31 March 2011: 72.5 percent).

The report on the first quarter of 2012 will be published on May 8, 2012.

Year-on-year comparison of key figures (unaudited):

Q1 2012 Q1 2011 % change
Sales EUR000s 13,313 12,859 +3.5
Gross margin EUR000s 5,127 5,410 -5.2
EBITDA EUR000s -778 -1,090 -28.6
EBIT EUR000s -896 -1,225 -26.9
EBT EUR000s -551 -936 -41.1
net income
EUR000s -691 -1,151 -40.0
EUR -0.04 -0.06 -33.3
03.31.12 03.31.11   
Liquid funds EUR000s 16,811 21,061 -20.2
Equity EUR000s 23,406 25,241 -7.3
Total assets EUR000s 33,352 34,822 -4.2

For more information:
Jens Körner (CFO)
ad pepper media International N.V.
phone: +49 (0) 911 929057-0
fax: +49 (0) 911 929057-157