Press Release in accordance with CONSOB Regulation No. 11971/1999 and subsequent modifications
RESULTS FOR SECOND QUARTER 2006:
REVENUES INCREASE TO EURO 26.1 MILLION
(+69.5% compared to Q2 2005)
37% OF REVENUES FROM DADA’S INTERNATIONAL BUSINESS
EBITDA INCREASES TO EURO 3.8 MILLION (EQUAL TO 15% OF REVENUES)
* Consolidated revenues of Euro 26.1 million (Euro 15.4 million in Q2 2005)
* EBITDA of Euro 3.8 million (Euro 3.3 million in Q2 2005), equal to 15% of revenues
* EBIT of Euro 2.8 million (Euro 2.4 million in Q2 2005), equal to 11% of revenues
* Net financial position of Euro 23.1 million
* Over 15 thousand people worldwide subscribe to Dada’s fee-based community and entertainment services everyday through the Dada.net brand, www.dada.net
* International business accounts for over 37% of consolidated sales, resulting from the expansion of the community and entertainment services into the USA, Germany, Spain, Portugal, the United Kingdom, France, Belgium, Austria, China, Brazil and Australia.
Florence, July 28, 2006 - The Board of Directors of Dada (MTAX of Borsa Italiana: DA.MI), under the chairmanship of Paolo Barberis, today approved the Quarterly Report as at June 30, 2006.
Dada (http://dada.dada.net) is the Italian leader and one of the most important worldwide players in the web and mobile community and entertainment market.
In the second quarter, Dada’s international presence grew significantly - increasing revenues from international business to 37% of consolidated sales (in the second quarter of 2005, when Dada started its international expansion, this accounted for only 1% of sales).
Dada’s services are today located in the USA, Germany, Spain, Portugal, the United Kingdom, France, Belgium, Austria, China, Brazil and Australia.
Dada’s services are provided through the brand Dada.net (www.dada.net) which includes life.dada.net, mobi.dada.net and love.dada.net and offers its customers a rich range of fee-based community & entertainment products and services, accessible both via PC and mobile phone (the latter through the SMS/MMS channel and on the “Decks” - the micro-portals of the main mobile phone operators).
The strength of Dada’s services worldwide comes from the convergence of a large number of applications, from Entertainment/Infotainment to Social Networking and Dating, in a single all inclusive subscription, accessible via web and mobile, together with a rich library of content.
In this context, love.dada.net (http://love.dada.net) represents the development from Incontri by SuperEva.com, the leading dating portal in Italy, with over 2.7 million users worldwide.
Mobi.dada.net (http://mobi.dada.net) represents the mobile offer of Dada, consisting of a wide range of added value services for mobile phone personalisation and entertainment and is currently present in 10 countries.
Life.dada.net (http://life.dada.net) is the ideal space where users can freely express themselves, publish and share writings, photos, video and chat not only via pc but also via mobile.
Having recently renewed its technology, the original portal of Dada superEva.it remains an all-encompassing research engine, used to search the web but also to meet people online.
Financial results
At Group level, the second quarter of 2006 recorded consolidated sales of Euro 26.1 million (an increase of 69.5% compared to the same period in the previous year and 15% compared to the first quarter of 2006) and a consolidated EBITDA of Euro 3.8 million with a margin on consolidated sales of 15% (in the second quarter of 2005, the EBITDA was Euro 3.3 million).
The costs incurred in the development of the international customer base and the consequent strong growth in sales resulted in a reduction in the margin as a percentage of sales, although there was a significant increase in the EBITDA in absolute terms. In relation to this, it is recalled that the business model of these services is characterised by a time lag between the costs to develop the customer base and the related economic returns.
In the second quarter of 2006, personnel costs were Euro 3.5 million, amounting to 13% of sales, an improvement compared to the 18% recorded in the second quarter of 2005.
The Ebit in the second quarter of 2006 was Euro 2.8 million, an increase compared to the second quarter of 2005 and the first quarter of the current year, which amounted to Euro 2.4 million in both periods. This result included write-downs and non-recurring charges of Euro 0.2 million, while the amortisation and depreciation in the quarter amounted to Euro 0.9 million.
The short-term Net Financial Position at June 30, 2006 was a positive amount of Euro 23.1 million (Euro 23.0 million at June 30, 2005).
Business Divisions
- Consumer
The core business of Dada is represented by the wide range of community and entertainment VAS services – “value added services” – accessible via web and mobile through the brand dada.net (www.dada.net).
In the current quarter, the revenues from the above-mentioned services and the online advertising of the Dada network accounted for 79% of consolidated sales, an increase compared to the same period in the previous year when the division accounted for 63% of consolidated sales.
- Business
Dada also operates in the development of advanced web projects and the provision of technological platforms to businesses which allow Dada clients to offer their users’ base mobile content, services and applications.
In the second quarter of 2006, this division accounted for 13% of revenues.
- Self-provisioning
Dada offers automated registration services of Internet domains, premium e-mail management and web site hosting, primarily aimed at medium and small businesses. In relation to the self-provisioning area, the current period saw the introduction of the registration of the .eu domains at a European level.
In the second quarter of 2006, the revenues from the self-provisioning area accounted for 8% of consolidated sales.
Further points on the agenda
The Board of Directors of Dada meeting today also approved a paid-in share capital increase for a maximum amount of Euro 9,350, through the issue of a maximum of 55,000 new ordinary Dada shares with a nominal value of Euro 0.17 each, to service the incentive and loyalty plan of two new Top Managers of the company and as partial execution of the powers attributed to the Dada Board by the Shareholders’ Meeting of December 30, 2005 and recorded in the Florence company's registration office on January 9, 2006. These powers were already partially exercised by the Board in the meeting of February 3, 2006
The subscription price of the shares was determined by the Board of Directors of the Company, in accordance with the criteria indicated by the Shareholders' Meeting, as Euro 15.47 per share, equal to the average official price registered of the Dada shares in the month prior to the assignment of the option rights.
The Board established that the exercise of the options is conditional, within the limits contained in the regulations, to the achieving of 90% of the objective Consolidated Ebitda for the year 2008 as determined by the Board. In general terms, the exercise of the options may take place from January 15 to January 31, from February 16 to February 28, from June 1 to June 15, from September 15 to September 30 (extended to October 15 only for the year 2012) and, finally, from November 15 to November 30 of each year until November 11, 2012 and from the date of the approval of the consolidated financial statements relating to the Dada Group for the year ended December 31, 2008.
The regulations approved govern in particular the procedures, conditions, and period for the assignment of the options, the subscription rights not yet exercised or not yet exercisable at the moment of any eventual termination of the relationship between the beneficiaries and the companies of the Group, the possibility to apply the so-called repricing of the options, and the advanced subscription of the options in the case of significant events related to the control of the Company. No forms of financial support are provided for by the Company or of any other nature for the subscription of the shares relating to the exercise of the options or restrictions on the shares subscribed.
