Financial Press Releases
Press Release in accordance with CONSOB Regulation No. 11971/1999
Shareholders’ Meeting approve the parent company and consolidated accounts at December 31, 2004:
Revenues at Euro 48.4 million, +63% compared to the previous year,
EBITDA at Euro 6.0 million, +263%,
NFP positive at over Euro 20 million, +24%.
The Shareholders’ Meeting of DADA unanimously approved the parent company and consolidated financial statements at December 31, 2004:
* The revenues recorded by the DADA Group in 2004 were Euro 48.4 million (+ 63% compared to 2003),
* The consolidated EBITDA was Euro 6 million (+263% compared to the previous year),
* The Group Net financial Position at December 31, 2004 was a positive amount of Euro 20.1 million (+24% compared to the end of 2003).
The Shareholders’ Meeting of DADA also confirmed the appointment of the co-opted Director, Barbara Poggiali, and renewed the powers of the BoD of DADA to purchase and sell treasury shares and to increase the share capital for a new stock option plan for the employees of the Group.
Florence, April 28, 2005 – The Shareholders’ Meeting of DADA S.p.A. (TechSTAR of Borsa Italiana: DA.MI), under the Chairmanship of Paolo Barberis, today approved unanimously the parent company and consolidated accounts of DADA for the year ended December 31, 2004, as proposed by the Board of Directors in the meeting of March 14, 2005.
In 2004, DADA further strengthened its leadership in Italy in the community and entertainment market , thanks to a wide offering of web and mobile products and services dedicated to DADA’s subscribers.
In 2004, DADA Group Revenues were equal to Euro 48.4 million, up 63% compared to the previous year, while consolidated EBITDA was positive for Euro 6.0 million (compared to Euro 1.7 million in the previous year).
After amortisation of Euro 9.3 million, DADA Consolidated Operating Result in 2004 improved by 64%, thus reducing the loss to Euro 3.2 million (Euro -9 million in 2003). Also DADA Group Net Result improved significantly in 2004 compared to the loss in 2003 of Euro 24.9 million, at Euro -5.8 million, after Euro 1.3 million of extraordinary non-recurring expenses, write-downs and provisions.
In 2004, the Parent Company DADA S.p.A. closed the year with a turnover equal to Euro 26 million (+91% compared to the previous year) and a positive EBITDA of Euro 1.4 million, compared to a negative amount of Euro 0.9 million in 2003.
In 2004, the operating result of the Parent Company was a loss of Euro 4.8 million (compared to a loss of Euro 8 million in 2003) and a net loss of Euro 6.7 million (compared to a loss of Euro 25 million in 2003).
The increase in the margin in 2004 was positively impacted by the significant increase in revenues, in particular in Consumer services, and the completion of the reorganisation and restructuring policy implemented in previous years. In 2004, the DADA Group strengthened its leadership in Italy in particular in the Consumer Services thanks to the success of its own brands and to the consolidation of the positioning in relation to the Business clientele.
In relation to operating costs, in particular there was a further decrease in personnel costs that decreased in absolute value in the year by approximately 10% and as a percentage on consolidated sales from 35% in 2003 to 18% in 2004.
There was also a significant reduction in the other fixed and general costs, in particular the general expenses and those for the use of third party assets that decreased from Euro 4.4 million in 2003 (17% on sales) to Euro 2.3 million in 2004 (5% on sales).
The DADA Group Net Financial Position as of December 31, 2004 was positive for Euro 20.1 million (Euro 16.4 million at the end of 2003). The DADA Group therefore recorded a positive Free Cash Flow generation equal to Euro 3.7 million.
At the year end of 2004, the DADA Group Operative Cash Flow was positive for Euro 4.7 million (a 30% growth from the Net Financial Position at the beginning of the year), compared to a cash use of Euro 1.8 million recorded in 2003.
Thanks to its financial and operational strengths, the DADA Group succeeded in self-financing all of its investments in tangible assets, which totalled Euro 2.9 million.
A further financial contribution, equal to approximately Euro 1.5 million, was from the corporate reorganisation of the Group that related to, among others, the disposal of non strategic investments, all in line with or above book value.
Thanks to these positive results, the DADA stock was admitted to TechStar, the new segment of the Italian Stock Exchange which identifies listed companies meeting the highest requirements of sustainable growth and transparency.
The DADA Group has commenced the transition process to IFRS International accounting standards – International Financial Reporting Standard -, in conformity with European Regulation No. 1725 published in the official Gazette in October 2003, that renders obligatory the application of the above-mentioned accounting standards to consolidated financial statements of listed companies on European regulated market. From the analysis made, not yet completed, it emerges that the areas most impacted by the transition to these accounting principles relate to intangible assets, financial assets and in particular goodwill amortisation, inventory for contract work in progress and the employee leaving indemnity provision. The DADA Group expects to present the information related to the application of the IFRS as from the half-year report as of June 30, 2005.
Business results
In 2004, DADA’s Consumer unit, whose revenues are about 54% on DADA Group turnover, reported a larger than expected growth, driven by the heavy demand of DADA community and entertainment products/services by over 4.5 million web users and more than 1.9 million mobile users.
Dada’s Consumer offering includes a wide range of fee community and entertainment services and products, which are available both via the Internet – through DADA historical brand “superEva” – and via mobile – through SMS shortcodes on the networks of mobile operators such as TIM, Vodafone, Wind – and finally through DADA presence in the new generation 3 and I-mode mobile portals.
Besides the already mentioned interaction between web and wireless services, DADA main assets are its marketing strength, which allows DADA to offer its services to a very large customer base – its products quality and finally its exclusive content.
With reference with the last two issues, DADA can rely on a wide library of content and images and videos optimized for all devices and on agreements with the main European and US labels.
In particular, 2004 saw a large increase in the demand of DADA services connected with mobile phones personalization (ring tones, true tones, sound effects, logos, pictures, screensavers,…) and with mobile entertainment in general (videos, MMS, Java Games, TXT fun,…), a demand which has also been stimulated by advertising investments during 2004, mostly on TV networks.
The success of these services are such that LINKTONE www linktone.com (NASDAQ: LTON), the most important Chinese provider of mobile content, signed an agreement with DADA in order to introduce on to the largest world wide wireless market the format and services of mobile entertainment developed by DADA.
Also MSN (the Microsoft consumer portal network) chose DADA as technological partner to enrich its “entertainment” section within the Italian portal (http://intrattenimento.msn.it/), with an area devoted to interactive mobile services, such as ring tones, pictures, java games…….
Finally, it is recalled that 2004 was the year of the launch of superEva.com, the “evolved” communication format on the internet, that integrates within its offer all the most advanced instruments offered for communication via internet (email, blog, MOblog). Among its main functions, besides friendship and job finder, there is also dating with the matching service “Incontri by superEva”, which exceeded 1 million registered users in 2004 – now it reports about 1.3 million users with over 489,000 unique users –, thus confirming to be the first online pay-community in Italy according to Nielsen Net Ratings last analysis, dated January 2005.
Thanks to the DADA Business Division, whose revenues are 33% of Group turnover, DADA represents one of the main Italian players offering advanced technological services and net marketing solutions to large and medium sized companies.
In particular, 2004 saw an increase in the demand of DADA mobile VAS solutions, which allow DADA clients to offer their user base mobile content, services and applications.
During 2004, DADA actually developed mobile VAS projects for 20 large Italian accounts that needed to communicate with their customers in a new, more usable way.
Moreover, in 2004 about 1,500 companies chose DADA for its marketing of on line solutions and some of the main Italian Groups entrusted DADA the development of personalised customer relationship solutions. Among these are names such as Autostrade per l’Italia, Trenitalia, Seat Pagine Gialle, Siemens, De Cecco, Barilla, Panini, Pirelli, Generali, Sky Italia, Tod’s, Fininvest, Banca Mediolanum, Medusa, Prosciutto di Parma, Grana Padano, and Merloni Elettrodomestici.
The Self-Provisioning Division, headed by Register.it S.p.A. represented approximately 13% of the Group sales, and further strengthened its leadership in the market of automatic fee payment services to small and medium sized companies with over 200,000 active domains names, 200,000 premium email accounts and over 40,000 hosted websites.
Average revenue per customer increased during 2004 thanks to Register.it up-selling services, which were 25% of the revenues. 2004 also saw important commercial agreements with some of the most important Italian companies in the market of fashion, entertainment and industry for the protection of their online brands.
Further resolutions of the Shareholders’ Meeting
The Shareholders’ Meeting of DADA S.p.A. today confirmed the appointment to the Board of Directors of the co-opted Director Barbara Poggiali, Strategic and Development Director of RCS Media Group (the complete curriculum vitae of Ms. Poggiali is available online, on the internet site of DADA www.dada.net).
The Shareholders’ Meeting also renewed the authorisation of the Board of Directors to acquire within eighteen months of the date of the resolution, up to a maximum number of ordinary shares representing 10% of the share capital at a nominal value of 0.17 each for a price not less than 20% and not above 10% of the last share price. At the same time, the Shareholders’ Meeting renewed for a further 3 years the authorisation granted to the Board of Directors of DADA to hold treasury shares, already existing in portfolio or acquired as a result of the present authorisation, for a price not lower than 95% of the average reference price of the previous 30 days before the resolution.
Finally, in relation to the extraordinary session, the Shareholders’ Meeting provided the Board of Directors of DADA with powers for five years to increase the share capital in relation to a stock option plan for a maximum amount of Euro 79,922.95, to be made through the issue of a maximum of 470,135 shares of DADA S.p.A., at a nominal value of Euro 0.17, to be offered as options to employees of DADA S.p.A. and/or subsidiary companies, assigned through an offer for subscription by payment and with exclusion of the option right, giving mandate to the Board of Directors to determine the beneficiaries, procedures and timing of the assignment of the options.
It is noted that this initiative has the purpose of providing a strong instrument of incentive and loyalty not only to the employees of the Parent Company, but also to the employees of the subsidiaries of DADA S.p.A.
