Business News
AdStar Reports Operating Results for Second Quarter
Thursday 21. August 2008 - AdStar, Inc. (BULLETIN BOARD: ADST) , the leading provider of e-commerce transaction services and payment processing software for the digital and print advertising and publishing industries, today reported its operating results for the three months ended June 30, 2008.
Net revenues for the three months ended June 30, 2008 totaled $1,038,000, compared with net revenues of $1,168,000 in 2007. ASP revenues declined by $91,000, or 18%, and Customization and other revenues declined $35,000, or 29%. The decline in ASP revenues is generally a result of the recent declines in classified advertising impacting the newspaper publishing industry as a whole, resulting in the loss of several customers and reduced processing volume in several others. The revenue reductions have been partially offset by revenue increases from four new ASP customers in 2008.
AdStar reported a net loss applicable to common shareholders of $217,000, or $0.01 per share, during the three months ended June 30, 2008, versus a net loss of $630,000, or $0.03 per share, in 2007. The loss in 2008 was primarily due to abandoned acquisition costs. During the first fiscal quarter ended March 31, 2008, the Company suspended incurring additional costs for its mobile advertising development initiative, resulting in a significant reduction in expenses reflected during the second fiscal quarter ended June 30, 2008. Excluding non-cash charges and direct abandoned acquisition costs, the Company earned a positive margin on operations (a non-GAAP measure) of $47,000 during the quarter ended June 30, 2008 (See table at end of this release for further non-GAAP information).
“Newspaper print advertising has undergone unprecedented declines that are beyond analyst expectations for the industry,” stated Leslie Bernhard, president and chief executive officer of AdStar, Inc. “This has caused our revenues to decline in a corresponding magnitude. AdStar has responded by dramatically reducing costs. We have postponed our mobile advertising initiative, along with the attendant costs, as well as the significant costs relating to our SEC reporting; which has resulted in a level of stability in our cash flow. We are not aware of any significant pending customer cancellations at this time, and we are at the same time adding new customers to our payment processing software and to our web-based ad services. We believe that there are opportunities arising from the adversity in the industry, whereby publishers are seeking efficiencies in their operations that can be facilitated by AdStar. Our payment processing software remains the premier solution in the industry for processing both circulation and advertising costs, and we are exploring wider applications for this sophisticated solution. We believe that AdStar has a platform for growth as the industry reaches a new equilibrium.”
As a part of the Company’s current efforts to conserve cash, AdStar has determined that it will suspend its quarterly filings on Form 10-Q. The Company intends to continue to report to its stockholders its quarterly and annual financial results in press releases and to maintain the corporate governance improvements the Company has made in recent years.