Business News
Medialink Reports First Quarter 2009 Results
Monday 18. May 2009 - Medialink Worldwide Incorporated (NASDAQ:MDLK), a leading provider of diversified media services for professional communicators and marketers, today reported financial results for the first quarter ended March 31, 2009.
Prior period results of operations and financial position have been reclassified to reflect Teletrax, the Company’s digital video monitoring services segment, and Medialink UK Limited (“Medialink UK”), the Company’s UK-based media communications services business, as discontinued operations in all periods presented.
Revenues for the three months ended March 31, 2009, of $3.2 million decreased by 34.5% from revenues of $4.9 million in the comparable 2008 period. This decrease, which is in line with previously announced expectations for the quarter, was the result of a decline in the number of projects amidst deteriorating worldwide economic conditions.
The Company incurred an operating loss of $1.3 million in the first quarter of 2009, as compared to an operating loss of $1.5 million in the comparable 2008 quarter. For the three months ended March 31, 2009, the Company reported a net loss of $1.5 million, or $0.23 per share, consisting of a loss from continuing operations of $1.4 million, or $0.21 per share, and a loss from discontinued operations of $120,000, or $0.02 per share. The loss from discontinued operations in the 2009 quarter represents costs incurred in the period for winding down Medialink UK.
For the comparable period in 2008, the Company reported a net loss of $2.5 million, or $0.39 per share, which consisted of a loss from continuing operations of $1.5 million, or $0.23 per share, and a loss from discontinued operations of $1.0 million, or $0.16 per share. The loss from discontinued operations in the 2008 quarter consisted of a loss from operations for Teletrax of approximately $800,000 and a loss from operations for Medialink UK of approximately $200,000.
The Company had cash and working capital totaling $4.7 million and $3.4 million, respectively, at March 31, 2009. The Company expects to incur operating losses in 2009 as revenues continue to decline from the prior year in the current economic climate. The Company’s sole source of capital is its working capital, which may not be sufficient to fund continuing operating losses and existing obligations. The Company is currently pursuing various strategic alternatives, including obtaining additional financing or investment from potentially interested third-party investors or buyers. The Company also continues to take action to reduce its costs, and has completed, and will continue to initiate, various measures in an effort to achieve profitability. If the Company is not successful in these efforts it may not be able to finance its operations and commitments with its working capital, and therefore may not be able to continue as a going concern, which would result in the Company’s inability to realize the carrying value of its assets and liquidate its liabilities.
“We faced significant challenges during rough economic times in the first quarter,” said Laurence Moskowitz, President and Chief Executive Officer of Medialink. “However, we continue to see improvement as revenue has increased each month in 2009 and our operating margins have increased from last year as result of our cost-cutting initiatives. Even with these modest performance improvements, the overall economic climate still poses greater challenges than we faced last year, and we are currently forecasting a $1.4 million decline in revenues for the second quarter of 2009 as compared to the comparable 2008 quarter.”