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MercadoLibre, Inc. Reports Financial Results for First Quarter 2012

MercadoLibre, Inc. Reports Financial Results for First Quarter 2012

 * Items sold during Q1'12 increased by 38.1% year-over-year to 15.0 million

 * Net Revenues in Q1'12 increased by 36.2% year-over-year to 83.7 million, a
                       43.6% growth in local currencies

* Q1'12 net income increased by 39.7% year-over-year to $19.6 million, a 47.0%
                          growth in local currencies

BUENOS AIRES, Argentina, May 8, 2012 (GLOBE NEWSWIRE) -- MercadoLibre, Inc.
(Nasdaq:MELI) (http://www.mercadolibre.com), Latin America's leading
e-commerce technology company, today reported financial results for the first
quarter ended March 31, 2012.

Marcos Galperin, President and Chief Executive Officer of MercadoLibre, Inc.,
commented, "It was a solid start to the year for MercadoLibre as we look to
sustain last year's business momentum. Our strong results during the first
quarter of 2012 are a result of continued execution against the strategic plan
we have established for the company. Shoppers increased their activity on our
marketplace as we remained focused on user experience, continuing to
strengthen our technology while posting visible improvements to our services.
I look forward to the rest of 2012, as we keep driving innovation on top of
the success of our current initiatives, with the goal of delivering sustained
top and bottom line growth during 2012".

Financial Results Summary

MercadoLibre reported consolidated net revenues for the three months ended
March 31, 2012 of $83.7 million, representing a year-over-year growth of 36.2%
in USD, and 43.6% in local currencies.

For the three months ended March 31, 2012, gross merchandise volume grew 38.6%
year-over-year to $1,321.7 million, while total payment volume grew 50.9%
year-over-year to $370.1 million. In local currencies, gross merchandise
volume grew 45.3% year-over-year, while payment volume grew 61.0%
year-over-year.

Items sold on MercadoLibre during the first quarter 2012 increased 38.1% to
15.0 million, while total payments transactions through MercadoPago increased
84.6% to 4.9 million.

Gross profit for the first quarter of 2012 was $62.6 million, a 32.9% increase
over the previous year quarter. Gross profit margin for the period was 74.8%,
down from 76.7% during the first quarter of 2011.

Total operating expenses during the first quarter 2012 increased 35.5% from
$27.8 million to $37.7 million. Total operating expenses as percentage of net
revenues for the first quarter of 2012 were 45.0%, down from 45.3% for the
same quarter one year earlier.

Income from operations for the first quarter 2012 was $24.9 million,
representing a year-over-year growth of 29.2% in USD, and 36.1% in local
currencies. Operating income margin for the period was 29.8%, down from 31.4%
during the first quarter of 2011, driven by gross profit margin contraction.

Net Income before taxes was $26.9 million, an increase of 34.2% over the first
quarter of 2011. The blended tax rate for the quarter was of 27.0%, as
compared to 29.9% during the same quarter one year earlier.

Net income for the three months ended March 31, 2012, increased 39.7%
year-over-year to $19.6 million, a local currency growth of 47.0%. Net income
margin was 23.5% for the first quarter of 2012, compared to 22.9% for the same
period last year. Earnings per share for the first quarter of 2012 were $0.45
compared to $0.32 for the prior year quarter.

Free cash flow, defined as cash from operating activities less purchases of
property, equipment and intangible assets, was $15.3 million for the three
months ended March 31, 2012.

The following table summarizes certain key performance metrics for the three
months ended March 31, 2012 and 2011.

Three month ended March 31, (in MM)                   2012     2011   %YOY
                                                                   
Total confirmed registered users at the end of period 69.5     55.6   25.0%
New confirmed registered users during the period      3.6      2.7    36.6%
Gross merchandise volume                              $1,321.7 $954.0 38.6%
Items sold                                            15.0     10.9   38.1%
Total payments volume                                 $370.1   $245.2 50.9%
Total payments transactions                           4.9      2.6    84.6%

Table of Year-on-Year Local Currency Revenue Growth Rates by Quarter

                        YoY Growth rates at previous years exchange rates
                                                                
Consolidated Net                                                 
Revenues
                        Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12
Brazil                   35%   26%   7%    15%   22%   15%   38%   39%   29%
Argentina                67%   62%   48%   52%   33%   37%   55%   70%   85%
Mexico                   25%   19%   11%   12%   11%   7%    14%   31%   35%
Venezuela                59%   69%   61%   57%   58%   39%   57%   64%   66%
Others                   47%   24%   14%   22%   22%   32%   37%   35%   34%
Total                    45%   39%   23%   25%   26%   22%   41%   46%   44%

Conference Call and Webcast

The Company will host a conference call and audio webcast on May 8, 2012 at
4:30 p.m. Eastern Time. The conference call may be accessed by dialing (970)
315-0420 or (877) 303-7209 (Conference ID 76688140) and requesting inclusion
in the call for MercadoLibre. The live conference call can be accessed via
audio webcast at the investor relations section of the Company's website, at
http://investor.mercadolibre.com. An archive of the webcast will be available
for one week following the conclusion of the conference call.

Definition of Selected Operational Metrics

Total confirmed registered users – Measure of the cumulative number of users
who have registered on the MercadoLibre Marketplace and confirmed their
registration.

New confirmed registered users – Measure of the number of new users who have
registered on the MercadoLibre Marketplace and confirmed their registration.

Gross merchandise volume – Measure of the total U.S. dollar sum of all
transactions completed through the MercadoLibre Marketplace, excluding motor
vehicles, vessels, aircraft, real estate, and services.

Items sold– Measure of the number of items sold/purchased through the
MercadoLibre Marketplace.

Total payment volume – Measure of total U.S. dollar sum of all transactions
paid for using MercadoPago.

Total payment transactions – Measure of the number of all transactions paid
for using MercadoPago.

Operating margin – Defined as income from operations as a percentage of net
revenues.

Net Income margin – Defined as net income as a percentage of net revenues.

Free Cash Flow – Defined as cash flow from operating activities less property,
equipment and intangible asset.

Local Currency Growth Rates – Calculated by using the average monthly exchange
rate for each month during the previous year and applying it to the
corresponding month in the current year, so as to calculate what the growth
would have been had exchange rates been the same throughout both periods.

About MercadoLibre

Founded in 1999, MercadoLibre is Latin America's leading e-commerce technology
company. Through its primary platforms, MercadoLibre.com and MercadoPago.com,
it provides solutions to individuals and companies buying, selling,
advertising, and paying for goods and services online.

MercadoLibre.com serves millions of users and creates a market for a wide
variety of goods and services in an easy, safe and efficient way. The site is
among the top 50 in the world in terms of page views and is the leading retail
platform in unique visitors in each country in which it operates according to
metrics provided by comScore Networks. MercadoLibre maintains a leadership
position in 12 Latin American countries. The Company is listed on NASDAQ
(Nasdaq:MELI) following its initial public offering in 2007.

For more information about the company visit:
http://investor.mercadolibre.com.

The MercadoLibre, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4193

                                                               
Consolidated balance sheets                                     
                                                               
                                                  March 31,     December 31,
                                                  2012          2011
                                                  (Unaudited)   (Audited)
Assets                                                          
Current assets:                                                 
Cash and cash equivalents                          $75,874,938  $67,381,677
Short-term investments                             82,722,150    74,928,620
Accounts receivable, net                           16,338,071    16,815,087
Credits Cards Receivables                          23,964,431    23,855,689
Prepaid expenses                                   1,955,533     1,269,594
Deferred tax assets                                9,949,385     9,131,638
Other assets                                       6,394,655     6,863,250
Total current assets                               217,199,163   200,245,555
Non-current assets:                                             
Long-term investments                              43,084,473    43,933,316
Property and equipment, net                        33,117,055    30,877,719
Goodwill, net                                      63,935,487    62,093,948
Intangible assets, net                             6,626,787     6,494,857
Deferred tax assets                                6,537,804     6,491,646
Other assets                                       6,068,687     5,794,395
Total non-current assets                           159,370,293   155,685,881
                                                               
Total assets                                       $376,569,456 $355,931,436
                                                               
Liabilities and Equity                                          
Current liabilities:                                            
Accounts payable and accrued expenses              $21,727,978  $20,251,313
Funds payable to customers                         70,486,512    69,216,185
Payroll and social security payable                13,145,102    13,525,293
Taxes payable                                      9,888,797     11,633,178
Loans payable and other financial liabilities      142,687       146,194
Dividends payable                                  4,812,036     3,531,362
Total current liabilities                          120,203,112   118,303,525
Non-current liabilities:                                        
Payroll and social security payable                3,950,099     3,844,172
Loans payable and other financial liabilities      101,249       136,227
Deferred tax liabilities                           8,481,593     8,670,606
Other liabilities                                 2,153,587     1,797,890
Total non-current liabilities                      14,686,528    14,448,895
Total liabilities                                  $134,889,640 $132,752,420
                                                               
Commitments and contingencies                                   
Redeemable noncontrolling interest                 $4,000,000   $4,000,000
                                                               
Equity:                                                         
Common stock, $0.001 par value, 110,000,000 shares
authorized, 44,147,120 and 44,142,020 shares       $44,147      $44,142
issued and outstanding at March 31, 2012 and
December 31, 2011, respectively
Additional paid-in capital                         120,463,063   120,452,032
Retained earnings                                  150,867,488  135,726,188
Accumulated other comprehensive loss               (33,694,882)  (37,043,346)
Total Equity                                      237,679,816   219,179,016
                                                               
Total liabilities, redeemable noncontrolling       $376,569,456 $355,931,436
interest and equity

                                                               
Consolidated statements of income                              
                                                               
                                                 Three Months Ended March 31,
                                                 2012           2011
                                                 (Unaudited)
Net revenues                                      $83,736,006   $61,459,668
Cost of net revenues                              (21,096,297)   (14,331,703)
Gross profit                                      62,639,709     47,127,965
                                                               
Operating expenses:                                             
Product and technology development                (7,586,074)    (5,156,890)
Sales and marketing                              (17,427,679)   (13,228,942)
General and administrative                        (12,695,212)   (9,450,977)
Total operating expenses                         (37,708,965)   (27,836,809)
Income from operations                            24,930,744     19,291,156
                                                               
Other income (expenses):                                        
Interest income and other financial gains         3,088,560      1,873,768
Interest expense and other financial charges      (77,317)       (628,950)
Foreign currency loss                            (1,032,978)    (500,655)
Other income / (loss), net                       (4,252)        20,344
Net income before income / asset tax expense     26,904,757     20,055,663
                                                               
Income / asset tax expense                        (7,267,719)    (5,998,029)
Net income                                       $19,637,038   $14,057,634
                                                               
Less: Net Income attributable to Noncontrolling   2,428          --
Interest
Net income attributable to MercadoLibre, Inc.     $19,634,610   $14,057,634
                                                               
                                                               
                                                 Three Months Ended March 31,
                                                 2012           2011
                                                 (Unaudited)
Basic EPS                                                       
Basic net income attributable to MercadoLibre,    $0.45         $0.32
Inc. per common share
                                                               
Weighted average shares                           44,142,076     44,131,383
                                                               
                                                               
Diluted EPS                                                     
Diluted net income attributable to MercadoLibre,  $0.45         $0.32
Inc. per common share
                                                               
Weighted average shares                           44,147,796     44,147,667

                                                               
Consolidated statements of cash flows
                                                               
                                                 Three Months Ended March 31,
                                                 2012           2011
                                                 (Unaudited)
Cash flows from operations:                                     
Net income                                       $19,637,038  $14,057,634
Adjustments to reconcile net income to net cash
provided by operating activities:
Net Income attributable to Noncontrolling         2,428         --
Interest
Depreciation and amortization                     1,966,624     1,541,143
Accrued interest                                  (816,543)     (575,613)
LTRP accrued compensation                        1,849,633     1,170,710
Deferred income taxes                             (190,810)     316,866
Changes in assets and liabilities:                              
Accounts receivable                              1,803,522     (378,620)
Credit Card Receivables                           (116,468)     479,325
Prepaid expenses                                  (673,723)     71,641
Other assets                                      493,886       (70,095)
Accounts payable and accrued expenses             (6,375,961)   (4,754,255)
Funds payable to customers                        (159,063)     3,072,102
Provisions                                        1,407,480     18,026
Other liabilities                                 158,139       220,113
Net cash provided by operating activities         18,986,182    15,168,977
Cash flows from investing activities:                           
Purchase of investments                           (86,658,793)  (99,069,739)
Proceeds from sale and maturity of investments    83,583,664    80,823,544
Purchases of intangible assets                    (31,508)      (73,405)
Purchases of property and equipment               (3,696,281)   (2,886,154)
Net cash used in investing activities            (6,802,918)   (21,205,754)
Cash flows from financing activities:                           
Dividends paid                                    (3,531,362)   --
Stock options exercised                           --           885
Net cash provided in financing activities        (3,531,362)   885
Effect of exchange rate changes on cash and cash  (158,641)     173,684
equivalents
Net increase in cash and cash equivalents         8,493,261     (5,862,208)
Cash and cash equivalents, beginning of the       67,381,677    56,830,466
period
                                                               
Cash and cash equivalents, end of the period      $75,874,938  $50,968,258
                                                               
                                                               
                                                               
                                                 Three Months Ended March 31,
                                                 2012           2011
                                                 (Unaudited)
Supplemental cash flow information:                             
Cash paid for interest                            $20,646       $13,889
Cash paid for income and asset taxes              $10,015,712   $7,898,283

                                                                      
Financial results of reporting segments
                                                                      
            Three Months Ended March 31, 2012
            Brazil       Argentina    Mexico      Venezuela    Other       Total
                                                                Countries
                                                                      
Net revenues $42,164,654 $18,116,469 $6,583,865 $11,241,572 $5,629,446 $83,736,006
Direct costs (25,743,214) (8,122,935)  (3,646,637) (4,847,335)  (2,815,667) (45,175,788)
Direct       16,421,440   9,993,534    2,937,228   6,394,237    2,813,779   38,560,218
contribution
                                                                      
Operating
expenses and
indirect                                                               (13,629,474)
costs of net
revenues
Income from                                                            24,930,744
operations
                                                                      
Other income                                                           
(expenses):
Interest
income and
other                                                                  3,088,560
financial
gains
Interest
expense and
other                                                                  (77,317)
financial
results
Foreign
currency                                                               (1,032,978)
loss
Other                                                                  (4,252)
losses, net
Net income
before
income /                                                               $26,904,757
asset tax
expense
                                                                      
                                                                      
            Three Months Ended March 31, 2011
            Brazil       Argentina    Mexico      Venezuela    Other       Total
                                                                Countries
                                                                      
Net revenues $34,723,195 $10,579,932 $5,234,333 $6,770,453  $4,151,755 $61,459,668
Direct costs (20,075,608) (4,427,098)  (2,716,359) (3,069,739)  (2,100,316) (32,389,120)
Direct       14,647,587   6,152,834    2,517,974   3,700,714    2,051,439   29,070,548
contribution
                                                                      
Operating
expenses and
indirect                                                               (9,779,392)
costs of net
revenues
Income from                                                            19,291,156
operations
                                                                      
Other income                                                           
(expenses):
Interest
income and
other                                                                  1,873,768
financial
gains
Interest
expense and
other                                                                  (628,950)
financial
results
Foreign
currency                                                               (500,655)
loss
Other                                                                  20,344
income, net
Net income
before
income /                                                               $20,055,663
asset tax
expense

CONTACT: MercadoLibre, Inc.
         Investor Relations
         investor@mercadolibre.com
         http://investor.mercadolibre.com

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