WebMediaBrands Inc. Reports Financial Results for Its Third Quarter Ended September 30, 2012

  WebMediaBrands Inc. Reports Financial Results for Its Third Quarter Ended
  September 30, 2012

Business Wire

NEW YORK -- October 24, 2012

WebMediaBrands Inc. (Nasdaq: WEBM) today reported financial results for the
quarter ended September 30, 2012.

Highlights for the third quarter of 2012 include:

    Revenues for the third quarter of 2012 were $2.9 million and revenues from
 • research and advertising increased 13% and 12%, respectively, compared to
    the same period last year.
    
    Net loss for the third quarter of 2012 was $1.2 million. Non-GAAP loss,
    excluding interest, taxes, depreciation, amortization and stock-based
    compensation expense, or EBITDA, was $773,000 during the third quarter of
  • 2012, and included severance-related costs and a loss on the sale of
    certain assets totaling $352,000. We track the EBITDA metric and present
    it here because we believe it helps in the analysis of the performance of
    our core operations. Non-cash stock-based compensation expense was
    $121,000 during the third quarter of 2012.

“The third quarter results were anticipated and were discussed in both our
first and second quarterly conference calls,” stated Alan M. Meckler, Chairman
and CEO of WebMediaBrands, Inc. “Our third quarter results are typically
impacted by the fewer number of trade shows we hold and by the type of
education courses we offer. We have continued to invest in our product
offerings, specifically with our research business. In addition, we have
identified cost efficiencies in certain areas of the business and we have
entered into a new lease for our New York City location, which will reduce our
annual lease expense by more than $250,000,” added Meckler.

WebMediaBrands Inc. Third Quarter 2012 Financial Results Conference Call Alert

WebMediaBrands Inc. invites you to participate in its conference call
reviewing 2012 third quarter results on Wednesday, October 24, 2012 at 5:00 pm
ET.

The conference call number is 888-452-4023 for domestic participants and
719-325-2329 for international participants; confirmation code “6944647.”
Please call five minutes in advance to ensure that you are connected prior to
the presentation. The conference call replay will be available untilMonday,
October 29, 2012. Replay call numbers are 888-203-1112 for domestic
participants and 719-457-0820 for international participants; confirmation
code “6944647.”

WebMediaBrands Inc.
Unaudited Consolidated Condensed Statements of Operations
For the Three and Nine Months Ended September 30, 2012 and 2011
(in thousands, except per share amounts)
                                                    
                              Three Months Ended       Nine Months Ended
                              September 30,            September 30,
                              2012        2011        2012        2011
Revenues                      $ 2,917      $ 3,008     $ 10,642     $ 9,054
Cost of revenues                1,678        1,686       5,830        5,257
Advertising, promotion and      614          472         1,920        1,537
selling
General and administrative      1,306        1,359       3,938        4,080
Depreciation                    78           77          238          242
Amortization                    137          160         409          371
Contingent acquisition         –           –          –           329
consideration
Total operating expenses       3,813       3,754      12,335      11,816
                                                                             
Operating loss                  (896   )     (746  )     (1,693 )     (2,762 )
Other loss, net                 (213   )     (4    )     (216   )     (7     )
Interest income                 1            1           3            41
Interest expense               (63    )    (178  )    (209   )    (535   )
                                                                             
Loss before income taxes        (1,171 )     (927  )     (2,115 )     (3,263 )
Provision (benefit) for        11          (437  )    30          (417   )
income taxes
                                                                             
Net loss                      $ (1,182 )   $ (490  )   $ (2,145 )   $ (2,846 )
                                                                             
                                                                             
Loss per share:
Basic net loss                $ (0.20  )   $ (0.08 )   $ (0.36  )   $ (0.49  )
Diluted net loss              $ (0.20  )   $ (0.08 )   $ (0.36  )   $ (0.49  )
                                                                             
Weighted average shares
used in computing loss per
share:
Basic                          6,009       6,082      5,983       5,765
Diluted                        6,009       6,082      5,983       5,765
                                                                             
Shares outstanding and per share data have been adjusted to give effect to the
one-for-seven reverse stock
split implemented on August 16, 2012.

WebMediaBrands Inc.
Consolidated Condensed Balance Sheets
September 30, 2012 and December 31, 2011
(in thousands, except share and per share amounts)
                                                               
                                                  September 30,   December 31,
                                                  2012            2011
                                                  (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents                         $  2,479        $ 3,438
Accounts receivable, net of allowances of $37        617            489
and $11, respectively
Prepaid expenses and other current assets           583           575
Total current assets                                 3,679          4,502
                                                                             
Property and equipment, net of accumulated           346            477
depreciation of $1,582 and $1,350, respectively
Intangible assets, net of accumulated                2,403          2,626
amortization of $1,109 and $722, respectively
Goodwill                                             15,116         15,116
Investments and other assets                        794           1,146
Total assets                                      $  22,338       $ 23,867
                                                                             
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable                                  $  362          $ 367
Accrued payroll and related expenses                 397            391
Accrued expenses and other current liabilities       476            662
Deferred revenues                                   1,555         1,288
Total current liabilities                            2,790          2,708
                                                                             
Loan from related party                              7,647          7,647
Deferred revenues                                    20             22
Deferred income taxes                                470            444
Other long-term liabilities                         63            60
Total liabilities                                   10,990        10,881
                                                                             
Commitments and contingencies
                                                                             
Stockholders’ equity:
Preferred stock, $.01 par value, 4,000,000
shares authorized, no shares issued and              –              –
outstanding
Common stock, $.01 par value, 18,750,000 shares
authorized, 6,128,879 and 6,077,957 shares
issued                                               61             61
and 6,009,594 and 5,958,672 shares outstanding
at September 30, 2012 and December 31, 2011,
respectively
Additional paid-in capital                           289,543        289,036
Accumulated deficit                                  (277,760 )     (275,615 )
Treasury stock, 119,285 shares at cost              (496     )    (496     )
Total stockholders’ equity                          11,348        12,986
Total liabilities and stockholders’ equity        $  22,338       $ 23,867
                                                                             
Shares outstanding and per share data have been adjusted to give effect to the
one-for-seven reverse stock
split implemented on August 16, 2012.

WebMediaBrands Inc.
Unaudited Consolidated Condensed Statements of Cash Flows
For the Nine Months Ended September 30, 2012 and 2011
(in thousands)
                                                    
                                                      Nine Months Ended
                                                      September 30,
                                                      2012        2011
Cash flows from operating activities:
Net loss                                              $ (2,145 )   $ (2,846  )
Adjustments to reconcile net loss to net cash used
in operating activities:
Depreciation and amortization                           647          613
Stock-based compensation                                380          372
Provision for losses on accounts receivable             27           15
Amortization of debt issuance costs                     27           22
Other, net                                              210          (3      )
Deferred income taxes                                   25           (422    )
Changes in assets and liabilities (net of
businesses acquired):
Accounts receivable, net                                (155   )     (53     )
Prepaid expenses and other assets                       130          434
Accounts payable, accrued expenses and other            (195   )     (566    )
liabilities
Deferred revenues                                      265         309
Net cash used in operating activities                  (784   )    (2,125  )
Cash flows from investing activities:
Purchases of property and equipment                     (91    )     (39     )
Acquisitions of businesses, assets and other           (186   )    (9,020  )
Net cash used in investing activities                  (277   )    (9,059  )
Cash flows from financing activities:
Debt issuance costs                                     (23    )     –
Repayment of borrowings from related party              –            (50     )
Proceeds from exercise of stock options                125         144
Net cash provided by financing activities              102         94
Net decrease in cash and cash equivalents               (959   )     (11,090 )
Cash and cash equivalents, beginning of period         3,438       12,970
Cash and cash equivalents, end of period              $ 2,479      $ 1,880

About WebMediaBrands Inc.

WebMediaBrands Inc. (Nasdaq: WEBM) (http://www.webmediabrands.com) is a
leading Internet media company that provides content, education, and career
services to social media, traditional media, and creative professionals
through a portfolio of vertical online properties, communities, and trade
shows. The Company's online business includes: (i)mediabistro.com, a leading
blog network providing content, education, community, and career resources
(including the industry's leading online job board) about major media industry
verticals including new media, social media, Facebook, TV news, advertising,
public relations, publishing, design, and mobile; (ii)InsideNetwork.com, a
leading network of online properties providing original market research, data
services, news, and job listings on the Facebook platform, on social gaming,
and on mobile applications ecosystems; and (iii)SemanticWeb.com, a leading
blog providing content, education, community resources and career resources on
the commercialization and application of Semantic Technologies, Linked Data,
and Big Data. The Company's online business also includes community,
membership and e-commerce offerings including a freelance listing service, a
marketplace for designing and purchasing logos (stocklogos.com) and premium
membership services. The Company's trade show and educational offerings
include conferences, online and in-person courses, and video subscription
libraries on topics covered by the Company's online business.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: Statements in this press release that are not historical facts are
"forward-looking statements" under the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve risks and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements. The
potential risks and uncertainties address a variety of subjects including, for
example: general economic conditions; the competitive environment in which
WebMediaBrands competes; and the unpredictability of WebMediaBrands’s future
revenues, expenses, cash flows and stock prices. For a more detailed
discussion of such risks and uncertainties, refer to WebMediaBrands’s reports
filed with the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934. The forward-looking statements included herein are made
as of the date of this press release, and WebMediaBrands assumes no obligation
to update the forward-looking statements after the date hereof, except as
required by law.

All current WebMediaBrands press releases can be found online at
http://www.webmediabrands.com/corporate/press.html

Contact:

WebMediaBrands
Caitlin McKinney, 212-547-7870
press@webmediabrands.com
 
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