Feb. 9, 2006
ATLANTA, Feb. 9, 2006 (PRIMEZONE) -- Interland (Nasdaq:INLD), soon to be Web.com, Inc., a leading provider of websites and online services for small and medium-sized businesses (SMBs), today reported results for its transition period ended December 31, 2005. As previously reported, Interland moved from its past practice of reporting on a fiscal year ending August 31, to a conventional calendar reporting year ending December 31 beginning on January 1, 2006. As a result, the company is required to report financial results for the transition period including the months of September, October, November (which was previously reported) and December. This transition report is pursuant to Section 13 of the Securities Exchange Act of 1934 for the transition period from September 1, 2005 to December 31, 2005.
Summary of Four Month Transition Period Results:
"This transition period gives investors an added window into our financials which showed the overall health of the business getting stronger," stated Jeff Stibel, President and CEO, Interland.
For further information on the quarter, please refer to the company's Form 10-Q for the transition report.
About Interland / Web.com
Interland, Inc. (Nasdaq:INLD) is a leading provider of websites and online services focused on helping small and medium-sized businesses achieve success by providing the knowledge, services and tools to build, manage and promote businesses online. Interland offers a wide selection of online services, including do it yourself and custom website development, website hosting, ecommerce, web marketing and web mail tools. The company plans to change its corporate name to Web.com, Inc. in the first half of 2006. For more information on the company, please visit www.interland.com or www.web.com or call at 1-800-WEB-HOST.
Interland will host a conference call today to discuss its quarterly results at 9:30 a.m. ET (6:30 a.m. PT). A live webcast of the call can be accessed on the investors section of the company's website at www.interland.com. A replay of the call will be available on the site for seven days.
(1) EBITDA from continuing operations is a non-GAAP financial measure that is most directly comparable to the GAAP financial measure of Net Loss from continuing operations. Reconciliations of the non-GAAP measure to both Net Loss from continuing operations, as well as to Net Cash Used in Operating Activities, follow.
INTERLAND, INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
For the
Four Months Ended
--------------------
12/31/05 12/31/04
--------------------
Revenues $ 16,292 $ 30,573
Operating costs and expenses:
Network operating costs, exclusive of
depreciation shown below 2,963 7,474
Sales and marketing, exclusive of
depreciation shown below 3,411 5,264
Technical support, exclusive of
depreciation shown below 2,348 5,050
General and administrative, exclusive
of depreciation shown below 7,204 9,847
Bad debt expense 373 632
Depreciation and amortization 1,750 7,705
Restructuring costs 1,626 --
Other expense (income), net (165) (14)
--------------------
Total operating costs and expenses 19,510 35,958
--------------------
Operating loss (3,218) (5,385)
Interest income (expense), net 324 95
--------------------
Loss from continuing operations
before income taxes (2,894) (5,290)
Income tax benefit (expense) -- --
--------------------
Net loss from continuing operations (2,894) (5,290)
Income/(loss) from discontinued
operations, net of tax (146) 608
--------------------
Net loss $ (3,040) $ (4,682)
====================
Net Income/(loss) per share, basic
and diluted:
Continuing operations $ (0.18) $ (0.33)
Discontinued operations (0.01) 0.04
--------- --------
$ (0.19) $ (0.29)
========= ========
Number of shares used in per share
calculation:
Basic and diluted 16,272 16,016
INTERLAND, INC.
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In thousands)
As of
--------------------
Dec. 31, Aug. 31,
2005 2005
--------------------
Assets
Current assets
Cash and cash equivalents $ 17,370 $ 16,891
Trade receivables, net of
allowance for doubtful accounts 1,812 1,365
Other receivables 1,180 11,502
Prepaids and other current assets 2,026 2,698
Restricted investments 276 258
-------- --------
Total current assets 22,664 32,714
Restricted investments 9,015 9,299
Securities, held-to-maturity 53 50
Property plant and equipment, net 6,303 5,858
Goodwill 921 --
Intangibles, net 6,568 3,038
Other assets 5,600 5,600
-------- --------
Total assets $ 51,124 $ 56,559
======== ========
Liabilities and shareholders' equity
Current liabilities
Accounts payable $ 934 $ 2,355
Accrued expenses 6,232 10,465
Accrued restructuring charges 4,416 4,717
Current portion of long-term debt
and capital lease obligations 1,693 859
Deferred revenue 4,637 4,542
-------- --------
Total current liabilities 17,912 22,938
Long-term debt and capital lease
obligations 3,850 2,510
Deferred revenue, long-term 206 229
Other liabilities 934 939
-------- --------
Total liabilities 22,902 26,616
-------- --------
Shareholders' equity
Common stock, $.01 par value,
authorized 21 million shares,
issued and outstanding 16.4 and
16.4 million shares, respectively 166 164
Additional capital 325,493 323,498
Warrants 2,128 2,806
Note receivable from shareholder (735) (735)
Accumulated deficit (298,830) (295,790)
-------- --------
Total shareholders' equity 28,222 29,943
-------- --------
Total liabilities and shareholders'
equity $ 51,124 $ 56,559
======== ========
EBITDA is defined as net income (loss) less (i) provision for income taxes, (ii) interest income or expense, and (iii) depreciation and amortization. EBITDA is not an indicator of financial performance under generally accepted accounting principles and may not be comparable to similarly captioned information reported by other companies. In addition, it does not replace net income (loss), operating income (loss), or cash flows from operating activities as indicators of operating performance. The effect of taxes and interest on Interland's net loss is not significant, but depreciation and amortization, primarily as a result of acquisitions, is significant. The Company believes that measuring the performance of the business without regard to non-cash depreciation and amortization can make trends in operating results more readily apparent, and when considered with other information, assist investors and other users of the Company's financial statements who wish to evaluate the Company's ability to generate future cash flows.
The following table reflects the calculation of EBITDA from continuing operations and a reconciliation to net cash provided by (used in) operating activities:
For the
Four Months Ended
--------------------
12/31/05 12/31/04
--------------------
Net loss $ (3,040) $ (4,682)
Depreciation and amortization 1,750 7,705
Interest expense (income) (324) (95)
Discontinued operations 146 (608)
--------------------
EBITDA $ (1,468) $ 2,320
====================
Interest income / (expense) 324 95
Provision for bad debts 373 632
(Gain)/Loss on the sale of assets -- (14)
Other non-cash adjustments 537 210
Restructuring charges 1,626 --
Changes in assets and liabilities:
Cash received from sale of
dedicated assets 11,267 --
Receivables, net (1,765) (273)
Other current assets 692 745
Accounts payable, accrued
expenses, and deferred revenue (8,109) (4,712)
--------------------
Net cash provided by (used in)
operating activities $ 3,477 $ (997)
====================
CONTACT: Interland
Investor and Press Contact:
Peter Delgrosso
404-260-2500
[email protected]
