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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 26, 2000
Ticketmaster Online-CitySearch, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-25041 95-4546874
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(State or Other Jurisdiction (Commission File (IRS Employer
of Incorporation) Number) Identification No.)
790 E. Colorado Boulevard, Suite 200, Pasadena, California 91101
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (626) 405-0050
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ITEM 5. OTHER EVENTS.
On January 26, 2000, the Registrant issued a press release announcing
its results for the quarter and year ended December 31, 1999. The full text
of the press release is set forth in Exhibit 99.1 hereto and is incorporated
in this Report as if fully set forth herein.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) EXHIBITS.
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Exhibit No. Description
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<S> <C>
99.1 Press Release dated January 26, 2000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: January 27, 2000 TICKETMASTER ONLINE-CITYSEARCH, INC.
By: /s/ Charles Conn
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Charles Conn
Chief Executive Officer
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INDEX TO EXHIBITS
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Exhibit No. Description
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<S> <C>
99.1 Press Release dated January 26, 2000.
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FOR IMMEDIATE RELEASE
TICKETMASTER ONLINE-CITYSEARCH, INC.
ANNOUNCES RECORD FOURTH QUARTER RESULTS;
REVENUE INCREASES 168%
TMCS SOLIDIFIES POSITION AS LEADING LOCAL PORTAL
AND NUMBER ONE ONLINE TICKETING COMPANY
Pasadena, CA - January 26, 2000 - Ticketmaster Online-CitySearch, Inc. (NASDAQ:
TMCS) today announced financial results for the fourth quarter of 1999 that
demonstrate its status as the leading local portal and "get it done" online
consumer service. Revenues in the fourth quarter increased 168% over the
comparable year-ago period to $36.4 million, driven by a 262% increase in online
ticketing revenues and a 144% increase in city guide and related revenues. For
the year, the Company recorded more than $105 million in revenues.
FINANCIAL RESULTS
Ticketmaster Online-CitySearch reported the following:
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Three Months Ended Year Ended
December 31, December 31,
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$ IN THOUSANDS ACTUAL ACTUAL Change ACTUAL PRO FORMA Change
1999 1998 1999 1998
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<S> <C> <C> <C> <C> <C> <C>
Revenues
Ticketing $20,974 $5,795 262% $64,787 $16,366 296%
City Guide 12,825 5,264 144% 33,915 16,332 108%
Sponsorship
& Advertising 2,591 2,544 2% 6,601 7,459 (12%)
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Total $36,390 $13,603 168% $105,303 $40,157 162%
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EBITDA ($14,507) ($3,801) (282)% ($42,743) ($23,079) (85)%
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The pro forma results are presented as if Ticketmaster Online and CitySearch
had been combined as of January 1, 1998.
"We continue to deliver on our mission to be the place on the Web where
people come to get things done locally," said Charles Conn, Chief Executive
Officer of Ticketmaster Online-CitySearch. "We entered 1999 with two close
competitors, an emerging but unproven ticketing business and two clear goals
become the
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leading local portal and grow our primary local commerce application,
ticketing. I am pleased to report that we move into 2000 having established
Ticketmaster Online-CitySearch as the clear number one local portal service,
with consumer reach well ahead of our competition, and with a ticketing
business that alone surpassed Forrester Research's revenue expectations for
the whole U.S. online event ticketing industry. Traffic in the fourth
quarter grew approximately 204% over the comparable year-ago period and 69%
since the third quarter, and we have extended our local platform to include a
host of new services and products to help our users get things done online.
We believe we are now the number one local portal, with the clear number one
position in ticketing, and extremely strong positions in the city guide and
online personals businesses."
"We continue to base our efforts on the belief that consumers spend the
lion's share of their time and money within twenty miles of their homes -- and
that Internet users need and want information and the ability to get things
done locally online. While building a robust local platform requires a
significant investment in time and capital, we are proud to have created a
strong, differentiated service with key local media and community
partnerships in our cities. In the coming year, we will look to continue to
build off this strong local platform, expanding both our range of services
and the types of Web-connected devices that can utilize our services. "
The Company's EBITDA loss for the quarter was $14.5 million, or $10.7 million
wider than in the year-ago comparable period. The increase in EBITDA loss
was primarily attributable to the Company's accelerated roll-out of new owned
and operated city guides.
AUDIENCE AND TRAFFIC HIGHLIGHTS
Ticketmaster Online-CitySearch's combined reach among home and work users
increased to 8.9% during December 1999, up from 4.7% in December 1998
according to Media Metrix. The Company registered unique users of 5.8
million in December, an increase of 118% from December 1998. In commerce,
Media Metrix reported that the ticketmaster.com site ranked among the top 20
most visited e-commerce sites during the 1999 holiday season.
TICKETING & TRANSACTIONS
Ticketing revenue increased 262% in the fourth quarter of 1999 over the
comparable year-ago period. While Forrester Research had estimated that the
U.S. online event ticketing market for 1999 would reach $300 million in the
aggregate, ticketmaster.com alone had gross ticket sales of over $400 million
in 1999, making it by far the largest provider of online tickets.
Ticketmaster.com averaged $1.7 million per day in gross sales transactions in
the fourth quarter and had two record transaction days in December, selling
149,325 and 159,451 tickets, on December 4th and 11th, worth
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approximately $4 million and $8 million, respectively. Overall,
ticketmaster.com sold 3.3 million tickets in the quarter at an average
convenience and handling charge of $6.46 per ticket. For the quarter, this
represented a record 18.4% of the total tickets sold by Ticketmaster Corp.
within the United States, United Kingdom, and Canada.
The percentage of total Ticketmaster tickets sold online continues to expand
rapidly for a wide range of events, including music, sports and family
entertainment. For example, in the Nashville market, ticketmaster.com sold
41% of the Tennessee Titans' playoff tickets, 22% of the Nashville Predators'
single game tickets and 41% of the Music City Bowl tickets sold by
Ticketmaster Corp.
CITY GUIDE & RELATED
City Guide and Related revenue increased 144% in the fourth quarter of 1999
over the comparable year-ago period, benefiting in part from the first full
quarter of revenues from the One and Only Networks acquisition. CitySearch
city guides that have been online for more than one year have seen traffic
increase by approximately 75% since the beginning of the year, and according
to the latest available data from Media Metrix, Ticketmaster
Online-CitySearch has estimated local reach in these markets ranging from 14
to 17%. Including city guides launched this year and the effect of the
Sidewalk acquisition, city guide traffic increased 200% since the beginning
of 1999.
In 1999, the Company added 25 new city guides with local sales and editorial
staff, and further expanded its network to more than 70 cities worldwide with
the acquisition and integration of the arts and entertainment portion of
Microsoft's Sidewalk city guides. Now a comprehensive national network,
CitySearch continues to focus on local media relationships in its cities,
recently adding new promotional and content arrangements with many radio,
television and newspaper companies including Clear Channel Communications in
Tampa, The Denver Post Online and WMEX-Radio Boston, bringing the total
number of media partnerships to over 100.
Ticketmaster Online-CitySearch closed the acquisition of One and Only Network
in the third quarter. Combined with Match.Com, these properties have over
four million user registrations. In December, Media Metrix reported the
combined personals companies had approximately 1.1 million unique users,
making it one of the largest independent networks of online personals on the
Internet.
SPONSORSHIPS AND ADVERTISING
Revenue in the Sponsorships and Advertising category increased 2% in the
fourth quarter of 1999 over the comparable year-ago period. Excluding the
loss of one major sponsor (N2K) in the year-ago period, revenue in the
category increased 108% over the comparable year-ago period. The Company
added Circuit
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City, Real Networks, and Oldsmobile, among others, to its existing roster of
leading advertisers and sponsors which includes MSN, ESPN, and Ford Motor
Company.
The Company believes that its national network of local city guides with
strong, differentiated content is in an excellent position to benefit from
the continuing growth of online advertising. According to Jupiter Research,
77% of advertisers indicated that they planned to increase local online
advertising in 2000, and 55% of advertisers indicated that they plan to
increase their ad spending on city guides in 2000.
OTHER RECENT HIGHLIGHTS
CitySearch announced plans to continue to integrate its platform of in-depth
locally-developed content with new online tools and functionality that allow
consumers to "get things done." For example, a user on citysearch.com will
be able to find out about family, sports, concerts, and arts events, purchase
tickets (ticketmaster.com or culturefinder.com), find a date or invite a
friend (Match.Com or Evite.com), research and make reservations at a nearby
restaurant (reservations.citysearch.com), and even purchase related
merchandise prior to the event (store.ticketmaster.com).
CORPORATE HIGHLIGHTS
- USA Networks, Inc. (NASDAQ:USAI) invested an additional $40 million
in TMCS through the acquisition of 1.3 million Class B common shares
by its wholly-owned subsidiary Ticketmaster Corporation in December
1999. The strategic investment increased available cash to
approximately $88 million at year-end and strengthened the Company's
ability to execute its growth strategies.
- Ticketmaster Online-CitySearch solidified its management team, by
promoting John Pleasants to President, Dan Marriott to Executive Vice
President, Corporate Strategy and Development, Steven Trepp to
President, City Guide and Traci Fleming to Chief Operating Officer,
City Guide.
- Microsoft and CitySearch launched a Local Channel delivering local
arts and entertainment content to nearly 3,000 local areas nationwide
on the MSN portal, as well as through the MSN Entertainment Channel
and Microsoft WebTV Network service.
EXPANDED SERVICES
- CitySearch announced its new Reservations Center which will feature
convenient online tee-time reservations for golfers through
SelectTeeTimes.com, LinksTime.com and Teemaster.com; personal service
scheduling through PointServe; hotel reservations through Hotel
Reservation Network (HRN), WorldRes.com and Pegasus Systems, Inc.; and
online restaurant reservations through foodline.com.
- CitySearch announced an investment and distribution arrangement with
the newly combined ActiveUSA.com/Racegate.com, the Internet's largest
online local participatory sports registration and reservation
company. ActiveUSA.com will allow consumers to book online
reservations for more than 6,000 local and national events in as many
as 60 different sporting categories. In
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addition, ActiveUSA.com will offer information for over 50,000 events
nationwide, making it one of the most comprehensive sporting events
calendars on the Internet.
- CitySearch signed a marketing and distribution agreement with
CultureFinder.com, an award-winning cultural events site, which will
help make TMCS the Internet's largest local portal for access to
cultural events.
EXPANDED E-COMMERCE
- CitySearch announced a long-term distribution partnership agreement
that will make Kozmo.com, a leading local delivery service, the
exclusive "under one hour" general delivery provider on the
citysearch.com network of city guides.
- Ticketmaster.com launched store.ticketmaster.com, offering in-context
merchandise to ticket shoppers letting consumers purchase CDs, videos,
apparel, and memorabilia related to their favorite artists, sports
teams, and entertainment events before, during and after their ticket
purchase. This integrated retail approach lets consumers buy the
things they want while they shop for tickets, gather information and
plan for a night out.
ABOUT TICKETMASTER ONLINE-CITYSEARCH
Ticketmaster Online-CitySearch, Inc. (NASDAQ: TMCS) is a leading local portal
and transactions company that provides in-depth local content and services to
help people "get things done" online. TMCS offers practical tools for living
that make the Internet an indispensable part of peoples' everyday lives. The
TMCS family of Web sites includes citysearch.com, ticketmaster.com,
store.ticketmaster.com, cityauction.com, match.com, oneandonly.com,
sidewalk.com, livedaily.com, astroabby.com, reservations.citysearch.com and
jobs.citysearch.com. TMCS is located in Pasadena, Calif.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This press release contains forward-looking statements about Ticketmaster
Online-CitySearch, Inc. (the "Company"), including those concerning its
future product plans. These forward-looking statements involve risks and
uncertainties. The Company's actual results could differ materially from
these statements. Among the risks and uncertainties that could adversely
affect the Company's actual results are: the limited operating history and
early development stage of the Company; the absence of history of
Ticketmaster Online as an independent company; the Company's lack of
profitability and anticipation of continued losses; the Company's dependence
on its relationship with Ticketmaster Corporation; control of the Company by
USA Networks, Inc.; the potential for conflicts of interest; the fact that
the license agreement between USA Networks, Ticketmaster Corporation and the
Company is subject to certain limitations that are contained therein;
possible future sales of the Company's securities by USA Networks, Inc.;
company integration risks; the Company's dependence on increased ticket
sales; the Company's future capital needs and the uncertainty of additional
financing; the unpredictability and potential fluctuations in future revenues
and operating results. Investors are encouraged to read the risks and
uncertainties detailed in the Company's filings with the Securities and
Exchange Commission.
Ticketmaster Online-CitySearch is the owner or licensee of its name and logo
trademarks and service marks. All other trademarks and trade names are the
property of their respective owners.
# # #
FOR MORE INFORMATION:
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Nancy Scott Lyon, Ticketmaster Online-CitySearch, +1-626-660-2530;
[email protected] or Sara Strickland, Ticketmaster Online-CitySearch,
+1-626-660-2758; [email protected].
Ticketmaster Online-CitySearch corporate headquarters is located at 790 East
Colorado Boulevard - Suite 200, Pasadena, California, 91101; +1-626-405-0050;
fax +1-626-405-9929; [email protected].
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Condensed Consolidated Balance Sheet
(in thousands)
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December 31 December 31
1999 1998
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<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 87,754 $ 106,910
Accounts receivable, net 4,075 1,249
Other current assets 5,047 3,030
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Total current assets 96,876 111,189
Property and equipment, net 16,832 5,893
Investments 23,085 -
Goodwill and other intangible assets, net 667,555 299,643
Other long term assets 321 -
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Total assets $ 804,669 $ 416,725
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 4,537 $ 2,734
Accrued expenses 9,100 4,551
Other current liabilities 6,936 3,213
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Total current liabilities 20,573 10,498
Other liabilities 1,503 2,639
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Total liabilities 22,076 13,137
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Stockholders' equity
Common stock & additional paid in capital 919,987 419,633
Accumulated deficit (137,406) (16,038)
Foreign currency translation 12 (7)
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Total stockholders' equity 782,593 403,588
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Total liabilities and stockholders' equity $ 804,669 $ 416,725
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Ticketmaster Online-CitySearch, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
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<CAPTION>
Actual Actual Actual Pro Forma (a)
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3 Mos. Ended 3 Mos. Ended Year Ended Year Ended
12/31/99 12/31/98 12/31/99 12/31/98
(unaudited) (unaudited)
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<S> <C> <C> <C> <C>
Revenues
Ticketing operations $20,974 $5,795 $64,787 $16,366
City guide and related 12,825 5,264 33,915 16,332
Sponsorship and advertising 2,591 2,544 6,601 7,459
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Total revenues 36,390 13,603 105,303 40,157
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Operating costs and expenses
Ticketing operations 15,257 4,322 47,870 12,132
City guide and related 11,183 3,916 30,289 14,512
Sales and marketing 17,747 6,062 47,262 21,797
Research and development 1,866 1,689 7,455 6,728
General and administrative 5,255 2,203 15,241 8,201
Amortization of goodwill 33,451 12,228 77,744 47,705
Merger and other transaction costs 943 11 4,236 3,112
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Total costs and expenses 85,702 30,431 230,097 114,187
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Loss from operations (49,312) (16,828) (124,794) (74,030)
Interest income, net 940 56 4,163 1,432
Equity in net loss of unconsolidated affiliates (272) 0 (272) 0
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Loss before income taxes (48,644) (16,772) (120,903) (72,598)
Income tax provision 281 86 464 0
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Net loss ($48,925) ($16,858) ($121,367) ($72,598)
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Basic and diluted net loss
per share ($0.58) ($0.26) ($1.59) ($1.16)
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Shares used to compute basic and
diluted net loss per share 84,610 65,325 76,097 62,682
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Supplemental Financial Information (b)
EBITDA (c) ($14,507) ($3,801) ($42,743) ($23,079)
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EBITDA before merger and other
transactions costs (d) ($13,564) ($3,790) ($38,507) ($19,967)
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Basic and diluted net loss
per share, excluding merger
and other transaction costs ($0.57) ($0.26) ($1.54) ($1.11)
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Notes:
a) The unaudited pro forma statements of operations data reflects the
combined operating results of Ticketmaster Online and CitySearch as if
the merger between Ticketmaster Online and CitySearch had occurred at
the beginning of the period.
b) The accompanying supplemental financial information is presented for
informational purposes only and should not be considered as a substitute
for the historical and pro forma financial information presented in
accordance with GAAP.
c) EBITDA is defined as earnings before interest, taxes, depreciation
and amortization.
d) EBITDA before merger and other transaction costs excludes
non-recurring charges associated with the Ticketmaster Online and
CitySearch merger and other transactions.
