<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K/A
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
TOWNPAGESNET.COM PLC
11 MARKET SQUARE, ALTON
HAMPSHIRE, GU34 1HD, UK
(011) 44 1420 543 468
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F
FORM 20-F |X| FORM 40-F |_|
Indicate by check mark whether the Registrant by furnishing the information
contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
Yes |_| No |X|
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b) :
N/A
Page 1 of 24 Pages
Exhibit Index Appears on Page 23.
<PAGE>
TOWNPAGESNET.COM PLC
TABLE OF CONTENTS
PAGE
----
Part I FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited) .......3-6
Condensed Consolidated Balance Sheets September 30, 1999 and
December 31, 1998 ............................................. 3
Condensed Consolidated Statements of Operations
Nine Months ended September 30, 1999 and 1998 ............... 4
Three Months ended September 30, 1999 and 1998 .............. 5
Condensed Consolidated Statement of Cash Flows Nine Months ended
September 30, 1999 and 1998 ............................... 6
Notes to Condensed Consolidated Financial Statements ...... 7-11
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations .................................. 12
Item 3. Quantitative and Qualitative Disclosures about
Market Risk ................................................
Part II OTHER INFORMATION
Item 1. Legal Proceedings ............................................. 22
Item 2. Changes in Securities and Use of Proceeds ..................... 22
Item 3. Defaults Upon Senior Securities ............................... 22
Item 4. Submission of Matters to a Vote of Security Holders ........... 23
Item 5. Other Information ............................................. 23
Item 6. Exhibits and Reports on Form 6-K .............................. 23
Exhibit Index ......................................................... 23
Signatures ............................................................ 24
2
<PAGE>
TOWNPAGESNET.COM PLC
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30,
December 31, 1998 1999 1999
-------------------- ----------------------- -----------------------
(1) (Unaudited) (Unaudited)
Amounts in pounds sterling Amounts in US Dollars
<S> <C> <C> <C>
ASSETS:
CURRENT ASSETS:
Cash, cash equivalents 33,868 3,618,238 5,958,876
Accounts receivable 590,350 10,469,455 17,242,145
Receivable from related party 235,000 1,486,347 2,447,865
Unbilled receivables 422,872 471,673 776,798
Other receivables 1,700 133,844 220,428
Prepaid expenses 223,313 115,833 190,765
-------------------- ----------------------- -----------------------
Total current assets 1,507,103 16,295,390 26,836,877
Equipment and fixtures
Computer equipment 136,140 493,355 812,506
Furniture and fixtures 14,677 243,330 400,741
Equipment 37,894 1,409,388 2,321,121
-------------------- ----------------------- -----------------------
188,711 2,146,073 3,534,368
Less: Accumulated depreciation 63,883 1,016,602 1,674,241
-------------------- ----------------------- -----------------------
124,828 1,129,471 1,860,127
Intangible assets 7,629,919 12,565,714
-------------------- ----------------------- -----------------------
Total assets 1,631,931 25,054,780 41,262,718
==================== ======================= =======================
LIABILITIES AND STOCKHOLDERS' EQUITY (NET
CAPITAL DEFICIENCY)
CURRENT LIABILITIES:
Bank loans of credit and other notes
payable 303,084 499,149
Accounts payable 248,108 653,043 1,075,497
Accrued expenses and other
liabilities 127,099 1,041,218 1,714,782
Accrued interest 106,203 0 0
Taxes and social security payable 49,239 562,877 927,002
Deferred income 228,244 2,292,811 3,776,032
Capital lease obligation - current
portion 0 165,850 273,138
Amounts payable under Web site
design agreements 411,969 4,285,568 7,057,902
Debenture loans from stockholder 1,682,190 0 0
-------------------- ----------------------- -----------------------
Total current liabilities 2,853,052 9,304,451 15,323,502
COMMITMENTS
STOCKHOLDERS EQUITY (NET CAPITAL DEFICIENCY)
9% Series A redeemable convertible preferred
stock (pound)1 par value, 5,000,000 shares authorized,
none and 850,000 issued and outstanding at 850,000 1,399,865
December 1998 and September 1999, respectively.
Ordinary shares:
(pound)0.01 par value; 20,000,000 shares authorized,
5,000,000 and 8,546,272 issued outstanding at
December 1998 and September 1999, respectively. 50,000 85,463 140,749
Additional Paid-In Capital 122,500 16,465,544 27,117,104
Accumulated deficit (1,393,621) (1,650,678) (2,718,502)
-------------------- ----------------------- -----------------------
Total stockholders' equity (net
capital deficiency) (1,221,121) 15,750,329 25,939,216
-------------------- ----------------------- -----------------------
Total liabilities and stockholders'
equity (net capital deficiency) 1,631,931 25,054,780 41,262,718
==================== ======================= =======================
</TABLE>
(I) Derived from audited Financial Statements as of December 31,1998.
See accompanying notes.
3
<PAGE>
TOWNPAGESNET.COM PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months ended September 30,
1998 1999 1999
------------------- --------------- ---------------------
Amounts in pounds sterling Amounts in US
Dollars
<S> <C> <C> <C>
Revenues
Advertising revenues 19,334 300,231 494,450
Contract revenues and other 21,140 4,731,608 7,792,485
Contract revenues from related parties 0 556,142 915,910
------------------- --------------- ---------------------
Total revenues 40,474 5,587,981 9,202,845
Cost of revenues
Maintenance and housing costs 19,000 463,865 763,939
Cost of contract revenues and other 0 2,763,609 4,551,388
Advertising and commission costs 0 177,980 293,115
------------------- --------------- ---------------------
Total cost of revenues 19,000 3,405,454 5,608,442
Gross profit 21,474 2,182,527 3,594,403
OPERATING EXPENSES:
Sales and marketing 254,458 762,750 1,256,173
Research and development 144,396 364,931 601,005
General and administrative 564,086 1,124,423 1,851,812
Depreciation 28,795 71,219 117,291
Amortization 0 197,953 326,009
------------------- --------------- ---------------------
Total operating expenses 991,735 2,521,276 4,152,290
Loss from operations (970,261) (338,749) (557,887)
Interest expense (55,570) (64,228) (105,777)
Interest income 1,309 146,718 241,630
Other income 12,609 4,371 7,199
------------------- --------------- ---------------------
Net loss (1,011,913) (251,888) (414,835)
=================== =============== =====================
Basic and diluted net loss per share ((pound)0.20) ((pound)0.04) ($0.07)
=================== =============== =====================
Shares used in computing basic and diluted net
loss per share 5,000,000 6,345,244 6,345,244
=================== =============== =====================
</TABLE>
See accompanying notes.
4
<PAGE>
TOWNPAGESNET.COM PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months ended September 30,
1998 1999 1999
------------------ --------------- ----------------------
Amounts in pounds sterling Amounts in US Dollars
<S> <C> <C> <C>
Revenues
Advertising revenues 13,124 295,949 487,399
Contract revenues and other 15,572 1,269,030 2,089,965
Contract revenues from related parties 0 157,039 258,628
------------------ --------------- ----------------------
Total revenues 28,696 1,722,018 2,835,992
Cost of revenues
Maintenance and housing costs 0 111,663 183,898
Cost of contract revenues and other 0 561,075 924,034
Advertising and commission costs 0 177,980 293,115
------------------ --------------- ----------------------
Total cost of revenues 0 850,718 1,401,047
Gross profit 28,696 871,300 1,434,945
OPERATING EXPENSES:
Sales and marketing 119,232 521,663 859,127
Research and development 64,953 192,602 317,196
General and administrative 229,100 746,712 1,229,759
Depreciation 18,825 35,811 58,978
Amortization 0 197,953 326,009
------------------ --------------- ----------------------
Total operating expenses 432,110 1,694,741 2,791,069
Loss from operations (403,414) (823,441) (1,356,124)
Interest expense (25,899) (7,705) (12,689)
Interest income 183 77,602 127,803
Other income 10,789 3,350 5,517
------------------ --------------- ----------------------
Net loss (418,341) (750,194) (1,235,493)
================== =============== ======================
Basic and diluted net loss per share ((pound)0.08) ((pound)0.10) ($0.16)
================== =============== ======================
Shares used in computing basic and diluted net
loss per share 5,000,000 7,652,736 7,652,736
================== =============== ======================
</TABLE>
See accompanying notes.
5
<PAGE>
TOWNPAGESNET.COM PLC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine months ended
Nine months ended September 30, September 30,
1998 1999 1999
---------------------------------- -----------------------------
Amounts in pounds sterling Amounts in US dollars
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss (1,011,913) (251,888) (414,835)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation 28,795 71,219 117,291
Amortization of Intangibles 0 197,953 326,009
CHANGE IN OPERATING ASSETS AND
LIABILITIES:
Accounts receivable (38,421) (8,637,501) (14,225,102)
Prepaid expenses (2,832) 195,813 322,484
Accounts payable 184,968 622,251 1,024,785
Accrued liabilities and other liabilities 19,631 (490,680) (808,100)
Taxes and social security payable 0 267,379 440,346
Deferred income 0 (2,064,566) (3,400,134)
---------------------------------- -----------------------------
Net cash used in operating activities (819,772) (10,090,020) (16,617,256)
---------------------------------- -----------------------------
Cash flows used in investing activities:
Purchases of tangible fixed assets (125,865) (322,441) (531,028)
Purchases of fixed asset investments 0 (1,549,486) (2,551,848)
---------------------------------- -----------------------------
Net cash used in investing activities (125,865) (1,871,927) (3,082,876)
---------------------------------- -----------------------------
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
Proceeds from issuance of common stock 0 10,498,619 17,290,176
Issuance of common stock 0 5,879,888 9,683,588
Proceeds from (repayments of) debenture loan from
stockholder 937,996 (832,190) (1,370,534)
---------------------------------- -----------------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 937,996 15,546,317 25,603,230
---------------------------------- -----------------------------
Net increase (decrease) in cash and cash
equivalents (7,641) 3,584,370 5,903,098
Cash and cash equivalents at beginning of period 12,868 33,868 55,778
---------------------------------- -----------------------------
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 5,227 3,618,238 5,958,876
================================== =============================
SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION
CASH PAID FOR INTEREST 0 74,565 122,801
================================== =============================
</TABLE>
See accompanying notes.
6
<PAGE>
TOWNPAGESNET.COM PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DESCRIPTION OF BUSINESS
TownPagesNet.com plc (the `Company') produces and delivers TownPages, an
Internet-based interactive service organized to provide comprehensive,
locally-focused information about specified towns and cities in the United
Kingdom. The Company was incorporated in England and Wales on July 31, 1998 as
Town Pages Holdings plc. The Company acquired all of the share capital of Town
Pages UK Limited (formerly known as Town Pages Limited) on December 15, 1998.
The Company's name was changed to TownPagesNet.com plc and its subsidiary's name
was changed to Town Pages UK Limited in April 1999.
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements include
the Company and its subsidiaries, Town Pages UK Limited, WWW.CO.UK Limited and
its affiliates, and Morbria Limited and its subsidiaries. All significant
intercompany transactions and balances have been eliminated upon consolidation.
The unaudited condensed consolidated financial statements have been prepared by
the Company and reflect all adjustments consisting only of normal recurring
adjustments, which are in the opinion of management, necessary for a fair
presentation of the interim periods presented. The results of operations for the
three and nine months ended September 30, 1999 are not necessarily indicative of
the results to be expected for any subsequent quarter or for the entire year
ending December 31, 1999. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with United States
generally accepted accounting principles have been condensed or omitted pursuant
to the Securities and Exchange Commission's rules and regulations. A condensed
consolidated statement of comprehensive loss has not been presented because the
components of comprehensive loss are not material.
The balance sheet at 31 December 1998 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements.
These unaudited condensed consolidated financial statements and notes included
herein should be read in conjunction with the Company's audited consolidated
financial statements and notes as included in the Company's registration
statement on Form F-1 for the year ended December 31, 1998 as filed with the
Securities and Exchange Commission on April 30, 1999.
The financial statements expressed in pounds sterling as of September 30, 1999
were translated into United States Dollars, solely for the convenience of the
reader, at the prevailing exchange rate at September 30, 1999 of (pound)1 =
$1.6469. These translations should not be construed as representations that the
pound sterling amounts actually represent U.S. dollar amounts or that they could
be converted into U.S. dollars at the rate indicated or at any other rate.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at
7
<PAGE>
TOWNPAGESNET.COM PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
the date of the financial statements and the reported amount of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
REVENUE RECOGNITION
The Company's contract revenues are derived principally from services performed
under development contracts for the design, coordination, and integration of the
customer's content and links into the TownPages directory. Fees for these
services are recognized as the service is performed. These fees are recognized
as revenue once the related activities have been performed and/or the customer's
web links are available on the Town Pages directory.
Revenues from web site design agreements are recognized using the percentage of
completion method where reliable estimates of costs to complete the contracts
are available. If reliable estimates of costs to complete are not available, the
completed contract method is used. Revenues under web site design agreements
were (pound)1,426,069 ($2,348,593) for the 3 months ended September 30, 1999 and
(pound)5,287,750 ($8,708,395) for the 9 months ended September 30, 1999. There
were no unbilled receivables as of September 30, 1999. Unbilled receivables were
billed in accordance with billing schedules specified in the contracts to which
they relate.
The Company's advertising revenues are derived principally from short-term
advertising contracts which are recognized ratably over the term of the
contract. Certain advertising contracts contain a guaranteed number of
impressions (a view of an advertisement by a customer). To the extent that the
impression deliveries are falling short of the guarantees, the Company defers
recognition of the corresponding revenues.
Subscription revenues are for the set-up of customers on the TownPages
directory. These fees are recognized ratably over the term of the subscription
period which is generally one year.
Deferred revenue is primarily comprised of payments received from web site
design contracts in advance of revenue recognition and billings in excess of
recognized revenue relating to advertising contracts.
CASH AND CASH EQUIVALENTS
The Company considers investments in highly liquid instruments purchased with an
original maturity of 90 days or less to be cash equivalents. Such amounts are
stated at cost which approximates market value. As of September 30, 1999 the
Company's cash equivalents were comprised of (pound)3,618,238 ($5,958,876) of
short term deposits.
GOODWILL
The Company amortizes goodwill from the acquisitions of their subsidiaries on a
straight line basis over its economic useful life of five years. Goodwill is
included under the caption Intangible Assets.
The Company operates in a highly technological industry with relatively low
entry market barriers. Due to the fast moving nature of the Internet market, the
Company does not believe that
8
<PAGE>
TOWNPAGESNET.COM PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
goodwill will have a useful economic life of more than five years. The carrying
value of goodwill will continually be reviewed for impairment to ensure that the
carrying value of the goodwill does not exceed its recoverable amount.
NET LOSS PER SHARE
Basic and diluted net loss per share is calculated using the weighted average
number of common shares outstanding. Diluted net loss per share is computed
using the weighted average number of common shares outstanding and dilutive
common stock equivalents outstanding during the period. A reconciliation of the
numerators and denominators used in the basic and diluted net loss per share
amounts is as follows:
<TABLE>
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
1998 1999 1998 1999
------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
Net loss (pound) (418,341) (pound) (750,194) (pound) (1,011,913) (pound) (251,888)
================== ================== ================== ==================
Shares used to compute basic and diluted
net loss per share 5,000,000 7,652,736 5,000,000 6,345,244
================== ================== ================== ==================
Basic and diluted net loss per share (pound) (0.08) (pound) (0.10) (pound) (0.20) (pound) (0.04)
================== ================== ================== ==================
</TABLE>
2. ACQUISTION OF WWW.CO.UK LIMITED
On July 19, 1999, the Company completed the acquisition of four companies,
WWW.CO.UK Limited, Summerfields Publishing Limited, The Platinum Club Limited,
and Featureboards Limited, all corporations under common control and organized
and existing laws of England and Wales (collectively referred to as `WWW'). WWW
provides advertising management and optimization services to advertisers and
agencies in both print media and through the Internet from locations in the
United Kingdom. Under the trading name `Cinemas Online,' WWW is an Internet
provider of cinema information in England and Ireland. In connection with the
acquistion, in exchange for all the outstanding capital stock of WWW, the
Company paid (pound)1,500,000 in cash (approximately US$2.34 million) and issued
an aggregate of 488,281 of the Company's ordinary shares, valued (based on the
US$8.00 per share closing price of the Company's American Depositary Shares
(`ADS's) on the American Stock Exchange on Friday, July 16, 1999) at
(pound)2,500,000.
In addition, the Company agreed to pay to the former owners of WWW, a maximum of
(pound)250,000 within 90 days after the end of each of fiscal years ending
December 31, 1999 and December 31, 2000 in the event that the aggregate turnover
or sales revenues of WWW equals or exceeds certain specified targets in each of
fiscal years 1999 and 2000.
9
<PAGE>
TOWNPAGESNET.COM PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
The acquisition was accounted for using the purchase method of accounting. The
results of operations of WWW are included in the accompanying statement of
operations from the date of acquisition.
3. ACQUISTION OF MORBRIA LIMITED
On September 24, 1999, the Company consummated the acquisition of Morbria
Limited, and its subsidiaries, The Graphic Palette Company (Manchester) Limited,
Centrix Communications Limited and Review Marketing and Advertising Limited, all
corporations organized and existing under the laws of England and Wales
(collectively referred to as `Morbria'). Morbria, through its subsidiary Graphic
Palette, specilizes in web site design and advertising services. In connection
with the acquisition, in exchange for all the outstanding capital stock of
Morbria Limited, the Company issued an aggregate of 857,972 of the Company's
ordinary shares, valued (based on a price of US$6.50 per share, representing a
20% discount of the per share closing price of the ADSs on the American Stock
Exchange on Thursday, September 23, 1999) at (pound)3,379,888 (approximately
US$5.4 million).
Glen UK Holdings Limited (`Glen'), the majority stockholder of Morbria, is an
investment company owned by Kevin R Leech, the majority stockholder and a
director of the Company.The Company's shares issued to Glen are being held in
escrow by the Company's UK counsel pending delivery of a fairness opinion to the
Company indicating that the consideration paid for the Morbria shares is fair
and reasonable from a financial point of view of the Company's stockholders.
In addition, the Company agreed to pay to the former owners of Morbria,
contingent consideration within 90 days after the end of each of fiscal years
ending March 31, 2000 and March 31, 2001 in the event that the aggregate
turnover or sales revenues of Morbria equals or exceeds certain specified
targets in each of fiscal years 2000 and 2001.
The acquisition was accounted for using the purchase method of accounting. The
results of operations of Morbria are included in the accompanying statement of
operations from the date of acquisition.
4. PRO FORMA EFFECT OF ACQUISITIONS
The pro forma unaudited results of operations for the nine months ended
September 30, 1999 and September 30, 1998, assuming consummation of the
purchases as of January 1, 1998, are as follows:
<TABLE>
<CAPTION>
Nine Months Ended Nine Months Ended
September 30, September 30,
1998 1999 1999
------------------------------ ---------------------
Amounts in Pounds Sterling Amounts in US Dollars
<S> <C> <C> <C>
Net Revenues:
TownPagesNet.com plc 40,474 5,228,005 8,610,001
WWW.CO.UK Limited 961,840 1,035,372 1,705,154
Morbria Limited 1,544,429 1,421,050 2,340,327
----------- ----------- -----------
2,546,743 7,684,427 12,655,483
=========== =========== ===========
Net Loss:
TownPagesNet.com plc (1,011,913) (93,931) (154,695)
WWW.CO.UK Limited 70,733 (99,201) (163,374)
Morbria Limited (54,118) (58,408) (96,189)
----------- ----------- -----------
(995,298) (251,538) (414,258)
=========== =========== ===========
Basic and Diluted
Net Loss per Share (0.20) (0.04) (0.07)
</TABLE>
10
<PAGE>
TOWNPAGESNET.COM PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
5. INITIAL PUBLIC OFFERING
On May 5, 1999, the Company completed an initial public offering of 2,200,000
American Depositary Shares at an initial price to the public of $10.00 per
share, resulting in net proceeds to the Company (after deducting underwriters
discounts and commissions and offering expenses) of approximately $16.6 million.
6. SUBSEQUENT EVENTS
ACQUISITION OF BUYERSGUIDE LIMITED
On October 1, 1999, the Company consummated the acquisition of BuyersGuide
Limited, a corporation organized and existing under the laws of England and
Wales (`BuyersGuide'). BuyersGuide publishes the Internet-based Local Authority
& Public Service "Buyer's Guide." In connection with the acquisition, in
exchange for all the outstanding capital stock of BuyersGuide, the Company
issued an aggregate of 486,381 of the Company's ordinary shares, valued at
(pound)2,500,000 (approximately US$4.1 million), based on the average of the
closing price per share of the ADSs on the American Stock Exchange on the five
business days prior to the closing date of the acquisition.
In addition, the Company agreed to pay to former owners of BuyersGuide
contingent consideration within 90 days after the end of the Company's fiscal
year ending March 31, 2000, in the event BuyersGuides' pre-tax income equals or
exceeds certain specified targets in fiscal 2000.
The acquisition will be accounted for using the purchase method of accounting.
ACQUISTION AND MERGER WITH RESEARCH SALES INC.
Effective November 1, 1999, the Company consummated the merger of its
newly-formed, wholly-owned subsidiary, Rasmussen Acquisition Corp., a Washington
corporation, with and into Research Sales, Inc. (d/b/a Rasmussen Research,
Inc.), a Washington corporation (`Research Sales'). Research Sales is an
Internet-based polling and market research firm. In connection with the merger,
in exchange for all of the capital stock of Research Sales, the Company issued
an aggregate of 551,302 of the Company's ordinary shares, valued at
approximately US$4.5 million at US$8.1625 per share based on the average closing
price per ADS on the American Stock Exchange for the 5 days ending on September
1, 1999.
In addition, pursuant to the terms of the Agreement and Plan of Merger, the
Company has made working capital loans to Research Sales in the aggregate amount
of US$595,000 and it will make an additional US$150,000 in working capital loans
by December 1, 1999. The loans are evidenced by promissory notes bearing
interest at the Bank of America prime rate and are payable one year from the
date of the notes.
The merger will be accounted for using the purchase method of accounting.
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
THE DISCUSSION IN "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS" CONTAINS TREND ANALYSES AND OTHER FORWARD-LOOKING
STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933 AND
SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934. ALL STATEMENTS, TREND
ANALYSES AND OTHER INFORMATION CONTAINED HEREIN RELATIVE TO MARKETS FOR
TOWNPAGESNET.COM PLC's SERVICES AND PRODUCTS AND TRENDS IN REVENUE, AS WELL AS
OTHER STATEMENTS INCLUDING SUCH WORDS AS "ANTICIPATE," "BELIEVE," "PLAN,"
"ESTIMATE," "EXPECT," "GOAL," AND "INTEND" AND OTHER SIMILAR EXPRESSIONS
CONSTITUTE FORWARD-LOOKING STATEMENTS. THESE FORWARD-LOOKING STATEMENTS ARE
SUBJECT TO BUSINESS AND ECONOMIC RISKS DESCRIBED IN THIS REPORT.
OVERVIEW
TownPagesNet.com plc (`TownPages' or the `Company') operates TownPages(R), an
interactive online local content network providing comprehensive, up-to-date
locally focused information about towns and cities in the United Kingdom in a
graphically pleasing format. The TownPages(R) network of sites is aggregated in
local and national sections.
The local network consists of detailed community information on 1,300 towns and
cities throughout the UK. This information includes in-depth community
information provided by local governments as well as information concerning
local news, events, tourist attractions, hotels, restaurants, public transport,
shopping, real estate listings, employment opportunities, arts and entertainment
events, sports, weather, recreational activities, business, and professional
services. TownPages(R) also features chatrooms and message boards.
The national network consists of vertical e-commerce channels which benefit from
the traffic derived from consumers seeking local information. TownPages(R)
facilitates channel usage by providing common features and functionability
within each channel including experts, chatrooms, message boards and other
services.
We have signed contracts for 3 additional national e-commerce vertical web
channels during this quarter, with a combined contract value of $2.3 million,
bringing our national channel contracts up to 24.
TownPages now offers channels covering the following subjects: cars, travel,
health, shopping, fashion, auction, financial services and information,
homewares, gardening, memorabilia and collectibles, leisure, lifetime
dedication, toys, pets, languages, shipping, angling, weddings, the royal
family, sports, cooking, women, venture capital and over 40's. Our objective is
to have 50 e-commerce web channels within 15 months.
12
<PAGE>
To enable TownPages(R) to potentially reach all consumers in the UK marketplace,
we have commenced a strategic plan to roll out approximately 3,500 free to the
user internet access kiosks in selected locations throughout the UK. On August
13, 1999, we entered into an agreement with NCR Limited to manufacture, install,
and co-market the Internet access kiosks. This agreement will enable us to move
forward into the next phase of the national roll out of the TownPages(R)
service. The Company has to date installed 50 kiosks.
The business model for the kiosk roll out is being adapted in line with the UK
market place. Where the Company was going to offer free online access, it is now
starting to develop kiosks with NCR where the consumer will be charged for
general online surfing (at a discounted rate to the successful Photo-Me
service). It is intended that the Town Pages service will be installed on the
hard drive, which the consumer may still view for free. This has the potential
effect of turning the kiosk into a revenue generator and turns the roll out of
kiosks into a potential profit centre rather than a capital cost. Due to the
emergence of WAP technology, the Company's free e-mail service is a lesser
feature.
The Company believes it is essential that the kiosks have e-commerce capability,
the ability to print, and revenue producing capability, before the full roll out
is commenced aggressively.
In the future, we intend our kiosks to be able to facilitate e-commerce through
a built in credit card facility as well as have the ability to print. We believe
that our branded Internet access kiosks in prominent locations across the UK
will continue to be a tool for promoting the TownPages brand, and that they
could be the initial entry point to the Internet for a large number of UK
consumers. Our main service is also accessible through standard Internet
connections to the TownPages web site at www.townpagesnet.com or
www.townpages.co.uk.
As anticipated, we have moved into a net loss position at the nine months ended
30 September, 1999. It is anticipated that we may incur net losses for the
foreseeable future as we continue our national marketing and kiosk roll out
program. Performance will depend, in part, on the amount and rates of growth in
our net revenue from e-commerce and advertising. We expect operating expenses to
increase significantly, especially in the areas of sales and marketing and brand
promotion. To the extent that these expenses are not accompanied by an increase
in net revenue, our business, results of operations and financial condition
could be materially adversely affected. We will need to increase our quarterly
net revenue to achieve profitability. We believe that period-to-period
comparisons of our operating results are not meaningful and that you should not
rely upon the results for any period as an indication of future performance. Our
business, results of operations and financial condition will be materially and
adversely affected if:
o net revenue does not grow at anticipated rates;
o increases in operating expenses are not offset by commensurate increases in
net revenue; or
o we are unable to adjust operating expense levels in light of net revenue.
To date, we have entered into various business and technology acquisitions,
license arrangements and strategic alliances in order to provide
community-specific content, generate additional traffic,
13
<PAGE>
increase the number of members and establish additional sources of net revenue.
We intend to continue making acquisitions to increase online reach and
membership and to seek additional strategic alliances with content and
distribution partners, including alliances that create co-branded sites through
which we market our services. Acquisitions carry numerous risks and
uncertainties, including:
o difficulties in integrating operations, personnel, technologies, products and
the information systems of the acquired companies;
o diversion of management's attention from other business concerns;
o risks of entering geographic and business markets in which we have little or
no prior experience; and
o potential loss of key employees of acquired entities.
We cannot guarantee that we will be able to successfully integrate any
businesses, products, technologies or personnel that we have acquired or may
acquire in the future. A failure to successfully integrate acquired entities or
assets could have a material adverse effect on our business, results of
operations and financial condition. In addition, we cannot guarantee that we
will be successful in identifying and closing transactions with potential
acquisition candidates.
14
<PAGE>
RESULTS OF OPERATIONS
The following table presents certain consolidated statement of operations data
for the periods indicated as a percentage of total net revenue.
<TABLE>
<CAPTION>
Three months Ended Nine months Ended
September 30, September 30,
1998 1999 1998 1999
---- ---- ---- ----
% % % %
<S> <C> <C> <C> <C>
Total revenues:
Advertising 46% 17% 48% 5%
Contract and other revenues 54% 74% 52% 85%
Contract revenues from
related parties 0% 9% 0% 10%
Total revenues: 100% 100% 100% 100%
Cost of revenues:
Maintenance and hosting costs 0% 6% 47% 8%
Cost of contract revenue &
other 0% 33% 0% 49%
Advertising and commission
costs 0% 10% 0% 3%
--------------------------------------------------
Total Cost of Revenue: 0% 49% 47% 61%
Gross Profit 100% 51% 53% 39%
Operating Expenses:
Research and development 416% 30% 629% 14%
Sales and marketing 226% 11% 357% 7%
General and administrative 798% 43% 1394% 20%
Depreciation 66% 2% 71% 1%
Amortization 0% 11% 0% 4%
--------------------------------------------------
Total Operating Expenses 1506% 98% 2450% 45%
Loss from operations -1406% -48% -2397% -6%
Interest expense -90% 0% -137% -1%
Interest income 1% 5% 3% 3%
Other income 38% 0% 31% 0%
--------------------------------------------------
Net loss -1458% -44% -2500% -5%
==================================================
</TABLE>
15
<PAGE>
NET REVENUE
Total net revenue for the three months ended September 30, 1999 was
(pound)1,722,018 ($2,835,993), an increase of (pound) 1,693,322 ($2,788,732)
from revenues of (pound)28,696 ($47,259) for the three months ended September
30, 1998. Total net revenue for the nine months ended September 30, 1999 was
(pound) 5,587,981 ($9,202,845), an increase of (pound)5,547,507 ($9,136,189)
from revenues of (pound)40,474 ($66,656) for the nine months ended September 30,
1998.
The increase in net revenue was primarily due to the following factors: an
increase in the number of web development channel contracts that have been
signed up; the expansion of our service; and a broader product offering and an
increase in the frequency of visitors to the site attracting additional
advertisers.
ADVERTISING REVENUE
Advertising revenue increased to (pound)295,949 ($487,399) for the three months
ended September 30, 1999 from (pound)13,124 ($21,614) for the three months ended
September 30, 1998 and for the nine months ended September 30, 1999 increased to
(pound)300,231 ($494,450) from (pound)19,334 ($31,841) for the nine months ended
September 30, 1998. We installed a further 31 kiosks in the quarter ended
September 30, 1999. We anticipate that revenues from this source will account
for an increasing amount of net revenues in the future as we anticipate that the
increasing number of kiosks will bring in more advertising revenue.
CONTRACT REVENUE AND OTHER
Contract and other revenues increased to (pound)1,426,069 ($2,348,593), of which
(pound)157,039 ($258,628) are with a related party, for the 3 months ended
September 30 1999, from (pound)15,572 ($25,646) for the 3 month period ended
September 30, 1998. In the nine months ended September 30, 1999 contract and
other revenues increased to (pound)5,287,750($ 8,708,395), of which
(pound)556,142 ($915,910) are with a related party, from (pound)21,140 ($34,815)
for the nine month period ended September 30, 1998.
Our management performs ongoing credit evaluations of our customers' financial
condition and generally does not require collateral on accounts receivable. When
required, we maintain allowances for credit losses and those losses have not
been material to date. There was an allowance for doubtful accounts as of
September 30, 1999 of (pound)414,524($682,680) there was no provision as of
December 31, 1998. This increase is due to the inclusion of WWW which carries a
fixed percentage provision in its balance sheet.
MAINTENANCE AND HOSTING COSTS
Maintenance and hosting costs consist primarily of Internet connection charges,
Web site equipment leasing costs, purchase and installation of public
information point kiosks, repair and
16
<PAGE>
maintenance of equipment and systems, collection, development, and processing
for display on Town Pages(R) of locally-focused content. Maintenance and hosting
costs increased to (pound)111,663 ($183,898) for the 3 months ended September
30, 1999, there were no maintenance and hosting expenses for the 3 months ended
September 30, 1998. In the nine months ended September 30,1999, maintenance and
hosting costs increased to (pound)463,865 ($763,939) from (pound)19,000
($31,291) for the nine months ended September 30, 1998. The increase in
maintenance and hosting costs was primarily due to the costs associated with the
installation and maintenance of additional TownPages(R) kiosks. We anticipate
that those costs will continue to grow in absolute amounts for the foreseeable
future as we pursue our expansion plan.
COSTS OF CONTRACT AND OTHER REVENUES
Cost of contract and other revenues consists primarily of certain Web site
design and related operating costs. Cost of contract and other revenues
increased to (pound)561,075 ($924,034) for the 3 months ended September 30,
1999. There were no cost of contract and other revenues for the 3 months ended
September 30, 1998. In the nine months ended September 30,1999, cost of contract
and other revenues increased to (pound)2,763,609 ($4,551,388). There were no
cost of contract and other revenues for the 9 months ended September 30, 1998.
RESEARCH AND DEVELOPMENT EXPENSES
Research and development expenses include expenses associated with the
development of services, products and our Web site and consist principally of
personnel costs, overhead costs, editorial costs, equipment depreciation and
supplies. These costs have been charged to research and development expenses as
incurred. Research and development expenses increased to (pound)192,602
($317,196) for the 3 months ended September 30, 1999, from (pound)64,953
($106,971) for the 3 months ended September 30, 1998. For the 9 months ended
September 30, 1999 research and development expenses increased to (pound)364,931
($601,005) from (pound)144,396 ($237,806) for the 9 months ended September 30,
1998. The increase in research and development expenses was primarily due to the
roll-out of TownPages kiosks and personnel increases involved in the development
of our Web site. We expect that research and development expenses will grow
significantly in pounds sterling for the foreseeable future as we pursue our
expansion strategy and devote substantial resources to the development of
services, products and our Web site.
SALES AND MARKETING EXPENSES
Sales and marketing expenses consist primarily of salaries of sales and
marketing personnel, commissions, advertising and other marketing related
expenses. Sales and marketing expenses also include personnel costs and costs
associated with our radio, bus, direct mailings, printed ads, film trailer
advertising and telesales campaigns in the United Kingdom. Sales and marketing
17
<PAGE>
expenses increased to (pound)521,663 ($859,127) for the 3 months ended September
30, 1999, from (pound)119,232 ($196,363) for the 3 months ended September 30,
1998. The increase occurred primarily because of the advertising sales and
marketing efforts during this period as we focused on preparations for our
national roll-out. For the 9 months ended September 30,1999 sales and marketing
expenses increased to (pound)762,750 ($1,256,173) from (pound)254,458 ($419,067)
for the 9 months ended September 30, 1998. The pounds sterling increase in sales
and marketing expenses was primarily due to the roll-out of TownPages and
increases in the number of sales personnel, increased sales commissions and
increased expenses associated with promotion and marketing efforts. We expect
that sales and marketing expenses will grow significantly in pounds sterling for
the foreseeable future as we pursue our expansion and branding strategy and hire
additional sales and marketing personnel.
GENERAL AND ADMINISTRATIVE
General and administrative expenses consist primarily of salaries and related
costs for general corporate functions, including finance, accounting, facilities
and legal and other fees for professional services. General and administrative
expenses increased to (pound)746,712 ($1,229,759) for the 3 months ended
September 30, 1999, from (pound)229,100 ($377,305) for the 3 months ended
September 30, 1998. In the 9 months ended September 30, 1999 general and
administrative expenses increased to (pound)1,124,423 ($1,851,812) from
(pound)564,086 ($928,993) for the 9 months ended September 30, 1998. The pounds
sterling increase in general and administrative expenses was primarily due to
increases in the number of personnel to support the growth of our business,
increases in recruiting costs related to filling key senior executive positions
and costs associated with the increase in professional fees required for
compliance purposes. We expect that we will incur additional general and
administrative expenses in pounds sterling for the foreseeable future as we hire
additional personnel and incur additional expenses related to the growth of the
business and our operations as a public company.
NET LOSS
Due to a substantial increase in operating expenses to finance our continued
development, increased penetration of existing markets and expansion into
additional markets during the 3 months ended September 30, 1999, as compared to
the 3 months ended September 30, 1998, resulting in a loss of (pound)750,194
($1,235,493) for the 3 months ended September 30, 1999, as compared to a net
loss of (pound)418,341 ($688,966) for the 3 months ended September 30, 1998 and
a loss of (pound)251,888 ($414,835) for the 9 months ended September 30, 1999,
as compared to a net loss of (pound)1,011,913 ($1,666,520) for the 9 months
ended September 30, 1998. We anticipate that losses may continue to arise on an
annual and quarterly basis until at least late in the year 2000.
LIQUIDITY AND CAPITAL RESOURCES
Prior to our initial public offering, we financed our operations primarily
through loans from Glen Investments, an investment vehicle owned by Kevin Leech,
our majority stockholder and one of
18
<PAGE>
our directors. On May 5, 1999, we completed our initial public offering of
American Depositary Shares representing 2,200,000 shares of our common stock.
Proceeds from the offering were approximately (pound)10,498,619
($16,551,073), net of offering costs. At September 30, 1999, we had cash and
cash equivalents and short-term investments of approximately (pound)3,618,238
($5,958,876) at September 30, 1999 which also represents their fair value.
TownPages does not use derivative financial instruments in its investment
portfolio. TownPages considers investments in highly liquid instruments
purchased with an original maturity of 90 days or less to be cash equivalents.
Net cash used in operating activities for the 9 months ended September 30,
1999 and 1998 was (pound)10,090,020 ($16,617,254) and (pound)819,772
($1,350,083), respectively. Cash used in operating activities in each period
was primarily the result of an increase in accounts receivable related to the
expansion of web contracts offset by an increase in current liabilities and
accounts payable as a result of the growth of our business. This is also
offset by the recognition of previously recognized deferred income.
Net cash used in investing activities for the 9 months ended September 30,
1999 and 1998 was (pound)1,871,927 ($3,082,876) and (pound)125,865
($207,287), respectively. Cash used in investing activities in this quarter
was primarily related to the acquisition of WWW.CO.UK Limited. We will
continue to evaluate the acquisition of products, businesses and technologies
that complement our business.
Net cash provided by financing activities for the 9 months ended September
30, 1999 and 1998 was (pound)15,546,317 ($25,603,230), and (pound)937,996
($1,544,786) respectively. Cash provided by financing activities in the 9
months ended September 30, 1999 was primarily attributable to net proceeds
from the issuance of common stock. Cash used in financing activities in the 9
months ended September 30, 1999 was related to the payback of the debenture
loan from a shareholder.
If cash generated by operations is insufficient to satisfy our liquidity
requirements, we may need to sell additional equity or debt securities or obtain
additional credit facilities. The sale of additional equity or convertible debt
securities may result in additional dilution to our stockholders. We may not be
able to raise any such capital on terms acceptable to us or at all.
DISCLOSURES ABOUT MARKET RISK
Our exposure to market risk is principally confined to our short-term
available-for-sale securities, which have short maturities and, therefore,
minimal and immaterial market risk.
YEAR 2000 COMPLIANCE
19
<PAGE>
The Year 2000 issue refers to the potential failures that computer systems may
incur as a result of the date change from 1999 to 2000. Many existing computer
programs use only two digits to identify a year in the date field. These
programs were designed without considering the impact of the upcoming change of
the century. As a result, computer systems using these programs may be unable to
properly recognize date-sensitive data resulting in the creation of erroneous
information or system failure.
We rely on telecommunications carriers to transmit our Internet traffic over
local and long distance networks. It is uncertain what impact the Year 2000
issue will have on the Internet and the Web, or on the ability of users to use
their computers to access our services, but major disruption is possible. A
possible worst case Year 2000 scenario for us would be if the telecommunications
carriers' systems failed. If their networks fail for an extended period of time
due to the Year 2000 issue, we will no longer be able to operate our business.
In the event our telecommunications carriers' systems are not Year 2000
compliant on a timely basis, we will seek services through carriers who are Year
2000 compliant. However, there is no assurance that this can be accomplished in
a cost-effective manner.
We have taken a number of steps to address the Year 2000 issue. We have
completed testing of our hardware, software and data sets according to Year 2000
compliance standards we established internally as the first phase of our Year
2000 compliance certification process. As the next phase of our Year 2000
compliance certification process, we are rechecking these systems in accordance
with Year 2000 compliance standards officially established by the British
Standards Institute. As a parallel phase of our Year 2000 compliance
certification process, we are requesting and receiving certifications from the
various vendors of our hardware, software and microprocessor-embedded equipment
that the products they have provided to us are fully Year 2000 compliant. Where
it is necessary to achieve Year 2000 compliance, we are obtaining upgrades from
these vendors. Any failure by our vendors to resolve any Year 2000 issues on a
timely basis, or in a manner that is compatible with our systems, could
significantly damage our business and financial condition. In the event our
vendors do not become Year 2000 compliant on a timely basis, we will seek
products and services from vendors who are Year 2000 compliant. However, there
can be no assurance that this can be accomplished in a cost-effective manner.
Although our management expects to incur costs in correcting any Year 2000
issues arising as a result of our suppliers handling of their own Year 2000
issues, our management cannot currently estimate those costs. In the process of
testing our hardware, software, data sets and microprocessor embedded equipment,
we have not encountered any significant problems to date and expect to be fully
Year 2000 compliant by mid-1999. Based on our experience to date, we have only
budgeted approximately (pound)5,000 ($8,300) for completion of our Year 2000
remediation efforts. However, there can be no assurance that actual costs of
compliance will not significantly exceed this amount.
EFFECTS OF THE EURO
20
<PAGE>
Under the terms of the Treaty on European Economic and Monetary Union, as of
January 1, 1999, the euro was introduced as a common currency among the eleven
members of the European Union that are participating in this phase of European
Economic and Monetary Union, commonly referred to as EMU. Although the
individual currencies of these countries will continue to be used until the end
of 2001, their exchange rates with the euro are fixed. The Euro is now being
used for transactions that do not involve payment using physical notes and coins
of the participating countries. The individual currencies will be replaced with
euro notes and coins at the start of 2002 when all countries participating in
the EMU are expected to operate with the euro as their exclusive common
currency.
The current government of the United Kingdom has stated that the United Kingdom
will not participate in EMU and adopt the euro until after the next general
election, at the earliest. We are currently working on the assumption that the
next general election will be in 2001 or 2002 and that the United Kingdom will
enter the EMU shortly thereafter following confirmation of the government's
decision through a referendum.
We do not currently operate in any countries that have adopted the euro and we
therefore do not face a significant currency or competitive exposure to the
euro. However, in the future we may expand into a number of these countries.
In the event that the United Kingdom adopts the euro, we would face a number of
costs in altering our accounting-related systems for the new currency, although
at present it is too early to estimate what these costs might be. Adoption of
the euro in the United Kingdom would also create greater transparency between
prices offered to our customers in different countries that participate in EMU.
A significant amount of uncertainty exists as to the effect that the euro will
have on the marketplace. We are assessing the effect that the euro introduction
will have on our internal systems and the sale of our products and services. We
expect to take appropriate actions based on the results of this assessment.
Currently, we do not believe that the adoption of the euro by eleven countries
of the European Union will have an adverse impact on our liquidity or financial
condition.
21
<PAGE>
TOWNPAGESNET.COM PLC
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
In July 1999, the Company issued 488,281 of its ordinary shares as partial
consideration for the acquisition of WWW.CO.UK Limited and its affiliates. The
shares were issued to the former owners of the capital stock of WWW. In
September 1999, the Company issued 857,972 of its ordinary shares as
consideration for the acquisition of Morbria Limited and its subsidiaries. The
shares were issued to the former owners of the capital stock of Morbria. The
issuances of these securities were deemed to be exempt from registration under
the Securities Act of 1933 (the "Securities Act") in reliance on Section 4(2) of
the Securities Act, or Regulation D promulgated thereunder, as transactions by
an issuer not involving a public offering. No underwriters were engaged in
connection with these issuances of these securities.
The effective date of the Company's registration statement, filed on Form F-1
under the Securities Act of 1933 relating to the Company's initial public
offering of its securities, was April 30, 1999. American Depositary Shares
representing a total of 2,200,000 shares of the Company's ordinary shares were
sold in an offering underwritten by Dirks & Co, Inc, JP Turner Securities LLC
and Security Capital Trading Inc. on May 5, 1999, at an initial public offering
price of $10.00 per share. The initial public offering resulted in gross
proceeds of (pound)13,954,964 ($22,000,000), (pound)3,456,345 ($5,448,927) of
which was applied to the underwriting discount and other offering expenses. As a
result, net proceeds of the offering to the Company were approximately
(pound)10,498,619 ($16,551,073).
From the time of receipt through September 30, 1999, net proceeds of the
offering were applied as follows:
- - approximately (pound)1,600,044 ($2,635,112) towards the retirement of
indebtedness owed to Glen Investments Limited, a company controlled by the
Company's majority stockholder and director, Kevin R Leech; and
- - (pound)1,500,000 (approximately $2,340,000) for the acquisition of
WWW.CO.UK Limited and its affiliates in July 1999.
In addition, net offering proceeds were used for general corporate purposes and
to provide working capital to expand our services. Funds not used have been
invested in investment-grade, interest-bearing securities in the United Kingdom.
The Company may use a portion of the net proceeds to acquire or invest in
companies, technologies or expertise to its business.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
22
<PAGE>
TOWNPAGESNET.COM PLC
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 6-K
(a) Exhibits
Exhibit Number Description
-------------- -----------
27.1 Financial Data Schedule
(b) Reports on Form 6-K
On August 11, 1999, the Company filed a report on form 6-K relating to
the acqusition of WWW.CO.UK Limited.
Exhibit Index
Exhibit Number Description
- -------------- -----------
27.1 Financial Data Schedule *
* filed herewith
23
<PAGE>
TOWNPAGESNET.COM PLC
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report on Form 6-K to be signed on its behalf by
the undersigned thereto duly authorized.
REGISTRANT:
TOWNPAGESNET.COM PLC
BY: /s/ Stephen Hall
-------------------------------------
CHIEF EXECUTIVE OFFICER
24
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CURRENCY> POUNDS STERLING
<S> <C> <C>
<PERIOD-TYPE> 9-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1999
<PERIOD-START> JAN-01-1999 JUL-01-1999
<PERIOD-END> SEP-30-1999 SEP-30-1999
<EXCHANGE-RATE> 1.6469 1.6469
<CASH> 3,618,238 3,618,238
<SECURITIES> 0 0
<RECEIVABLES> 12,677,152 12,677,152
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 16,295,390 16,295,390
<PP&E> 9,775,992 9,775,992
<DEPRECIATION> 1,016,602 1,016,602
<TOTAL-ASSETS> 25,054,780 25,054,780
<CURRENT-LIABILITIES> 9,304,451 9,304,451
<BONDS> 0 0
0 0
850,000 850,000
<COMMON> 85,463 85,463
<OTHER-SE> 14,814,866 14,814,866
<TOTAL-LIABILITY-AND-EQUITY> 25,054,780 25,054,780
<SALES> 0 0
<TOTAL-REVENUES> 5,587,981 1,722,018
<CGS> 0 0
<TOTAL-COSTS> 3,405,454 850,718
<OTHER-EXPENSES> 2,370,187 1,613,789
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 64,228 7,705
<INCOME-PRETAX> (251,888) (750,194)
<INCOME-TAX> (251,888) (750,194)
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (251,888) (750,194)
<EPS-BASIC> (0.04) (0.10)
<EPS-DILUTED> (0.04) (0.10)
</TABLE>
