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Exhibit 2
Bid.Com International Inc.
[LOGO] 6725 Airport Road, Suite 201
Mississauga, ON L4V 1V2
Tel: 905-672-7467 / Facsimile: 905-672-5705
Website: www.bid.com
(Nasdaq: BIDS, TSE: BII)
FOR IMMEDIATE RELEASE
BID.COM ANNOUNCES THIRD QUARTER 2000 RESULTS
Liquidity, value of new contracts and operating performance improve
TORONTO, ONTARIO -October 25, 2000- Bid.Com International Inc. (Nasdaq: BIDS,
TSE: BII), a global application provider of dynamic pricing solutions, today
announced results for its third quarter ended September 30, 2000. As evidenced
by the increasing value of new contracts signed, improved operational
performance and growing global customer base, the results provide an endorsement
of the Company's evolution as a business-to-business enabler of e-commerce
activities. All figures are in Canadian dollars. As of September 30, 2000, the
exchange rate was Cdn $1.5070 to US$1.00.
Gross revenue in the third quarter 2000 totaled $1.7 million compared to $3.0
million in the second quarter of 2000 and $8.3 million in the third quarter of
1999. The decline in revenues reflects the on-going implementation of Bid.Com's
previously announced exit from the business-to-consumer arena. Effective
October 24, 2000, a key phase of this transition was completed with the closing
of Bid.Com's on-line retail operations.
Customer list and new contract value grow
During the third quarter, Bid.Com entered into agreements with 14 new business
customers. These agreements typically vary in duration from one to three years.
Bid.Com expects that revenues associated with these agreements will begin to be
realized in the fourth quarter of 2000. In its business-to-business model,
Bid.Com typically recognizes revenues through implementation fees, monthly
hosting fees, and a percentage share of transactions.
In addition to its gross revenues of $1.7 million, Bid.Com generated $1.3
million in new contract value in the third quarter. New contract value
represents contractually committed revenue that will be earned over the course
of signed agreements. This total does not include any share of transactions
that Bid.Com will receive as a result of its customers' on-line sales
activities. When added to its existing deferred revenues of $3.1 million,
Bid.Com has developed a cumulative contract value of $4.4 million.
"The increasing size of our cumulative contract value is a true indication of
the momentum that Bid.Com is building, and one that we will use to measure
performance," said Jeff Lymburner, President and CEO of Bid.Com International
Inc. "Based on current projections, we are confident that the total of gross
revenues and new contract value for the fourth quarter 2000, will meet or exceed
the $3 million total achieved in this past quarter. With the close of our on-
line retail operations, our revenue in the fourth quarter will be derived almost
exclusively from B2B activities."
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Bid.Com International Inc.
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Burn-rate and liquidity improve
During the quarter, Bid.Com experienced a number of non-operational items that
warrant highlighting:
. The Company realized an accounting gain of $20.7 million on the
disposition of its investment in Quack.Com. This total was calculated
based on a discounted market value of the Company's shares in AOL as of
August 31st, 2000.
. The Company recorded an adjustment to reflect a reduction of $573,000 in
the value of its investment in AOL shares based on market value as of
September 30, 2000.
. To reflect the volatility of recent market conditions, the Company
recorded a special impairment provision for strategic investments in the
amount of $2.9 million.
Including all non-operational items, Bid.Com reported net income for the quarter
of $11.3 million or $0.21 per basic share. Excluding non-operational items, the
net loss was $6.0 million, or $0.11 per basic share. This compares to a net
loss of $7.1 million, or $0.13 per basic share, for the second quarter of 2000
and a net loss of $5.0 million, or $0.10 per basic share, for the same period in
1999.
"Bid.Com is realizing a significant improvement in its burn-rate quarter over
quarter," Mr. Lymburner continued. "By introducing operational efficiencies, we
were able to reduce expenses and improve our cash burn-rate by $600,000 in the
quarter."
Summary of milestones achieved
Throughout the past quarter, Bid.Com continued to focus on its strategy of
delivering dynamic pricing solutions to business customers, enabling them to
embark on e-commerce initiatives. The following were key developments
announced during the third quarter, 2000:
. Bid.Com sold its equity investment in Quack.com, significantly improving
the Company's liquidity.
. The Company entered into multi-year agreements with 14 organizations,
representing large and medium-sized operations. Bid.Com's new customer
base includes: News International, In2face, MarineMax, Stereo Advantage,
and EssentiaLink.
. The Company expanded its sales and market presence in Europe, California
and New York.
. Bid.Com successfully implemented a number of successful e-commerce
initiatives for its customers.
. The Company continued to enhance its web presence to reflect its business-
to-business focus.
"The third quarter was a watershed for Bid.Com," Mr. Lymburner concluded.
"Without any dilution to shareholder value, we significantly improved our
liquidity as a result of the sale of our equity stake in Quack.Com. As our
customer base grows and operational performance continues to improve, we believe
that Bid.Com will become cash flow positive before the end of 2001."
Bid.Com will hold a conference call at 8:30 a.m. EDT on Thursday, October 26 to
discuss its financial results. Followers of Bid.Com are invited to listen to
the call live over the Internet on
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Bid.Com International Inc.
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the Investor Relations section of the Bid.Com.com site at
http://www.bid.com/investor.asp. The call will also be broadcast on
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http://www.vcall.com and http://www.streetevents.com.
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About Bid.Com International Inc.:
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Founded in 1995, Bid.Com offers a comprehensive suite of on-line Dynamic Pricing
Solutions for business-to-business and business-to-consumer markets. Bid.Com
offers multiple on-line transaction methods, providing fixed price, traditional
auction, real-time declining price (Dutch) auction and reverse auctions (Request
for Quotation/Proposal (RFQ/RFP) all within the same package. Thanks to award-
winning modular architecture, the Bid.Com system can be integrated with
virtually any business-to-business or consumer-based application. A growing
number of organizations have made Bid.Com their on-line sales partner in sectors
such as automotive, heavy machinery, capital markets, electronic media, wireless
communications, arts and culture, and retail. Customers and partners include GE
Capital, News International Inc., Research In Motion, CapGemini, and
PricewaterhouseCoopers.
Bid.Com has offices in Toronto (Ontario), Tampa (Florida), Sacramento
(California), Dublin (Ireland), and Melbourne (Australia). The company's shares
trade on both the NASDAQ National Market and the Toronto Stock Exchange (NASDAQ:
BIDS, TSE: BII).
This news release may include comments that do not refer strictly to historical
results or actions and may be deemed to be forward-looking within the meaning of
the Safe Harbor provisions of the U.S. federal securities laws. These include,
among others, statements about expectations of future revenues, cash flows and
capital requirements. Forward-looking statements are subject to risks and
uncertainties that may cause the Company's results to differ materially from
expectations. These risks include the Company's ability to further develop its
business-to-business and licensing businesses, the Company's ability to develop
appropriate strategic alliances and successful development and implementation of
technology, acceptance of the Company's products and services, competitive
factors, new products and technological changes, and other such risks as the
Company may identify and discuss from time to time, including those risks
disclosed in the Company's Form 20-F filed with the Securities and Exchange
Commission. Accordingly, there is no certainty that the Company's plans will be
achieved.
To receive additional information about Bid.Com International Inc. please visit
www.bid.com.
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CONTACTS:
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At Bid.Com: At BenchMark Porter Novelli:
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Joe Racanelli, Director of Marketing Stacey Tessis
Tel: (905) 672-7467 ext. 273 Tel: (416) 423-6605
Fax: (905) 672-9928 E-mail:[email protected]
E-mail: [email protected]
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At FRB
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Alison Ziegler
Tel: (212) 661-8030
E-mail: [email protected]
