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JACKSONVILLE, Fla. -- a21, Inc. ("a21") (OTCBB: ATWO), a leading online digital content marketplace for creative professionals, today reported its financial results for the first quarter ended March 31, 2006.
Revenue for the first quarter of 2006 was $2.9 million, compared to $2.3 million for the same prior year period. The increase in revenue is largely attributable to the Ingram acquisition in addition incremental revenue growth from SuperStock, Inc. SuperStock Limited, a21`s UK subsidiary, acquired Ingram Publishing Ltd. in October 2005. Net loss for the first quarter of fiscal 2006, excluding a deemed dividend of $157,000, was $2.4 million or $0.03 per share, versus net loss of $982,000, or $0.03 per share, for the same prior year period. The loss reflects more than $1.0 million of non-operating expenses.
On January 1, 2006, the Company adopted Statement of Financial Accounting Standards No. 123 (revised 2004), "Share-Based Payment," ("SFAS 123(R)") which requires the recognition of compensation expense for all share-based payment awards made to employees and directors. The results of the first quarter of 2006 include non-cash stock-based compensation expense of $1.0 million or $0.01 per share. The first quarter results also reflect other incremental operating expenses including approximately $250,000 of incremental, non-cash amortization and depreciation charges associated with the Ingram acquisition along with corporate legal and audit costs. Cash used in operations for the first quarter of 2006 was $663,000, compared to $650,000 for the same.
"We continued to make progress in the first quarter while again improving our balance sheet," said Albert H. Pleus, Chairman and CEO of a21. "We added additional equity capital in the first quarter, and in April, raised $15.5 million to pay off debt and add approximately $11 million of working capital to the Company for growth."
Thomas V. Butta, Vice Chairman and President of a21 and CEO of SuperStock, further stated, "In the first quarter, we grew revenue while integrating the Ingram operation into SuperStock. In addition, we consolidated our UK presence in a new expanded location in London while opening a new market facing office in New York. On the product side, we launched a new, highly competitive Subscription offering, Purestock X, into our direct and distribution channels. And we continued to bolster our management team with the addition of industry veteran, Ellen Bough, as VP, Visual Content."
"With a strong balance sheet and businesses demonstrating organic growth, we believe the Company continues to be well positioned to take advantage of opportunities to grow organically as well as via acquisition," Butta concluded.
About a21
a21 (www.a21group.com) is a leading online digital content marketplace for the professional creative community. Through SuperStock (www.superstock.com; www.superstock.co.uk and www.purestockx.com) and Ingram Publishing (www.ingrampublishing.com), its most recent acquisition, a21 delivers high quality images and exceptional customer service. a21 and its companies, with offices in New York, Florida, and the United Kingdom, provide a whole new level of image access to photographers, artists, photography agencies and other customers, offering a valuable and viable choice in the stock image industry.
The statements contained in this press release contain certain forward-looking statements, including statements regarding a21, Inc.`s expectations, intentions, strategies and beliefs regarding the future. All statements contained herein are based upon information available to a21, Inc.`s management as of the date hereof and actual results may vary based upon future events, both within and without the control of a21, Inc.`s management.
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