Press Release
View printer-friendly version << BackSALT LAKE CITY, Jan 27, 2003 (BUSINESS WIRE) --
Overstock.com Inc. (Nasdaq: OSTK) today reported financial results for its fourth quarter and year ended Dec. 31, 2002.
"Our fourth quarter results surpassed even our own expectations," said Patrick Byrne, CEO and president of Overstock.com. "In what turned out to be a lackluster quarter for many retailers, we managed to generate record sales growth and achieved net income profitability for the fourth quarter. We credit these results to our continued discipline of building a lean and efficient infrastructure that can support offering low prices to consumers with a high level of customer service."
Key Financial and Operating Metrics:
Revenue -- In Q4-02, revenue totaled a record $41.5 million, a 191 percent increase over $14.3 million recorded in Q4-01. For the year, revenue totaled a record $91.8 million, a 129 percent increase over $40.0 million recorded in 2001.
Gross Profit -- In Q4-02, gross profit totaled a record $9.1 million, a 254 percent increase over $2.6 million recorded in Q4-01. For the year, gross profit totaled a record $18.3 million, a 242 percent increase over $5.4 million recorded in 2001.
Gross Margin -- In Q4-02, gross margin improved to a record 22 percent compared to 18 percent recorded in Q4-01. For the year, gross margin improved to a record 20 percent compared to 13 percent recorded in 2001.
Operating Income (Loss) -- In Q4-02, operating income totaled a record $1.1 million compared to an operating loss of $2.7 million recorded in Q4-01. For the year, operating loss totaled $4.1 million compared to an operating loss of $13.6 million recorded in 2001.
Net Income (Loss) -- In Q4-02, GAAP net income totaled a record $1.1 million, or diluted earnings per share of $0.06, compared to a loss of $2.9 million, or $0.27 diluted loss per share recorded in Q4-01. For the year, net loss totaled $4.6 million, or $0.88 diluted loss per share, compared to a net loss of $13.8 million, or diluted loss per share of $1.29, recorded in 2001.
Gross Merchandise Sales (Non-GAAP) -- During Q4-02, Overstock.com customers spent a record $67.2 million, a 170 percent increase over $24.9 million recorded in Q4-01. During 2002, Overstock.com customers spent a record $154.5 million, a 123 percent increase over $69.3 million recorded in 2001. Gross merchandise sales represents the gross sales price of all sales transactions, including those for which the company only records a commission under generally accepted accounting principles, and therefore differs from GAAP revenue. The following table reconciles total revenue to gross merchandise sales:
Three months ended Year ended
----------------- ------------------
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2001 2002 2001 2002
-------- -------- -------- ---------
Total revenue $14,274 $41,529 $40,003 $91,784
Add: Obligations payable to
third parties upon sale
of third-party merchandise 7,392 21,969 18,480 50,962
Add: Sales returns and
discounts 3,259 3,719 10,864 11,737
-------- -------- -------- ---------
Gross merchandise sales
(non-GAAP) $24,925 $67,217 $69,347 $154,483
======== ======== ======== =========
In conjunction with its fourth quarter earnings release, Overstock.com will broadcast its conference call live over the Internet on Tuesday, Jan. 28, at 8:30 a.m. ET (5:30 a.m. PT). Interested parties are invited to listen by logging on or calling 800/289-0468 (in the United States) or 913/981-5517 (outside the United States).
About Overstock.com
Overstock.com is a publicly traded company listed on the NASDAQ National Market System, headquartered in Salt Lake City, and can be found online at www.overstock.com.
Note Regarding Forward-Looking Statements
This press release contains certain 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. Such forward-looking statements include, but are not limited to, statements regarding our ability to build an efficient infrastructure and our ability to offer low prices to consumers with a high level of customer service. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ, including, but not limited to, our limited operating history, our ability to manage growth, a general downturn in economic conditions, and such other risks as identified in our Prospectus dated May 29, 2002, filed with the Securities and Exchange Commission and all subsequent filings with the Securities and Exchange Commission, which contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.
Overstock.com Inc.
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three months ended
--------------------------------------------
Dec. 31, Mar. 31, Jun. 30, Sept. 30, Dec. 31,
2001 2002 2002 2002 2002
-------- -------- -------- -------- --------
Direct revenue $12,392 $10,029 $11,853 $20,759 $35,302
Commission revenue 1,882 1,659 2,230 2,857 5,633
Warehouse revenue - 379 297 192 594
-------- -------- -------- -------- --------
Total revenue 14,274 12,067 14,380 23,808 41,529
Cost of goods sold 11,689 9,990 11,831 19,238 32,382
-------- -------- -------- -------- --------
Gross profit 2,585 2,077 2,549 4,570 9,147
Operating expenses:
Sales and marketing
expenses 1,431 1,219 1,313 2,083 4,054
General and
administrative expenses 2,741 2,802 2,195 2,372 3,456
Amortization of goodwill 759 - - - -
Amortization of
stock-based compensation 324 846 806 674 577
-------- -------- -------- -------- --------
Total operating expenses 5,255 4,867 4,314 5,129 8,087
-------- -------- -------- -------- --------
Operating income (loss) (2,670) (2,790) (1,765) (559) 1,060
Interest income 48 22 49 229 103
Interest expense (285) (240) (208) (7) (10)
Other income (expense),
net 10 1 (442) 63 (66)
-------- -------- -------- -------- --------
Net income (loss) (2,897) (3,007) (2,366) (274) 1,087
Deemed dividend related to
redeemable common stock (102) (111) (106) (97) (92)
Deemed dividend related to
beneficial conversion
feature of preferred
stock - (6,607) - - -
-------- -------- -------- -------- --------
Net income (loss)
attributable to common
shares $(2,999) $(9,725) $(2,472) $(371) $995
======== ======== ======== ======== ========
Net income (loss) per
share
- basic $(0.27) $(0.87) $(0.20) $(0.03) $0.07
- diluted $(0.27) $(0.87) $(0.20) $(0.03) $0.06
Weighted average common
shares outstanding
- basic 11,178 11,171 12,280 14,447 14,486
- diluted 11,178 11,171 12,280 14,447 15,696
Gross merchandise sales
(non-GAAP)
Total revenue $14,274 $12,067 $14,380 $23,808 $41,529
Add: Obligations
payable to third
parties upon sale
of third-party
merchandise 7,392 7,031 9,474 12,488 21,969
Add: Sales returns
and discounts 3,259 2,891 2,651 2,476 3,719
-------- -------- -------- -------- --------
Gross merchandise sales
(non-GAAP) $24,925 $21,989 $26,505 $38,772 $67,217
======== ======== ======== ======== ========
Overstock.com Inc.
Consolidated Statements of Operations
(in thousands, except per share amounts)
Year ended Dec. 31,
-------------------
2001 2002
--------- ---------
Direct revenue $35,243 $77,943
Commission revenue 3,965 12,379
Warehouse revenue 795 1,462
--------- ---------
Total revenue 40,003 91,784
Cost of goods sold 34,640 73,441
--------- ---------
Gross profit 5,363 18,343
Operating expenses:
Sales and marketing expenses $ 5,784 $ 8,669
General and administrative expenses 9,441 10,825
Amortization of goodwill 3,056 -
Amortization of stock-based compensation 649 2,903
--------- ---------
Total operating expenses 18,930 22,397
--------- ---------
Operating loss (13,567) (4,054)
Interest income 461 403
Interest expense (729) (465)
Other income (expense), net 29 (444)
--------- ---------
Net loss (13,806) (4,560)
Deemed dividend related to redeemable common stock (404) (406)
Deemed dividend related to beneficial conversion
feature of preferred stock - (6,607)
--------- ---------
Net loss attributable to common shares $(14,210) $(11,573)
========= =========
Net loss per common share - basic and diluted $(1.29) $(0.88)
Weighted average common shares outstanding - basic
and diluted 10,998 13,108
Overstock.com Inc.
Consolidated Balance Sheet Data
(in thousands)
Dec. 31, Dec. 31,
2001 2002
--------- ---------
Cash and marketable securities $3,729 $32,662
Inventories, net 7,586 13,954
Working capital 3,071 35,679
Total liabilities 10,450 20,322
Total stockholders' equity 5,980 39,271
Overstock.com Inc., Salt Lake City Rich Paongo, 801/947-3132 (Investor Relations) rpaongo@overstock.com Leslie A. Dotson, 415/377-4414 (Public Relations) ladotson@earthlink.net
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