a21 Third Quarter Results

Posted on 12/2/2005 by Jim Pickerell | Printable Version | Comments (0)

1

A21 THIRD QUARTER RESULTS


December 2, 2005

a21, Inc. has reported revenues for the third quarter of 2005 of $2,064,000 compared to $2,077,000 for the same period in 2004 and down from $2,327,000 in the second quarter of 2005. The following lists revenue per quarter for the last six quarters.















Q2 2004

$2,527,297

Q3 2004

$2,076,995

Q4 2004

$2,100,000

Q1 2005

$2,313,000

Q2 2005

$2,327,000

Q3 2005

$2,064,000



The total revenue for the last four quarters is $8,804,000. About 15% of the company's revenue comes from international sales and the rest from domestic.

Revenues were $6,703,000 in the nine months ended September 30, 2005 compared to $5,402,000 in the nine months ended September 30, 2004. (However, this tends to give a false impression because a21 didn't acquire Superstock until March of 2004 so they are comparing 9 months of 2005 revenue with 7 months of 2004 since a21 had virtually no income until it acquired Superstock.)

Losses Increase

Net loss for the third quarter was $1,343,000 or $0.03 per share, versus a net loss of $1,046,000, or $0.03 per share, for the same period in 2004. Earnings per share for the third quarter of 2005 was calculated on the basis of 41,874,607 weighted average number of shares outstanding, compared to 38,115,732 weighted average number of shares outstanding for the same period in 2004. The third quarter 2005 results include non-cash charges of $531,000 primarily for compensation, depreciation and amortization expenses.

Net loss was $3,310,000, or $0.08 per share, in the nine months ended September 30, 2005 as compared to a net loss of $1,997,000, or $0.06 per share, in the nine months ended September 30, 2004. Earnings per share for the nine months ended September 30, 2005 was calculated on the basis of 41,752,336 weighted average number of shares outstanding, compared to 34,000,866 weighted average number of shares outstanding for the same period in 2004. The results for the nine months ended September 30, 2005 include non-cash charges of $1,880,000 primarily for compensation, depreciation and amortization expenses.

Chairman and CEO Albert H. Pleus said the company expects to turn things around after spending money in the third quarter on acquisitions and raising capital.

Pleus added, "While our revenues were even with the same quarter last year, we have invested more in our business in the third quarter, are pleased with the progress we are making and believe encouraging results will follow. Feedback from our customers, contributors, employees and other partners has been overwhelmingly positive. In addition, we believe our recent capital raises totaling over $5 million and the acquisition of Ingram Publishing Limited will enable us to further implement our business plan."

In the public announcement Thomas V. Butta, Vice Chairman and President of a21 and CEO of operating subsidiary SuperStock laid out a number of new developments in the past quarter that were designed to increase revenue. He said, "We believe we have made gains on a number of fronts: sales from direct customers, the number of channel partners carrying our products, the number of images available for sale, the number of image contributors, the further rollout of our new Royalty-Free (RF) brand, Purestock, the successful launch of an RF store on SuperStock.com, continued improvement in customer features on our web site, and in structuring our organization to have our most qualified people in critical positions."

While one would think that each of these actions would have provided some boost to revenue, clearly they did not. While we don't know the specifics of each of these initiatives, it seems that adding new images, increasing the number of contributors, rolling out a new RF brand and adding channel partners seem to have had no positive effect on increasing revenue. Maybe a long lead time is require before such actions start bearing fruit, but several of these actions have been ongoing for several quarters, not something that was just launched in Q3.

In light of the failure of such actions to increase revenue it is worth considering a few numbers from Getty. In spite of a huge increase in the number of Image Partners and the number of images available on Gettyimages.com, Getty's total revenue from RF single image sales dropped a little over $1 million in Q3 (See Story 767). Also the average price per RF image licensed dropped about $5 indicating that Getty is probably being more aggressive in discounting in an effort to increase volume and revenue.

On the RM side total the number of images Getty licensed was flat, the average price per image was also down about $5 and gross revenue was down about a million.

Meanwhile, Getty's gross annual return per RF image on its site was down from $634.63 a year ago to $558.02 last month. In the RM arena Getty's annual revenue per image dropped from $673.54 per image a year ago to $413.19 (See Story 775). If Getty, with all its power in the market, is having trouble increasing revenue while doing many of the same things a21 is doing, it is not surprising that a21 has trouble increasing revenue.

Photographers need to ask themselves, "What good does it do me to keep pumping new images into the market if revenue doesn't increase?"


Copyright © 2005 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of www.selling-stock.com, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  

Comments

Be the first to comment below.

Post Comment

You must log in to post comments.

Stay Connected

Sign up to receive our FREE weekly email listing new stories posted.

Follow Us

Free Stuff

Recent Stories – Summer 2016
If you’ve been shooting all summer and haven’t had time to keep up with your reading here are links to a few stories you might want to check out as we move into the fall. To begin, be sure to complet...
Read More
Corbis Acquisition by VCG/Getty Images
This story provides links to several stories that relate to the Visual China Group (VCG) acquisition of Corbis and the role Getty Images has been assigned in the transfer of Corbis assets to the Gett...
Read More
Finding The Right Image
Many think search will be solved with better Metadata. While metadata is important, there are limits to how far it can take the customer toward finding the right piece of content. This story provides...
Read More
Where Is The Stock Photo Industry Headed?
For new readers, or those who may have missed some of what I have written over the last few months, the following are a list of stories worth looking at to get a sense of where the industry is headed.
Read More
Photography As A Career
It’s that time of year when high school seniors are waiting for college acceptance letters and thinking about future careers. If you know someone who is thinking about photography as a career you mig...
Read More
2014 Stories You May Have Missed
For many the end of the year is a time to review past experiences and consider whether it makes sense to chart a new course in the year ahead. Stock photography has changed dramatically for professio...
Read More
More Stories In 2014 You May Have Missed
Every so often I put together a list of the most important stories we’ve published in the recent past. If you are engaged in the business of stock photography the links below are to stories that we’v...
Read More
Getty: A Three Month Review
In all the excitement about 35 million FREE images it is worth looking back at some of things that have been happening at Getty Images in the last three months. After watching revenue decline for the...
Read More
State Of Stock Photo Industry: 2013
If you’re looking for an overview of the state of the stock photo industry as of October 2013 the stories listed below are a good place to start. Regular readers of Selling-Stock will have seen all t...
Read More
Education Market Shifts To Digital
If supplying pictures for educational use is a significant part of your business plan you need to be aware of how the market is trending toward digital delivery and how that is likely to affect the p...
Read More

More from Free Stuff