SOFTWARE & SERVICES
18 AUGUST 2009
WEB 2.O WEEKLY
VENTURE CAPITAL EXITS TAKING LONGER
SOFT WAR E CO MPAN IES TAK ING A BOUT 91 MONTH S TO EXIT
DAVID SHORE, CFA, MBA 416.860.6784
david.shore@researchcapital.com Arun Thomas (Associate) 416.860.7666
A recent research report published by SVB Financial elucidates how difficult it has been for venture capitalists to exit their investment across various sectors. Data combined from Dow Jones Venture Source and SVB measures the time and capital it takes for a venture-backed company to go public, be sold or go out of business. In the software sector, the median exit multiple (calculated as the value of the company at the time of exit divided by the amount of capital invested in the company) since 2001 was 0.0x to 0.1x compared to 3.7x to 10.7x between 1994 and 2001. Moreover, the median time it takes to exit these companies is at an all-time high of 91 months (7.6 years).
Total capital raised in August (so far) is $129.4 million: Online gaming company Turbine, Inc. raised $50 million in August – the largest transaction in August. Mint, a vertical community site (offering web-based solutions for financial management), was a distant second raising $14.1 million. Total capital raised in July on 31 transactions was $178.7 million, averaging $5.8 million, and June was $196.1 million (averaging $4.9 million). The average for August, monthto-date so far, is $10 million.
Financing Activity Last Twelve Months
350.0 16.2 16.0 300.0 18.0
14.0 250.0 12.0 10.3 200.0 (US$m) 9.7
10.0 10.0 (US$m)
150.0
7.0
7.0 6.5
7.1 6.6 6.2 6.6 5.6 5.0
8.0
6.0
100.0 4.0
50.0 2.0
0.0 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Total Mar-09 Average Apr-09 May-09 Jun-09 Jul-09 Aug-09
0.0
A w eak price performance w eek: Most companies in our universe had a weak stock price performance over the past week (for stocks with prices greater than $1) (Figure 6), with 36 companies showing negative returns on the week. Quepasa Corp. (OTCBB:QPSA) led the group with a 12.0% return, while Spark Networks, Inc. (AMEX:LOV) had the worst return, dropping 23.1% in the week.
This report has been created by Anal ysts that are employed by Research Capital Corporation, a Canadian Investment Dealer.
Toronto 416.860.7600 Montreal 514.399.1500 www.researchcapital.com Vancouver 604.662.1800 Calgary 403.265.7400 Regina 306.566.7550
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THE WEB 2.0 UNIVERSE Ninety-one public Web 2.0 companies identified: Our Web 2.0 universe contains 91 companies, with a combined market cap of ~$62 billion (Figure 1). The median market cap for the group is ~$60 million, with average trailing revenue of ~$159.6 million (median $54.9 million). The companies are also generally profitable, with a median EBITDA margin of 13.1%. On a valuation basis, the overall average is 4.8x trailing revenue (median 1.8x) and 11.0x trailing EBITDA (median 9.8x). Twenty-one of the companies have more than 500 employees.
C omparable C ompany Analys is > Web 2.0
C ompany Name
Accelerize New Media, Inc. Actoz S oft C o. , L td. AQ Interactive, Inc. As s ocia ted Media Holdings Inc. B igs tring C orp. B etawave C orporation B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou.com Limited C hina G ateway C orpora tion C hines e G amer International C L IC K E R Inc. C ornerW orld C orporation C yberplex Inc. DADA S pA DXN Holdings B hd Dibz Interna tiona l, Inc. Digita lP os t Intera ctive, Inc. Digita lT own, Inc. Dolphin Digita l Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C ana da , Inc. F rogs ter Intera ctive P ictures AG G a mania Digital E ntertainment C o., Ltd. G a meO n C o L td. G eoS entric O yj G ia nt Intera ctive G roup, Inc. G igaMedia Ltd. G ra vity C o. , L td G ree, Inc. G ungHo O nline E ntertainment, Inc. Ha nbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment P ty Ltd. K AB Dis tribution Inc. K ings oft C o. L td. L ingo Media C orpora tion L iveW orld Inc. L ookS mart, L td. Magnitude Informa tion S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi L imited Myria d G roup AG NE O W IZ G a mes C orporation NetDragon W ebS oft, Inc. Netea s e.com Inc. NeuL ion Incorpora ted NeXplore C orporation Ngi G roup Inc. Northga te T echnologies Limited O pen T ext C orp. O penwa ve S ys tems Inc. P erfect W orld C o., Ltd. P NI Digita l Media Inc. Q uepas a C orp. O AO R B C Informa tion S ys tems S handa Intera ctive E ntertainment Ltd. S hutterfly, Inc. S K C ommunications C o., L td. S NAP Intera ctive, Inc. S NM G lobal Holdings S ocia l Media V enures , Inc. S ocia lwis e, Inc. S ohu.com Inc. S park Networks , Inc. S pectrumDNA, Inc. T encent Holdings L td. T he P a rent C ompa ny T he9 Limited T heS treet.com, Inc. T otal S port Online AS T ree. C om, Inc. Unis erve C ommunications C orp. United O nline Inc. UO MO Media , Inc V a lueC lick Inc. V O IS , Inc. W ebzen Inc. W izza rd S oftware C orpora tion W orlds . com Inc. W oozyF ly, Inc. W ynds torm C orporation XING AG Y edangO nline C orp. Y nk K orea Inc. High L ow Average Media n
L TM as of Tic ker
3/31/2009 3/31/2009 3/31/2009 6/30/2007 3/31/2009 3/31/2009 3/31/2009 9/30/2008 9/30/2008 3/31/2009 6/30/2009 9/30/2008 3/31/2009 5/31/2009 1/31/2009 6/30/2009 6/30/2009 5/31/2009 NA 3/31/2009 5/31/2009 3/31/2009 12/31/2008 3/31/2009 3/31/2009 12/31/2008 3/31/2009 6/30/2009 3/31/2009 3/31/2009 3/31/2009 3/31/2009 6/30/2009 3/31/2009 3/31/2009 6/30/2009 1/31/2009 3/31/2009 12/31/2008 3/31/2009 3/31/2009 3/31/2009 3/31/2009 6/30/2009 3/31/2009 6/30/2009 6/30/2009 12/31/2008 12/31/2008 12/31/2008 3/31/2009 6/30/2009 3/31/2009 6/30/2008 3/31/2009 6/30/2009 3/31/2009 6/30/2009 6/30/2009 3/31/2009 3/31/2009 12/31/2007 3/31/2009 6/30/2009 12/31/2008 3/31/2009 9/30/2008 12/31/2008 3/31/2009 6/30/2009 6/30/2009 3/31/2009 6/30/2009 8/2/2008 12/31/2008 3/31/2009 3/31/2006 6/30/2009 2/28/2009 6/30/2009 1/31/2009 6/30/2009 3/31/2009 3/31/2009 3/31/2009 3/31/2009 3/31/2009 NA 3/31/2009 12/31/2007 3/31/2009 AC L Z A052790 3838 AS MH BSGC B W AV B Y OC AIM:B G T BWBA C HIN.A C Y OU CGWY G T S M:3083 C LK Z CWR L T S X :C X C M:DA DXN DIB Z DG L P DG T W DP DM A041060 E XT I T S X :F MN FR G 6180 3812 G E O 1V GA G IG M GR VY T S E :3632 3765 A047080 IAC I IAS C .A IE E AS X :J MB T S X :K AB 3888 T S X V : LM LV W D LO O K MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X :NLN NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S NDA S FLY A066270 S TVI S NMN S MV I S C LW S OHU LO V S P XA 700 K IDS .Q NC T Y TSCM T OS O TR E E T S X V : US S UNT D UOMO V C LK V OIS W ZE N W ZE W DDD W ZY F W Y ND O 1B C A052770 A023770
E xc hange
OT C B B K OS E TS E OT C P K OT C B B OT C B B OT C B B AIM OT C P K Na s daqG S Na s daqG S OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E HL S E NY S E Na s daqG S Na s daqG M TS E OS E K OS E Na s daqG S OT C B B T S XV AS X TS X S E HK T S XV OT C P K Na s daqG M OT C B B TS E OM AS X SWX K OS E S E HK Na s daqG S TS X OT C P K TS E BSE Na s daqG S Na s daqG S Na s daqG S T S XV OT C B B R TS Na s daqG S Na s daqG S K OS E OT C B B OT C P K OT C P K OT C B B Na s daqG S AME X OT C B B S E HK OT C P K Na s daqG S Na s daqG M O T C NO Na s daqG M T S XV Na s daqG S OT C B B Na s daqG S OT C B B Na s daqG M AME X OT C B B OT C B B OT C P K XT R A K OS E K OS E
Trading C urrenc y HQ
US D KR W JPY US D US D US D US D GBP US D US D US D US D TWD US D US D C AD E UR MY R US D US D US D US D KR W US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KR W US D US D C AD AUD C AD HK D C AD US D US D US D JPY SEK AUD C HF KR W HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KR W US D US D US D US D US D US D US D HK D US D US D US D NO K US D C AD US D US D US D US D US D US D US D US D US D E UR KR W KR W United S ta tes S outh K orea J a pa n United S ta tes United S ta tes United S ta tes United S ta tes United K ingdom United S ta tes Hong K ong C hina United S ta tes T aiwan United S ta tes United S ta tes C anada Ita ly Ma la ys ia United S ta tes United S ta tes United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes G erma ny T aiwan J a pa n F inla nd C hina T aiwan S outh K orea J a pa n J a pa n S outh K orea United S ta tes C anada C anada Aus tra lia C anada C hina C anada United S ta tes United S ta tes United S ta tes J a pa n S weden Aus tra lia S witzerland S outh K orea C hina C hina C anada United S ta tes J a pa n India C anada United S ta tes C hina C anada United S ta tes R us s ia C hina United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes C hina United S ta tes United S ta tes C hina United S ta tes C hina United S ta tes Norway United S ta tes C anada United S ta tes C anada United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes G erma ny S outh K orea S outh K orea
C urrent P ric e
0. 57 21,300 49,600 0. 01 0. 02 0. 06 0. 27 0. 01 0. 23 2. 54 37. 35 0. 02 412 0. 01 0. 06 2 6. 09 0. 49 0. 00 0. 05 1. 30 0. 39 820 0. 08 1. 20 14. 00 56. 70 103,000 0. 05 8 4. 41 2. 01 7,930 230,000 4,125 18. 40 0. 12 0. 06 0. 36 1 8 1. 00 0. 06 1. 20 0. 01 604000. 00 288. 00 0. 08 4. 26 31600. 00 6 40. 21 1. 10 1 32800. 00 34. 30 38. 15 2. 80 36. 15 1. 60 1 1. 05 45. 40 14. 75 9850. 00 0 0. 00 0 0. 68 59. 92 2 0 115 0. 02 8. 28 2. 24 0. 03 8. 90 0. 05 7. 31 0 10 0 2. 75 0. 47 0. 09 0. 15 0. 10 27. 50 8,870 4,770
US D Market C ap ($m)
15.8 146.0 28.6 0. 6 1. 1 1. 8 12.5 4. 1 19.5 269.5 2,054.3 0. 3 1,051.6 0. 4 5. 7 97.0 139.0 31.5 0. 0 3. 9 35.6 20.2 47.2 3. 6 56.8 49.8 261.7 105.5 63.2 1,734.5 240.4 55.9 1,880.7 279.2 71.8 2,436.2 8. 4 2. 8 14.4 80.8 1,182.3 11.2 1. 7 20.5 3. 0 984.0 2,597.6 5. 3 84.1 528.5 404.4 5,204.2 113.2 37.9 43.0 24.4 2,007.6 233.3 1,777.9 49.4 17.8 145.7 3,031.3 375.5 328.0 4. 3 0. 0 0. 0 30.1 2,297.0 43.2 11.2 26,804.0 0. 4 211.2 68.6 0. 1 96.1 1. 0 612.9 10.7 872.4 4. 1 32.6 23.7 4. 7 2. 6 1. 8 204.1 110.6 20.2 26,804.0 0. 0 688.8 60.0
US D L TM Total R ev ($m)
4.1 91. 8 65. 5 0.1 0.1 8.4 7.1 0.3 0.0 389.9 241.2 6.7 56. 1 2.5 1.3 88. 1 232.5 75. 7 NA 0.7 NM 0.8 14. 6 NM 5.0 3.2 125.9 77. 6 6.0 218.9 183.6 45. 5 147.8 109.2 54. 9 1,392.3 0.0 1.5 14. 7 74. 2 129.0 0.9 11. 4 56. 8 0.1 129.6 1,878.9 1.2 40. 0 196.7 86. 9 471.9 18. 1 0.7 93. 6 81. 3 782.6 191.7 255.4 19. 5 0.1 146.9 569.9 218.6 182.8 3.3 2.0 0.1 0.0 485.1 50. 5 0.1 1,390.1 112.0 250.3 67. 0 2.2 216.6 23. 5 949.8 0.6 563.6 0.0 22. 8 5.6 0.0 NM NA 53. 3 54. 5 10. 4 1,878.9 0.0 159.6 54.9
US D L TM Total E B ITDA ($m)
(4.4) 19.9 4.1 (2.3) (2.0) (12.6) (9.5) (1.8) (4.6) 30.8 147. 2 (6.6) 31.4 (1.2) NM 9.5 30.5 10.9 NM (2.6) (2.5) (3.7) (3.5) NM (6.9) (6.2) 20.9 19.0 (15.4) NM NM 12.5 88.8 19.6 (14.7) 52.7 (0.8) (4.9) 5.5 8.8 52.0 (1.6) (0.0) (4.4) (3.1) 43.7 288. 7 (2.4) 0.8 52.8 34.4 297. 1 (11.8) (6.2) 11.2 (40.6) 199. 2 5.3 142. 0 0.5 (10.8) 19.2 260. 8 27.3 11.9 0.9 (0.7) (0.1) (4.8) 209. 6 10.8 (2.6) 685. 2 (13.5) 85.4 1.9 (1.1) (1.0) 0.1 203. 2 (0.5) 99.0 (1.1) (0.5) (5.3) (0.8) NM NM 16.6 11.7 (0.8) 685.2 -40.6 36.9 0.9
E B ITDA %
NM 21.7% 6.3% NM NM NM NM NM NM 7.9% 61.0% -98.9% 56.0% -45.8% NM 10.8% 13.1% 14.4% NM NM NM NM -23.6% NM NM NM 16.6% 24.5% NM NM NM 27.5% 60.1% 18.0% -26.8% 3.8% NM NM 37.2% 11.9% 40.3% NM -0.4% -7.8% NM 33.8% 15.4% NM 1.9% 26.8% 39.5% 63.0% -65.2% NM 12.0% -50.0% 25.5% 2.8% 55.6% 2.3% NM 13.1% 45.8% 12.5% 6.5% 28.0% -34.8% -60.6% NM 43.2% 21.3% NM 49.3% -12.0% 34.1% 2.9% -50.6% -0.4% 0.2% 21.4% -78.2% 17.6% NM -2.4% -94.5% NM NM NM 31.2% 21.6% -7.6% 63.0% -98.9% 6.9% 13.1%
TE V/L TM R evenue
5. 1x 1. 3x 15.6x 32.4x 2. 4x 14.9x 0. 7x 7. 4x 0. 0x 17.6x 0. 2x 5. 5x 0. 9x 0. 8x 0. 6x 7. 5x 27.3x 3. 4x 9. 9x 14.9x 1. 9x 0. 4x 9. 9x 0. 9x 12.0x 2. 3x 1. 0x 0. 5x 1. 2x 0. 6x 1. 2x 9. 2x 10.9x 0. 1x 6. 7x 1. 7x 3. 5x 2. 3x 2. 6x 3. 1x 5. 8x 0. 0x 0. 3x 2. 6x 0. 6x 0. 5x 2. 5x 0. 0x 1. 4x 1. 8x 0. 9x 1. 1x 4. 5x 3. 7x 0. 8x 21.1x 0. 2x 0. 1x 4. 6x 0. 5x 0. 2x 0. 9x 17.4x 1. 3x 4. 5x 2. 8x 2. 2x 32.4x 0. 0x 4.8x 1. 8x
TE V/L TM E B ITDA
5.9x 9.2x 12.1x 31.4x 8.1x 6.1x 4.2x 11.4x 1.8x 19.9x 12.8x 13.2x 1.7x 9.7x 22.7x 19.9x 10.9x 9.8x 7.9x 0.2x 10.4x 23.4x 0.8x 0.2x 11.4x 27.6x 3.1x 8.5x 3.8x 42.8x 2.1x 4.3x 7.4x 9.1x 10.3x 42.8x 0.2x 11.0x 9.8x
E mployees
11 NA NA 3 4 53 69 9 46 2,227 628 37 NA 22 NA NA NA NA NA 7 3 NA NA 2 NA NA NA NA 108 1,570 751 469 NA NA NA 3,200 NA NA 72 NA 2,271 NA NA 90 14 NA 2,969 NA 405 NA 2,426 3,109 237 NA NA NA 3,400 NA 2,096 NA 74 NA 3,124 514 NA 11 33 NA NA 3,197 183 7 6,194 347 1,626 310 16 700 NA 1,469 NA 1,189 4 NA 110 1 NA NA 239 NA NA 6,194 1 913 405
Figure 1. Web 2.0 Universe Summary Source. Capital IQ
Page 3
CAPITAL MARKETS ACTIVITY (M&A AND FINANCING) Total capital raised in August (so far) is $129.4 million: Online gaming company Turbine, Inc. raised $50 million in August – the largest transaction in August. Mint, a vertical community site (offering web based solutions for financial management), was a distant second raising $14.1 million. Total capital raised in July on 31 transactions was $178.7 million, averaging $5.8 million, and June was $196.1 million (averaging $4.9 million). The average for August, month-todate so far, is $10 million.
Financing Activity Last Twelve Months
350.0 16.2 16.0 300.0 18.0
14.0 250.0 12.0 10.3 200.0 (US$m) 9.7
10.0 10.0 (US$m)
150.0
7.0
7.0 6.5
7.1 6.6 6.2 6.6 5.6 5.0
8.0
6.0
100.0 4.0
50.0 2.0
0.0 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Total Mar-09 Average Apr-09 May-09 Jun-09 Jul-09 Aug-09
0.0
Figure 2. Financings, Last Twelve Months Source. Company reports
(US$m) 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 0.0
Figure 3. Capital Market Activity, Last Three Months Source. Company reports
Financing & M/A Summary - Last Three Months
People Media Super Rewards Turbine Friends Reunited AdLink Internet Media Pandora Media xoopit MediaMath Edo Interactive Sugar Inc. Kontera Ltd. Ning Tumri Mint Boku RichRelevance QuickPlay Media Grab Networks Wimba Traffiq AdChina Causes Goojet SAS Bill.com Outspark ConnectEdu Acquia, Inc beeTV AdMeld Inc. SBNation blueKiwi Software SA Nokeena Metaversum iMemories Boxee Bubble Motion Invodo Zoosk Sense Networks Gather Taomee MojoPages Animoto Quikr India Pvt. Ltd. GameGround OPEN Sports network Nexage StyleCaster RingRevenue TweetDeck Z2Live KODA Crowdcast YuMe eRepublik Busca ClickFuel Akademos Newser LLC ProtonMedia Inigral AdEx Media Roblox GROU.PS OneTXT my6sense iLoop Mobile Yapta I Love Rewards Comunitae Lat49 Cliqset Aloqa ChessCube Tributes.com CoTweet Cellufun AdWhirl LiquidPlanner Picaboo Glubble Clikthrough Cognitive Match Limited TodaCell BookFresh People Capital MashLogic iSyndica Masher Media Jaxtr Jul-09 Jun-09 Aug-09
Page 4
Turbine, Inc. raises $50 million: On the capital raise front, Turbine, Inc. raised $50 million, the largest transaction so far in August. Mint was a distant second securing a $14.1 million round. Closely behind was RichRelevance raising $12.5 million. Of the total 13 transactions, eight were below $10 million each, bringing the total capital raised for August (thus far) at $129.4 million. In addition, Friends Reunited was acquired for $42 million. For additional details on financings, see Figures 23 and 24 (at end of note).
Page 5
Ad Netw ork remains the most active sector in dollars raised: Following recent trends, Ad Networks as a sector saw the most activity in dollars raised ($126.4 million), followed by the Social Network sector with 12 transactions, raising $99.6 million (Figure 4).
Capital Market Activity by Sector - Last Three Months
140.0
120.0
100.0
80.0 (US$m)
60.0
126.4 99.6
40.0
80.0 69.9 64.2 64.0 35.0
20.0
32.6 24.0 22.3 21.5 19.3 Vertical Communities 19.1 Media 13.0 Mobile Payment 12.5 Comment/Reputation 12.0 Collaboration 10.7 Online Learning 5.0 Search 4.1 Classified
0.0 Online Dating Gaming Enterprise Mobile Infrastructure Music Blog Social Networks Virtual World Video Ad Network
3.2 Microblog
3.0 Mobile Ad
1.0 Publishing
1.0 Analytics
0.5 Online Calendar
0.5 Online Lending
0.0 SMS/Voice 0
# companies
13 12 1 5 7 10 1 5 2 7 4 3 4 1
1
2
2
1
1
1
2
1
1
1
1
Figure 4. Capital Market Activity, by Sector, Last Three Months Source. Company reports
CAPITAL MARKETS ACTIVITY (PRICE PERFORMANCE) Web 2.0 index far outpaces NASDAQ recovery: Our Web 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index from mid-2008 until earlier this year. However, the index has recently had a much stronger recovery relative to the NASDAQ index (Figure 5).
Web 2.0 Index Price Performance
130 120 110 100 90 80 70 60 50 40 9/1/2008 1/5/2009 2/2/2009 3/2/2009 6/8/2009 7/6/2009 8/18/2008 9/15/2008 9/29/2008 12/8/2008 1/19/2009 2/16/2009 3/16/2009 3/30/2009 4/13/2009 4/27/2009 5/11/2009 5/25/2009 6/22/2009 7/20/2009 8/3/2009 10/13/2008 10/27/2008 11/10/2008 11/24/2008 12/22/2008 8/17/2009
^COMP - Share Pricing
Figure 5. Web 2.0 Price Performance Source. Capital IQ
Index: Web 2.0 X (Market Cap Weights) - Index Value
Page 6
A w eak price performance w eek: Most companies in our universe had a weak stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 36 companies showing negative returns on the week. Quepasa Corp (OTCBB:QPSA) led the group with a 12.0% return, while Spark Networks, Inc. (AMEX:LOV) had the worst return, dropping 23.1% in the week.
1 Week P rice P erformance
Quepas a Corp. PNI Digital Media Inc. Openw ave S y s tems Inc. K ings oft Co. L td. NeuLion Incorporated NetDragon WebS of t, Inc. Tencent Holdings L td. My riad G roup A G XING A G Gree, Inc. Ngi G roup Inc. Fluid Mus ic Canada, Inc. Eolith Co. L td. DA DA S pA IA C/InterA ctiveCorp. GameOn Co L td. Open Tex t Corp. NEOWIZ Games Corporation Modern Times G roup Mtg A B Gamania Digital Entertainment Mix i, Inc. S K Communications Co., L td. Northgate Technologies Limited TheS treet.com, Inc. Y nk K orea Inc. Cy berplex Inc. United Online Inc. Perf ect World Co., L td. Frogs ter Interactive Pic tures A G LookS mart, L td. HanbitS of t, Inc. G ravity Co., L td Chines e Gamer International Giant Interactive G roup, Inc. Changy ou.com Limited Y edangOnline Corp. S ohu.com Inc. S hutterf ly , Inc. A Q Interactive, Inc. CDC Corp. V alueClick Inc. S handa Interactive A ctoz S of t Co., L td. Tree.Com, Inc. G igaMedia L td. Neteas e.com Inc. The9 Limited Webz en Inc. S park Netw orks , Inc. -23.1% -25.0%
Figure 6. 1-Week Price Performance Source. Capital IQ
-16.1% -20.0% -15.0%
-0.2% -0.5% -0.7% -0.8% -0.8% -1.7% -2.2% -2.3% -2.5% -2.6% -2.6% -2.9% -2.9% -3.2% -3.3% -3.4% -4. 0% -4.2% -4.3% -4.3% -4.6% -5.1% -6.0% -6.4% -7.2% -7.5% -7.8% -8.0% -9.1% -9.6% -9.9% -10.7% -11.4% -11.7%
0. 0%
4.2% 3.8% 3.7% 3.5% 3.4% 3.0% 2.5% 1. 9% 1.7%
8.1% 6.9%
12.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Page 7
INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS)
K ey Developmen ts
C ompany
OA O R BC Info rm atio n S ys tem s (R TS : R B CI)
Headline
V E B Files S uit W orth R U B 202. 3 Million Aga inst R B C Information S ys tems
Notes
V neshec onomba nk (V E B ) has lodged a s uit a ga inst the R B C I nforma tion S ys tems for the s um of R UB 202. 30 million (E UR 4. 52 million US D 6.41 mi llion) to the M os cow Arbitra tion Court. Ac cording to V E B , the la ws uit dema nds to rec over funds on bonds of R B C a c quired by V E B on the stoc k exc ha nge in 2008.
P erfec t Wo rld C o. , Ltd. (N as daqG S :P W R D) P erfec t Wo rld C o. , Ltd. (N as daqG S :P W R D)
P erfec t W orld C o. , L td. ha s filed a S helf R egis tra tion in the a mount of $373. 30 million. P erfec t W orld C o. L td. R eports U na udited C onsolida ted E a rnings R esults for the S ec ond Q ua rter E nded J une 30, 2009; P rov ides R ev enue G uida nc e for the Third Q uarter of 2009
P erfec t W orld Co. , L td. ha s filed a S helf R egis tra tion in the a mount of $373. 30 million. P erfec t W orld Co. L td. reported una udited c onsol ida ted ea rnings res ults for the sec ond qua rter ended J une 30, 2009 . For the quarter, tota l revenues were R MB 521,326, 842 a ga inst R MB 334, 412,759 a y ea r a go. O pera ting profit wa s R MB 279,667, 909 a ga ins t R MB 165,957, 778 a yea r a go. P rofit before ta x wa s R M B 282, 232, 114 a ga ins t R M B 169,758, 739 a yea r a go. N et income wa s R MB 262,479, 619 a ga inst R MB 164,489, 367 a yea r a go. N et income a ttributa bl e to the c ompa ny's s ha reholders wa s R MB 262, 585,824 or R MB 0. 99 per diluted s ha re a ga inst R MB 164, 489,367 R M B 0. 55 per diluted s ha re a y ea r a go. N et c a sh provided by opera ting a c tiv ities wa s R MB 326,652, 835 a ga i nst R M B 131, 218,948 a yea r a go. Ca pita l ex penditure on purcha s e of property , equipment, a nd softwa re wa s R MB 41,752, 492 a ga ins t R MB 511,927, 172 a yea r a go. N on-G AAP opera ting profit wa s R M B 299,957, 997 a ga ins t R MB 177,812, 863 a y ea r a go. N on-G AAP net income a ttributa ble to the c ompa ny's s ha reholders wa s R MB 282, 875,912 a ga inst R MB 176, 344,452 a yea r a go. For the third qua rter of 2009 the c ompa ny 's tota l revenues a re expec ted to be between R MB 547 million a nd R MB 563 million, representing
L o okS mart, Ltd. (N as daqG M: LOOK )
L ookS ma rt, L td. L a unches P a y P er C lick S ea rch Advertis ing M odel with O ptima l P ricing
L ookS ma rt, L td. a nnounc ed the la unch of O ptima l P ric ing: a new initia tive to deliv er better performa nc e to s ea rc h a dv ertis ers by s egmenting a nd pric ing tra ffic a c c ording to tha t tra ffic's v a lue. O ptima l P ric ing offers a dvertisers a unique opportunity to reac h a nd a ttra ct a udiences outs ide of the ma jor s ea rch engines, while ma na ging to meet a nd exc eed return-on-inves tment (R O I) goa ls. O ptima l P ricing a ggrega tes key word sea rc h tra ffic on the L ook S ma rt Advertiser Network , a nd cla s si fies performa nce da ta s o tha t the full s pectrum of tha t tra ffic is pric ed a ppropria tely a c cordi ng to traffic type, qua lity, and v olume. The model relies on informa tion a bout a dvertiser campa ign objectives a nd network structure to provide ea ch a dve rtis er a cha nc e to bid on the most va lua ble tra ffic a t a ll pric e points . As the c us tomer c a s e dia gra m illustra tes , this a pproa c h, when compa red to a s imple 'blended pricing' a pproa ch more c ommon in the sea rc h a dv ertis ing industry, a llows a dvertisers to genera te more pa id click s a nd c onvers ions , a nd to rea li ze conv ersions a t a lower c ost-per-conv ers ion.
Open T ext C orp. (N as daqG S :OT E X)
Ma ra thon O il C orpora tion S elects O pen Tex t eDis c overy E a rly C a s e Ass es sment
O pen T ext C orp. a nnounc ed tha t Ma ra thon O i l C orpora tion ha s s elected O pen T ext eD isc overy E a rly C a s e As ses s ment, powered by R ec ommind, to prov ide the la tes t in eDis cov ery c a pa bilities . T he eD isc overy s olution a dds to a c ompa ny 's broa der enterpris e c ontent a nd records ma na gement s tra tegy. eD isc ov ery, wi th E CM initia tives , is des igned to improv e bus iness proces ses , proa c tiv ely ma na ge importa nt records in a c corda nc e with co mplia nce, lega l a nd polic y requirements , a nd gives employ ees new wa y s to sha re bus iness c ontent. T he O pen Text E CM S uite, the c ompa ny's fla gship offering, brings together the broa d ra nge of content ma na gement c a pa bilities orga niza tions need to sec urely a nd s a fely ma na ge a ll ty pes of enterprise informa tion-documents, v ita l rec ords, W eb c ontent, video, i ma ges , ema il, fo rms a nd reports -a cros s ma ny different enterprise s ys tems a nd a pplica tions . O pen T ext's E CM S uite offers the c ross -enterpris e E CM s olutions cus tomers need a s the s tra tegic importa nc e of E CM grows in la rge orga niz a tions , driven by c ompli a nce a nd the need to c ut c osts.
T heS treet.c om, Inc . (Nas daqG M: T S CM) TheS treet.c om, Inc . a nnounc ed dela y ed 10-Q fil ing T heS treet.c om, Inc . (Nas daqG M: T S CM) TheS treet U pda tes O n D elisting R eview
O n 08/11/2009, TheS treet. c om, I nc . a nnounced tha t they will be una ble to file thei r next 10-Q by the dea dline required by the S E C . O n Augus t 11, 2009, T heS treet. com, I nc. notified T he N AS D AQ S toc k Ma rk et tha t the Compa ny did not ti mely file its Q ua rterly R eport on Form 10-Q for the qua rter ended J une 30, 2009, a s a res ult of which the Compa ny is not currently in c omplia nce with R ule 5250(c)(1) of the NAS D AQ S toc k Ma rk et R ules – E qui ty R ules – N AS D AQ L is ting R ules. T he Company ha s identified an is s ue rela ting to its rec ording of certa in rev enue in P romotions . com, tha t the Compa ny ac quired in Augus t 2007. T he C ompa ny currently is a s ses sing the impa ct of this iss ue on the periods sinc e the a cquis ition a nd ha s not yet determined whether it will be required to res ta te a ny prior period res ults . T he C ompa ny currently does not believ e tha t this ma tter is lik ely to res ult in a ny signific a nt percenta ge revis ion to the a ggrega te revenue or ex pense previous ly reported by the C ompa ny s inc e the a c quis ition (a lthough the C ompa ny c a nnot give a ny a s s ura nces with respe ct to this ma tter a s its rev iew is not y et complete) but ma y result in ma teria l revi sions upwa rd or downwa rd to the net income reported by the C ompa ny during O n Augus t 3, 2009, B oa rd of D irectors of the I B 3 Network s Inc . dis mis s ed M oore & As soc ia tes Cha rtered, its independent registered public a cc ount firm. O n the s a me da te, Augus t 3, 2009, the a c counting firm of S ea le a nd B eers , CP As wa s enga ged a s the c ompa ny 's new independent registered public a cc ount firm. The B oa rd of Direc tors of the compa ny a nd the co mpa ny 's Audit C ommittee a pproved of the dismis sa l of Moore & Ass oc ia tes C ha rtered a nd the enga gement of S ea le a nd B eers , CP A s a s its independent a uditor.
IB 3 N etworks , Inc . (OT CB B:IBN W )
IB 3 N etwork s I nc. Announces C hanges in C ertify ing Acc ounta nt
S NM G lobal H oldings (OTCP K:S N MN )
S NM G loba l H oldings Completes Join t V enture to Dev elop S oc ia l Media Network
S NM G loba l Holdings a nnounced a joi nt venture with High S peed Ma ga z ine a nd its editor 'D J ' Foothill to develop a soc ia l media network a nd la unch a n onlin e ma ga zine. T he new entity will be a n online soc ia l media community tha t will inc lude a n online ma ga zine, a rea lity televi sion progra m, intera c tiv e enterta inment tools a nd the development of pa rtners hips with other s oc ia l network ing s ites. T he compa ny will la unc h a n online s ports a nd enterta inment ma ga zine with empha s is on upcoming a thletes a nd enterta iners. S NM will la unc h the online s ite with a limited V IP ha rd c opy run in the firs t qua rter of 2010. T he joint venture pla ns to expand to a dditiona l loc a tions , inc luding N ew Y ork, O rl a ndo, a nd a site in S outh F lorida to be s elec ted la ter.
S park Networks , Inc . (AME X:L OV)
S pa rk N etwork s I nc. R eports Una udited Cons olida ted S pa rk Network s I nc. reported una udited cons olida ted ea rnings res ults for the s econd qua rter a nd six months ended J une 30, 2009. For the E a rnings R esults for the S ec ond Q ua rter a nd S ix M onths qua rter, the c ompa ny reported net income of $1, 887,000 or $0.09 ba sic a nd diluted ea rnings per s ha re on net rev enue of $11, 242,000 E nded J une 30, 2009 compa red to net income of $1,641 ,000 or $0. 07 ba s ic a nd diluted ea rnings per sha re on net revenue of $14, 987,000 for the s a me period a yea r a go. O pera ting inc ome wa s $ 1,930, 000 a nd inc ome before inc ome tax es wa s $3,815, 000 c ompa red to opera ting income of $2,923, 000 a nd inc ome before inc ome taxes of $3, 147, 000 for the sa me period a yea r a go. E B I TD A wa s $4,321, 000 a nd a djus ted E B I TD A wa s $2,553, 000 c ompa red to E B IT DA of $3, 581,000 a nd a djus ted E B I T DA of $4,386, 000 for the sa me period a yea r a go. As of June 30, 2009, the compa ny ha d a pproxima tely $7. 8 million of debt outs ta nding. For six months the compa ny reported net income of $2,197, 000 or $0. 11 ba s ic a nd diluted ea rnings per sha re on net rev enue of $23,274, 000 compa red to net income of $3,207 ,000 or $0. 13 ba s ic a nd diluted ea rnings per sha re on net revenue of $30, 009,000 for the s a me period a yea r a go. O pera ting inc ome wa s $ 3,138, 000 a nd inc ome before inc ome tax es wa s $4,531, 000 c ompa red to opera ting income of $5,400, 000 a
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K AB D is tribution Inc . (TS X: K AB )
K AB Dis tribution Inc . R eports U na udited Cons olida ted K AB D is tribution I nc . reported una udited c onsolida ted ea rni ngs results for the s ec ond qua rter a nd si x months ended June 30, 2009. F or the E a rnings R esults for the S ec ond Q ua rter a nd S ix M onths qua rter, the c ompa ny reported los s from continuing opera tions a nd net los s of CA D 26,450, 000 or CA D 0.19 per ba s ic a nd diluted s ha re on E nded J une 30, 2009 revenues of C AD 10, 450,000 compa red to los s from continuing opera tions of C AD 2, 675,000 or C AD 0. 02 per ba sic a nd diluted s ha re a nd net loss of CAD 2, 546, 000 or CAD 0. 02 per ba s ic a nd di luted sha re on revenues of C AD 18, 964,000 for the s a me period a y ea r a go. T he compa ny reported los s before inc ome ta xes of C AD 26,2 76,000 compa red to loss before income ta x es of CAD 3,449, 000 for the sa me period a yea r a go. Net ca s h prov ided b y opera ting a ctivities wa s CAD 1, 105, 000 a nd purcha s e of property , pla nt a nd equipment, net of ta x credits wa s CAD 50, 000 c ompa red to net ca s h prov ided by opera ting a ctivities of C AD 2, 758,000 a nd purc ha s e of property, pla nt and equipment, net of ta x credi ts of C AD 780, 000 for the sa me period a yea r ago. The c ompa ny reported c omprehensiv e l oss of C AD 7, 208,000 compa red to comprehens ive loss of CAD 3, 412,000 for the s a me period a y ea r a go. W ebzen Inc . P rov ides E a rnings G uida nc e for the S econd W ebzen Inc . provided ea rnings guida nc e for the sec ond qua rter and s ix months ended Ju ne 30, 2009. F or the qua rter, the compa ny reported Q ua rter a nd S ix Months E nded J une 30, 2009 sa les were K R W 6. 2 million a ga ins t K R W 7,245 million for the sa me period a yea r ago. T he c ompa ny reported a n opera ting i ncome of K R W 69 million a ga inst the opera ting loss of K R W 4,024 million for the sa me period a yea r a go. L os s from continuing opera tion before corpora te income ta x wa s K R W 73 million compa red to the los s from continuing opera tion before corpora te inc ome ta x of K R W 11, 795 million for the sa me peri od a yea r a go. Net loss wa s K R W 313 million a ga ins t net los s of K R W 11, 981 million for the sa me period a yea r a go. For the six months, the compa ny reported s a les were K R W 13, 593 million a ga inst K R W 14, 391 million for the s a me period a y ear a go. The compa ny reported a n opera ting inc ome of K R W 1, 974 million a gainst the opera ting loss of K R W 7,792 million for the sa me period a yea r a go. P rofit from c ontinuing opera tion before corpora te inc ome ta x wa s K R W 4, 598 million c ompa red to the los s from continuing opera tion before corpora te i ncome ta x of K R W 13, 690 million for the s a me period a y ea r a go. N et inc ome wa s K R W 4,043 mill ion a ga ins t net los s of K R
W ebzen Inc . (KOS E : A069080)
OA O R BC Info rm atio n S ys tem s (R TS : R B CI) MOK O.mobi Limited (AS X:MKB ); T ris c reen Media G roup
O AO R B C I nforma tion S y stems E lec ts N ew B oa rd
O n Augus t 6, 2009 stoc kholders of O AO R B C I nforma tion S y stems elected a new B oa rd of Direc tors : G erma n K a plun, Alek sa ndr Morgulc hik, D mitriy B elik , a nd R B C ma na gers S ergey L u kin a nd Artem I nyutin, S ergey K os helenk o, V la dimir E ngels berg, V la dis la v B ess a ra bov a nd Timofey G rid nev. MO K O . mo bi L imited (AS X : M K B ) a nnounc ed a priv a te pla cement of 21, 428, 571 s ha res a t AU D 0.07 per sha re for gross proceeds of AUD 1,500, 000 with exis ting inv estor T risc reen Media G roup a nd s ophistica ted inves tors on Augus t 12, 2009. T risc reen M edia G roup wi ll inv est for AUD 500, 000 in the tra nsa ction. The c ompa ny will a c c ept over subs c ription of up to AUD 500, 000. United O nline I nc. , $ 0. 10, C a sh Div idend, Aug-12-2009 Tenc ent Holdin gs L td. a nnounc ed una udited cons olida ted ea rnings results for the s econd qua rter a nd firs t ha lf ended June 30, 2009. F or the firs t ha lf, the compa ny reported tota l rev enues were CN Y 5, 382. 8 million (U S D 787. 9 million), a n inc rea se of 77.5% ov er the first ha lf of yea r ended J une 30, 2008. O pera ting profit wa s C NY 2,563. 5 million (U S D 375.2 million), a n inc rea s e of 70. 6% yea r over yea r. N et profit for the period wa s CN Y 2, 255. 4 million (US D 330. 1 million), a n inc rea se of 88.9% y ea r ov er y ea r. P rofi t a ttributa ble to equity holders of the c ompa ny for the period wa s C NY 2,227. 9 million (US D 32 6.1 millio n), a n inc rea se of 89. 1% y ea r ov er yea r. For the qua rter, the compa ny reported tota l revenues were CN Y 2, 878.4 million (U S D 421. 3 million), a n increa s e of 14.9% c ompa red to C NY 2.504. 4 million for the first qua rter of 2009 or a n inc rea s e of 79. 9% compa red to CN Y 1, 599. 8 million for the sec ond qua rter of 2008. O pera ting profit wa s C NY 1,398. 9 million (US D 204.8 mil lion), a n inc rea s e of 20. 1% compa red to CN Y 1, 164.6 million in first qua rter of 2009 or a n increa s e of 82.8% c ompa red to C NY 765.3 million for the sa me period la s t yea r. P rofit a ttributa ble to equity hol ders of the c ompa ny for t
MO K O . mobi L imited a nnounc ed i t will receiv e AU D 1. 50 million of funding from T ris creen Media G roup a nd other inves tors . United O nline I nc. , $ 0.10, C a sh D ividend, Aug-12-2009 Tenc ent H oldings L td. Announces Una udited Cons olida ted E a rnings R es ults for the S econd Q ua rter a nd F irs t Ha lf E nded J une 30, 2009
U nited Online Inc . (Nas daqG S :U NT D) T enc ent Holdings Ltd. (S E H K:700)
L iveWo rld Inc . (OT CPK :L VWD )
L iveW orld Inc . R eports U na udited C onsolida ted E a rnings L iveW orld Inc . reported una udited c ons olida ted ea rnings res ults for the sec ond qua rter a nd s ix months ended June 30, 2009. F or the R es ults for the S ec ond Q ua rter a nd S ix Months E nded qua rter, the c ompa ny reported $2. 3 million in tota l revenues a nd a net los s of $177,000 for the s ec ond qua rter of 2009 c ompa red to $3. 1 June 30, 2009 million in tota l rev enues a nd a net los s of $138, 000 for the sec ond qua rter of 2008. T he lower rev enues a re prima rily a ttributed to spending reductions by exis ting c lients due to c urrent ec onomic conditions. Thes e reduc tions were pa rtia lly offset by work from new clients a s well a s progra m expa ns ion by s elec t cl ients . Adjus ted E B I TD A wa s $49,000 or 2% of tota l rev enues for the s econd qua rter of 2009 compa red to $107,000 or 3% of tota l revenues for the se cond qua rter of 2008. T he reduc tion in the compa ny 's Adjusted E B IT DA wa s due prima rily to the reduced tota l revenues for the peri od. L oss before ta x wa s $164,000 compa red to $112,000 for the s a me qua rter a yea r a go. N et ca s h provided by opera ting a c tiv ities wa s $126, 000 compa red to net c as h us ed in opera ting a c tiv ities of $257,000 for the s a me qua rter a yea r a go. For the six months the compa ny reported net los s of $157 000 or $0 00 per diluted s ha re on tota l rev enue of $4 9 million c ompa red to net lo s K AB D is tribution I nc . expec ts to distribute $0.65 in a ggrega te per c ommon s ha re to s ha reholders in S eptember 2009. Acc elerize New M edia I nc . reported ea rnings res ults for the sec ond qua rter a nd s ix months ended J une 30, 2009. R evenues for the qua rter ended J une 30, 2009 inc rea sed by $374, 960 or 44% to $1,227, 935 from $852, 975 for the qua rter ended J une 30, 2008. Net loss for the qua rter decrea s ed $583,065 or 61% to $374, 020 c ompa red to $957, 085 for the sec ond qua rter of 2008. F or the three months, net ca s h used in opera ting a c tivities a mounted to $192, 925, a dec rea se of $337, 294 or 64% from $530,219 for the s econd qua rter of 2008. For the six months ended J une 30, 2009, the c ompa ny reported revenues of $2, 260, 401, a n inc rea s e of $632, 521 or 39% from $1,627, 880 for the firs t ha lf of 2008. Net los s for the s ix months dec rea s ed $566, 829 or 30% to $1,343, 318 compared to $1,910, 147 for the six months ended J une 30, 2008. For the s ix months, net ca s h used in opera ting a ctivities a mounted to $490, 994, a dec rea s e of $714, 242 or 59% from $1,205, 236 for the firs t ha lf of 2008. The compa ny rec orded a charge for goodwill impa irment of $184, 000 a nd $531,547 for the three month a nd si x month period ended J une 30, 2009, res pectively , whic h wa s inc luded in the c ompa ny 's opera ting expens es .
K AB D is tribution Inc . (TS X: K AB ) A c c eleriz e New Media, Inc . (OT CB B: A CL Z)
K AB Dis tribution Inc . P rovides Div idend G uida nc e Acc eleriz e N ew Media Inc . R eports E a rnings R es ults for the S econd Q uarter a nd S ix Months E nded J une 30, 2009 ; R eports G oodwill Impa irment C ha rges for the S eco nd Q ua rter a nd S ix Months of 2009
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P NI Digital Media Inc . (T S XV:P N)
P NI Digita l M edia I nc . R eports Un-Audi ted C ons olida ted E a rnings R esults for the T hird Q ua rter a nd N ine M onths E nded J une 30, 2009
P NI D igita l M edia I nc. reported un-a udited cons olida ted ea rnings res ults for the third qua rter a nd nine months ended J une 30, 2009. F or the qua rter, the c ompa ny reported revenue of C AD 5,443, 760, repres enting a n increa s e of 29 % ov er the C AD 4, 217,992 for s a me period in la s t yea r. N et loss wa s C AD 1,877, 992 or C AD 0.05 per ba sic a nd diluted s ha re c ompa red to net loss of C AD 2, 297,614 or C AD 0. 07 per ba s ic a nd diluted s ha re for the sa me period la s t y ea r. G AAP net loss from operations for the qua rter of CAD 853, 109 compa red to C AD 2, 427, 704 for the sa me period of fis ca l 2008. N on-G AAP a djusted E B I T DA for the qua rter wa s C AD 1, 102, 357, compa red to a non-G AA P a djus ted E B IT DA los s of C AD 984,668 in the third qua rter of 2008. N on-G AAP a djusted E B IT DA per s ha re of CAD 0. 03 compa red to a non-G AAP a djusted E B IT DA los s per s ha re of C AD 0. 03 in the third qua rter of 2008. For the nine months, the compa ny reported net los s of C AD 2, 412,472 or C AD 0. 07 per ba sic a nd diluted s ha re on rev enue of C AD 17,635, 132 c ompa red to net loss of CAD 6, 002,442 or C AD 0. 18 per ba s ic a nd diluted sha re on rev enue of C AD 11, 776,085 fo r the s a me period la s t yea r.
NeuL ion Inc o rpo rated (T S X: NL N)
NeuL ion I ncorpora ted R eports E a rnings R es ults for the S eco nd Q ua rter a nd S ix Months E nded June 30, 2009
NeuL ion Inc orpora ted reported ea rnings res ults for the s econd qua rter a nd six months ended J une 30, 2009. For the qua rter, the compa ny reported revenue wa s $6. 5 million c ompa red to $3. 0 million in the s a me period in 2008, ma rk ing a y ear ov er y ea r inc rea se of 117% . N et los s wa s $4. 9 million (including $1. 7 million of non-ca s h cha rges ) or $0.04 per sha re ba sic a nd diluted c ompa red to $1. 5 million (inc luding $0. 8 million of non-c a sh cha rges) or $0. 04 per s ha re ba s ic a nd diluted for the s a me period in 2008. For six months, the c ompa ny reported revenue wa s $13.0 mil lion c ompa red to $4. 9 million in the sa me period in 2008, ma rking a y ea r ov er yea r increas e of 165% . Net loss wa s $10.7 million (inc luding $3.5 million of non-c a s h c ha rges) or $0.10 per s ha re ba sic a nd diluted for compa red to $3.0 million (inc luding $1.4 milli on of non-ca sh c ha rges) or $0. 07 per s ha re ba s ic a nd diluted for the s a me period in 2008. T he revenue a nd net los s for the three months a nd six months ended J une 30, 2008 reflect the results of opera tions of N euL ion U S A the a cc ounting a c quirer, prior to the merger between N euL ion US A a nd N euL ion on O c tober 20, 2008.
Neteas e. c om Inc . (N as daqG S :NT E S )
Netea se. c om I nc. Announc es U naudited C ons olida ted Netea se. com Inc . a nnounc ed una udited cons olida ted fina ncia l results for the sec ond qua rter ended J une 30, 2009. Tota l rev enues for the Fina nc ia l R es ults for the S ec ond Q ua rter E nded J une 30, sec ond qua rter of 2009 were C NY 872.1 million ($127. 7 million), compa red to C N Y 715. 9 million ($104.8 million) for the sec ond qua rter of 2009 2008. Net profit a ttributa ble to sha reholders for the sec ond qua rter of 2009 tota led C NY 468.1 million ($68. 5 million), compa red to C N Y 438. 2 million ($64. 2 million) for the sec ond qua rter of 2008. T he c ompa ny reported ba sic a nd diluted ea rnings per Americ a n depos ita ry s ha re or ADS of C N Y 3.64 ($0.53) a nd C N Y 3. 60 ($0. 53) ea c h for the s econd qua rter of 2009. T he c ompa ny reported ba si c a nd diluted ea rn ings per ADS of C N Y 3.62 ($0.53) a nd C N Y 3. 39 ($0. 50) for the sec ond qua rter of 2008. C a sh flows genera ted from opera ting ac tiv ities tota led C NY 544.4 mi llion ($79. 7 million) for the s econd qua rter of 2009, c ompa red to C NY 513. 3 million ($75.2 mill ion) for the s ec ond qua rter of 200 8. The compa ny reported opera ting profit of C NY 517. 072 million ($75.703 mil lion), net inc ome before ta x of C N Y 583. 471 million C N Y 85.425 million) a nd diluted per s ha re of C N Y 0. 14 ($0.02) compa red to opera ting profit of C N Y 573. 050 million, net income before ta x of C NY 578. 174 W izz a rd M edia L a unc hes L ibs ynP ro 3.0 W izza rd M edia a nnounc ed the a va ila bility of L ibs ynP R O 3. 0, a new di gita l media publis hing pla tform set to funda mentally cha nge online media s yndic a tion a nd monetiza tion forever. L ibsy nP R O 3.0 is now the founda tion by which dozens of new publishing options will be a va ila ble to c ontent produc ers. This new pla tform gives media producers the a bility to pick a nd c hoose in a n a la c a rte fa s hion the media sy ndica tion pa ck a ges s trea mlined for their needs. This new pla tform a lso la ys the groundwork for the digita l media publis hing indus try's first 'c lic k-to-build' c ustomized iP hone a ppl ica tion. P odc a sters will be a ble to turn their shows into intera ctive iP hone a pps a nd with sta nda rd a pprova ls , sell them in the iTunes App S tore prov iding a new reve nue s trea m to a ccompa ny the a dvertis ing c a mpa ig ns they c urrently ma na ge th roug h their L ibs ynP R O 3.0 a cc ount. The L ibsy nP R O 3. 0 digita l media publis hing s ys tem is ba s ed a round a c ompletely redes igned publishing engine tha t is c a pa ble of forma tting, tra ns coding a nd del ivering content s pecia lly s uited for v a rious des tina tions a llowing to stra tegic a lly dis tribute c ontent to s elected network of publishing des tina tions with j ust a few c lic ks . NeuL ion Inc orpora ted reported c a sh flow a nd c a pita l expenditure for the sec ond qua rter a nd s ix months ended J une 30, 2009. F or the qua rter, the c ompa ny reported c a sh used in opera ting a ctivities wa s $3,751, 902 a ga inst $286, 278 in 2008. T he c ompa ny spent on purc ha se of property , pla nt a nd equipment of $149,437 a ga ins t $55,216 in 2008. For the six months, the compa ny reported c a sh us ed in opera ting a c tiv ities wa s $9, 124,651 a ga inst cas h from opera tions of $99, 129 in 2008. The compa ny s pent on purc ha s e of property, pla nt a nd equipment of $531, 841 a ga inst $1, 054, 258 in 2008.
W izz ard S oftware Co rporatio n (A ME X: WZ E )
NeuL ion Inc o rpo rated (T S X: NL N)
Neulion I ncorpora ted R eports C a s h F low a nd C a pita l E xpenditure for the S econd Q ua rter a nd S ix Months E nded J une 30, 2009
B eyond Co mmerc e, Inc . (OT CB B: B YOC)
B eyond C ommerce I nc. P romotes Trev or W illi a ms to E xec utiv e V ice P reside nt, I nterna tiona l; P rov ides S a les G uida nce for the T hird Q ua rter of 2009
B eyond C ommerce Inc . a nnounc ed enha nc ements to its ex ecutive tea m, i ncluding the promotion of T revor Wi llia ms to E xec utiv e V ic e P resident, I nterna tiona l. The compa ny prov ides sa les guida nce for the third qua rter of 2009. The compa ny a ntici pa tes s a les to s tea dil y increa s e a s the compa ny begins a d s a les interna tiona ll y in the third q ua rter of 2009.
W o rlds . c om Inc . (O TCB B: WDDD ) IB 3 N etworks , Inc . (OT CB B:IBN W )
W orlds. c om Inc . a nnounc ed dela y ed 10-Q filing IB 3 N etwork s , Inc . a nnounc ed dela y ed 10-Q filing
O n 08/14/2009, Wo rl ds. com Inc . a nnounc ed tha t they will be una ble to fil e their nex t 10-Q by the dea dline required by the S E C . O n 08/14/2009, IB 3 Network s, Inc . a nnounc ed tha t they will b e una ble to file their nex t 10-Q by the dea dline required by the S E C .
B etawave Co rporatio n (OT CB B:B WA V) B eta wa ve C orpora tion R eports Una udited C ons olida ted B eta wa ve C orpora tion reported un a udited cons olida ted ea rnings res ults for the s econd qua rter a nd six months ended J une 30, 2009. For the E a rnings R esults for the S ec ond Q ua rter a nd S ix M onths qua rter, the c ompa ny's tota l revenues increa s ed 78% to $2, 282,325 from $1,282 ,439 for the s econd qua rter of 2008. N et loss was E nded J une 30, 2009 $2,581, 790 or $0. 09 ba s ic a nd diluted per s ha re a ga inst $3, 562,052 or $0.14 ba sic a nd diluted per s ha re a year a go. For the six months, the compa ny reported net c a sh us ed in opera ting a c tiv ities wa s $6, 967,931 a ga ins t $2,820, 055 a yea r a go. W izz ard S oftware Co rporatio n (A ME X: WZ E ) W izz a rd S oftwa re C orpora ti on R eports E a rnings R es ults for th e S ec ond Q ua rter E nded J une 30, 2009 W izza rd S oftwa re C orpora tion reported ea rnings res ults for the se cond qua rter ended J une 30, 2009. F or the qua rter, the c ompa ny rec orded revenues of $1, 160, 919, a 21% dec rea se from revenues of $1, 465, 874 in the s econd qua rter of 2008. T he dec rea s e for the s ec ond qua rter of 2009 reflec ts a decrea s e in rev enue in hea lthca re a nd s oftwa re bus iness s egments due to the ec onomic recess ion, prima rily due to a decrea s e in s ta ffing revenues within the hea lthc a re s ubsidia ry . T he c ompany 's net los s a va ila ble to c ommon sha reholders wa s $2, 193,552, or $0. 05 per sh a re, in the s ec ond qua rter of 200 9, vers us a net loss of $1 998, 225, or $0. 04 per s ha re, in the sec ond qua rter of 2008. E xc luding a one-time, non-c as h c ha rge for the exten sion a nd re-pric ing of wa rra nts, the c ompa ny's net los s was $1,171, 214 for the sec ond qua rter of 2009, or $0.02 per s ha re. Fluid Mus ic C a na da , Inc . a nnounc ed una udited cons olida ted ea rnings res ults for the sec ond qua rter a nd s ix months ended J une 30, 2009. For the qua rter, the compa ny reported net los s a nd comprehens ive loss of $100,330 or $0.00 per s ha re on revenue of $1, 380,717 c ompa red to net los s a nd c omprehensiv e los s of $6, 414,393 or $0.17 per s ha re on rev enue of $1, 053,61 7 for the s a me period a y ea r a go . L oss from opera tions wa s $171, 450 c ompa red to $3, 131,311 for the s a me period a y ea r a go. L oss before prov is ion for inc ome ta xes wa d $100, 330 compa red to $6,414, 393 for the sa me period a yea r a go. Net ca s h prov ided by opera ting a ctivities wa s $411,928 c ompa red to c ash used in opera ting a ctivi ties of $1, 709, 499 for the s a me period a yea r a go. Amount spent on purc ha se of fixed a ss ets wa s $345, 961 c ompa red to $43,693 for the s a me period a y ea r a go. For the six months, the compa ny reported net los s a nd comprehens ive loss of $1,799, 361 or $0. 03 per sha re on rev enue of $2,703, 735 compa red to net loss a nd c omprehensiv e los s of $10, 358,479 or $0.28 per s ha re on revenue of $2, 028,474 for the s a me period a y ea r a go. L oss from opera tions wa s $1,850, 308 c ompa red to $6, 813, 765 for the s a me period a yea r a go. L oss before provis ion for income ta xes wa d $1
F luid Mus ic C anada, Inc . (T S X:FMN)
Fluid Mus ic C a na da , In c. Announces U na udited C ons olida ted E a rnings R es ults for the S econd Q ua rter a nd S i x M onths E nded J une 30, 2009
Figure 7. Key Developments Source. Capital IQ
Page 10
VALUATION Online Gaming companies lead market-cap charts: Thirteen companies in our Web 2.0 universe top US$1 billion in market capitalization (Figure 8). Fifty-eight of the 91 companies have market caps under US$100 million, with 25 under US$10 million. Online gaming companies dominate the top of the list, led by Tencent Holdings with a market cap over US$20 billion.
Market C ap (US D m)
Tenc ent Holdings Ltd. Neteas e.com Inc . S handa Interac tive Entertainment Ltd. Modern Times G roup Mtg A B IA C/InterA c tiveCorp. S ohu.com Inc . Changyou.c om Limited Open Tex t Corp. G ree, Inc . Perf ect World Co., Ltd. G iant Interac tive G roup, Inc . K ings of t Co. Ltd. Chines e G amer International Mix i, Inc . V alueClic k Inc . United Online Inc . NEOWIZ G ames Corporation NetDragon WebS of t, Inc . S hutterfly , Inc . S K Communic ations Co., Ltd. G ungHo Online Entertainment, Inc . CDC Corp. G amania Digital Entertainment Co., Ltd. G igaMedia Ltd. Openw ave S y s tems Inc . The9 Limited XING A G A c toz S of t Co., Ltd. OA O R B C Inf ormation S y s tems DA DA S pA NeuLion Inc orporated Y edangOnline Corp. G ameOn Co L td. Cy berplex Inc . Tree.Com, Inc . My riad G roup A G K A B Dis tribution Inc . HanbitS of t, Inc . TheS treet.c om, Inc . G eoS entric Oy j Fluid Mus ic Canada, Inc . Gravity Co., Ltd Frogs ter Interac tive Pic tures A G PNI Digital Media Inc . Eolith Co. Ltd. S park Netw orks , Inc . Ngi G roup Inc . NeXplore Corporation DigitalTow n, Inc . Webz en Inc . DXN Holdings B hd S ocialw is e, Inc . A Q Interac tive, Inc . Northgate Tec hnologies Limited Wiz z ard S oftw are Corporation LookS mart, Ltd. Y nk K orea Inc . Dolphin Digital Media, Inc . B roadWebA s ia Inc . Quepas a Corp. A c c eleriz e New Media, Inc . J umbuc k Entertainment Pty Ltd. B ey ond Commerc e, Inc . Lingo Media Corporation S pec trumDNA , Inc . UOMO Media, Inc IA S Energy , Inc . CornerWorld Corporation MOK O.mobi Limited Worlds .com Inc . S NA P Interac tive, Inc . V OIS , Inc . B right Things plc DigitalPos t Interac tive, Inc . Ex tens ions , Inc . Magnitude Inf ormation S y s tems Inc . is eemedia Inc . Wooz yFly , Inc . Wy nds torm Corporation B etaw ave Corporation LiveWorld Inc. B igs tring Corp. Unis erve Communic ations Corp. A s s oc iated Media Holdings Inc . CLICK ER Inc . The Parent Company China G atew ay Corporation Total S port Online A S S NM G lobal Holdings Dibz International, Inc . S oc ial Media V enures , Inc . 0 2597.6 2436.2 2297.0 3031.3
2054.3 2007.6 1880.7 1777.9 1734.5 1182.3 1051.6 984.0 872.4
612.9 528.5 404.4 375.5 328.0 279.2 269.5 261.7 240.4 233.3 211.2 204.1 146.0 145.7 139.0 113.2 110.6 105.5 97.0 96.1 84.1 80.8 71.8 68.6 63.2 56.8 55.9 49.8 49.4 47.2 43.2 43.0 37.9 35.6 32.6 31.5 30.1 28.6 24.4 23.7 20.5 20.2 20.2 19.5 17.8 15.8 14.4 12.5 11.2 11.2 10.7 8.4 5.7 5.3 4.7 4.3 4.1 4.1 3.9 3.6 3.0 2.8 2.6 1.8 1.8 1.7 1.1 1.0 0.6 0.4 0.4 0.3 0.1 0.0 0.0 0.0 500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Figure 8. Market Cap Ranking Source. Capital IQ
Page 11
TEV/Revenue (LTM) averages 4.8x: The overall average TEV/Revenue (LTM) multiple for our group is 4.8x (vs. 5.0x last week) (Figure 9). Two companies trade at more than 25x revenue – Bigstring Corp. (OTCBB:BSGC) at 32.4x, followed by Dolphin Digital Media, Inc. (OTCBB:DPDM) at 27.3x. The median is only 1.8x. Note that we exclude multiples greater than 50x. Thirty companies have multiples under 1.5x.
T E V/L T M R evenue (x)
35.0 30.0
27.3
32.4
25.0
21.1
20.0 15.0 10.0 A verage, 4.8 5.0 0.0
3.1 3.4 3.5 3.7 2.5 2.6 2.6 2.8 2.8 1.8 1.9 2.2 2.3 2.3 2.4 1.3 1.3 1.4 1.7 0.6 0.7 0.8 0.8 0.9 0.9 0.9 0.9 1.0 1.1 1.2 1.2 0.1 0.2 0.2 0.2 0.3 0.4 0.5 0.5 0.5 0.6 0.6 5.5 5.8 4.5 4.54.6 5.1 9.2 7.5 6.7 7.4 9.9 9.9 15.6 14.914.9 12.0 10.9
17.417.6
Figure 9. TEV/Revenue Ranking Source. Capital IQ
TEV/Revenue (LTM) by country/exchange: We have also calculated multiples based on where the companies are listed or domiciled. Figure 10 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 11.0x (vs. 11.7x last week). On a geographic basis, the United States has the most companies (39), trading at an average of 5.1x revenue (vs. 5.3x last week) (Figure 11). Ten of the companies are Canadian (average 4.7x revenue).
Average TEV/LTM Revenue - By Exchange
16.0 14.9 14.0 12.0 11.1 11.0 10.0 9.9 9.7 8.8 8.0 6.0 4.0 2.0 OTCBB GTSM 0.0 SEHK AIM HLSE XTRA
(x)
(x)
T heS treet.com, Inc. Unis erve C ommunications C orp. C LIC K E R Inc. T he P arent C ompany Northgate T echnologies Limited G ameO n C o Ltd. P erfect World C o., Ltd. T ree.C om, Inc . IAC /InterActiveC orp. DXN Holdings B hd J umbuck E nterta inment P ty Ltd. O penwave S y s tems Inc. C DC C orp. DADA S pA S park Network s , Inc. S NAP Interactive, Inc. C y berplex Inc. G igaMedia Ltd. United O nline Inc. HanbitS oft, Inc. S NM G lobal Holdings K AB Dis tribution Inc . is eemedia Inc. Actoz S oft C o., Ltd. V alueC lick Inc. S hutterfly , Inc. Modern T imes G roup Mtg AB S K C ommunic ations C o., Ltd. G amania Digital E ntertainment C o. , Ltd. Y edangO nline C orp. G ungHo O nline E nterta inment, Inc. My riad G roup AG B ey ond C ommerce, Inc . P NI Digital Media Inc. NE O WIZ G ames C orporation O pen T ex t C orp. Y nk K orea Inc. XING AG NetDragon WebS oft, Inc. E olith C o. Ltd. MO K O .mobi Limited S ohu.c om Inc. Wiz z ard S oftware C orporation S ocial Media V enures , Inc. T otal S port O nline AS Acceleriz e New Media, Inc. C ornerWorld C orpora tion NeuLion Incorporated Mix i, Inc. C ha ngy ou.com Limited DigitalP os t Interactive, Inc . K ings oft C o. Ltd. G eoS entric O y j F luid Mus ic C anada, Inc . Lingo Media C orpora tion G ree, Inc. F rogs ter Intera ctive P ictures AG B right T hings plc As s ociated Media H oldings Inc. UO MO Media , Inc C hines e G amer International T encent H oldings Ltd. Dolphin Digital Media, Inc . B igs tring C orp.
Average TEV/LTM Revenue - By Country
16.0 14.9 14.0 12.0 10.0 8.0 6.0 4.0 9.9 8.8 7.5 6.8 5.1 4.7 4.6 4.3 2.3 2.1 2.0 1.7 Germany United Finland United China Japan Canada Taiwan Australia Norway South Switzerland Sweden 0.8 0.7 Hong Kong Italy 0.6 0.3 0.0 India 1 Malaysia Russia 1
4.8 4.6 4.43.7
3.6 2.6 2.3 OTCPK
2.3 2.1 2.0 1.9 1.7 OSE ASX KOSE NasdaqGS OM
0.8 0.6 CM KLSE
2.0
OTCNO TSX
NasdaqGM
0.3 0.3 0.0 RTS BSE
TSE
AMEX
TSXV
# Companies
1 3 19 1 2 2 5 1 4 4 11 2 1 1 2 6 14 1 1 1 1 5 1
# Companies
SWX
0.0
1
1
2
10
3
39 10
1
6
1
2
8
1
1
1
1
Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ
Page 12
TEV/EBITDA (LTM) averages 11.0x: The average multiple for the 34 companies with positive EBITDA (and multiples under 100x) is 11.0x LTM EBITDA (vs. 11.1x last week), led by Tencent Holdings (SEHK-700) 42.8x multiple (Figure 12). Twelve companies have EBITDA multiples under 7x. The median multiple is 9.2x (vs. 9.8x last week).
T E V/L T M E B IT DA (x)
45.0 40.0 35.0 30.0 25.0 19.9 19.9 20.0 15.0 10.0 5.0 0.8 0.0 P erfec t World C o., L td. 1.7 J umbuc k E ntertainment P ty Ltd. 1.8 G a meO n C o Ltd. 2.1 T heS treet.com, Inc. 3.1 3.8 4.2 4.3 5.9 13.2 12.1 12.8 10.9 11.4 11.4 9.8 10.3 10.4 22.7 23.4 27.6 31.4 42.8
A verage, 11.0 6.1 7.4 7.9 8.1 8.5 9.1 9.2
9.7
NE O WIZ G a mes C orporation
G amania Digita l E ntertainment C o., Ltd.
G ungH o O nline E ntertainment, Inc.
S K C ommunications C o., Ltd.
Modern T imes G roup Mtg AB
C hines e G a mer Interna tional
DXN Holdings B hd
C hangy ou.com Limited
C DC C orp.
S NAP Intera ctive, Inc.
U nited O nline Inc.
O pen T ex t C orp.
IAC /InterActiv eC orp.
S ohu.c om Inc .
V a lueC lick Inc .
C y berplex Inc .
G ree, Inc .
Mix i, Inc .
NetDragon WebS oft, Inc .
Figure 12. TEV/EBITDA Ranking Source. Capital IQ
TEV/EBITDA (LTM) by country/exchange: Figure 13 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 3.1x (vs. 3.1x last week). On a geographic basis, the United States has the most companies (39), trading at an average of 8.6x EBITDA (Figure 14). Ten of the companies are Canadian (average 9.4x EBITDA).
Average TEV/LTM EBITDA - By Exchange
30.0 25.0 20.0 (x) 15.0 10.0 5.0 GTSM 0.0 SEHK KOSE OSE TSE NasdaqGS OM XTRA TSX CM 21.4 24.5
Average TEV/LTM EBITDA - By Country
25.0 21.4 20.0 15.0 (x) 15.8 13.4 10.0 10.9 10.9 9.4 9.2
13.4 12.8
10.910.4 10.1 9.1 8.9
O penwave S y s tems Inc.
6.1
9.1 8.6 6.1 4.2 1.7 Germany United States 0.2 Russia 1 0.0 Switzerland 1
4.2 3.8 3.1 2.1 1.7 OTCBB NasdaqGM AMEX KLSE ASX
0.2 0.0 RTS SWX
5.0 0.0 Japan Hong Kong
T encent Holdings Ltd.
S park Network s , Inc .
XING AG
K AB Dis tribution Inc.
Y edangO nline C orp.
S hutterfly , Inc.
Actoz S oft C o., Ltd.
K ings oft C o. Ltd.
DADA S pA
Malaysia 1
China
Canada
South Korea
Italy
# Companies
3
2
6
1
1
5
14
2
4
1
1
2
19
5
2
1
1
# Companies
3
10
8
6
1
10
1
2
39
1
Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ
Australia 2
Taiwan
Sweden
Page 13
P/E (LTM) averages 11.0x: The average multiple for the 30 companies with positive earnings (and multiples under 100x) is 11.0x LTM EPS (vs. 10.0x last week), led Tencent Holdings Ltd (SEHK-700) 55.1x multiple (Figure 15). Eleven companies have P/E multiples under 10x. The median is just 12.5x.
P /E L T M (x)
60.0 50.5 50.0 40.7 40.0 29.0 26. 6 27.9 21. 9 20.0 A verage, 11. 0 10.0 0. 0 0.0 G ravity C o. , L td 1. 9 G iant Interac tive G roup, Inc. 2. 4 T he9 Limited 2. 4 S handa Interactive E ntertainment L td. 2. 5 P erfec t World C o. , L td. 2. 9 Neteas e.c om Inc . 5.3 5.8 6.6 8.9 9.5 11. 1 11. 5 11. 8 11. 8 14. 5 13. 1 13. 6 14. 1 19. 2 30.7 31.3 42.1
55.1
30.0
J umbuck E ntertainment P ty L td.
G amania Digital E ntertainment C o. , L td.
NE O WIZ G ames C orporation
Modern T imes G roup Mtg AB
C hines e G amer International
C hangyou.c om Limited
DXN H oldings B hd
S NAP Interac tive, Inc .
G ameO n C o Ltd.
NetDragon WebS oft, Inc .
O pen T ex t C orp.
G igaMedia L td.
C y berplex Inc .
S ohu. com Inc .
S park Network s , Inc .
G ree, Inc .
Mix i, Inc .
Figure 15. P/E Ranking Source. Capital IQ
P/E (LTM) by country/exchange: Figure 16 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 18.7x. On a geographic basis, the United States has the most companies (39), trading at an average of 15.2x earnings (Figure 17). Ten of the companies are Canadian (average 20.1x EPS).
Average P/E - By Exchange
40.0 35.0 30.0 25.0 (x) 20.0 15.0 10.0 5.0 OTCBB GTSM 0.0 TSE KOSE SEHK NasdaqGS OM XTRA AMEX TSX KLSE ASX
40.0
Average P/E - By Country
34.6
34.6 34.3 32.0 19.2 18.7 13.1 11.8 10.0 8.9 5.8 5.3
(x)
35.0 30.0
20.9
25.0 20.0 15.0 10.0
26.0 20.1 19.2 15.7 15.2 13.6 13.1 5.8 5.3 0.0 0.0 Germany United States Japan China Australia Malaysia Canada Taiwan South Korea Sweden Switzerland 1 India 1
1.9 NYSE
0.0 NasdaqGM
5.0
0.0 SWX
0.0
# Companies
5
2
3
6
2
19
1
2
14
4
2
1
1
5
1
# Companies
6
3
10
2
8
39
10
T encent Holdings L td.
IAC /InterAc tiveC orp.
Y edangO nline C orp.
Ac toz S oft C o., Ltd.
K ings oft C o. Ltd.
Worlds . com Inc .
XING AG
1
2
1
Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ
Page 14
UPCOMING EVENTS
E arnings C alendar
C ompany
C DC C orp. (Nas daqG S : C HIN. A) W izzard S oftware C orporation (AME X: W ZE ) G iant Interactive G roup, Inc. (NY S E : G A) O pen T ext C orp. (Nas daqG S : O T E X) NetDragon W ebS oft, Inc. (S E HK : 777) T he9 Limited (Nas daqG S : NC T Y )
Figure 18. Earnings Calendar Source. Company reports
Date & Time
T ues day, Augus t 18, 2009 9: 00 AM (E DT ) T ues day, Augus t 18, 2009 11: 00 AM (E DT ) W ednes day, Augus t 19, 2009 8: 00 AM (E DT ) T hurs day, Augus t 20, 2009 5: 00 P M (E DT ) T ues day, Augus t 25, 2009 9: 00 P M (E DT ) T hurs day, Augus t 27, 2009 9: 00 P M (E DT )
Quarter
Q 2 2009 Q 2 2009 Q 2 2009 Q 4 2009 Q 2 2009 Q 2 2009
C onf C all Details
888-603-6873 877-407-8035 866-203-3436 416-644-3415 10-800-130-0399 800-561-2693
Page 15
C omparable C ompany Analys is > Web 2.0
P ric e P erformanc e
C ompany Name Accelerize New Media, Inc. Actoz S oft C o. , L td. AQ Interactive, Inc. As s ociated Media Holdings Inc. B igs tring C orp. B etawave C orporation B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou.com L imited C hina G ateway C orporation C hines e G amer International C L IC K E R Inc. C ornerW orld C orporation C yberplex Inc. DADA S pA DXN Holdings B hd Dibz International, Inc. DigitalP os t Interactive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C anada, Inc. F rogs ter Interactive P ictures AG G amania Digital E ntertainment C o. , L td. G ameO n C o L td. G eoS entric O yj G iant Interactive G roup, Inc. G igaMedia L td. G ravity C o., L td G ree, Inc. G ungHo O nline E ntertainment, Inc. HanbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment P ty L td. K AB Dis tribution Inc. K ings oft C o. L td. L ingo Media C orporation L iveW orld Inc. L ookS mart, L td. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O . mobi L imited Myriad G roup AG NE O W IZ G ames C orporation NetDragon W ebS oft, Inc. Neteas e.com Inc. NeuL ion Incorporated NeXplore C orporation Ngi G roup Inc. Northgate T echnologies L imited O pen T ext C orp. O penwave S ys tems Inc. P erfect W orld C o., L td. P NI Digital Media Inc. Q uepas a C orp. O AO R B C Information S ys tems S handa Interactive E ntertainment L td. S hutterfly, Inc. S K C ommunications C o., L td. S NAP Interactive, Inc. S NM G lobal H oldings S ocial Media V enures , Inc. S ocialwis e, Inc. S ohu. com Inc. S park Networks , Inc. S pectrumDNA, Inc. T encent Holdings L td. T he P arent C ompany T he9 L imited T heS treet.com, Inc. T otal S port O nline AS T ree.C om, Inc. Unis erve C ommunications C orp. United O nline Inc. UO MO Media, Inc V alueC lick Inc. V O IS , Inc. W ebzen Inc. W izzard S oftware C orporation W orlds .com Inc. W oozyF ly, Inc. W ynds torm C orporation XING AG Y edangO nline C orp. Y nk K orea Inc. High L ow Average Median C urrenc y US D KR W JPY US D US D US D US D GBP US D US D US D US D TWD US D US D C AD E UR MY R US D US D US D US D KR W US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KR W US D US D C AD AU D C AD HK D C AD US D US D US D JPY SEK AU D C HF KR W HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KR W US D US D US D US D US D US D US D HK D US D US D US D NO K US D C AD US D US D US D US D US D US D US D US D US D E UR KR W KR W Tic ker AC L Z A052790 3838 AS MH BS GC B W AV B Y OC AIM: B G T BWBA C HIN.A C Y OU CGWY G T S M: 3083 C LK Z CWR L T S X:C X C M: DA DXN DIB Z DG L P DG T W DP DM A041060 E XT I T S X:F MN FR G 6180 3812 G E O 1V GA G IG M GR VY T S E :3632 3765 A047080 IAC I IAS C . A IE E AS X: J MB T S X:K AB 3888 T S XV :L M LV W D LOOK MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X:NL N NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S NDA S F LY A066270 S TVI S NMN S MV I S C LW S O HU LOV S P XA 700 K IDS . Q NC T Y TS CM T OS O TR E E T S XV :US S UNT D UO MO V C LK V O IS W ZE N W ZE W DDD W ZY F W Y ND O 1B C A052770 A023770 E xc hange OT C B B K OS E TS E OT C P K OT C B B OT C B B OT C B B AIM OT C P K Nas daqG S Nas daqG S OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E HL S E NY S E Nas daqG S Nas daqG M TS E OS E K OS E Nas daqG S OT C B B T S XV AS X TS X S E HK T S XV OT C P K Nas daqG M OT C B B TS E OM AS X SWX K OS E S E HK Nas daqG S TS X OT C P K TS E BSE Nas daqG S Nas daqG S Nas daqG S T S XV OT C B B R TS Nas daqG S Nas daqG S K OS E OT C B B OT C P K OT C P K OT C B B Nas daqG S AME X OT C B B S E HK OT C P K Nas daqG S Nas daqG M O T C NO Nas daqG M T S XV Nas daqG S OT C B B Nas daqG S OT C B B Nas daqG M AME X OT C B B OT C B B OT C P K XT R A K OS E K OS E US D Market C ap ($m) 15. 8 146.0 28. 6 0.6 1.1 1.8 12. 5 4.1 19. 5 269.5 2,054. 3 0.3 1,051. 6 0.4 5.7 97. 0 139.0 31. 5 0.0 3.9 35. 6 20. 2 47. 2 3.6 56. 8 49. 8 261.7 105.5 63. 2 1,734. 5 240.4 55. 9 1,880. 7 279.2 71. 8 2,436. 2 8.4 2.8 14. 4 80. 8 1,182. 3 11. 2 1.7 20. 5 3.0 984.0 2,597. 6 5.3 84. 1 528.5 404.4 5,204. 2 113.2 37. 9 43. 0 24. 4 2,007. 6 233.3 1,777. 9 49. 4 17. 8 145.7 3,031. 3 375.5 328.0 4.3 0.0 0.0 30. 1 2,297. 0 43. 2 11. 2 26, 804. 0 0.4 211.2 68. 6 0.1 96. 1 1.0 612.9 10. 7 872.4 4.1 32. 6 23. 7 4.7 2.6 1.8 204.1 110.6 20. 2 C urrent P ric e 0. 57 21, 300 49, 600 0. 01 0. 02 0. 06 0. 27 0. 01 0. 23 2. 54 37. 35 0. 02 411. 50 0. 01 0. 06 1. 65 6. 09 0. 49 0. 00 0. 05 1. 30 0. 39 820. 00 0. 08 1. 20 14. 00 56. 70 103, 000 0. 05 7. 68 4. 41 2. 01 7, 930 230, 000 4, 125 18. 40 0. 12 0. 06 0. 36 1 8 1. 00 0. 06 1. 20 0. 01 604,000. 00 288. 00 0. 08 4. 26 31,600. 00 5. 93 40. 21 1. 10 0. 68 32,800. 00 34. 30 38. 15 2. 80 36. 15 1. 60 1. 40 1. 05 45. 40 14. 75 9,850. 00 0 0. 00 0. 19 0. 68 59. 92 2 0 115 0. 02 8. 28 2. 24 0. 03 8. 90 0. 05 7. 31 0. 13 10. 01 0. 01 2. 75 0. 47 0. 09 0. 15 0. 10 27. 50 8, 870 4, 770 1 Wk 1. 8% -9.6% -7.5% -30. 0% -24. 0% -20. 0% -10. 0% -14. 7% -22. 8% -7.8% -5.1% -25. 0% -4.3% -31. 3% 9. 1% -2.9% -0.2% 3. 2% 20.0% -16. 5% -13. 3% -2.5% 0. 0% -60. 0% 1. 7% -3.4% -2.2% -0.7% 0. 0% -4.6% -10. 7% -4.3% 2. 5% 13.9% -4.2% -0.5% -33. 3% -14. 3% -2.7% 0. 0% 4. 2% -10. 7% -8.3% -4.0% 8. 3% -2.3% -1.7% 15.4% 3. 4% -0.8% 3. 7% -11. 4% 3. 8% -2.9% 1. 9% -2.6% -0.8% 6. 9% -3.3% 8. 1% 12.0% 0. 0% -9.1% -7.2% -2.5% 100. 0% -60. 0% -13. 6% -8.1% -6.4% -23. 1% 0. 0% 3. 5% 0. 0% -11. 7% -2.6% 0. 0% -9.9% 0. 0% -3.2% -16. 7% -8.0% -5.7% -16. 1% 0. 0% 0. 0% 0. 0% 0. 0% 3. 0% -6.0% -2.9% 100. 0% -60. 0% -4.7% -2.8% 1 Mth 26. 7% -21. 5% -9.8% -30. 0% -55. 8% -47. 8% -19. 4% -14. 7% -22. 8% 17. 6% -9.7% 650.0% -17. 9% -44. 4% 20. 0% 8.6% 2.1% 24. 4% NM 66. 7% -35. 0% 8.3% 5.8% 0.0% 33. 3% 15. 7% -9.6% -2.8% 25. 0% 5.3% -14. 0% 23. 7% 17. 0% 15. 0% -9.9% 9.4% 9.1% -29. 4% -5.3% 1.6% 30. 7% 0.0% 57. 1% 9.1% -27. 8% -12. 0% 23. 3% 25. 0% -12. 2% -1.4% 3.3% 2.7% 15. 8% 51. 1% 0.5% 0.0% 3.3% -5.1% 13. 9% 3.9% 55. 6% 16. 7% -18. 9% 7.0% 5.8% -11. 1% -71. 4% -40. 6% -15. 0% -3.4% -14. 3% 53. 3% 16. 9% -48. 3% -2.0% 15. 5% 0.0% -8.7% -35. 7% -9.1% 19. 0% -11. 3% -28. 6% -22. 1% -4.1% -35. 7% NM 0.0% -3.5% 11. 7% -19. 2% 650.0% -71. 4% 6.6% 0.0% 3 Mth 14. 0% 42. 0% -5.2% 833.3% -17. 4% -45. 5% -77. 5% -14. 7% -54. 9% 88. 1% 22. 7% 650.0% 42. 4% 37. 5% -33. 3% -7.8% 1.7% 24. 4% 20. 0% 214.5% -35. 0% -44. 3% -15. 5% -46. 7% 71. 4% 66. 7% 40. 3% 12. 4% 0.0% -8.9% -29. 2% 107.2% 46. 9% 32. 3% -23. 5% 20. 2% -55. 6% -36. 8% -14. 3% 6.7% 70. 9% -13. 0% -21. 4% -11. 8% -35. 0% 41. 1% 22. 0% 7.1% -27. 2% -2.0% 5.0% 31. 5% 46. 7% -2.9% 10. 3% -28. 9% 19. 0% 87. 9% 80. 0% -9.1% 34. 6% 6.6% -15. 6% 0.5% 0.5% -46. 7% -33. 3% 1800. 0% -26. 9% 8.0% -6.7% -32. 4% 45. 0% 20. 0% -11. 5% 17. 9% 0.0% -28. 9% 12. 5% 6.6% -86. 1% -6.4% -44. 4% -26. 7% -21. 7% -40. 0% 0.0% 233.3% -11. 3% -12. 6% -38. 1% 1800. 0% -86. 1% 42.6% 0.0% 6 Mth 62.9% 78.2% 56.5% 180. 0% 18.8% -70.0% -40.0% -32.6% -77.2% 206. 0% NM 650. 0% 279. 3% -71.1% -60.0% 364. 8% 1. 4% 67.2% -88.0% 400. 0% -35.0% -20.4% 45.1% -60.0% 135. 3% 250. 0% 161. 3% 1. 7% 25.0% 27.6% -36.7% 187. 1% 45.2% 133. 3% 8. 0% 24.3% 471. 4% -33.3% -12.2% 68.4% 196. 1% 11.1% 10.0% -9. 8% -69.0% 48.0% 133. 2% 87.5% -7. 0% 82.1% 103. 8% 110. 7% 175. 0% -28.4% 47.1% -14.3% 9. 9% 197. 9% 171. 8% -11.6% -0. 7% 238. 7% 48.4% 81.2% 32.2% -59.6% 100. 0% -86.6% 51.1% 30.9% -10.6% 130. 0% 149. 7% -40.0% -35.1% -13.2% -25.0% 117. 1% -43.8% 50.4% 56.3% 52.6% -33.3% 100. 7% -26.6% -47.1% 0. 0% -16.7% -7. 6% 28.7% 10.0% 650. 0% -88.0% 60.4% 28.7% 1 Yr -9.5% 79. 7% -64. 2% -30. 0% -74. 7% -80. 0% -91. 0% -36. 0% -84. 7% 1.4% NM -50. 0% 422.2% -99. 2% -91. 9% 175.0% -47. 8% 24. 4% -97. 6% -16. 7% -71. 1% -56. 7% 16. 3% -46. 7% -18. 9% 103.5% 134.5% -10. 4% -28. 6% -24. 7% -62. 2% 43. 6% NM 17. 5% 36. 4% 6.7% -40. 0% -66. 7% -28. 0% -15. 8% 205.8% -44. 4% -78. 0% -64. 4% -56. 7% -23. 7% -19. 4% 92. 3% -56. 1% 209.0% -8.8% 50. 0% NM -2.9% -60. 4% -88. 2% 8.4% 94. 4% 43. 0% -53. 1% -57. 6% -86. 2% 58. 7% 43. 8% -18. 6% -55. 1% -99. 7% -24. 0% -71. 9% -22. 5% -50. 2% NM 78. 7% -99. 2% -57. 3% -68. 0% -40. 0% 11. 4% -82. 0% -32. 9% -66. 2% -24. 1% -66. 7% 6.2% -68. 2% -70. 0% NM -83. 3% -22. 5% -4.2% -54. 4% 422.2% -99. 7% -14.2% -30. 0% 52 Week -13. 6% -40. 8% -65. 8% -72. 0% -77. 6% -82. 4% -91. 7% -48. 2% -92. 1% -35. 2% -22. 8% -57. 1% -20. 7% -99. 3% -92. 4% -17. 1% -50. 8% -11. 8% -97. 6% -49. 5% -72. 6% -65. 5% -29. 3% -92. 1% -33. 3% -9.7% -17. 6% -32. 7% -28. 6% -27. 8% -65. 4% -14. 1% -4.0% -17. 8% -37. 9% -47. 2% -57. 1% -72. 7% -41. 0% -28. 1% -10. 9% -47. 9% -78. 0% -64. 4% -78. 3% -34. 4% -22. 1% -25. 0% -57. 3% -24. 8% -20. 5% -14. 3% 0. 9% -53. 1% -74. 3% -89. 0% -5.1% -10. 5% -13. 8% -55. 8% -59. 5% -86. 6% -30. 2% -10. 8% -29. 6% -63. 0% -99. 9% -96. 2% -73. 8% -25. 0% -52. 9% -61. 7% -6.2% -99. 3% -58. 2% -69. 5% -40. 0% -31. 9% -82. 0% -38. 0% -88. 2% -27. 5% -84. 6% -41. 2% -72. 8% -74. 3% -96. 3% -83. 3% -23. 6% -28. 5% -61. 5% 0. 9% -99. 9% -49.4% -48. 0%
688.8
Figure 19. Price Performance Source. Capital IQ
Page 16
C omparable C ompany Analys is > Web 2.0
Valuation Multiples C ompany Name
Accelerize New Media , Inc. Actoz S oft C o., Ltd. AQ Interactive, Inc. As s ociated Media Holdings Inc. B igs tring C orp. B etawa ve C orpora tion B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou. com L imited C hina G a teway C orporation C hines e G a mer Interna tiona l C L IC K E R Inc. C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd Dibz Internationa l, Inc. Digita lP os t Intera ctive, Inc. Digita lT own, Inc. Dolphin Digital Media, Inc. E olith C o. Ltd. E xtens ions , Inc. F luid Mus ic C a na da, Inc. F rogs ter Intera ctive P ictures AG G a ma nia Digita l E nterta inment C o., Ltd. G a meOn C o Ltd. G eoS entric Oyj G ia nt Intera ctive G roup, Inc. G igaMedia L td. G ravity C o. , L td G ree, Inc. G ungHo O nline E nterta inment, Inc. Ha nbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E nterta inment P ty Ltd. K AB Dis tribution Inc. K ings oft C o. L td. L ingo Media C orporation L iveW orld Inc. L ookS mart, Ltd. Ma gnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi L imited Myria d G roup AG NE O W IZ G ames C orpora tion NetDra gon W ebS oft, Inc. Netea s e.com Inc. NeuL ion Incorpora ted NeXplore C orpora tion Ngi G roup Inc. Northgate T echnologies L imited O pen T ext C orp. O penwa ve S ys tems Inc. P erfect W orld C o., L td. P NI Digita l Media Inc. Q uepa s a C orp. O AO R B C Information S ys tems S ha nda Intera ctive E ntertainment L td. S hutterfly, Inc. S K C ommunica tions C o. , L td. S NAP Intera ctive, Inc. S NM G loba l Holdings S ocia l Media V enures , Inc. S ocia lwis e, Inc. S ohu.com Inc. S pa rk Networks , Inc. S pectrumDNA, Inc. T encent Holdings L td. T he P a rent C ompany T he9 Limited T heS treet.com, Inc. T ota l S port O nline AS T ree. C om, Inc. U nis erve C ommunica tions C orp. U nited Online Inc. U O MO Media , Inc V alueC lick Inc. V OIS , Inc. W ebzen Inc. W izza rd S oftwa re C orporation W orlds .com Inc. W oozyF ly, Inc. W ynds torm C orpora tion XING AG Y edangO nline C orp. Y nk K orea Inc. High L ow Average Media n
S ector
Direct Ma rketing G a ming G a ming Mobile Ins ta nt Mes s a ging Media S ocia l Networking S ocia l Networking S ocia l Networking G a ming G a ming Mobile G a ming Direct Ma rketing C ontent Advertis ing S ocia l Networking S ocia l Networking S NS Apps C ontent S ocia l Networking S ocia l Networking G a ming C ontent Media G a ming G a ming G a ming Mobile G a ming G a ming G a ming S ocia l Networking Media G a ming Media V ideo C ontent S ocia l Networking C ontent G a ming Lea rning S ocia l Networking Direct Ma rketing S ocia l Networking S ocia l Networking Media S ocia l Networking Mobile G a ming G a ming G a ming V ideo C ontent Media Direct Ma rketing C olla boration Mobile G a ming Digita l Imaging S ocia l Networking Media G a ming Digita l Imaging S earch Da ting Media S ocia l Networking S ocia l Networking G a ming S ocia l Networking Media P ortal Media G a ming Media Media P ortal S ocia l Networking Media Media Media S ocia l Networking G a ming P odcas ting C ontent S ocia l Networking C ontent S ocia l Networking G a ming G a ming
C ountry
United S ta tes S outh K orea J a pa n United S ta tes United S ta tes United S ta tes United S ta tes United K ingdom United S ta tes Hong K ong C hina United S ta tes T aiwan United S ta tes United S ta tes C a na da Italy Ma la ys ia United S ta tes United S ta tes United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes G ermany T aiwan J a pa n F inla nd C hina T aiwan S outh K orea J a pa n J a pa n S outh K orea United S ta tes C a na da C a na da Aus tralia C a na da C hina C a na da United S ta tes United S ta tes United S ta tes J a pa n S weden Aus tralia S witzerla nd S outh K orea C hina C hina C a na da United S ta tes J a pa n India C a na da United S ta tes C hina C a na da United S ta tes R us s ia C hina United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes C hina United S ta tes United S ta tes C hina United S ta tes C hina United S ta tes Norwa y United S ta tes C a na da United S ta tes C a na da United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes G ermany S outh K orea S outh K orea
P rimary E xchange
OT C B B K OS E TSE OT C P K OT C B B OT C B B OT C B B AIM OT C P K Na s daqG S Na s daqG S OT C P K GTS M OT C B B OT C B B TSX CM K LS E OT C P K OT C B B OT C B B OT C B B K OS E OT C P K TSX XT R A GTS M TSE HL S E NY S E Na s daqG S Na s daqG M TSE OS E K OS E Na s daqG S OT C B B T S XV AS X TSX S E HK T S XV OT C P K Na s daqG M OT C B B TSE OM AS X SWX K OS E S E HK Na s daqG S TSX OT C P K TSE BSE Na s daqG S Na s daqG S Na s daqG S T S XV OT C B B R TS Na s daqG S Na s daqG S K OS E OT C B B OT C P K OT C P K OT C B B Na s daqG S AME X OT C B B S E HK OT C P K Na s daqG S Na s daqG M O T C NO Na s daqG M T S XV Na s daqG S OT C B B Na s daqG S OT C B B Na s daqG M AME X OT C B B OT C B B OT C P K XT R A K OS E K OS E
Tic ker
AC L Z A052790 3838 AS MH BS GC B W AV B Y OC AIM:B G T BWBA C HIN.A C Y OU CGWY G T S M:3083 C LK Z CWR L T S X:C X C M:DA DXN DIB Z DG LP DG T W DP DM A041060 E XT I T S X:F MN FR G 6180 3812 G E O 1V GA G IG M GR VY T S E :3632 3765 A047080 IAC I IAS C . A IE E AS X:J MB T S X: K AB 3888 T S XV :L M LV W D LO O K MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X:NLN NXP C 2497 590057 OT E X OP W V PWR D T S XV : P N QP S A R BCI S NDA S FLY A066270 STVI S NMN S MV I S C LW S O HU LO V S P XA 700 K IDS . Q NC T Y TS CM T OS O TR E E T S XV : US S UNT D U OMO V C LK V O IS W ZE N W ZE W DDD W ZY F W Y ND O 1B C A052770 A023770
US D Market C ap ($m)
15. 8 146. 0 28. 6 0. 6 1. 1 1. 8 12. 5 4. 1 19. 5 269. 5 2, 054. 3 0. 3 1, 051. 6 0. 4 5. 7 97. 0 139. 0 31. 5 0. 0 3. 9 35. 6 20. 2 47. 2 3. 6 56. 8 49. 8 261. 7 105. 5 63. 2 1, 734. 5 240. 4 55. 9 1, 880. 7 279. 2 71. 8 2, 436. 2 8. 4 2. 8 14. 4 80. 8 1, 182. 3 11. 2 1. 7 20. 5 3. 0 984. 0 2, 597. 6 5. 3 84. 1 528. 5 404. 4 5, 204. 2 113. 2 37. 9 43. 0 24. 4 2, 007. 6 233. 3 1, 777. 9 49. 4 17. 8 145. 7 3, 031. 3 375. 5 328. 0 4. 3 0. 0 0. 0 30. 1 2, 297. 0 43. 2 11. 2 26, 804. 0 0. 4 211. 2 68. 6 0. 1 96. 1 1. 0 612. 9 10. 7 872. 4 4. 1 32. 6 23. 7 4. 7 2. 6 1. 8 204. 1 110. 6 20. 2 26, 804. 0 0. 0 688.8 45. 2
TE V/L TM R evenue
5.1x 1.3x 15. 6x 32. 4x 2.4x 14. 9x 0.7x 7.4x 0.0x 17. 6x 0.2x 5.5x 0.9x 0.8x 0.6x 7.5x 27. 3x 3.4x 9.9x 14. 9x 1.9x 0.4x 9.9x 0.9x 12. 0x 2.3x 1.0x 0.5x 1. 2x 0.6x 1. 2x 9.2x 10. 9x 0.1x 6.7x 1.7x 3.5x 2.3x 2.6x 3.1x 5.8x 0.0x 0.3x 2.6x 0.6x 0.5x 2.5x 0.0x 1.4x 1.8x 0.9x 1.1x 4.5x 3.7x 0.8x 21. 1x 0.2x 0.1x 4.6x 0.5x 0.2x 0.9x 17. 4x 1.3x 4.5x 2.8x 2.2x 2.8x 32. 4x 0.0x 4.8x 2.2x
TE V/ NTM R evenue
0.8x 5.7x 0.7x 1.3x 6.6x 0.9x 0.5x 1.6x 2.4x 0.6x 2.3x 1.8x 1.4x 3.2x 0.2x 0.1x 6.6x 0.1x 1.9x 1.4x
TE V/L TM E B ITDA
5.9x 9.2x 12. 1x 31. 4x 8.1x 6.1x 4.2x 11. 4x 1.8x 19. 9x 12. 8x 13. 2x 1.7x 9.7x 22. 7x 19. 9x 10. 9x 9.8x 7.9x 0.2x 10. 4x 23. 4x 0.8x 0.2x 11. 4x 27. 6x 3.1x 8.5x 3.8x 42. 8x 2.1x 4.3x 7.4x 9.1x 10. 3x 42. 8x 0.2x 11.0x 9.2x
TE V/NTM E B ITDA
12.3x 9. 9x 6. 2x 4. 3x 4. 1x 12.3x 8. 1x 5. 6x 4. 4x 5. 4x 7. 1x 7. 1x 12.9x 7. 3x 12.9x 4. 1x 7.6x 7. 1x
P /L TM E P S
21. 9x 14. 1x 40. 7x 8.9x 5.3x 27. 9x 11. 1x 1.9x 9.5x 0. 0x 42. 1x 11. 5x 5.8x 26. 6x 50. 5x 13. 1x 29. 0x 14. 5x 2.9x 31. 3x 2.5x 2.4x 6.6x 13. 6x 11. 8x 55. 1x 2.4x 30. 7x 19. 2x 11. 8x 55. 1x 0.0x 17.5x 12. 5x
P /NTM E P S
12.6x 10.0x 1. 6x 12.8x 8. 9x 35.0x 14.2x 16.2x 14.5x 35.0x 11.7x 11.5x 12.6x 16.3x 11.9x 50.1x 50.1x 1. 6x 17.2x 12.7x
P /TangB V
2.5x 0.4x 0.3x 13. 9x 15. 3x 3.9x 0.7x 4.5x 5.5x 6.9x 3.4x 1.3x 10. 7x 0.3x 2.0x 0.0x 19. 5x 39. 0x 2.2x 1.2x 2.3x 1.4x 6.4x 11. 7x 0.7x 0.8x 6.9x 3.9x 3.8x 14. 7x 2.2x 0.8x 6. 5x 0.9x 3.4x 1.2x 20. 1x 1.0x 2.2x 2.6x 38. 3x 4.5x 44. 2x 29. 3x 24. 5x 0.1x 0.9x 1.2x 5.7x 14. 3x 0.0x 6.4x 4.1x 0.9x 44. 2x 0.0x 7.6x 3.4x
Figure 20. Valuation Comparison Source. Capital IQ
Page 17
C omparable C ompany Analys is > Web 2.0
S ummary by C ountry
C ompany Name United S tates C anada C hina S outh K orea J apan T aiwan Aus tralia G ermany S witzerland Hong K ong F inland Italy United K ingdom India S weden R us s ia Malays ia Norway G rand Total 39 10 10 8 6 3 2 2 1 1 1 1 1 1 1 1 1 1 90 US D Market C ap ($m) C hina United S tates J apan S weden C anada T aiwan S outh K orea Hong K ong G ermany R us s ia Italy S witzerla nd F inland Malays ia India Aus tra lia United K ingdom Norway G rand Total 44, 701. 2 5, 079. 8 3, 321. 0 2, 597. 6 2, 382. 0 1, 553. 7 1, 320. 5 269. 5 253. 9 145. 7 139. 0 84. 1 63. 2 31. 5 24. 4 19. 8 4. 1 0. 1 61,991.0 Avg US D Market C ap ($m) C hina S weden J apa n T aiwan Hong K ong C anada S outh K orea R us s ia Italy United S ta tes G ermany S witzerland F inla nd Ma lays ia India Aus tralia United K ingdom Norwa y G rand Total 4, 470. 1 2, 597. 6 553. 5 517. 9 269. 5 238. 2 165. 1 145. 7 139. 0 130. 3 126. 9 84. 1 63. 2 31. 5 24. 4 9. 9 4. 1 0. 1 688.8 US D L TM Total R ev ($m) C hina United S tates S weden C anada S outh K orea J apan Hong K ong T aiwan Italy R us s ia India Malays ia G ermany S witzerla nd Aus tra lia F inland Norway United K ingdom G rand Total 4, 098. 7 3, 879. 1 1, 878. 9 1, 009. 1 663. 6 623. 3 389. 9 365. 6 232. 5 146. 9 81. 3 75. 7 56. 5 40. 0 15. 9 6. 0 2. 2 0. 3 13,565.5 US D L TM Total E B ITDA ($m) C hina S weden United S tates C ana da J apan S outh K orea T aiwan Hong K ong Italy R us s ia Malays ia G erma ny Aus tralia S witzerland Norway United K ingdom F inland India G rand Total 1, 913. 6 288. 7 287. 8 198. 4 186. 6 90. 2 52. 4 30. 8 30. 5 19. 2 10. 9 10. 5 3. 0 0. 8 -1. 1 -1. 8 -15. 4 -40. 6 3,064.4 E B ITDA % C hina Aus tralia T aiwan G erma ny J apan S weden Malays ia Italy R us s ia Hong K ong S outh K orea S witzerland C ana da United S tates India Norway United K ingdom F inland G rand Total 48. 0% 37. 2% 36. 3% 31. 2% 25. 8% 15. 4% 14. 4% 13. 1% 13. 1% 7. 9% 6. 4% 1. 9% -13. 2% -14. 4% -50. 0% -50. 6% #DIV /0! #DIV /0! 6.9%
Figure 21. Comparison by Country Source. Capital IQ
C omparable C ompany Analys is > Web 2.0
S ummary by E xc hange
C ompany Name OT C B B Nas daqG S OT C P K K OS E TS E Nas daqG M TS X T S XV S E HK AME X AS X XT R A GTS M SWX HL S E CM BS E NY S E OS E AIM OM R TS K LS E OT C NO G rand Total 19 14 11 6 5 5 4 4 3 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 90 US D Market C ap ($m) S E HK Nas daqG S TS E OM NY S E GTS M K OS E TS X OS E Nas daqG M XT R A OT CB B R TS CM S WX AME X OT CP K T S XV HL S E K LS E BSE AS X AIM O T C NO G rand Total 28, 390. 7 21, 623. 6 3, 041. 8 2, 597. 6 1, 734. 5 1, 313. 3 1, 232. 0 347. 7 279. 2 273. 7 253. 9 193. 9 145. 7 139. 0 84. 1 66. 9 65. 8 64. 4 63. 2 31. 5 24. 4 19. 8 4. 1 0. 1 61,991.0 Avg US D Market C ap ($m) S E HK OM NY S E Nas daqG S GTS M TS E OS E K OS E R TS CM XT R A TS X SWX HL S E Nas daqG M AME X K LS E BS E T S XV OT C B B AS X OT C P K AIM OT C NO G rand Total 9, 463. 6 2, 597. 6 1, 734. 5 1, 544. 5 656. 6 608. 4 279. 2 205. 3 145. 7 139. 0 126. 9 86. 9 84. 1 63. 2 54. 7 33. 5 31. 5 24. 4 16. 1 10. 2 9. 9 6. 0 4. 1 0. 1 688.8 US D L TM Total R ev ($m) OM S E HK Nas daqG S CM NY S E R TS OS E TS E K OS E GTS M Nas daqG M BSE K LS E TS X S WX XT R A AME X OT CP K T S XV AS X HL S E O T C NO OT CB B AIM G rand Total 1, 878. 9 535. 4 496. 1 232. 5 218. 9 146. 9 109. 2 102. 8 99. 2 91. 0 81. 8 81. 3 75. 7 46. 3 40. 0 28. 3 28. 1 16. 6 11. 4 7. 9 6. 0 2. 2 1. 7 0. 3 159.6 US D L TM Total E B ITDA ($m) Nas daqG S S E HK OM TS E K OS E GTS M CM OS E R TS K LS E XT R A Nas daqG M AME X AS X SWX NY S E TS X O T C NO AIM T S XV HL S E OT C P K BSE OT C B B G rand Total 1, 759. 8 771. 5 288. 7 166. 9 78. 2 52. 4 30. 5 19. 6 19. 2 10. 9 10. 5 8. 5 5. 5 3. 0 0. 8 0. 0 -0. 3 -1. 1 -1. 8 -6. 0 -15. 4 -34. 0 -40. 6 -62. 2 3,064.4 E B ITDA % S E HK AS X GTS M XT R A Nas daqG S TS E OS E OM K LS E CM R TS K OS E Nas daqG M SWX T S XV TS X OT C B B AME X OT C P K BSE O T C NO AIM NY S E HL S E G rand Total 43. 0% 37. 2% 36. 3% 31. 2% 30. 3% 27. 3% 18. 0% 15. 4% 14. 4% 13. 1% 13. 1% 4. 4% 3. 9% 1. 9% 1. 3% -14. 2% -32. 0% -36. 6% -41. 3% -50. 0% -50. 6% #DIV /0! #DIV /0! #DIV /0! 6.9%
Figure 22. Comparison by Exchange Source. Capital IQ
Page 18
F inanc ing - L as t Three Months (US $ m)
Month J un-09 C ompany Name S ugar Inc . Tumri B oku W imba G rab Networks US A C ountry US A US A US A US A 12. 0 13. 0 12. 0 10. 0 8. 5 8. 0 8. 0 8. 0 F ra nce US A 6. 5 6. 5 6. 0 6. 0 6. 0 5. 3 5. 0 5. 0 4. 4 4. 1 3. 5 US A US A S pa in US A US A US A US A US A Is rael US A US A C a na da US A Is rael Netherla nds US A US A US A 1. 0 1. 0 0. 5 53.3 15.3 28.5 67.8 34.0 35. 0 15. 5 15. 0 12. 0 10. 0 8. 3 8. 2 8. 0 8. 0 6. 6 6. 3 6. 2 6. 0 4. 1 4. 0 4. 0 4. 0 3. 2 2. 6 2. 5 2. 5 2. 0 1. 7 1. 5 1. 5 1. 2 1. 1 1. 0 1. 0 1. 0 0. 5 0. 5 0. 3 63.8 11.1 31.8 51.5 27.0 5.3 1. 5 1. 0 1. 0 2. 0 1. 8 2. 1 2. 0 2. 0 2. 4 2. 3 3. 0 2. 9 2. 8 2. 5 2. 5 15. 0 Angel/S eed P IP E S eries A S eries B S eries C 16. 0 S eries D G rand Total 16. 0 15. 0 13. 0 12. 0 12. 0 10. 0 8. 5 8. 0 8. 0 8. 0 6. 5 6. 5 6. 0 6. 0 6. 0 5. 3 5. 0 5. 0 4. 4 4. 1 3. 5 3. 0 2. 9 2. 8 2. 5 2. 5 2. 4 2. 3 2. 1 2. 0 2. 0 2. 0 1. 8 1. 5 1. 0 1. 0 1. 0 1. 0 0. 5 204.1 35. 0 15. 5 15. 0 12. 0 10. 0 8. 3 8. 2 8. 0 8. 0 6. 6 6. 3 6. 2 6. 0 4. 1 4. 0 4. 0 4. 0 3. 2 2. 6 2. 5 2. 5 2. 0 1. 7 1. 5 1. 5 1. 2 1. 1 1. 0 1. 0 1. 0 0. 5 0. 5 0. 3 185.2
AdC hina
G oojet S AS
C hina
F ra nce
E do Interac tive
AdMeld Inc . beeTV blueK iwi S oftware S A Nokeena US A
US A
US A
B ubble Motion
S ens e Networks Zoos k G ather MojoP ages Taomee Animoto G ameG round R ingR evenue C rowdc as t YuMe eR epublik News er L L C C lic kF uel Inigral AdE x Media G R OU.P S my6s ens e Yapta OneTXT I L ove R ewards C liqs et TodaC ell G lubble AdW hirl L iquidP lanner Mas hL ogic J un-09 Total J ul-09 P andora Media K ontera L td. Ning QuickP lay Media C aus es Outs park C onnectE du Ac quia, Inc S B Nation MediaMath Metavers um iMemories Invodo Quikr India P vt. L td. OP E N S ports network S tyleC as ter Nexage TweetDec k B us c a P rotonMedia Akademos iL oop Mobile C omunitae Aloqa L at49 Tributes .c om C oTweet C ellufun C likthrough C ognitive Match L imited B ookF res h P eople C apital Mas her Media J ul-09 Total US A Is rael US A C a na da US A US A US A US A US A US A G ermany US A US A India US A US A US A UK US A US A US A US A S pa in G ermany C a na da US A US A US A US A UK US A US A US A Is rael US A
US A
US A US A US A US A C hina US A
Page 19
Month Aug-09
C ompany Name Turbine Mint R ichR elevance Traffiq MediaMath B ill.c om E do Interac tive B oxee Z2L ive K ODA R oblox C hes s C ube iS yndica
C ountry US A US A US A US A US A US A US A US A US A US A US A S outh Africa US A
Angel/S eed
P IP E
S eries A
S eries B
S eries C 14. 1
S eries D 50. 0
G rand Total 50. 0 14. 1 12. 5 10. 0 10. 0
12. 5 10. 0 10. 0 8. 5 8. 5 6. 0 3. 0 3. 0 2. 2 1. 3 0. 4 25.3 142.4 15.3 3.0 42.6 28.5 128.0 22.6 108.1 50.0 82.3
8. 5 8. 5 6. 0 3. 0 3. 0 2. 2 1. 3 0. 4 129.4 518.6
Aug-09 Total G rand Total
Figure 23. Financing, Last Three Months Source. Company reports
Page 20
C ompany Des c riptions - C urrent Month C apital Market Ac tivity
C ompany
B ill.c om
HQ
United S ta tes
Webs ite
Des c ription
B ill. com, Inc. offers a n electronic ca s h mana gement s ervice. Its s ervice s implifies the way companies mana ge bills , invoices , contra cts , and other documents . T he compa ny delivers its s ervice through a n on-demand S oftware a s a S ervice (S a aS ) model. C as hV iew is a W eb-ba s ed s ys tem that allows companies to s tore all documents , proces s es , mes s ages , and tra ns a ctions in one place. It gives companies a real-time daily view of a nticipa ted ca s h flow while s imulta neous ly proces s ing trans actions . T he compa ny was formerly known a s C as hV iew, Inc. and changed its na me to B ill. com, Inc. in J anuary, 2008. B ill. com, Inc. was founded in 2006 and is bas ed in P a lo Alto, C a lifornia . B oxee T V , Ltd. develops media center s oftwa re. T he compa ny’s s oftware enables its us ers to control media programs s tored in the pers onal computer or the Internet domain, and brings them to the televis ion. It enables its us ers to view, rate, and recommend content to their friends through s ocial networking features , as well as its s ocial component a llows s ha ring with friends . T he company wa s founded in 2007 a nd is bas ed in New Y ork, New Y ork.
www.bill.com
B oxee
United S ta tes
www.boxee.tv
C hes s C ube E do Interactive
S outh Africa United S ta tes
www.chesscube.com www.edointeractive.net
C hes s C ube, is an online ga me allowing us ers to play ches s for free a nd maintain their online ra ting, s ocialize in chat rooms a nd invite friends to pla y ches s . T he compa ny is bas ed in S outh Africa. edo intera ctive, Inc. develops technologies for digital ma rketing. T he compa ny focus es on Marketing P latform, a behavioral ta rgeting and marketing pla tform tha t a llows bus ines s es to create micro-ta rgeted marketing campa igns ; monitor the campaign from their computer; target key cons umer groups us ing demographic, geographic, and ps ychogra phic cons umer information to filter a nd build targeted ca mpaigns ; and offers demons trable s a les revenue res ults . It offers P rewa rding, a tool that gives ca s h incentives directly to cons umers in adva nce of des ired purchas ing beha vior through their pre-paid debit Mas terC ard; C as h, a s ys tem that provides cas h rewards to loyal cus tomers ; a nd MarketIQ, which provides real-time feedback from cus tomers through s urveys and focus group tools . T he compa ny was founded in 2007 and is bas ed in Na s hville, T ennes s ee. F riends R eunited G roup opera tes as a n online community that connects people through a network of friends . It provides a n online meeting pla ce for people to s ocia lize, make acquaintances , a nd find others who s hare their interes ts . T he company a ls o ena bles members to look up friend’s W eb pages , and s ha re photos and videos . In a ddition, it offers online da ting s ervices . T he company is bas ed in the United K ingdom. F riends R eunited G roup opera tes as a s ubs idiary of IT V plc. iMemories , LLC provides digital convers ion a nd W eb-s ha ring s ervices for home videos and photos . It offers iMemories Achieve, a s ervice that trans fers home movies , photos , or s lides onto DV Ds ; iMemories online, a s ervice that uploads home movies a nd photos onto a n online pers onal library; and iMemories Movie, a s ervice that converts home videos into cinematic motion pictures and tra ns fers them onto DV Ds . T he compa ny als o provides iMemories S afeS hip K it, a packa ging and s hipping s olution; a nd iMemories gift cards . iMemories , LLC was founded in 2006 and is headqua rtered in S cotts dale, Arizona. iS yndica , a cloud-bas ed digital media dis tribution platform, s implifies online s elling by s yndica ting, promoting and tra cking us er content on multiple es ta blis hed channels . iS yndica ’s Upload O nce - S ell E verywhere™ approach helps us ers increas e revenue while reducing their workload. B uilt on Amazon W eb S ervices (AW S ), our V irtual Dis tribution S erver (V DS ) is a groundbrea king, patent pending, multi-ca tegory s oftware-a s -a-s ervice (S aaS ) dis tribution platform. iS yndica currently s upports photogra phy a nd video. K O DA was founded with a mis s ion to create a platform that allows emerging talent and s ma rt companies to go beyond the res ume or tra ditiona l job pos ting. More profes s ional than F a cebook but more pers ona l than LinkedIn, K ODA looks to s howca s e profiles and employer profiles tha t a llow both s ides of the hiring equation to get to know each other.
Friends R eunited
United K ingdom
www.friendsreunited.co.uk
iMemories
United S ta tes
www.imemories.com
iS yndic a
United S ta tes
www.isyndica.com
K oda
United S ta tes
www.koda.us
Mint
United S ta tes
www.mint.com
Mint S oftware, Inc. provides a W eb-bas ed s olution for online financia l ma nagement. It offers money mana gement, debt mana gement, expens e tracking, inves tment management, budget ma nagement, mutual fund, IR A mana gement, a nd financial pla nning s ervices . T he company a ls o provides s ugges tions bas ed on us er’s s pending patterns a nd automatic categorization of purcha s es . Mint S oftware, Inc. wa s founded in 2006 and is bas ed in Mounta in V iew, C alifornia. richreleva nce, Inc. provides pers onalization and product recommendation tools for the eC ommerce s ites . It offers R ichrecs , which offers product recommendations to pers onalize cus tomer's s hopping experience; myrecs tha t enga ges loya l s hoppers with a pers onalized page of releva nt product recommendations ; a nd richmail, which ena bles cros s -s elling a nd up s elling of relevant products . richreleva nce, Inc. was founded in 2005 and is headqua rtered in S a n F ra ncis co, C alifornia. It has locations in S a n Diego, C alifornia; Dallas and Hous ton, T exas ; and New Y ork, New Y ork. R oblox C orporation develops online ga ming s oftware. R oblox C orporation wa s founded in 2004 a nd is bas ed in P ortola V alley, C alifornia. T R AF F IQ , Inc. , a dis play advertis ing marketplace, operates a digital media mana gement platform that connects buyers and s ellers of online media . Its platform provides a s uite of enterpris e tools that ena bles negotia tions for deal points a nd centralized advertis ing operations , including tra fficking, inventory management, tracking and optimization, and billing. T he company’s pla tform incorporates components of the media planning, buying, a nd s elling proces s , including s ite s ea rch, inventory pa cka ging tools , negotia tion management, order execution, automated R F P dis tribution, campaign optimization, and publis her reconciliation/invoicing. It s erves advertis ers and publis hers . T he company wa s founded in 2006 a nd is bas ed in New Y ork, New Y ork with an additional office in V ienna, V irginia. T urbine, Inc. , an interactive media compa ny, engages in developing, launching, and operating online entertainment in North America. It offers online ga mes , including multiplayer online role-playing ga mes . T he compa ny operates s ocial gaming communities . It a ls o s ells its games through retailers in North America a nd E urope. T urbine, Inc. was formerly known a s T urbine E ntertainment S oftware C orp. T he company wa s founded in 1994 a nd is hea dquartered in W es twood, Mas s achus etts .
R ichR elevance
United S ta tes
www.richrelevance.com
R oblox Traffiq
United S ta tes United S ta tes
www.roblox.com www.traffiq.com
Turbine Inc .
United S ta tes
www.turbine.com
Z2L ive
United S ta tes
www.z2live.com
Z2Live, a mobile multiplayer gaming pla tform, was formed to levera ge the new ca pabilities of mobile devices , the s ea mles s flow between mobile and W eb communities a nd the advent of cons umer-focus ed marketplaces . T he compa ny was founded in 2009 by Damon Danieli, a 14-yea r Micros oft veteran, Da vid B luhm, a long time veteran of mobile content and entertainment a nd Madrona V enture G roup, a S eattlebas ed venture capital firm. Z2L ive’s mis s ion is to ena ble multiplayer gaming a cros s all mobile devices and a ll wireles s networks .
Figure 24. Company Descriptions Source. Company reports, Capital IQ, Crunchbase
Page 21
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Information about Research Capital Corporation’s Rating System, the distribution of our research to clients and the percentage of recommendations which are in each of our rating categories is available on our web site at www.researchcapital.com. The information contained in this report has been drawn from sources believed to be reliable but its accuracy or completeness is not guaranteed, nor in providing it does Research Capital Corporation assume any responsibility or liability. Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the securities mentioned herein. Contents of this report cannot be reproduced in whole or in part without the expressed permission of Research Capital Corporation. (U.S. Institutional Clients — Research Capital U.S.A. Inc. (a wholly owned subsidiary of Research Capital Corporation) accepts responsibility for the contents of this report subject to the terms & limitations set out above. Firms or institutions receiving this report should effect transactions in securities discussed in the report through Research Capital U.S.A. Inc., a Broker-Dealer Registered with the United States Securities and Exchange Commission).
Tor ont o 41 6. 860 .7 60 0
M ontr eal 5 14. 39 9. 15 00
V a nc ouve r 6 04.6 6 2.1 80 0
Ca lgar y 4 0 3. 2 65 .7 40 0
Re gi na 30 6.5 66. 75 50
www.researchcapital.com