Jetzt dürfte der Weg nach oben frei sein, oder!?
Zumindestens hier zu Lande wurde diese Nachricht positiv aufgenommen.
mfG: Speculator
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CMGI beendet Engagement um iCast und 1stUp.com
Die amerikanische Internetbeteiligungsgesellschaft CMGI meldete am gestrigen Montag, ihre Entertainment web-site iCast verkaufen zu wollen. Man verfolgt damit weiter das Ziel bis zum Ende des Fiskaljahres 2001 die Profitabilität zu erreichen.
Gestern nach Börsenschluß sagte CMGI-Chairman David Wetherell in einer Telefonkonferenz, das Unternehmen werde diejenigen Geschäftsfelder aufgeben, welche die Profitabilität nicht erreichen werden. iCast habe demnach nicht den Zukunftsplänen CMGIs entsprochen, ein Käufer werde derzeit ausfindig gemacht.
Die Geschäftsaufgabe von iCast knüpft nahlos an die Pleiten weiterer Entertainment-sites an wie beispielsweise Pop.com und Shockwave.com. Auch die CMGI-Tochter AltaVista versucht derzeit durch Personalkürzungen Kosten einzusparen und die Gewinnzone zu erreichen.
Weiter meldete CMGI die Aufgabe des Geschäftes mit 1stUp.com, ein Anbieter eines kostenlosen, werbefinanzierten Internetzugangs.
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Original (Englisch)
CMGI Presents Financial Guidance for Fiscal 2001, Reviews Progress of Restructuring Plan
Management Announces Intentions to Exit iCAST and 1stUp.com
ANDOVER, Mass. - November 13, 2000 - CMGI, Inc. (Nasdaq: CMGI), a leading Internet operating and development company, today announced its projected financial results for the 2001 fiscal year, as well as several strategic actions resulting from the company's ongoing review of its majority-owned operating subsidiaries.
On September 7, 2000, CMGI announced that it had formally organized its majority-owned operating companies and venture capital affiliate into six business segments (Search and Portals; Internet Professional Services; Interactive Marketing; e-Business and Fulfillment; Infrastructure and Enabling Technologies; and Venture Capital) with the goals of achieving leadership, growth and profitability across all segments. As part of this strategic review, the company has also stated it intends to reduce the number of its majority-owned operating companies to an optimal number of 5 to 10 in total by the end of its 2001 fiscal year.
In keeping with its new operational structure, CMGI has outlined detailed P&L guidance by segment on a going forward basis, including segment P&L guidance on a revenue and EBITDA basis as well as for CMGI on a consolidated basis. Guidance for its venture capital segment is limited to operating expenses only. Key overview points represented in the guidance included:
Projected year-over-year revenue growth of 80% to 90% resulting in expected revenue of approximately $1.65 billion for fiscal year 2001;
As of November 13, 2000, the company maintained a strong cash and available-for-sale securities position of approximately $940 million and $210 million, respectively, not including subsidiaries;
Projected profitability on an EBITDA basis for four out of five operating segments by the end of fiscal 2001;
Projected gross profit margin improvement to more than 30% in fiscal Q4 from 10% in fiscal Q1;
Improvement in CMGI's expected EBIDTA performance over the next three fiscal quarters to a loss of approximately $25 million in Q4 from a loss of approximately $225 million in Q4 FY 2000;
A projected consolidated cash position at the end of FY 2001 of more than $700 million, assuming no external fundraising for either CMGI or its companies; and
Expected consolidated CMGI revenues increasing 182% for the first quarter of fiscal 2001 versus consolidated first quarter revenues in fiscal 2000.
Additionally, CMGI has received Board and management approval to restructure certain operations and divest others given these businesses' extended timelines for market leadership and profitability. On a consolidated basis, CMGI expects to incur restructuring charges of $8 to $10 million in the first fiscal quarter (ended Oct. 31, 2000) and $75 to $80 million in the second fiscal quarter (ending January 31, 2001). These restructuring efforts will enable CMGI to dedicate resources to those businesses in which it believes it can meet its objectives for growth, leadership and profitability.
"In announcing our new segment strategy earlier this Fall, we went to great detail to communicate the long-term benefits such a strategy could have on the company, its customers, strategic partners and ultimately, its shareholders," said David Wetherell, CMGI chairman and CEO. "We are now beginning to realize some of the expected benefits as we focus resources on the businesses which are most strategic to our future. Although there is much to do, we are making progress, including some critical, albeit difficult decisions."
Continued Wetherell, "We will clearly face some near-term transitions, however, our singular focus is on creating and maximizing shareholder value by focusing on the segments where we can achieve growth, market leadership and profitability. As we continue our transition to a fully integrated Internet operating and development company, we are committed to providing all CMGI shareholders with unprecedented clarity regarding segment performance and expectations."
Detailed guidance as provided for each CMGI business segment follows:
SEARCH AND PORTALS
CMGI's Search & Portals segment consists of AltaVista, MyWay.com and iCAST. The key guidance points for this segment include:
Projected year-over-year revenue growth of 20 to 25%;
Projected profitability on an EBITDA basis in the fiscal fourth quarter;
The continued focus of AltaVista as a best-in-class search portal, with a strong position in the enterprise search space bolstered by 38 patents and additional patents pending;
The completion of MyWay's transition to a licensing-based revenue model on schedule to be completed at end of the fiscal Q2 and projected to reach a profitable run rate on an EBITDA basis in fiscal Q4; and
CMGI's intention to exit the operations of iCAST by the end of the second fiscal quarter.
On September 15th, AltaVista announced the realignment of its operations to focus on its core strength in search technologies. Although the consumer search market remains strong, it is still largely driven by advertising revenue. As a result, AltaVista will use its portfolio of 38 patents, plus additional ones pending, to build additional revenue streams in the faster-growing business search sector, characterized by more traditional software business elements including annual licensing and higher-margin product offerings. AltaVista is currently realizing approximately 12% of its revenues from the B2B search space. With AltaVista's leading technology, language presence and expertise, the company intends to aggressively pursue leadership in this segment.
On October 5, 2000, CMGI announced the consolidation of the MyWay advertising and Zip2 licensing-based portal platforms, resulting in a single licensing-based recurring revenue model. The transition to a single platform is on schedule to be completed by the end of January 2001.
Additionally, CMGI has determined it will exit the entertainment portal business, represented by iCAST, by the close of its second fiscal quarter ending January 31, 2000. This decision was based on the significant capital requirements required to fund this nascent business and its extended timeline to profitability. CMGI also announced that Signatures Network, a business previously included in the operations of iCAST, will continue as an independent CMGI majority-owned subsidiary and will transition to the company's E-Business & Fulfillment segment.
SEARCH AND PORTALS FINANCIAL GUIDANCE
The market dynamics for business models that rely solely on advertising revenues have been compromised by the current Internet climate. As a result, CMGI companies, and the industry at large, have experienced renegotiation of many sponsorship deals. Due largely to a shortfall in MyWay's ad sales and the transition to a licensing-based model, CMGI expects to incur a decrease in sequential Search & Portals segment revenues resulting in first quarter revenues of approximately $57 to $58 million versus fourth quarter revenues reclassified to exclude Signature Networks of approximately $68 million. CMGI expects that fiscal 2001 revenues will grow approximately 20 to 25%. MyWay is projected to remain a solid contributor, but will likely comprise less than 10% of segment revenues.
Fourth quarter operating expenses in the Search & Portals segment, not including cost of revenues and reclassified to exclude Signatures Network, were approximately $340 million and included $220 million in amortization expenses. CMGI projects going forward that operating expenses will decline on an absolute basis, exiting the fourth quarter in the $280 to $300 million range, including amortization expenses. The Search & Portals segment exited fiscal 2000 with gross margin of 51.3%. CMGI projects that gross margin for the segment will be approximately 53% for the first fiscal quarter and for fiscal 2001 will be 63 to 65% as a result of AltaVista's accelerated transition to a software-based business model. Expressed as a percentage of revenues, exiting fiscal 2000 Research & Development (R&D) expenses accounted for 39.5%, Sales & Marketing (S&M) 116.5% and General & Administrative (G&A) 20.3%. R&D expenses as a percentage of revenues are expected to be approximately 40% for the first fiscal quarter and 29 to 30% for fiscal 2001, including restructuring charges. S&M expenses as a percentage of revenues are expected to be approximately 94% for the first fiscal quarter and 62 to 63% for fiscal 2001, including restructuring charges. G&A expenses as a percentage of revenues are expected to be approximately 27% for the first fiscal quarter and 19 to 20% for fiscal 2001, including restructuring charges. Amortization expenses for the first fiscal quarter were approximately 400% of revenues are expected to be 300% for the fiscal year, not including any adjustments that might be necessary for goodwill impairment charges.
Improvement reflects reduced expenses relating to the exit of iCAST, continued consolidation efforts at MyWay, and AltaVista's continued business model transition from an advertising to a software licensing revenue model. We expect to see benefits of these efforts in the third quarter, as we forecast reaching breakeven EBITDA sometime during the third quarter and positive EBITDA for the fourth quarter. Restructuring activities are expected to result in additional expenses in the first quarter of $4 to $5 million and in the second quarter of approximately $25 to $30 million, primarily associated with the exit of iCAST's business. As previously indicated, these restructuring expenses will be spread among the line items of CMGI's P&L.
INTERNET PROFESSIONAL SERVICES
CMGI's Internet Professional Services segment consists of Tallán (formerly CMGI Solutions). Highlights for the segment include:
Projected year-over-year pro-forma revenue growth of 40%;
A shift in focus to enterprise customers, thereby reducing dot.com revenue exposure;
Maintenance of positive EBITDA throughout fiscal 2001;
Continued focus on hiring, training and developing world-class talent; and
Upside leverage for this segment derived from CMGI enterprise relationships, such as Tallán's relationship with B2E Solutions (formerly Freeup.com), a joint venture between CMGI and Compaq.
Industry sources estimate the global opportunity for Internet professional services to be as large as $26 billion, growing at a rate of 40 to 50% per year over the next several years. CMGI believes that Tallán's business fundamentals remain strong and position our operating segment in the top 25 percent of the Internet professional services market. CMGI has limited dot.com exposure, as global 2000 companies and financially sound middle-market companies comprise the majority or approximately 80% of Tallan's revenue base. As a result, CMGI believes this segment's growth will keep pace with or exceed the industry as a whole.
INTERNET PROFESSIONAL SERVICES FINANCIAL GUIDANCE
CMGI acquired Tallán on March 31, 2000 in a purchase transaction, and as a result, CMGI's results for Fiscal 2000 only included four months of Tallán operations. As announced at the close of the fourth quarter, CMGI had 391 billable consultants and annualized revenue per billable consultant of $311,000. Establishing a baseline for pro forma fiscal 2000 revenues of approximately $95 million, CMGI expects fiscal 2001 revenues to grow in-line with the overall industry growth rate of 40%.
Operating expenses, excluding cost of services, amortization and goodwill impairment for the Internet Professional Services Segment were $10 million for the fourth fiscal quarter of 2000. This segment exited fiscal 2000 with a gross margin of 29.4%. CMGI projects that gross margin for the segment will be approximately 30% for the first fiscal quarter, and in the 36 to 38% range for the fiscal year, inclusive of training and staff development costs which approximate 500 basis points. The Internet Professional Services segment exited fiscal 2000 with S&M and G&A expenses of 10%, and 23.4%, respectively. For fiscal 2001, CMGI forecasts that S&M expenses as a percentage of revenues will be approximately 6% in the first fiscal quarter and 8 to 10% for the fiscal year. G&A expenses as a percentage of revenues will be approximately 23% for the first fiscal quarter and 24 to 25% for the fiscal year. CMGI forecasts recurring EBITDA to remain strong and average 8 to 10% of revenues for the fiscal year. CMGI expects amortization expenses for the year will decline slightly over the fiscal year in absolute terms.
INTERACTIVE MARKETING
CMGI's Interactive Marketing segment consists of Engage and yesmail.com. On October 12, 2000, CMGI announced that CMGion had acquired AdForce and, as a result, CMGI no longer includes AdForce in this segment. Highlights for this segment include:
Continued expense containment in the face of softness in online advertising revenues resulting in expected positive EBITDA for fiscal Q4;
Projected year-over-year revenue growth of 30 to 35%; and
Upside for this segment derived from the addition of CRM-based revenues for yesmail.com and continued market penetration of Engage's suite of marketing software and related services.
The Interactive Marketing sector remains under pressure as dot.com advertising declines over the short term and ad-supported business models evolve. Industry revenue estimates are being revised, but bellwethers suggest there will be modest revenue growth of approximately 15 to 20% year-over-year. CMGI believes that Engage's increased focus on software solutions and the Global 2000 and financially-sound middle market companies will provide additional stability to their business model.
INTERACTIVE MARKETING FINANCIAL GUIDANCE
First quarter revenues are forecast to come under pressure as a result of current industry-wide trends. CMGI forecasts a sequential decline of approximately 30% over reclassified fourth quarter revenues of $72.5 million that reflect the acquisition of AdForce by CMGion. As the software solutions' business gains momentum, CMGI forecasts that sector revenues will increase approximately 30 to 35% year over year.
The Interactive Marketing Segment exited fiscal 2000 with a reclassified gross margin of 45.4%. CMGI projects that gross margin for the segment will be approximately 30% for the first quarter and improve to 44-45% for the fiscal year as a result of Engage's increased focus on software-based solutions. CMGI exited fiscal 2000 with R&D, S&M and G&A expenses of 18.6%, 55.4%, and 18.1%, respectively. R&D expenses as a percent of revenues are expected to be approximately 32% in Q1, including restructuring charges, and 20-21% for the fiscal year. S&M expenses as a percentage of revenues are expected to be approximately 80% in Q1, including restructuring charges, and approximately 53 to 54% for fiscal 2001. G&A expenses as a percentage of revenues are expected to be approximately 24% in Q1, including restructuring charges, and 19-20% for the fiscal year. Amortization expenses for the first quarter were approximately 300% of revenues and are projected to be 275% for the fiscal year, not including impairment charges. CMGI projects that negative EBITDA in the Interactive Marketing segment will turn positive for the fourth fiscal quarter. We will incur charges associated with our restructuring of approximately $4 to 5 million in the first quarter and $2 to 3 million in the second quarter. The restructuring charges will be distributed between COGS and G&A.
E-BUSINESS AND FULFILLMENT
uBid, SalesLink and Signatures Network are the three CMGI companies that comprise this segment. Key guidance points for this sector include:
Projected year-over-year pro forma revenue growth of 60 to 65%;
Improved operating efficiencies and strong revenue growth resulting in positive EBITDA for the fourth fiscal quarter of 2001;
uBid revenues surpassing $1 million per employee and growing, as well as expected additional revenue opportunities resulting from uBid's launch of consumer-to-consumer auction capabilities;
B2B now comprises 30% of uBid's revenues, derived from the sale of computers;
The addition of SalesLink's Memphis distribution facility in the third quarter; and
SalesLink's projected profitability for all four quarters of FY 2001 on an EBITDA basis.
The supply chain management and fulfillment market is expected to grow at a compounded annual rate of 19% to $50 billion in the next two years. SalesLink has an opportunity to gain additional share through differentiation of its Advanced Planning System and has entered into a commercial relationship with uBid to provide improved order management and fulfillment services through its new Memphis facility coming on-line this Spring.
The consumer online market is expected to remain strong with business-to-consumer auctions expected to outpace consumer-to-consumer auctions growing to 66% of the total $19 billion auction market in 2002. uBid continues to lead the B2C auction marketplace.
E-BUSINESS AND FULFILLMENT FINANCIAL GUIDANCE
CMGI forecasts that eBusiness and Fulfillment segment revenues will keep pace with market growth, noting seasonality patterns that may vary for each company. CMGI expects that the first two quarters will be strong with the holidays fast approaching. Revenue growth for the first quarter is expected to be 10% versus reclassified fourth quarter revenues of $171 million to include Signatures Network. Revenues are expected to decline slightly in the second quarter as a result of a seasonally strong first quarter for SalesLink and a decline in live events for Signatures. Projected pro forma revenue growth is expected to be in the 60 to 65% range for the fiscal 2001 year.
The E-Business and Fulfillment Segment exited fiscal 2000 with a reclassified gross margin of 11.6%. We expect that first fiscal quarter gross margin will be approximately 12%. CMGI projects that gross margin for the segment will improve through the year and be 11 to 13% of fiscal 2001 revenues. The E-Business and Fulfillment Segment exited fiscal 2000 with S&M and G&A expenses of 8.8% and 6.0%, respectively. For the fiscal first quarter, we expect that S&M expenses will be approximately 8% and G&A expenses will be approximately 6% of revenues. S&M expenses, as a percent revenues, are expected to be 8 to 10% for fiscal 2001. G&A expenses, as a percent revenues, are expected to be 5-7% for fiscal 2001 R&D expenditures are forecast to be nominal. In regards to EBITDA, CMGI forecasts this segment to be positive for the third quarter and going forward. The company also expects to exit the fourth quarter with a positive EBITDA in the 1 to 2% range. Amortization expenses will remain consistent with fourth quarter levels and constant at $30 to $35 million per quarter throughout the year.
INFRASTRUCTURE AND ENABLING TECHNOLOGIES
CMGI's Infrastructure and Enabling Technologies segment currently consists of seven operating companies: 1stUp.com, Activate, CMGion, Equilibrium, ExchangePath, NaviPath, and NaviSite. Guidance highlights for the segment include:
CMGI's intention to divest 1st Up and exit the ad-supported Internet access business;
CMGI's intention to increase resources supporting NaviPath's VISP business (NaviOne), and significantly reduce network costs over the next two quarters;
Projected year-over-year segment revenue growth in excess of 100%;
A significant reduction in EBITDA losses during the fiscal year with fourth quarter's EBITDA loss totaling approximately 25% of peak losses expected in the second quarter;
Continued focus on NaviSite's managed services business, an area of strong sequential growth; and
A CMGI capital commitment to NaviSite of $80 million to help fund continued expansion.
During CMGI's first fiscal quarter, CMGion announced the acquisition of Tribal Voice and AdForce. Through these acquisitions, CMGion's strategic position is significantly enhanced as it approaches its goal of delivering scaleable, reliable technology and services over any kind of digital connection. AdForce's technology includes key components that will enable CMGion to more rapidly develop a global platform to allow content transformation, applications and profiling to be executed at the edges of the Internet. CMGion also gains proven management leadership with the addition of the AdForce team and the appointment of Chuck Berger to CEO of CMGion.
CMGI has also determined that it will divest its ad-supported Internet access business represented by 1stUp.com by the end of the second fiscal quarter. Given the investments required to be successful in this marketplace, as well as the challenging dynamics within 1stUp's free, ad-supported access business, the company's timeline to profitability has been greatly extended. As a result, CMGI no longer believes it can achieve the scale on a stand-alone basis necessary to drive this business to profitability within an acceptable timeframe.
INFRASTRUCTURE AND ENABLING TECHNOLOGIES FINANCIAL GUIDANCE
CMGI will continuously evaluate the economics of each individual company to ensure the businesses are on the right trajectory to achieve profitability within a reasonable timeframe. CMGI does not expect this sector to turn EBITDA positive during the 2001 fiscal year given the diversity and capitalization requirements of the companies in this segment. CMGI has made certain assumptions about restructuring in this segment to significantly reduce its network costs. Additionally, CMGI reiterates its funding commitment of $80 million to NaviSite and, as such, has included this figure in its corporate cash consumption forecasts.
CMGI expects first quarter Infrastructure & Enabling Technologies segment revenues to decline sequentially by 2% versus fiscal fourth quarter revenues of approximately $35 million reclassified to include AdForce. This decline reflects the repositioning of AdForce within this segment as well as the negative revenue impact from the industry-wide decline in ad spending. We expect to see sequential year-over-year revenue growth in excess of 100% for this segment.
Infrastructure Segment operating expenses, not including cost of goods sold and reclassified to reflect the changes in AdForce, were $116 million for the fourth fiscal quarter. The Infrastructure segment exited fiscal 2000 with a negative gross margin of negative 78.9%. CMGI projects that gross margin for the segment will turn positive late in the third quarter and be a negative 41 to 43% of revenues for fiscal 2001, as a result of restructuring actions. Gross margin in the first fiscal quarter is expected to be approximately negative 120%. CMGI exited fiscal 2000 with R&D, S&M and G&A expenses of 30.8%, 58.4%, and 49.3% of revenue, respectively. R&D expenses as a percentage of revenues are expected to be approximately 38% for the first fiscal quarter and 32 to 35% for fiscal 2001, including restructuring charges. S&M expenses as a percentage of revenues are expected to be 75% for the first fiscal quarter and 64 to 66% for fiscal 2001, including restructuring charges. G&A expenses as a percentage of revenues are expected to be 51% for the first fiscal quarter and 40 to 42% for fiscal 2001, including restructuring charges. CMGI further projects that negative EBITDA in the Infrastructure segment will peak in the second quarter and then steadily improve. EBITDA will remain negative in the fourth quarter, but is expected to be approximately a third of the second quarter level. CMGI will incur one-time charges associated with our restructuring of approximately $50 million in the second quarter.
VENTURE CAPITAL
Recognizing the challenging public and private capital markets, the partnership is primarily focused on managing its existing portfolio of 52 companies, with primary emphasis to reduce burn rates and define clear paths to profitability for each company with their existing capital reserves. There are four fundamental paths to achieving a healthy, high return-yielding portfolio: develop growing and profitable operations, merge with synergistic companies to accelerate profitability, pursue divestiture or shut down. Examples include:
Half.com was sold to eBay in July 2000, providing a 524% return on CMGI@Ventures' investment;
eGroups was sold to Yahoo! in August 2000, providing a 374% return on CMGI@Ventures' investment;
MyFamily.com acquired ThirdAge in November, enabling the combined entity to reach profitability by Q3 of calendar 2001;
CarParts Technologies has acquired two small, profitable software companies, enhancing its technology platform offering to the automotive aftermarket industry, as well as accelerating its own profitability path;
Furniture.com, in agreement with CMGI@Ventures' nine co-investors and management, closed earlier this month; and
MotherNature.com has announced that it is liquidating its assets.
In parallel with the industry at large since April, CMGI@Ventures' investment pace has significantly slowed, though it continues to prudently evaluate early-stage enabling technology and eBusiness opportunities that can provide value and balance to the CMGI portfolio. Since January, CMGI@Ventures has made 11 investments in infrastructure, search technologies, storage, B2B enabling software, natural language technologies, streaming media, and wireless enterprise and enabling technologies.
Given CMGI@Ventures' emphasis on early-stage investments, the firm continues to see a high volume of quality deals. In particular, market conditions have restored valuations to attractive levels. This early-stage emphasis also allows CMGI@Ventures to achieve substantial equity stakes in new investments with far fewer dollars at risk.
CMGI@Ventures expects to maintain its investment spending levels of $30 million a quarter, increasing to $32 million per quarter in the third and fourth quarters to further solidify its position in the Internet's newest emerging technology businesses.
CONSOLIDATED FINANCIAL GUIDANCE
CMGI exited fiscal 2000 with fourth quarter revenues of approximately $377 million and fiscal 2000 revenues of approximately $898 million. Fiscal 2000 growth reflected strong organic growth as well as growth through acquisitions. Using fourth quarter as a base-line for consolidated entity guidance:
CMGI anticipates that first quarter consolidated revenues may be sequentially down approximately 3.5% resulting from its reorganization. For fiscal year 2001, CMGI expects revenues to increase 80 to 90% versus fiscal 2000.
First quarter gross margins are expected to decline slightly to approximately 11% versus the fourth quarter consolidated margin of 18% due to the effects of restructuring. In the remaining quarters, CMGI expects that gross margin for fiscal 2001 will be in the 20 to 23% range. Examples of events expected to positively influence this margin include AltaVista's increased focus on search software solutions, the Infrastructure and Enabling Technologies segment's expected achievement of positive gross margin in the fourth quarter, and the expectation of software revenues becoming a larger component of the overall Interactive Marketing segment's revenues.
CMGI expects Research & Development expenditures, which represented 13.7% of fourth quarter fiscal 2000's revenues, will decline to 11 to 13%. CMGI expects first quarter R&D expenses to be approximately 15% of revenues. Cost savings expected from reorganizations and consolidations, such as the merger of the MyWay and Zip2 portal platforms, will be redirected to assist other companies reach market leadership.
CMGI also expects that Sales & Marketing expenditures will decrease as a percent of total revenues as a result of efficiencies gained during the consolidation of companies within segments. CMGI exited the fourth quarter of fiscal 2000 with expenses equal to 42.3% of revenues. CMGI forecasts that Sales & Marketing expenses as a percent of revenue will be 31 to 33% for fiscal 2001 with Sales & Marketing expenses for the first quarter of approximately 40% . The first and second quarter estimates include restructuring charges.
General & Administrative expenses are also forecast to decline as a percent of total revenues, again reflecting the benefits gained from consolidation of companies within segments. CMGI exited the fourth quarter of fiscal 2000 with expenses equal to 21.9% of revenues. CMGI forecasts that General & Administrative expenses as a percentage of revenues will be approximately 24% for the first fiscal quarter and 19 to 21% for the fiscal year. CMGI has budgeted restructuring costs in the first three quarters.
Amortization in the fourth quarter was approximately $536 million. In fiscal 2001, CMGI expects amortization expenses to be approximately 127% of revenues for the fiscal year. For the first quarter, amortization expenses are projected to be approximately 148% of revenues; however, this figure does not include any adjustments that may be necessary for goodwill impairment charges. On a quarterly basis, CMGI will review goodwill impairment charges and provide updated guidance.
On a consolidated basis, CMGI expects to take a restructuring charge of $8 to $10 million in the first fiscal quarter and $75 to $80 million in the second fiscal quarter. This charge will be spread among various P&L accounts and CMGI expects to provide additional clarity during its first fiscal quarter earnings call next month.
For the companies funded by CMGI, cash consumption for the fiscal year will decrease from approximately $190 million per quarter at the end of fiscal 2000 to just $45 million per quarter by the end of fiscal 2001. This cash consumption figure includes the $30 million quarterly investment requirements of CMGI@Ventures.
At the end of fiscal 2000, CMGI exited the year with total consolidated cash and available-for-sale securities of approximately $1.8 billion. We expect to exit fiscal 2001 with consolidated cash and available-for-sale securities in excess of $700 million. This assumes CMGI will not access any external funding sources, but instead rely on the sale of its available-for-sale securities.
About CMGI and CMGI @Ventures
CMGI, Inc. (Nasdaq: CMGI), a leading global Internet operating and development company, represents a network of 70 established and emerging companies, including both CMGI operating businesses and synergistic investments made through its venture capital affiliate, CMGI @Ventures. Companies in the CMGI network span a range of vertical market segments including search and portals; infrastructure and enabling technologies; e-business and fulfillment; interactive marketing; and Internet professional services. CMGI leverages the technologies, content and market reach of its extended network to foster rapid growth and industry leadership across the Internet Economy. Compaq, Microsoft, Pacific Century CyberWorks and Sumitomo hold minority positions in CMGI.
CMGI's majority-owned operating companies include Engage (Nasdaq: ENGA), NaviSite (Nasdaq: NAVI), 1stUp.com, Activate, AltaVista, CMGion, Equilibrium, ExchangePath, iCAST, MyWay.com, NaviPath, SalesLink, Tallán, uBid.com and yesmail.com. CMGI @Ventures has ownership interests in 52 companies including Terra Lycos (Nasdaq: TRLY), Critical Path (Nasdaq: CPTH), Ventro (Nasdaq: VNTR) and Vicinity (Nasdaq: VCNT).
CMGI's corporate headquarters is located at 100 Brickstone Square, Andover, MA 01810. CMGI @Ventures has offices there, as well as at 3000 Alpine Road, Menlo Park, CA 94028. For additional information, visit www.cmgi.com.
# # #
This release contains forward-looking statements which address a variety of subjects including, for example, projected financial results for CMGI and its operating companies, the expected benefits of CMGI's segmentation strategy and reorganization efforts, the expected revenues, gross margins and profitability of CMGI and its segments, CMGI's projected cash position, expected restructuring efforts and related charges, and expected market conditions in the markets in which CMGI and its operating companies compete. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: CMGI's success is dependent upon its ability to integrate its operating companies in accordance with its segment strategy; CMGI's success, including its ability to decrease its cash burn rate, improve its cash position and revenue run rate and reach profitability, depends on its ability to execute on its business strategy and the continued and increased demand for and market acceptance of CMGI's and its operating companies' web sites and the Internet in general; CMGI may experience difficulties integrating technologies, operations and personnel of recent acquisitions; and increased competition and technological changes in the markets in which CMGI competes. For a detailed discussion of cautionary statements that may affect CMGI's future results of operations and financial results, please refer to CMGI's filings with the Securities and Exchange Commission, including CMGI's most recent Annual Report on Form 10-K
CONTACTS:
Catherine Taylor Deidre Moore
CMGI Investor Relations CMGI Public Relations
(978) 684-3832 (978) 684-3655
IR@cmgi.com dmoore@cmgi.com
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