Pasadena, Calif. – Gemstar-TV Guide International’s Interactive Platform Sector enjoyed a 5 percent increase in revenue during the fourth quarter, hitting $14.8 million, up from $14.1 million in the year-ago period.
Gemstar attributed the increase to a full year of revenue at SkyMall and increased revenue from its TV Games network.
Despite the increase in revenue in the fourth quarter, ended Dec. 31, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) expanded $22.9 million, to a negative $24.2 million, compared with a negative $1.3 million in the same three months in 2001. This decrease was due to a full year of costs at SkyMall, increased costs related to the Interactive Program Guide (IPG) and about $15 million in non-recurring expenses.
Revenue for the 12 months in Gemstar’s Interactive Platform Sector jumped 38 percent, to $46.5 million, up from $33.7 million in 2001. This was attributed to a full year of revenue at SkyMall and increased wagering revenue related to the TV Games Network following the launch of interactive wagering in California.
However, even with the increase in revenue for the 12 months, EBITDA rose to a negative $41.5 million, compared with a negative $38 million in the year-ago period. This was due to a full year of expenses at SkyMall, combined with increased costs incurred to integrate the growing IPG base with increasing number of cable service providers offering the company’s advertising-enabled IPG product.
In the fourth quarter, Gemstar recorded consolidated revenue of $244.7 million, down 18 percent from the $299 million year-on-year. Consolidated EBITDA for the three months widened to a negative $33.8 million, up from $78.7 million in the fourth quarter of 2001.
For the 12 months, consolidated revenue dropped 14 percent, to $1 billion, down from $1.2 billion in 2001. The decrease was due to a $48 million decrease in TV Guide Magazine’s revenue, a $19 million decrease in TV Guide ad sales, a $63 million decline in C-Band subscriber revenue and a $24 million drop in license fees form DSS set-top box makers. Full-year EBITDA decreased 55 percent, to $119.7 million, down from $267.6 million in 2001.
Early in March, Gemstar received a determination from the Nasdaq Listing Qualifications Panel, with respect to the company’s securities on the Nasdaq Stock Market. Gemstar believes that with the current financial filings, it has met all but one of the conditions presented by Nasdaq, and that it is current in its Securities and Exchange Commission Filings. By its May 20 annual shareholders meeting, Gemstar believes it will have satisfied the final specific requirement for its securities to remain listed on Nasdaq.
