Press releases | Archive 2004
RBC revenue nearly doubles in the first nine months of 2004RBC revenue nearly doubles in the first nine months of 2004
- Nine-month sales rise 96% to $51.6m, driven by continuous growth in the underlying Media1 and IT business and the TV project's expansion
- The core Media and IT operations grow 53%, with online advertising and software programming as the main contributors
- RBC TV continues to achieve strong results, reporting the sales volume of $11.3m. The channel's audience soars 98% over six months.
|1-3Q 20042||1-3Q 20032||% Growth||Forecast 2004|
|Media services||24 000||15 016||60||34 000|
|IT services||16 260||11 269||44||21 000|
|Core Media & IT business||40260||26 285||53||55 000|
|TV project||11 300||-||-||16 000|
|Total revenue||51 560||26 285||96||71 000|
1All references to Media relate to RBC’s information and advertising services. The TV project is presented as a separate line of business for the convenience of valuation of the different elements of RBC’s activities.
2Figures calculated on the basis of management accounts in accordance with IFRS (unaudited).
Moscow, November 23, 2004 - Today RBC Information Systems (RTS, MICEX: RBCI) announced its preliminary three-quarter 2004 financials, demonstrating a sharp sales increase. Commenting on the results publication, RBC Chairman and CEO German Kaplun said: "I am pleased to report that we are approaching the year end with extremely strong results, as the total RBC revenue nearly doubled in the first nine months of 2004. The rapid growth pace was driven by the excellent performance of the underlying Media and IT business and the dynamic development of the TV project."
Revenue. In the first nine months, RBC total revenue rose 96% from $26.3 million in 2003 to $51.6 million in 2004, due to strong organic business expansion, as the company continued to utilize its unique combination of experience in delivering business news, generating advertising and providing IT support. In the total 3Q2004 revenue mix of the company, 47% was contributed by the underlying media business, 22% came from RBC TV, and 31% from the IT business.
Media Services. The revenue from media services, comprising RBC's activities in information subscription, online advertising and marketing communications, went up 60% from $15.0 million in the first three quarters of 2003 to $24.0 million in the same period of 2004. The sales increase was due to strong RBC brand awareness among the business community, extensive advertising selling experience, the launch of new projects and healthy performance from key media products.
In the third quarter, the company set up an online bulletin board service to connect buyers and sellers of different businesses, introduced new sections at www.rbc.ru and www.quote.ru, as well as presented new analytical products intended for financial market professionals. In August 2004, RBC acquired the 'Best Brand' national business contest, which annually recognizes the most notable achievements in the field of creation and promotion of brands on the Russian market. This year the number of 'Best Brand' participants and sponsors significantly enhanced owing to the synergetic effect with the RBC's marketing communication branch and massive promotion.
The media operations of the company expanded significantly ahead of the media market growth in Russia, which registered a 32% increase in the first nine months of 2004, according to the Russian Association of Communication Agencies. Over the past twelve months, the monthly audience and the average number of hits on RBC's web sites expanded about 35% to 5.7 million individual users and 160 million hits per month respectively. The company has already notified its clients of an anticipated 30% increase in advertising rates on RBC's resources effective April 2005.
RBC TV. In the first nine months of 2004, RBC TV brought $11.3 million in revenue, adding 45 percentage points to the top line growth of the company.
The channel almost doubled its viewership in the past six months of 2004. According to the independent media researcher COMCON-Media, the weekly audience of RBC TV soared from 1.563 million viewers in April 2004 to 3.094 million in October 2004. The number of people, who can watch the channel in Russia, reached 37.456 million. This means that the core audience of RBC TV rose from 5.4% of the total coverage to 8.3%.
The impressive audience increase was achieved on the back of expanded signal distribution in Russia and the growing need for domestic business news in the country. The current demand is fueled by the overall rapid development of Russian economy and capital markets as well as the expansion of the business class. Overall, the project is progressing on schedule and is exceptionally well placed to secure dynamic long-term revenue growth for the company.
IT Services. The revenue from IT services was up 44% from $11.3 million in the first nine months of 2003 to $16.3 million in the same period of 2004. The robust growth was driven by an increased number of government contracts and offshore orders and underpinned by a general IT spending upsurge in Russia.
In the third quarter of 2004, RBC broadened its client base among state organizations and continued providing a growing scope of IT services to such state agencies as the Russian Federal Atomic Energy Agency, the Russian Federal Customs Service, the Federal State Statistics Service and the State Property Ministry. The company won a World Bank's tender for the creation of an IT platform for the Russian Finance Ministry to keep track of financing secured with movable property in Russia. State contracts ensured approximately 30% of IT-generated revenue by the end of the third quarter. At the same time, none of the customers accounts for more than 10% of the IT revenue.
RBC also strengthened its position as a provider of quality solutions for different types of companies, including financial organizations. For example, the implementation of a Siebel eFinance CRM-system at Kazkommertsbank by RBC was recognized as the best system integration project of the year at the Global CRM Forum in Moscow. The company successfully promotes its new solution for the leasing industry, which has been developed on the MBS Navision platform this year. RBC has created additional modules responding to the specific needs of Russian leasing companies and is working on the implementation of this solution for six large clients.
Cautionary note regarding forward-looking statements
Some of the information in this press release may contain statements of future expectations and other forward-looking statements. These expectations are based on management's current views and assumptions and involve known and unknown risks and uncertainties. It is possible that the company's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect the firm's future results, see "Risk Factors" in the company's latest Annual Report on www.rbcinfosystems.com. RBC assumes no obligation to update any forward-looking information contained in this document.