Lycos Europe reports higher losses in H1

Lycos Europe N.V., one of the leading European portal providers and online advertisers, today published its unaudited condensed consolidated interim financial statements for the first half year 2007.

The EBITDA of the first six months ended June 30, 2007 amounted to a loss of EUR 7.6 mln compared to a negative EUR 0.1 mln in the same first half period of 2006.

Revenues remained stable, whereas the cost base increased. This was mainly the result of additional marketing initiatives, higher expenses in connection with the recent product launches and one-time effects. The EBITDA therefore deviates from previous forecasts.

The disposal of the available for sale investment in Seznam.cz, a.s. resulted in a transaction gain of EUR 64.8 mln. Mainly as a result of Pangora’s loss of Google traffic and the negative trend in the Fireball usage, the company had to incur an impairment loss of EUR 19.2 mln. Both together had a significant impact on the company’s financial statement. The net profit for the first six months of 2007 amounted to EUR 48.7 mln.

Cash, cash equivalents and other investments increased to EUR 168.6 mln as
at June 30, 2007. The cash ratio of 4.4 (cash, cash equivalents and other investments divided by total liabilities) shows the strong financial position of Lycos Europe.

The ongoing product offensive and marketing initiative will result in a similar cost level during the coming months. The increase in revenues is not expected to cover this cost level and therefore, the company calculates also with an operating loss for the second half of 2007.
Lycos Europe is one of the leading European portal providers and online advertisers operating a network of websites in seven languages in Europe and the USA. The company’s combination of search, communication services, online communities, content channels, Internet access, shopping, homepage building and domain names registration addresses a wide range of target groups.