* Q4'10 net income increased by 41.2% year-over-year to $15.9 million
* Items sold during Q4'10 increased by 31.2% year-over-year to 11.3 million
* Total payments transactions in Q4'10 increased by 134.5% to 2.4 million
* Net Income during FY'10 increased by 68.7% year-over-year to $56.0 million
BUENOS AIRES, Argentina, Feb. 23, 2011 (GLOBE NEWSWIRE) -- MercadoLibre, Inc. (Nasdaq:MELI) ( Latin America's leading e-commerce technology company, today reported financial results for the fourth quarter and full year ended December 31, 2010.
Marcos Galperin, President and Chief Executive Officer of MercadoLibre, Inc., commented, "We are pleased to have ended a strong year with accelerating growth as all of our businesses performed well throughout the holiday season. We believe this is a testament to the power of the e-commerce ecosystem we have built. Additionally, our value proposition continues to prove very attractive to the fast-growing base of Internet users in Latin America. In our view, the combination of low prices, attractive product selection, clear and intuitive listing formats, increasingly seamless payments integration, and advertising services we offer continue to create great value for both buyers and sellers alike."
Financial Results Summary
MercadoLibre reported consolidated net revenues for the three months ended December 31, 2010 of $62.3 million, representing 27.1% year-over-year growth.Revenue growth was negatively impacted by the pre-sale of credit card receivables beginning in the third quarter of 2010. Had the company carried out similar pre-sales of credit card receivables during 2009, revenue growth would have been 38.4% during the fourth quarter of 2010 as compared to the same quarter one year earlier.
For the three months ended December 31, 2010, items sold on MercadoLibre grew 31.2% to 11.3 million while total Payments transactions through MercadoPago grew 134.5% to 2.4 million as compared to the fourth quarter of 2009. Gross merchandise volume for the fourth quarter 2010 grew 25.6% year-over-year to $988.1 million, while total payment volume grew 73.8% year-over-year to $236.1 million.
Income from operations grew 17.3% to $21.0 million in the fourth quarter of 2010 compared to $17.9 million in the fourth quarter of 2009. Operating income margin for the fourth quarter of 2010 was 33.6%. Growth in income from operations was also negatively impacted by the pre-sale of credit card receivables.
Net income for the three months ended December 31, 2010 was $15.9 million, representing 41.2% growth over the same quarter one year earlier. Net income margin was 25.6% for the fourth quarter of 2010, compared to 23.0% for the same period last year. Earnings per share for the fourth quarter of 2010 were $0.36 compared to $0.26 for the prior year quarter.
Free cash flow, defined as cash from operating activities less property, equipment and intangible asset purchases, was $22.8 million for the three months ended December 31 2010.
For the full year, MercadoLibre generated $3.4 billion in gross merchandise volume, consolidated net revenues of $216.7 million, and net income of $56.0 million, or $1.27 per share. Gross merchandise volume was up 23.8% in 2010 when compared to the full year 2009, while net revenues rose 25.4% and net income increased 68.7%.
The following table summarizes certain key performance metrics for the year and quarters ended December 31, 2009 and 2010.
Change in MercadoPago Financing Operations
Starting in the third quarter of 2010, the company began to pre-sell credit card receivables from its MercadoPago financing operations. For this reason, starting in the third quarter of 2010, MercadoPago financing revenues now represent the net amount received from financing institutions as a result of pre-selling these installments-related financing receivables. Credit card receivables are being pre-sold in order to better manage credit risk; generate increased predictability of the associated cost; and not assume any financing risk.
The following table may prove helpful to analyze the annual evolution of the company's revenue growth, as it shows consolidated net revenues since Q4 of 2008 net of MercadoPago financing cost:
MercadoLibre provides consolidated net revenues net of MercadoPago financing costs because it believes that such presentation is a beneficial supplemental disclosure to investors in analyzing and assessing the historical revenue growth of the company.
Conference Call and Webcast
The Company will host a conference call and audio webcast on February 23, 2011 at 4:30 p.m. Eastern Time. The conference call may be accessed by dialing (970) 315-0420 and requesting inclusion in the call for MercadoLibre. The live conference call can be accessed via audio webcast at the investor relations section of the Company's website, at http://investor.mercadolibre.com. An archive of the webcast will be available for one week following the conclusion of the conference call.
Definition of Selected Operational Metrics
Total confirmed registered users – Measure of the cumulative number of users who have registered on the MercadoLibre Marketplace and confirmed their registration.
New confirmed registered users – Measure of the number of new users who have registered on the MercadoLibre Marketplace and confirmed their registration.
Gross merchandise volume – Measure of the total U.S. dollar sum of all transactions completed through the MercadoLibre Marketplace, excluding motor vehicles, vessels, aircraft, real estate, and services.
Items sold – Measure of the number of items sold/purchased through the MercadoLibre Marketplace.
Total payment volume – Measure of total U.S. dollar sum of all transactions paid for using MercadoPago.
Total payment transactions – Measure of the number of all transactions paid for using MercadoPago.
Operating margin – Defined as income from operations as a percentage of net revenues.
Net Income margin – Defined as net income as a percentage of net revenues.
Free Cash Flow – Defined as cash flow from operating activities less property, equipment and intangible asset purchases.
About MercadoLibre
Founded in 1999, MercadoLibre is Latin America's leading e-commerce technology company. Through its primary platforms, MercadoLibre.com and MercadoPago.com, it provides solutions to individuals and companies buying, selling, advertising, and paying for goods online.
MercadoLibre.com serves millions of users and creates a market for a wide variety of goods and services in an easy, safe and efficient way. The site is among the top 50 in the world in terms of page views and is the leading retail platform in unique visitors in each country in which it operates according to metrics provided by comScore Networks. MercadoLibre maintains a leadership position in 12 Latin American countries. The Company is listed on NASDAQ (Nasdaq:MELI) following its initial public offering in 2007.
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CONTACT: MercadoLibre, Inc. Investor Relations Pedro Arnt investor@mercadolibre.com http://investor.mercadolibre.com Media Relations Valeria Bazzi Valeria.bazzi@mercadolibre.com