ALLOY NET UP IN QUARTER
Byline: Valerie Seckler
NEW YORK — Teen media network and direct marketer Alloy Inc. achieved fourth-quarter net profit of $1.5 million, or 4 cents a share, propelled by a gross margin that grew 1.7 basis points, as a growing portion of the firm’s revenue stemmed from media sponsorships, which are more profitable than e-commerce.
The profit for the quarter ended Jan. 31 compared with a prior-year net loss of $6.8 million, or 32 cents a share. Gross profit in the most recent period grew to 59.5 percent of sales, or $38.2 million, from 57.8 percent of sales, or $24.5 million, a year ago.
An expanded database of names and strong holiday business brought a 51 percent surge in Alloy’s fourth-quarter revenue, which tallied $64.2 million, up from $42.5 million in the fourth quarter of 2001. At its fiscal yearend, Alloy had a database of almost 9.6 million names of Generation Y girls and boys, of which around 2.5 million were established buyers.
The strong fourth-quarter business along with a secondary offering of stock put more than $130 million in cash and marketable securities on Alloy’s balance sheet as of Jan. 31. As a result, Alloy chairman and chief executive Matt Diamond stated, “We are leveraging our economies of scale and range of capabilities with media buyers to cross-sell our services and capture a greater share of marketing dollars directed to the youth market,” Diamond noted. “Our demographic contact points now encompass direct mail, Web sites, magazines, college and high school media, event marketing, and sampling.”
For the full year, Alloy’s net loss narrowed to $15.6 million, or 62 cents a share, from a loss of $29.7 million, or $1.58 a share, in 2001, as sales surged 82 percent to reach $165.6 million.