The emphasis was on the big picture when MediaBay discussed its results for the first quarter ended March 31. The company noted that over the past several weeks it has restructured its finances with a new debt facility in which it received proceeds of $8.6 million while also extending the maturity of its debt to 2007. The new financing will provide the company with money to revive its marketing operations, something that was necessary if it was to continue operating.
The lack of marketing dollars was cited as the main reason for a drop in revenue from $10.7 million in the first quarter of 2003 to $5.7 million in the most recent period. Net loss in the quarter was $1.2 million, down from $1.5 million. Sales in its Audio Book Club division fell 54%, to $3.7 million, which the company attributed to a 70% reduction in its advertising budget to recruit new members. An equally steep decline in advertising expenditures dropped sales in its Radio Spirits division to $1.9 million from $2.6 million. According to MediaBay CEO Jeffrey Dittus, among the new marketing initiatives planned is the creation of an affiliated partnership program.
Dittus also said the company will use the new funding to increase its Internet business. It is in the process of digitizing all of its spoken-word offerings, and Dittus said he hopes, over time, to raise the amount of business done over the Web from 15% of sales to 50%. Dittus also said he hopes to be able to offer digital downloads from MediaBay's book club within the year.
