Mamma.com Posts Actual Income

Mamma.com (MAMA-NASDAQ) just gapped up after posting its quarterly results. Its Q4 revenues increased 118% to $3.57 million due to a significant increase in search advertising revenues, new software licensing contracts and increase in customized development and maintenance support, year-end revenues were at $9.60 million.  Its Cash, cash equivalents and temporary investments at $7.97 million.  The company even posted net earnings of $420,175, or $0.03 EPS.  Its net loss for the year was -$0.30 on EPS, down from -$0.47 in 2005.

Here is the benefactor for it: The increase was due to improvement in search revenues of $1,430,369 mostly due to expanded distribution and new clients for $1,204,915 and by Copernic’s contribution for the entire quarter in 2006 of $225,454. The Company executed new software licensing contracts which mainly accounted for its revenue increase of $694,511 as well as an increase in customized development and maintenance of $219,303.  Subsequent to the year end, two officers resigned from their positions and Mamma.com will pay most of the termination costs of CDN$550,000 in Q1 2007, it will change the duration of option agreements and allow accelerated vesting options for one of the officers. These changes will represent an additional non-cash item expense of approximately $270,000.

Martin Bouchard, President/CEO: "During the fourth quarter, we have significantly increased our search revenues by expanding our search network and by signing new clients thus generating our best quarterly results this year. We also executed new software licensing contracts of our award-winning desktop search technology. In addition, we have launched two new specialized search engines: Mamma Jobs and Mamma Videos. And, finally, we have completed the integration of Mamma.com/Copernic to provide the Company with a unified management team with a focused vision. The new licensing of software in the quarter was a major contributor to the quarter’s profitability. Unlike our search activities, licensing software fluctuates quarterly.  2007 will be an important year for the Company. We intend to focus our resources in sales and marketing, mainly in the USA and Europe. We also expect to announce new innovative products and services that are very unique in the market."

Keep in mind that MAMA is one of these cult stocks that trades wildly around news and is a daytrader natural.  Keep in mind that there are NO large analysts that follow the stock. Shares closed up almost 9% ahead of this at $4.50 to give a $64 million market cap and shares are up almost another 20% in after-hours.  We’ll see if the bulls win out in the name on its earnings or if the bears can win by commenting that this was mostly from one customer and it will have charges for directors leaving.  This is one volatile name and its share trading volume usually spikes much higher on news days.  As of February its shoirt interest was 4.6 million shares and its 52-week trading band is $0.86 to $8.60.

Jon C. Ogg
March 7, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.