Webhire Announces Record First Quarter Internet Revenues; Recruiting Solutions Leader Makes Significant Progress on the Road to Profitability

Business Wire, Jan 30, 2001

Business/Technology Editors

LEXINGTON, Mass.--(BUSINESS WIRE)--Jan. 30, 2001

Webhire Inc. (Nasdaq:HIRE), the #1 choice in recruiting solutions, with more than 1,000 corporate customers in North America, today reported record quarterly Internet Services revenues for the period ended December 31, 2000.

First quarter Internet Services revenues were $3,261,000 compared to $1,877,000 in the first quarter of 2000, a 74% increase. As a result, the Company reported that, for the first time, the majority of its revenues is now generated from its market-leading recruiting products delivered via an Application Service Provider (ASP) model. During the first quarter, Internet Services revenue represented 54% of the Company's total revenue, up from 29% during the comparable first quarter period in fiscal year 2000 and up from 48% in the fourth quarter of fiscal year 2000. Total Webhire revenue for the first quarter of 2001 was $6,095,000 compared to $6,494,000 in the first quarter of

2000.

The first quarter net loss was $5,579,000 or $0.26 per share, which is a significant improvement when compared with the net loss of $8,381,000 or $0.58 per share for the first quarter of fiscal 2000. The first quarter loss, prior to amortization of acquired technologies and intangible assets, was $0.15 per share, compared to a loss, prior to amortization of acquired technologies and intangible assets and stock-based consideration, of $0.35 per share for the first quarter of fiscal 2000.

"Our results this quarter demonstrate that we are making significant progress on the road to profitability," said Marty Fahey, Webhire president and CEO. "We posted our 13th consecutive quarterly record for Internet Services revenues. We now have more than 1,000 corporate customers in North America and 90% of these customers rely on our ASP product line. Every business day 10,000 online users access Internet recruiting tools and services provided by Webhire. At the same time that we are growing our customer base, we are improving our gross margins for delivering Internet Services and significantly reducing our operating expenses. To put this in perspective, in our fiscal first quarter, we increased our corporate customer count by 120% over last year's first quarter, while reducing our overall headcount by 12%."

During the fiscal first quarter of 2001, Webhire added more than 70 new ASP subscribers from all industries and geographies. New subscribers added during the fiscal first quarter include: AIM Funds Management; Applied Systems, Inc.; Equiva Services; Federal Home Loan Bank of Pittsburgh; Lego Systems, Inc.; Luxsonor Semiconductors; Network Appliance, Inc.; Research in Motion; Robert Bosch Corporation; Snapple Beverage Group and Valero Energy.

2001 Outlook

For the remaining quarters of fiscal year 2001, the Company expects that Internet Services revenues will continue to become an even larger component of total revenues. In the second quarter of 2001, the Company expects that total revenues will be approximately equal to first quarter levels, but with increasing gross margins. The Company also expects that, in the second quarter, total spending on Sales & Marketing, Research & Development and G&A will decrease in absolute dollars and as a percentage of revenues when compared to the first quarter. The Company projects that the net loss per share for the second quarter, excluding amortization of acquired technologies and intangible assets, will decrease compared to the net loss in the first quarter, to the range of ($.10) to ($.12) per share.

For the full fiscal year 2001, Internet Services revenues are currently projected to be in the range of $14 million to $16 million, compared to Internet Services revenues of $9.9 million in fiscal year 2000. The Company's total revenues for fiscal year 2001 are currently estimated in the range of $24 million to $25 million. For fiscal year 2001, the net loss per share, excluding amortization of acquired technologies and intangible assets, is currently estimated in the range of ($0.42) to ($0.46) per share, compared with the reported net loss, excluding amortization of acquired technologies and intangible assets and one-time charges of ($1.53) per share for fiscal year 2000. The net loss per share, including amortization of acquired technologies and intangible assets, is currently estimated in the range of ($0.64) and ($0.68), compared with the reported net loss of ($2.39) per share for fiscal year 2000.

Conference Call

Webhire has invited its shareholders, prospective shareholders and analysts to attend the company's Q1 earnings conference call by phone on Tuesday, January 30, at 4:30 p.m. (ET). The earnings conference call may also be heard via a live webcast that can be accessed from Webhire's Investor Information pages at http://www.webhire.com/about/index.asp. For those who wish to participate directly, the dial-in number is 1-800-231-9012. Please advise the operator that you are dialing in for the Webhire earnings call. Marty Fahey, Webhire president and CEO, will host the call. The confirmation code for the call is 600873. International callers should dial 1-719-457-2617.