Wednesday, May 14, 2008

Mercadolibre (MELI) Reports

Latin America internet name Mercadolibre (MELI) reported last night and the stock is down only a bit this AM early - after a huge run I was hoping for some sort of sell off - a constant refrain lately; but we have yet to get any serious buying opportunities. The valuation continues to be extremely rich but the scarcity value of these type of stocks is unique. I just love near 80% gross margins.
  • Consolidated net revenues for the first quarter of 2008 increased 75.2% to $28.8 million, compared to $16.5 million for the first quarter of 2007. Marketplace revenues, which represented 81.4% of net revenues, grew 65.4% to $23.5 million from $14.2 million for the prior year period. Payments revenues, which represented 18.6% of net revenues, increased 136.7% to $5.4 million from $2.3 million for the prior year period. Revenue growth was primarily driven by solid growth in both gross merchandise and total payment volume.
  • Gross profit grew 75.9% to $22.8 million from $13.0 million in the prior year period and gross profit margin, defined as gross profit as a percentage of revenues, expanded to 79.1% from 78.8% for the same quarter one year earlier.
  • Income from operations grew 117.6% to $6.5 million, from $3.0 million for the same period one year earlier.
  • Net income before income and asset tax expenses for the quarter was $4.9 million, an increase of 162.9% over prior year quarter net income before income and asset tax of $1.9 million.
  • The Company's first quarter 2008 net income reflects an effective tax rate of 58.1%, in part due to added tax expenses derived from the introduction of new taxes in Mexico as well as certain new non-deductible expenses incurred in Venezuela. (ouch!)
  • Registered Users -- New confirmed registered users for the three month period ended March 31, 2008 were 1.6 million, generating a total confirmed registered user base of 26.5 million users as of March 31, 2008, an increase of 34.5% over the 19.7 million users registered as of March 31, 2007.
  • Transaction volume -- Gross merchandise volume was $449.7 million for the first quarter of 2008, a 43.9% growth from gross merchandise volume of $312.5 for the same period during 2007.
Long Mercadolibre in fund; no personal position

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