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Price
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| þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| -OR- |
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| Delaware | 98-0212790 | |
| (State or other jurisdiction | (I.R.S. Employer | |
| of incorporation or organization) | Identification Number) |
| Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
|
(Do not check if a smaller reporting company)
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||||||
| Item 1. |
Unaudited Condensed Consolidated Financial Statements
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| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
| (Unaudited) | (Audited) | |||||||
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Assets
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||||||||
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Current assets:
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||||||||
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Cash and cash equivalents
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$ | 59,083,417 | $ | 56,830,466 | ||||
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Short-term investments
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67,578,494 | 5,342,766 | ||||||
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Accounts receivable, net
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15,429,301 | 12,618,173 | ||||||
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Funds receivable from customers
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13,244,197 | 6,151,518 | ||||||
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Prepaid expenses
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1,140,002 | 913,262 | ||||||
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Deferred tax assets
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11,922,213 | 12,911,256 | ||||||
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Other assets
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6,093,323 | 6,867,767 | ||||||
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Total current assets
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174,490,947 | 101,635,208 | ||||||
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Non-current assets:
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||||||||
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Long-term investments
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41,002,762 | 78,846,281 | ||||||
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Property and equipment, net
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31,351,966 | 20,817,712 | ||||||
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Goodwill, net
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62,861,760 | 60,496,314 | ||||||
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Intangible assets, net
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6,710,125 | 4,141,167 | ||||||
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Deferred tax assets
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3,495,916 | 2,975,118 | ||||||
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Other assets
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5,430,114 | 771,223 | ||||||
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Total non-current assets
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150,852,643 | 168,047,815 | ||||||
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Total assets
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$ | 325,343,590 | $ | 269,683,023 | ||||
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Liabilities and Equity
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Current liabilities:
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Accounts payable and accrued expenses
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$ | 19,998,140 | $ | 17,232,103 | ||||
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Funds payable to customers
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58,874,916 | 48,788,225 | ||||||
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Payroll and social security payable
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11,722,130 | 10,786,534 | ||||||
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Taxes payable
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9,997,791 | 11,487,574 | ||||||
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Loans payable and other financial liabilities
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140,107 | 100,031 | ||||||
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Dividends payable
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3,531,362 | — | ||||||
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Total current liabilities
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104,264,446 | 88,394,467 | ||||||
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Non-current liabilities:
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Payroll and social security payable
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3,056,099 | 2,562,343 | ||||||
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Loans payable and other financial liabilities
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178,543 | 188,846 | ||||||
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Deferred tax liabilities
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8,219,638 | 5,167,699 | ||||||
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Other liabilities
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1,770,821 | 1,651,398 | ||||||
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Total non-current liabilities
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13,225,101 | 9,570,286 | ||||||
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Total liabilities
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$ | 117,489,547 | $ | 97,964,753 | ||||
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Commitments and contingencies (Note 8)
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Equity:
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Common stock, $0.001 par value, 110,000,000 shares authorized,
44,142,020 and 44,131,376 shares issued and outstanding at
September 30,
2011 and December 31, 2010, respectively
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$ | 44,142 | $ | 44,131 | ||||
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Additional paid-in capital
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120,440,906 | 120,391,622 | ||||||
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Retained earnings
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118,262,734 | 73,681,556 | ||||||
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Accumulated other comprehensive loss
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(34,304,372 | ) | (22,399,039 | ) | ||||
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Total Equity of MercadoLibre, Inc.
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204,443,410 | 171,718,270 | ||||||
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Noncontrolling Interest
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3,410,633 | — | ||||||
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Total equity
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207,854,043 | 171,718,270 | ||||||
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Total liabilities and equity
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$ | 325,343,590 | $ | 269,683,023 | ||||
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||||||||
2
| Nine Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
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Net revenues
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$ | 212,465,972 | $ | 154,399,483 | $ | 81,628,144 | $ | 55,951,378 | ||||||||
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Cost of net revenues
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(51,331,295 | ) | (32,755,531 | ) | (20,060,474 | ) | (11,450,919 | ) | ||||||||
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Gross profit
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161,134,677 | 121,643,952 | 61,567,670 | 44,500,459 | ||||||||||||
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Operating expenses:
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Product and technology development
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(16,600,802 | ) | (11,425,716 | ) | (5,925,019 | ) | (4,224,476 | ) | ||||||||
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Sales and marketing
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(45,567,338 | ) | (34,863,616 | ) | (16,701,982 | ) | (12,281,672 | ) | ||||||||
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General and administrative
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(28,160,262 | ) | (21,725,081 | ) | (8,976,946 | ) | (8,683,605 | ) | ||||||||
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Total operating expenses
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(90,328,402 | ) | (68,014,413 | ) | (31,603,947 | ) | (25,189,753 | ) | ||||||||
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Income from operations
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70,806,275 | 53,629,539 | 29,963,723 | 19,310,706 | ||||||||||||
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Other income (expenses):
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Interest income and other financial gains
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7,037,264 | 3,073,427 | 2,913,596 | 1,361,899 | ||||||||||||
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Interest expense and other financial charges
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(2,562,633 | ) | (6,919,307 | ) | (1,052,865 | ) | (567,969 | ) | ||||||||
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Foreign currency gain / (loss)
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2,080,822 | 7,275 | 3,284,190 | (354,219 | ) | |||||||||||
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Other income / (loss), net
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253,148 | — | (7,292 | ) | — | |||||||||||
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Net income before income / asset tax expense
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77,614,876 | 49,790,934 | 35,101,352 | 19,750,417 | ||||||||||||
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Income / asset tax expense
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(22,439,967 | ) | (9,705,408 | ) | (8,804,905 | ) | (959,454 | ) | ||||||||
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Net income
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$ | 55,174,909 | $ | 40,085,526 | $ | 26,296,447 | $ | 18,790,963 | ||||||||
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Less: Net Income attributable to Noncontrolling
Interest
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522 | — | 522 | — | ||||||||||||
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Net income attibutable to MercadoLibre, Inc.
|
$ | 55,174,387 | $ | 40,085,526 | $ | 26,295,925 | $ | 18,790,963 | ||||||||
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||||||||||||||||
| Nine Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
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Basic EPS
|
||||||||||||||||
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Basic net income attibutable to MercadoLibre, Inc. per
common share
|
$ | 1.25 | $ | 0.91 | $ | 0.60 | $ | 0.43 | ||||||||
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Weighted average shares
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44,137,176 | 44,121,539 | 44,141,925 | 44,129,762 | ||||||||||||
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Diluted EPS
|
||||||||||||||||
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Diluted net income attibutable to MercadoLibre, Inc.
per
common share
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$ | 1.25 | $ | 0.91 | $ | 0.60 | $ | 0.43 | ||||||||
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Weighted average shares
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44,150,872 | 44,144,678 | 44,151,218 | 44,151,367 | ||||||||||||
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3
| Accumulated | ||||||||||||||||||||||||||||||||||||
| Additional | other | Total Equity | Total | |||||||||||||||||||||||||||||||||
| Comprehensive | Common stock | paid-in | Retained | comprehensive | of | Noncontrolling | ||||||||||||||||||||||||||||||
| income | Shares | Amount | capital | Earnings | income / (loss) | MercadoLibre, Inc. | Equity | Total | ||||||||||||||||||||||||||||
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Balance as of December 31, 2009
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44,120,269 | $ | 44,120 | $ | 120,257,998 | $ | 17,656,537 | $ | (23,765,418 | ) | $ | 114,193,237 | $ | — | $ | 114,193,237 | ||||||||||||||||||||
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Stock options exercised
|
7,126 | 7 | 18,192 | — | — | 18,199 | — | 18,199 | ||||||||||||||||||||||||||||
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Stock-based compensation — stock options
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— | — | 183 | — | — | 183 | — | 183 | ||||||||||||||||||||||||||||
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Stock-based compensation — restricted shares
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— | — | 37,696 | — | — | 37,696 | — | 37,696 | ||||||||||||||||||||||||||||
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Stock-based compensation LTRP
|
— | — | 52,291 | — | — | 52,291 | — | 52,291 | ||||||||||||||||||||||||||||
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LTRP shares issued
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3,981 | 4 | (4 | ) | — | — | — | — | — | |||||||||||||||||||||||||||
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Net income
|
$ | 40,085,526 | — | — | — | 40,085,526 | — | 40,085,526 | — | 40,085,526 | ||||||||||||||||||||||||||
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Currency translation adjustment
|
1,129,724 | — | — | — | — | 1,129,724 | 1,129,724 | — | 1,129,724 | |||||||||||||||||||||||||||
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Unrealized net gain on investments
|
670,471 | — | — | — | — | 670,471 | 670,471 | — | 670,471 | |||||||||||||||||||||||||||
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Realized net gain on investments
|
(27,630 | ) | — | — | — | — | (27,630 | ) | (27,630 | ) | — | (27,630 | ) | |||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
|
Comprehensive income
|
$ | 41,858,091 | ||||||||||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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Balance as of September 30, 2010
|
44,131,376 | $ | 44,131 | $ | 120,366,356 | $ | 57,742,063 | $ | (21,992,853 | ) | $ | 156,159,697 | $ | — | $ | 156,159,697 | ||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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Stock options exercised
|
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
|
Stock-based compensation — stock options
|
— | — | 61 | — | — | 61 | — | 61 | ||||||||||||||||||||||||||||
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Stock-based compensation — restricted shares
|
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
|
Stock-based compensation LTRP
|
— | — | 25,205 | — | — | 25,205 | — | 25,205 | ||||||||||||||||||||||||||||
|
Net income
|
$ | 15,939,493 | — | — | — | 15,939,493 | — | 15,939,493 | — | 15,939,493 | ||||||||||||||||||||||||||
|
Currency translation adjustment
|
218,758 | — | — | — | — | 218,758 | 218,758 | — | 218,758 | |||||||||||||||||||||||||||
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Unrealized net loss on investments
|
(624,944 | ) | — | — | — | — | (624,944 | ) | (624,944 | ) | — | (624,944 | ) | |||||||||||||||||||||||
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Realized net gains on investments
|
— | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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Comprehensive income
|
$ | 15,533,307 | ||||||||||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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Balance as of December 31, 2010
|
44,131,376 | $ | 44,131 | $ | 120,391,622 | $ | 73,681,556 | $ | (22,399,039 | ) | $ | 171,718,270 | $ | — | $ | 171,718,270 | ||||||||||||||||||||
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||||||||||||||||||||||||||||||||||||
4
| Accumulated | ||||||||||||||||||||||||||||||||||||
| Additional | other | Total Equity | Total | |||||||||||||||||||||||||||||||||
| Comprehensive | Common stock | paid-in | Retained | comprehensive | of | Noncontrolling | Total | |||||||||||||||||||||||||||||
| income | Shares | Amount | capital | Earnings | income / (loss) | MercadoLibre, Inc. | Equity | Equity | ||||||||||||||||||||||||||||
|
Balance as of December 31, 2010
|
44,131,376 | $ | 44,131 | $ | 120,391,622 | $ | 73,681,556 | $ | (22,399,039 | ) | $ | 171,718,270 | $ | — | $ | 171,718,270 | ||||||||||||||||||||
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Stock options exercised
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5,950 | 6 | 11,169 | — | — | 11,175 | — | 11,175 | ||||||||||||||||||||||||||||
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Stock-based compensation LTRP
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— | — | 38,120 | — | — | 38,120 | — | 38,120 | ||||||||||||||||||||||||||||
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Dividend Distribution
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— | — | — | (10,593,209 | ) | — | (10,593,209 | ) | — | (10,593,209 | ) | |||||||||||||||||||||||||
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LTRP shares issued
|
4,694 | 5 | (5 | ) | — | — | — | — | — | |||||||||||||||||||||||||||
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Noncontrolling interest
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— | — | — | — | — | — | 3,648,037 | 3,648,037 | ||||||||||||||||||||||||||||
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Net income
|
$ | 55,174,387 | — | — | — | 55,174,387 | — | 55,174,387 | 522 | 55,174,909 | ||||||||||||||||||||||||||
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Currency translation adjustment
|
(12,787,985 | ) | — | — | — | — | (12,787,985 | ) | (12,787,985 | ) | (237,926 | ) | (13,025,911 | ) | ||||||||||||||||||||||
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Unrealized net gains on investments
|
928,179 | — | — | — | — | 928,179 | 928,179 | — | 928,179 | |||||||||||||||||||||||||||
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Realized net gain on investments
|
(45,527 | ) | — | — | — | — | (45,527 | ) | (45,527 | ) | — | (45,527 | ) | |||||||||||||||||||||||
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|
||||||||||||||||||||||||||||||||||||
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Comprehensive income
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$ | 43,269,054 | ||||||||||||||||||||||||||||||||||
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||||||||||||||||||||||||||||||||||||
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Balance as of September 30, 2011
|
44,142,020 | $ | 44,142 | $ | 120,440,906 | $ | 118,262,734 | $ | (34,304,372 | ) | $ | 204,443,410 | $ | 3,410,633 | $ | 207,854,043 | ||||||||||||||||||||
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||||||||||||||||||||||||||||||||||||
5
| Nine Months Ended September 30, | ||||||||
| 2011 | 2010 | |||||||
| (Unaudited) | ||||||||
|
Cash flows from operations:
|
||||||||
|
Net income
|
$ | 55,174,909 | $ | 40,085,526 | ||||
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
||||||||
|
Depreciation and amortization
|
5,249,168 | 3,594,156 | ||||||
|
Accrued interest
|
(4,461,828 | ) | (262,088 | ) | ||||
|
Stock-based compensation expense — stock options
|
— | 183 | ||||||
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Stock-based compensation expense — restricted shares
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— | 37,696 | ||||||
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LTRP accrued compensation
|
2,527,494 | 2,798,656 | ||||||
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Deferred income taxes
|
1,174,177 | (6,950,762 | ) | |||||
|
Changes in assets and liabilities, net of the effect of the acquired business :
|
||||||||
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Accounts receivable
|
(6,290,360 | ) | (6,048,287 | ) | ||||
|
Funds receivable from customers
|
(8,188,181 | ) | (877,971 | ) | ||||
|
Prepaid expenses
|
(276,976 | ) | (113,329 | ) | ||||
|
Other assets
|
(5,228,268 | ) | (2,600,348 | ) | ||||
|
Accounts payable and accrued expenses
|
6,288,050 | 7,856,387 | ||||||
|
Funds payable to customers
|
16,052,471 | 7,393,673 | ||||||
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Other liabilities
|
273,016 | (2,923,832 | ) | |||||
|
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||||||||
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Net cash provided by operating activities
|
62,293,672 | 41,989,660 | ||||||
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|
||||||||
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Cash flows from investing activities:
|
||||||||
|
Purchase of investments
|
(297,570,336 | ) | (85,338,161 | ) | ||||
|
Proceeds from sale and maturity of investments
|
268,529,776 | 51,145,297 | ||||||
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Payment for acquired businesses, net of cash acquired
|
(5,468,180 | ) | — | |||||
|
Purchases of intangible assets
|
(119,262 | ) | (12,788 | ) | ||||
|
Purchases of property and equipment
|
(17,084,397 | ) | (10,554,982 | ) | ||||
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|
||||||||
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Net cash used in investing activities
|
(51,712,399 | ) | (44,760,634 | ) | ||||
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|
||||||||
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Cash flows from financing activities:
|
||||||||
|
Decrease in loans payable
|
— | (2,898,702 | ) | |||||
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Dividends distribution
|
(7,061,847 | ) | — | |||||
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Stock options exercised
|
11,175 | 18,199 | ||||||
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||||||||
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Net cash used in financing activities
|
(7,050,672 | ) | (2,880,503 | ) | ||||
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||||||||
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Effect of exchange rate changes on cash and cash equivalents
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(1,277,650 | ) | 299,975 | |||||
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||||||||
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Net increase / (decrease) in cash and cash equivalents
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2,252,951 | (5,351,502 | ) | |||||
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Cash and cash equivalents, beginning of the period
|
56,830,466 | 49,803,402 | ||||||
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||||||||
|
|
||||||||
|
Cash and cash equivalents, end of the period
|
$ | 59,083,417 | $ | 44,451,900 | ||||
|
|
||||||||
6
| Nine Months Ended September 30, | ||||||||
| 2011 | 2010 | |||||||
| (Unaudited) | ||||||||
|
Supplemental cash flow information:
|
||||||||
|
Cash paid for interest
|
$ | 45,247 | $ | 5,765,634 | ||||
|
Cash paid for income and asset taxes
|
$ | 22,355,122 | $ | 16,603,211 | ||||
|
|
||||||||
|
Acquisition of AutoPlaza.com
|
||||||||
|
Cash and cash equivalents
|
$ | 3,876 | $ | — | ||||
|
Tax credits
|
49,951 | — | ||||||
|
Non current assets
|
99,522 | — | ||||||
|
|
||||||||
|
Total assets acquired
|
153,349 | — | ||||||
|
|
||||||||
|
Total liabilities assumed
|
— | — | ||||||
|
|
||||||||
|
Net assets acquired
|
153,349 | — | ||||||
|
|
||||||||
|
Identifiable Intangible Assets
|
8,966,744 | — | ||||||
|
Noncontrolling interest
|
(3,648,037 | ) | ||||||
|
Total purchase price
|
$ | 5,472,056 | — | |||||
|
|
||||||||
|
Cash and cash equivalents acquired
|
3,876 | — | ||||||
|
|
||||||||
|
Payment for acquired businesses, net of cash acquired
|
$ | 5,468,180 | — | |||||
|
|
||||||||
7
8
9
10
11
12
| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
|
|
||||||||
|
Venezuelan operations
|
||||||||
|
Assets
|
$ | 24,390,518 | $ | 21,928,340 | ||||
|
Liabilities
|
(7,729,510 | ) | (8,212,581 | ) | ||||
|
|
||||||||
|
Net Assets
|
16,661,008 | 13,715,759 | ||||||
|
|
||||||||
13
14
15
16
|
The Company’s restricted shares granted to its outside directors were participating securities.
Accordingly, net income attributable to MercadoLibre, Inc. for the nine-month periods ended
September 30, 2010, was allocated between unvested restricted shares and common stock under the
“two class method” for purposes of computing basic and diluted earnings per share.
|
|
Diluted earnings per share for the Company’s common stock assume the exercise of
outstanding stock options and vesting restricted shares, additional shares and shares granted
under the 2008 Long Term Retention Plan under the Company’s stock based employee compensation
plans.
|
|
The following table shows how net income attributable to MercadoLibre, Inc. is allocated using
the two-class method, for the three-month periods ended September 30, 2011 and 2010:
|
| Three Months Ended September 30, | ||||||||||||||||
| 2011 | 2010 | |||||||||||||||
| Basic | Diluted | Basic | Diluted | |||||||||||||
|
|
||||||||||||||||
|
Net income
|
$ | 26,296,447 | $ | 26,296,447 | $ | 18,790,963 | $ | 18,790,963 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
corresponding to unvested restricted shares
|
— | — | — | — | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to Noncontrolling interests
|
522 | 522 | — | — | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
corresponding to common stock
|
$ | 26,295,925 | $ | 26,295,925 | $ | 18,790,963 | $ | 18,790,963 | ||||||||
|
|
||||||||||||||||
|
The following table shows how net income attributable to MercadoLibre, Inc. is
allocated using the two-class method, for the nine-month periods ended September 30, 2011 and
2010:
|
| Nine Months Ended September 30, | ||||||||||||||||
| 2011 | 2010 | |||||||||||||||
| Basic | Diluted | Basic | Diluted | |||||||||||||
|
|
||||||||||||||||
|
Net income
|
$ | 55,174,909 | $ | 55,174,909 | $ | 40,085,526 | $ | 40,085,526 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
corresponding to unvested restricted shares
|
— | — | 4,474 | 4,474 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to Noncontrolling interests
|
522 | 522 | — | — | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
corresponding to common stock
|
$ | 55,174,387 | $ | 55,174,387 | $ | 40,081,052 | $ | 40,081,052 | ||||||||
|
|
||||||||||||||||
17
|
Net income attributable to MercadoLibre, Inc. per share of common stock is as follows for the
three-month periods ended September 30, 2011 and 2010:
|
| Three Months Ended September 30, | ||||||||||||||||
| 2011 | 2010 | |||||||||||||||
| Basic | Diluted | Basic | Diluted | |||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
per common share
|
$ | 0.60 | $ | 0.60 | $ | 0.43 | $ | 0.43 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Numerator:
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
|
$ | 26,295,925 | $ | 26,295,925 | $ | 18,790,963 | $ | 18,790,963 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Denominator:
|
||||||||||||||||
|
Weighted average of common stock
outstanding for Basic
earnings per share
|
44,141,925 | 44,141,925 | 44,129,762 | 44,129,762 | ||||||||||||
|
Adjustment for stock options
|
— | 4,513 | — | 12,949 | ||||||||||||
|
Adjustment for shares granted under LTRP
|
— | 4,780 | — | 8,656 | ||||||||||||
|
|
||||||||||||||||
|
Adjusted weighted average
of common stock outstanding
for Diluted earnings per share
|
44,141,925 | 44,151,218 | 44,129,762 | 44,151,367 | ||||||||||||
|
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc. per share of common stock is as follows for
the nine-month periods ended September 30, 2011 and 2010:
|
| Nine Months Ended September 30, | ||||||||||||||||
| 2011 | 2010 | |||||||||||||||
| Basic | Diluted | Basic | Diluted | |||||||||||||
|
Net income attributable to MercadoLibre, Inc.
per common share
|
$ | 1.25 | $ | 1.25 | $ | 0.91 | $ | 0.91 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Numerator:
|
||||||||||||||||
|
Net income attributable to MercadoLibre, Inc.
|
$ | 55,174,387 | $ | 55,174,387 | $ | 40,081,052 | $ | 40,081,052 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Denominator:
|
||||||||||||||||
|
Weighted average of common stock outstanding for Basic
earnings per share
|
44,137,176 | 44,137,176 | 44,121,539 | 44,121,539 | ||||||||||||
|
Adjustment for stock options
|
— | 8,894 | — | 14,821 | ||||||||||||
|
Adjustment for shares granted under LTRP
|
— | 4,802 | — | 8,318 | ||||||||||||
|
|
||||||||||||||||
|
Adjusted weighted average of common stock outstanding
for Diluted earnings per share
|
44,137,176 | 44,150,872 | 44,121,539 | 44,144,678 | ||||||||||||
|
|
||||||||||||||||
|
The calculation of diluted net income per share excludes all anti-dilutive shares. For the
three- and nine-month periods ended September 30, 2011 and 2010, there were no anti-dilutive shares.
|
18
|
Business Combinations
|
||
|
On September 14, 2011, the Company completed, through one of its subsidiaries, Meli
Participaciones S.L. (“ETVE” or “the Buyer”), the acquisition of the 60% of outstanding
membership interest of Autopark LLC, a limited liability company organized under the laws of
Delaware, from Hasteny Trading S.A. (“Hasteny“or “the Seller”), a parent company organized
under the laws of Uruguay, who owned all the shares of the capital stock of Autopark LLC.
|
|
Autopark LLC owns directly and indirectly the 100% of the membership interest of AP
Clasificados S.R.L. de C.V. (“AP Clasificados”), a company organized under the laws of Mexico.
AP Clasificados operates an online classified advertisements platform in Mexico primarily
dedicated to the sale of automobiles at
www.autoplaza.com.mx
and real estate at
www.homeshop.com.mx
(“the Acquired Business”).
|
|
The aggregate purchase price paid by the Company to the Seller for the 60% of the Acquired
Business was $5,472,056. In addition, the Company incurred in certain direct costs of the
business combination which were expensed as incurred.
|
|
On September 12, 2011 (the “settlement date”), part of the purchase price amounting to
$1,500,000, was placed into an escrow account, in order to cover unexpected liabilities and
working capital. On September 12, 2012 and 2013, 50% of the escrow amount less the amount of
all claims made by the Buyer, if any, will be released, respectively.
|
|
In addition, ETVE has the right and option (but not the obligation) to purchase the remaining
40% of the membership interest of Autopark LLC following the earlier to occur of (i) third
anniversary of the settlement date, or (ii) additional capital contribution be required to
capitalize Autopark LLC by their own member’s decision and Hasteny does not make such
additional capital contribution within ten (10) days of such members’ consent. The total
consideration to be paid shall be the greater of (i) $4,000,000 and (ii) the amount resulting
from multiplying (A) the percentage of the membership interest held by Hasteny as of the date
of the Call Notice by (B) an amount equal to 3.5 times the amount of invoiced sales of the
Acquired Business for the twelve months period ending on the date of Call Notice.
|
|
On the other hand, Hasteny has the right and option (but not the obligation) to sell and
transfer, all of the Hasteny interest in Autopark LLC, to ETVE and ETVE has the obligation to
buy following the earlier to occur (i) the third anniversary of the effective date, (ii) the
termination of the employment of the main operating officer of the acquired company, or (iii)
death or incapacitation of the main operating officer of the acquired company. The total
consideration to be paid by ETVE for the Hasteny Interests shall be the same as described in
the preceding paragraph.
|
|
The Seller and its affiliates have also agreed to enter into certain non-compete agreements
with the Company for 5 years since September 12, 2011.
|
19
|
Business Combinations (Continued)
|
|
The Company’s statement of income includes the results of operations of the Acquired Businesses
from September 15, 2011.
|
|
The following table summarizes the preliminary allocation of the cash paid in the acquisition:
|
|
Net Tangible Assets
|
$ | 153,349 | ||
|
Identifiable Intangible Assets
|
3,290,998 | |||
|
Deferred Tax Liabilities
|
(987,299 | ) | ||
|
Goodwill
|
6,663,045 | |||
|
Noncontrolling interest
|
(3,648,037 | ) | ||
|
|
||||
|
Aggregate Purchase Price
|
$ | 5,472,056 | ||
|
|
||||
|
Assets acquired were valued
at their respective fair values at the acquisition
date according to U.S. GAAP. The valuation of identifiable
intangible assets acquired as well as non-controlling interest reflects
management’s estimates based on, among other factors, use of established
valuation methods. The identifiable intangible assets consist of trademarks and
domains, customer lists and non-compete agreements. Management of the
Company estimates that
trademarks have an
indefinite useful
life, for that reason,
these intangible
assets are not
amortized but they are
subject to an annual
impairment test.
Intangible assets
associated with
customer list and
non-compete agreements
are amortized over a
five year period.
|
|
The Company recognized a goodwill because the acquired business is expected to expand the
company’s business in Mexico and to strengthen the Company`s leadership position in that
country.
|
|
Goodwill is not expected to be deductible for tax purposes.
|
|
The purchase price allocation, as fully described above, is preliminary.
|
|
The results of operations for periods prior to the acquisition, individually and in the
aggregate, were not material to the condensed consolidated statements of operations of the
Company and, accordingly, pro forma results of operations have not been presented.
|
20
| 4. |
Business Combinations, Goodwill and Intangible Assets (Continued)
|
|
Goodwill and Intangible Assets
|
|
The composition of goodwill and intangible assets is as follows:
|
| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
|
Goodwill
|
$ | 62,861,760 | $ | 60,496,314 | ||||
|
|
||||||||
|
Intangible assets with
indefinite lives
|
||||||||
|
- Trademarks
|
5,106,747 | 2,460,952 | ||||||
|
Amortizable intangible assets
|
||||||||
|
- Licenses and others
|
2,671,058 | 2,606,402 | ||||||
|
- Non-compete agreement
|
1,288,216 | 1,241,357 | ||||||
|
- Customer list
|
1,765,069 | 1,607,097 | ||||||
|
|
||||||||
|
Total intangible assets
|
$ | 10,831,090 | $ | 7,915,808 | ||||
|
Accumulated amortization
|
(4,120,965 | ) | (3,774,641 | ) | ||||
|
|
||||||||
|
Total intangible assets, net
|
$ | 6,710,125 | $ | 4,141,167 | ||||
|
|
||||||||
|
The changes in the carrying amount of goodwill for the nine-month period ended September 30,
2011 and the year ended December 31, 2010, are as follows:
|
| Nine Months Ended September 30, 2011 | ||||||||||||||||||||||||||||||||
| Brazil | Argentina | Chile | Mexico | Venezuela | Colombia | Other Countries | Total | |||||||||||||||||||||||||
|
Balance, beginning of year
|
$ | 13,130,649 | $ | 23,364,326 | $ | 7,296,888 | $ | 5,025,623 | $ | 4,846,030 | $ | 5,448,068 | $ | 1,384,730 | $ | 60,496,314 | ||||||||||||||||
|
- Purchase of Autoplaza.com
|
— | — | — | 6,663,045 | — | — | — | 6,663,045 | ||||||||||||||||||||||||
|
- Effect of exchange rates changes
|
(1,332,609 | ) | (1,272,397 | ) | (751,701 | ) | (951,712 | ) | — | (3,186 | ) | 14,006 | (4,297,599 | ) | ||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Balance, end of the period
|
$ | 11,798,040 | $ | 22,091,929 | $ | 6,545,187 | $ | 10,736,956 | $ | 4,846,030 | $ | 5,444,882 | $ | 1,398,736 | $ | 62,861,760 | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
| Year Ended December 31, 2010 | ||||||||||||||||||||||||||||||||
| Brazil | Argentina | Chile | Mexico | Venezuela | Colombia | Other Countries | Total | |||||||||||||||||||||||||
|
Balance, beginning
of year
|
$ | 12,565,062 | $ | 24,446,463 | $ | 6,734,405 | $ | 4,770,560 | $ | 4,846,030 | $ | 5,100,939 | $ | 1,359,287 | $ | 59,822,746 | ||||||||||||||||
|
- Effect of
exchange rates
changes
|
565,587 | (1,082,137 | ) | 562,483 | 255,063 | — | 347,129 | 25,443 | 673,568 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Balance, end of
the year
|
$ | 13,130,649 | $ | 23,364,326 | $ | 7,296,888 | $ | 5,025,623 | $ | 4,846,030 | $ | 5,448,068 | $ | 1,384,730 | $ | 60,496,314 | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Amortizable intangible assets
|
|
Amortizable intangible assets are comprised of customer lists and user base, trademarks and
trade names, non-compete agreements, acquired software licenses and other acquired intangible
assets including developed technologies. Aggregate amortization expense for intangible assets
totaled $252,293 and $236,637 for the three-month periods ended September 30, 2011 and 2010,
respectively. Aggregate amortization expense for intangible assets totaled $730,815 and $616,984 for the nine-month periods ended September 30, 2011 and
2010, respectively.
|
21
| 4. |
Business Combinations, Goodwill and Intangible Assets (Continued)
|
|
Goodwill and Intangible Assets
|
|
Expected future intangible asset amortization from acquisitions completed as of September 30,
2011 is as follows:
|
|
For year ended 12/31/2011
|
$ | 211,694 | ||
|
For year ended 12/31/2012
|
698,693 | |||
|
For year ended 12/31/2013
|
430,549 | |||
|
For year ended 12/31/2014
|
112,035 | |||
|
For year ended 12/31/2015
|
85,947 | |||
|
Thereafter
|
64,460 | |||
|
|
||||
|
|
$ | 1,603,378 | ||
|
|
||||
|
Reporting segments are based upon the Company’s internal organizational structure, the manner
in which the Company’s operations are managed, the criteria used by management to evaluate the
Company’s performance, the availability of separate financial information, and overall
materiality considerations.
|
|
Segment reporting is based on geography as the main basis of segment breakdown to reflect the
evaluation of the Company’s performance defined by the management.
|
|
The MercadoLibre segments include Brazil, Argentina, Mexico, Venezuela and other countries
(such as Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Panama, Peru, Portugal and
Uruguay).
|
|
Direct contribution consists of net revenues from external customers less direct costs. Direct
costs include specific costs of net revenues, sales and marketing expenses, and general and
administrative expenses over which segment managers have direct discretionary control, such as
advertising and marketing programs, customer support expenses, allowances for doubtful
accounts, headcount compensation, third party fees. All corporate related costs have been
excluded from the Company’s direct contribution.
|
|
Expenses over which segment managers do not currently have discretionary control, such as
certain technology and general and administrative costs, are monitored by management through
shared cost centers and are not evaluated in the measurement of segment performance.
|
22
| 5. |
Segments (Continued)
|
|
The following tables summarize the financial performance of the Company’s reporting segments:
|
| Three Months Ended September 30, 2011 | ||||||||||||||||||||||||
| Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net revenues
|
$ | 46,003,915 | $ | 15,828,272 | $ | 5,608,572 | $ | 9,045,783 | $ | 5,141,602 | $ | 81,628,144 | ||||||||||||
|
Direct costs
|
(25,709,957 | ) | (6,264,769 | ) | (3,183,432 | ) | (3,180,061 | ) | (2,636,836 | ) | (40,975,055 | ) | ||||||||||||
|
|
||||||||||||||||||||||||
|
Direct contribution
|
20,293,958 | 9,563,503 | 2,425,140 | 5,865,722 | 2,504,766 | 40,653,089 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Operating expenses and
indirect costs of net revenues
|
(10,689,366 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Income from operations
|
29,963,723 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Other income (expenses):
|
||||||||||||||||||||||||
|
Interest income and other financial gains
|
2,913,596 | |||||||||||||||||||||||
|
Interest expense and other financial results
|
(1,052,865 | ) | ||||||||||||||||||||||
|
Foreign currency gain
|
3,284,190 | |||||||||||||||||||||||
|
Other losses, net
|
(7,292 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net income before income / asset tax expense
|
$ | 35,101,352 | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
| Three Months Ended September 30, 2010 | ||||||||||||||||||||||||
| Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net revenues
|
$ | 31,077,654 | $ | 10,802,682 | $ | 4,722,635 | $ | 5,762,290 | $ | 3,586,117 | $ | 55,951,378 | ||||||||||||
|
Direct costs
|
(19,235,066 | ) | (5,353,452 | ) | (2,914,273 | ) | (2,653,357 | ) | (2,230,064 | ) | (32,386,212 | ) | ||||||||||||
|
|
||||||||||||||||||||||||
|
Direct contribution
|
11,842,588 | 5,449,230 | 1,808,362 | 3,108,933 | 1,356,053 | 23,565,166 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Operating expenses and
indirect costs of net revenues
|
(4,254,460 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Income from operations
|
19,310,706 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Other income (expenses):
|
||||||||||||||||||||||||
|
Interest income and other financial gains
|
1,361,899 | |||||||||||||||||||||||
|
Interest expense and other financial results
|
(567,969 | ) | ||||||||||||||||||||||
|
Foreign currency loss
|
(354,219 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net income before income / asset tax expense
|
$ | 19,750,417 | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
| Nine Months Ended September 30, 2011 | ||||||||||||||||||||||||
| Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net revenues
|
$ | 120,659,242 | $ | 38,800,077 | $ | 16,212,999 | $ | 23,051,176 | $ | 13,742,478 | $ | 212,465,972 | ||||||||||||
|
Direct costs
|
(69,712,512 | ) | (15,845,674 | ) | (8,881,811 | ) | (9,096,997 | ) | (7,230,721 | ) | (110,767,715 | ) | ||||||||||||
|
|
||||||||||||||||||||||||
|
Direct contribution
|
50,946,730 | 22,954,403 | 7,331,188 | 13,954,179 | 6,511,757 | 101,698,257 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Operating expenses and indirect costs of net revenues
|
(30,891,982 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Income from operations
|
70,806,275 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Other income (expenses):
|
||||||||||||||||||||||||
|
Interest income and other financial gains
|
7,037,264 | |||||||||||||||||||||||
|
Interest expense and other financial results
|
(2,562,633 | ) | ||||||||||||||||||||||
|
Foreign currency gains
|
2,080,822 | |||||||||||||||||||||||
|
Other income, net
|
253,148 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net income before income / asset tax expense
|
$ | 77,614,876 | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
23
| Nine Months Ended September 30, 2010 | ||||||||||||||||||||||||
| Brazil | Argentina | Mexico | Venezuela | Other Countries | Total | |||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net revenues
|
$ | 88,210,536 | $ | 28,609,190 | $ | 13,861,921 | $ | 13,705,926 | $ | 10,011,910 | $ | 154,399,483 | ||||||||||||
|
Direct costs
|
(50,090,123 | ) | (13,985,689 | ) | (8,544,912 | ) | (6,759,831 | ) | (5,694,502 | ) | $ | (85,075,057 | ) | |||||||||||
|
|
||||||||||||||||||||||||
|
Direct contribution
|
38,120,413 | 14,623,501 | 5,317,009 | 6,946,095 | 4,317,408 | 69,324,426 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Operating expenses and indirect costs of net revenues
|
(15,694,887 | ) | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Income from operations
|
53,629,539 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Other income (expenses):
|
||||||||||||||||||||||||
|
Interest income and other financial gains
|
3,073,427 | |||||||||||||||||||||||
|
Interest expense and other financial results
|
(6,919,307 | ) | ||||||||||||||||||||||
|
Foreign currency gains
|
7,275 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Net income before income / asset tax expense
|
$ | 49,790,934 | ||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
The following table summarizes the allocation of the long-lived tangible assets based on
geography:
|
| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
|
US long-lived tangible assets
|
$ | 6,871,005 | $ | 3,617,420 | ||||
|
|
||||||||
|
Other countries long-lived tangible assets
|
||||||||
|
Argentina
|
14,147,946 | 13,580,175 | ||||||
|
Brazil
|
2,637,183 | 3,264,625 | ||||||
|
Mexico
|
456,358 | 68,878 | ||||||
|
Venezuela
(*)
|
6,823,256 | 206,815 | ||||||
|
Other countries
|
416,218 | 79,799 | ||||||
|
|
||||||||
|
|
$ | 24,480,961 | $ | 17,200,292 | ||||
|
|
||||||||
|
Total long-lived tangible assets
|
$ | 31,351,966 | $ | 20,817,712 | ||||
|
|
||||||||
| (*) |
On June 2, 2011, the Company’s Venezuelan subsidiary acquired an office property of
992 square meters in a building located in Caracas, Venezuela. The purchase price of $6.6 million was paid in
cash.
|
24
|
The following table summarizes the allocation of the goodwill and intangible assets based on
geography:
|
| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
|
US intangible assets
|
$ | — | $ | 3,507 | ||||
|
|
||||||||
|
Other countries goodwill and intangible assets
|
||||||||
|
Argentina
|
23,044,009 | 24,825,718 | ||||||
|
Brazil
|
11,813,433 | 13,137,658 | ||||||
|
Mexico
|
13,898,219 | 5,043,335 | ||||||
|
Venezuela
|
6,595,409 | 6,595,866 | ||||||
|
Other countries
|
14,220,815 | 15,031,397 | ||||||
|
|
||||||||
|
|
$ | 69,571,885 | $ | 64,633,974 | ||||
|
|
||||||||
|
Total goodwill and intangible assets
|
$ | 69,571,885 | $ | 64,637,481 | ||||
|
|
||||||||
|
The following table summarizes the Company’s financial assets and liabilities measured at fair
value on a recurring basis as of September 30, 2011 and December 31, 2010:
|
| Quoted Prices in | Quoted Prices in | |||||||||||||||
| Balances as of | active markets for | Balances as of | active markets for | |||||||||||||
| September 30, | identical Assets | December 31, | identical Assets | |||||||||||||
| Description | 2011 | (Level 1) | 2010 | (Level 1) | ||||||||||||
|
|
||||||||||||||||
|
Assets
|
||||||||||||||||
|
|
||||||||||||||||
|
Cash and Cash Equivalents:
|
||||||||||||||||
|
|
||||||||||||||||
|
Money Market Funds
|
$ | 14,533,599 | $ | 14,533,599 | $ | 14,578,477 | $ | 14,578,477 | ||||||||
|
|
||||||||||||||||
|
Investments:
|
||||||||||||||||
|
|
||||||||||||||||
|
Asset backed securities
|
17,762,521 | 17,762,521 | 14,319,103 | 14,319,103 | ||||||||||||
|
|
||||||||||||||||
|
Sovereign Debt Securities
|
10,635,822 | 10,635,822 | 13,147,239 | 13,147,239 | ||||||||||||
|
|
||||||||||||||||
|
Corporate Debt Securities
|
14,720,669 | 14,720,669 | 11,381,761 | 11,381,761 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total financial Assets
|
$ | 57,652,611 | $ | 57,652,611 | $ | 53,426,580 | $ | 53,426,580 | ||||||||
|
|
||||||||||||||||
|
The Company’s financial assets are valued using market prices on active markets (level 1).
Level 1 instrument valuations are obtained from real-time quotes for transactions in active
exchange markets involving identical assets. As of September 30, 2011 and December 31, 2010,
the Company did not have any assets obtained from readily-available pricing sources for comparable instruments (level 2) or without observable market values that would require a
high level of judgment to determine fair value (level 3).
|
25
|
The unrealized net gains on short term and long term investments are reported as a component of
accumulated other comprehensive income. The Company does not anticipate any significant
realized losses associated with those investments in excess of the Company’s historical cost.
|
|
In addition, as of September 30, 2011, the Company had $65,462,243 of short-term investments,
which consisted of time deposits maintained as held to maturity investments. As of December 31, 2010, the Company had $45,340,944 of short-term and long-term investments,
which consisted of time deposits considered held to maturity securities. Those investments are
accounted for at amortized cost which, as of September 30, 2011 and December 31, 2010,
approximates their fair values.
|
|
As of September 30, 2011 and December 31, 2010, the carrying value of the Company’s cash and
cash equivalents approximated their fair value which was held primarily in money markets funds and bank deposits. In addition, the carrying value of accounts receivables, funds
receivables from customers, other receivables, other assets, accounts payables, social security
payables, taxes payables, loans and provisions and other liabilities approximates their fair
values because of its short term maturity.
|
|
For the three- and nine-month periods ended September 30, 2011 and 2010, the Company held no
direct investments in auction rate securities, collateralized debt obligations, structured
investment vehicles. As of September 30, 2011 and December 31, 2010, the Company does not have
any non-financial assets or liabilities measured at fair value.
|
|
As of September 30, 2011 and December 31, 2010, the fair value of short and long-term
investments classified as available for sale securities are as follows:
|
| September 30, 2011 | ||||||||||||||||
| Gross | Gross | |||||||||||||||
| Gross Amortized | Unrealized | Unrealized | Estimated Fair | |||||||||||||
| Cost | Gains | Losses (1) | Value | |||||||||||||
|
Short-term investments
|
||||||||||||||||
|
Sovereign Debt Securities
|
$ | 1,733,173 | $ | 3,035 | $ | — | $ | 1,736,208 | ||||||||
|
Corporate Debt Securities
|
384,983 | — | (4,940 | ) | 380,043 | |||||||||||
|
|
||||||||||||||||
|
Total Short-term investments
|
$ | 2,118,156 | $ | 3,035 | $ | (4,940 | ) | $ | 2,116,251 | |||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Long-term investments
|
||||||||||||||||
|
Sovereign Debt Securities
|
$ | 8,269,512 | $ | 630,102 | $ | — | $ | 8,899,614 | ||||||||
|
Corporate Debt Securities
|
14,312,659 | 172,068 | (144,099 | ) | 14,340,628 | |||||||||||
|
Asset Backed Securities (2)
|
17,022,343 | 754,516 | (14,339 | ) | 17,762,520 | |||||||||||
|
|
||||||||||||||||
|
Total Long-term investments
|
$ | 39,604,514 | $ | 1,556,686 | $ | (158,438 | ) | $ | 41,002,762 | |||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | 41,722,670 | $ | 1,559,721 | $ | (163,378 | ) | $ | 43,119,013 | |||||||
|
|
||||||||||||||||
26
| December 31, 2010 | ||||||||||||||||
| Gross | ||||||||||||||||
| Gross Amortized | Unrealized | Gross Unrealized | Estimated Fair | |||||||||||||
| Cost | Gains | Losses (1) | Value | |||||||||||||
|
Short-term investments
|
||||||||||||||||
|
Corporate Debt Securities
|
$ | 398,752 | $ | 26 | $ | (773 | ) | $ | 398,005 | |||||||
|
|
||||||||||||||||
|
Total short-term investments
|
$ | 398,752 | $ | 26 | $ | (773 | ) | $ | 398,005 | |||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Long-term investments
|
||||||||||||||||
|
Sovereign Debt Securities
|
$ | 13,282,207 | $ | 98,958 | $ | (233,926 | ) | $ | 13,147,239 | |||||||
|
Corporate Debt Securities
|
10,987,910 | 110,521 | (114,675 | ) | 10,983,756 | |||||||||||
|
Asset Backed Securities
|
14,107,501 | 439,239 | (227,637 | ) | 14,319,103 | |||||||||||
|
|
||||||||||||||||
|
Total long-term investments
|
$ | 38,377,618 | $ | 648,718 | $ | (576,238 | ) | $ | 38,450,098 | |||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | 38,776,370 | $ | 648,744 | $ | (577,011 | ) | $ | 38,848,103 | |||||||
|
|
||||||||||||||||
| (1) |
Unrealized losses from securities are primarily attributable to market price movements.
Management does not believe any remaining unrealized losses represent other-than-temporary
impairments based on our evaluation of available evidence including the credit rating of
the investments, as of September 30, 2011 and December 31, 2010.
|
|
| (2) |
Asset backed securities have investment grade credit ratings. These investments are
collateralized by real estate and they are guaranteed by the U.S. Federal Government.
|
|
As of September 30, 2011, the estimated fair values of short-term and long-term
investments classified by its contractual maturities are as follows:
|
|
One year or less
|
$ | 2,116,252 | ||
|
One year to two years
|
5,452,507 | |||
|
Two years to three years
|
3,228,204 | |||
|
Three years to four years
|
3,812,512 | |||
|
Four years to five years
|
1,781,791 | |||
|
More than five years
|
26,727,747 | |||
|
|
||||
|
Total
|
$ | 43,119,013 | ||
|
|
||||
|
The Company compensated its outside directors through the payment of cash fees and, from time
to time, through the issuance of equity awards.
|
|
On June 10, 2009, the Company issued an aggregate of 2,305 shares of common stock and 8,350
restricted shares of common stock (the “Restricted Shares”) to our outside directors. The
Restricted Shares vested in full in June 2010. Restricted Shares awarded to employees and
directors are measured at their fair market value using the grant-date price of the Company’s
shares. For the three- and nine-month periods ended September 30, 2010, the Company recognized
nil and $37,696, respectively, of compensation expense related to these awards, which are
included in operating expenses in the accompanying condensed consolidated statement of income.
|
27
|
The total accrued compensation cost for the three-month periods ended September 30, 2011 and
2010 in cash and equity awards amounts to $105,112 and $132,718 , respectively which were
included in operating expenses. For the nine-month periods ended September 30, 2011 and 2010,
the Company recognized $428,402 and $279,947 respectively, which amounts are included in
operating expenses in the accompanying condensed consolidated statement of income.
|
|
Litigation and Other Legal Matters
|
|
The Company is subject to certain contingent liabilities with respect to existing or potential
claims, lawsuits and other proceedings. The Company accrues liabilities when it considers
probable that future costs will be incurred and such costs can be reasonably estimated. The
proceeding-related reserve is based on developments to date and historical information related
to actions filed against the Company. As of September 30, 2011, the Company had established
reserves for proceeding-related contingencies of $1,738,721 to cover legal actions against the
Company. In addition, as of September 30, 2011 the Company and its subsidiaries are subject to
certain legal actions considered by the Company’s management and its legal counsels to be
reasonably possible for an aggregate amount up to $2,660,672.
|
|
No loss amount has been accrued for such possible legal actions of which most significant
(individually or in the aggregate) are described below.
|
|
As of September 30, 2011, 343 legal actions were pending in the Brazilian ordinary courts, 8 of
which were related to alleged intellectual property infringement. In addition, as of September
30, 2011, there were 1,759 cases still pending in Brazilian consumer courts. Filing and
pursuing of an action before Brazilian consumer courts do not require the assistance of a
lawyer. In most of the cases filed against the Company, the plaintiffs asserted that the
Company was responsible for fraud committed against them, or responsible for damages suffered
when purchasing an item on the Company’s website, when using MercadoPago, or when the Company
invoiced them.
|
|
On March 17, 2006, Vintage Denim Ltda., or Vintage, sued the Company’s Brazilian subsidiaries
MercadoLivre.com Atividades de Internet Ltda. and eBazar.com.br Ltda. in the 29th Civil Court
of the County of São Paulo, State of São Paulo, Brazil. Vintage requested a preliminary
injunction alleging that these subsidiaries were infringing Diesel trademarks and their right
of exclusive distribution as a result of sellers listing allegedly counterfeit and original
imported Diesel branded clothing through the Brazilian page of the Company’s website, based on
Brazilian Industrial Property Law (Law 9,279/96). Vintage sought an order enjoining the sale of
Diesel-branded clothing on the Company’s platform. A preliminary injunction was granted on
April 11, 2006 to prohibit the offer of Diesel-branded products, and a fine for non-compliance
was imposed in the approximate amount of $5,300
|
28
|
Litigation and Other Legal Matters (Continued)
|
|
per defendant per day of non-compliance. The
Company appealed that fine and obtained its suspension in 2006. Because the appeal of the preliminary injunction failed, in March of 2007,
Vintage presented petitions alleging the Company’s non-compliance with the preliminary
injunction granted to Vintage and requested a fine of approximately $3.3 million against the
Company’s subsidiaries, which represents approximately $5,300 per defendant per day of alleged
non-compliance since April 2006. In July 2007, the judge ordered the payment of the fine
mandated in the preliminary injunction, without specifying the amount. In September 2007, the
judge decided that (i) the Brazilian subsidiaries were not responsible for alleged infringement
of intellectual property rights by its users; and that (ii) the plaintiffs did not prove the
alleged infringement of its intellectual property rights. However, the decision maintained the
injunction until such ruling is non-appealable. The plaintiff appealed the judge’s ruling
regarding the subsidiary’s non-responsibility and the Company appealed the decision that
maintained the preliminary injunction. On July 26, 2011 the State Court of Appeals of the State
of São Paulo confirmed the judge’s ruling regarding our subsidiary’s non-responsibility. The
decision on the appeal regarding the decision that maintained the preliminary injunction is
still pending. In the opinion of the Company’s legal counsel, as of
September 30, 2011, the amount of $215,703 was not reserved since it was considered reasonably
possible but not probable.
|
|
State of São Paulo Fraud Claim
|
|
On June 12, 2007, a state prosecutor of the State of São Paulo, Brazil presented a claim
against the Brazilian subsidiary. The state prosecutor alleges that the Brazilian subsidiary
should be held liable for any fraud committed by sellers on the Brazilian version of the
Company’s website, or responsible for damages suffered by buyers when purchasing an item on the
Brazilian version of the MercadoLibre website. On June 26, 2009, the Lower Court Judge ruled in
favor of the State of São Paulo prosecutor, declaring that the Brazilian subsidiary shall be
held joint and severally liable for fraud committed by sellers and damages suffered by buyers
when using the website, and ordering the Brazilian subsidiary to remove from the Terms of
Service of the Brazilian website any provision limiting the Company’s responsibility, with a
penalty of approximately $2,500 per day of non-compliance. On June 29, 2009 the Company
presented a recourse to the lower court, which was not granted. On September 29, 2009 the
Company presented an appeal and requested to suspend the effects of the ruling issued by the
lower court until the appeal is decided by State Court of Appeals, which request was granted on
December 1, 2009. The decision on the appeal is still pending. In the opinion of the Company’s
management and its legal counsel the risk of loss is reasonably possible.
|
29
|
City of São Paulo Tax Claim
|
|
In 2007 São Paulo tax authorities have asserted taxes and fines against our Brazilian
subsidiary relating to the period from 2005 to 2007 in an approximate amount of $5.9 million
according to the exchange rate at that moment. In 2007 the Company presented administrative defenses against the authorities’ claim and the tax authorities ruled against
the Brazilian subsidiary. In 2009 the Company presented an appeal to the Conselho Municipal de
Tributos or São Paulo Municipal Council of Taxes which reduced the fine. On February 11, 2011,
the Company appealed this decision to the Câmaras Reunidas do Egrégio Conselho Municipal de
Tributos or Superior Chamber of the São Paulo Municipal Council of Taxes which maintained the
reduction of the Infraction. As of the date of these financial statements, the total amount of
the claim is approximately $5.1 million including surcharges and interest. With this decision
the administrative stage is finished. On August 15, 2011, the Company made a deposit in court
of approximately R$9.5 million or $5.1 million, according to the exchange rate at September 30,
2011, and filed a lawsuit in 8
th
Public Treasury Court of the County of São Paulo,
State of São Paulo, Brazil order to contest the taxes and fines asserted by the Tax
Authorities. The Company’s management and its legal advisors believe that the risk of loss is
remote, and as a result, it has not reserved any provisions for this claim.
|
|
Brazilian Federal Tax Claims
|
|
On September 2, 2011, the Brazilian Federal tax authority has asserted taxes and fines against
our Brazilian subsidiary relating to the Income Tax for the 2006 period in an approximate
amount of R$5.1 million or $2.8 million, according to the exchange rate at September 30, 2011.
On September 30, 2011 the Company presented administrative defenses against the tax
authorities’ claim. The Company ´s management and its legal advisors believe that the risk of
loss is remote, and as a result, the Company has not reserved any provisions for this claim.
|
|
State of São Paulo Customer Service Level Claim
|
|
On September 1, 2010, a state prosecutor of the State of São Paulo, Brazil presented a claim
against the Company’s Brazilian subsidiary. The state prosecutor alleges that the Brazilian
subsidiary should improve its customer service level and provide (among other things) a
telephone number for customer support. On November 17, 2010, the Judge of the first instance
court granted an injunction against the Brazilian subsidiary imposing the obligation to provide
customer service over telephone means within 60 days with a penalty of approximately $65,000
per day of non-compliance. On April 08, 2011, the Company was summoned of the lawsuit and the
injunction. On April 14, 2011, the Company presented recourse to the lower court; even though,
the injunction was not lifted, an extension of 30 days was granted, and the non-compliance fine
would start running as of July 11, 2011. On April 20, 2011 the Company presented an appeal and
requested to suspend the effects of the injunction issued by the lower court until the appeal
is decided by State Court of Appeals which was granted on May 4, 2011. In the opinion of the
Company’s management and its legal counsel the risk associated with this claim has considered
as reasonably possible and therefore an amount of approximately $500,000 was reserved.
|
30
|
State of Rio de Janeiro Fraud Claim
|
|
On April 15, 2011, a state prosecutor of the State of Rio de Janeiro, Brazil presented a claim
against the Brazilian subsidiary. The state prosecutor requests several clauses of the Terms of
Service of the Website shall be considered null and void. The prosecutor alleged that the
Brazilian subsidiary should be held liable for any fraud committed by sellers on the Brazilian
version of the Company’s website, or responsible for damages suffered by buyers when purchasing
an item on the Brazilian version of the MercadoLibre website. On August 30, 2011 the case filed
by a state prosecutor of the State of Rio de Janeiro, Brazil against our Brazilian subsidiary
was settled with no financial or legal liability for the Company. By the settlement, the
Brazilian subsidiary agreed to modify some clauses of the General Terms and Conditions of Use
from the Brazilian website. The settlement was homologated on September 15, 2011.
|
|
Other third parties have from time to time claimed, and others may claim in the future, that
the Company was responsible for fraud committed against them, or that the Company has infringed
their intellectual property rights. The underlying laws with respect to the potential liability
of online intermediaries like the Company are unclear in the jurisdictions where the Company
operates. Management believes that additional lawsuits alleging that the Company has violated
copyright or trademark laws will be filed against the Company in the future.
|
|
Intellectual property and regulatory claims, whether meritorious or not, are time consuming and
costly to resolve, require significant amounts of management time, could require expensive
changes in the Company’s methods of doing business, or could require the Company to enter into
costly royalty or licensing agreements. The Company may be subject to patent disputes, and be
subject to patent infringement claims as the Company’s services expand in scope and complexity.
In particular, the Company may face additional patent infringement claims involving various
aspects of the Payments businesses.
|
|
From time to time, the Company is involved in other disputes or regulatory inquiries that arise
in the ordinary course of business. The number and significance of these disputes and inquiries
are increasing as the Company’s business expands and the Company grows larger.
|
31
|
On August 8, 2008, the Board of Directors approved an employee retention program that will be
payable 50% in cash and 50% in shares, in addition to the annual salary and bonus of certain
executives. Payments will be made in the first quarter on annual basis according to the
following vesting schedule:
|
| • |
Year 1 (2008): 17%
|
||
| • |
Year 2 (2009): 22%
|
||
| • |
Year 3 (2010): 27%
|
||
| • |
Year 4 (2011): 34%
|
|
The shares granted for the 2008 LTRP were valued at the grant-date fair market value PF $36.8
per share. As of September 30, 2011, the Company paid the 66% related to the years one to three
of the 2008 LTRP.
|
|
For the three-month period ended September 30, 2011, the related accrued compensation was
$28,034 corresponding $11,127 to the share portion of the award credited to Additional Paid-in
Capital and $16,907 to the cash portion included in the Balance Sheet as Payroll and social
security payable. For the nine-month period ended September 30, 2011, the related accrued
compensation expense was $70,417 corresponding $38,120 to the share portion of the award
credited to Additional Paid-in Capital and $32,297 to the cash portion included in the Balance
Sheet as Payroll and social security payable.
|
|
For the three-month period ended September 30, 2010, the related accrued compensation expense
was $46,523 corresponding $14,504 to the share portion of the award credited to Additional
Paid-in Capital and $32,019 to the cash portion included in the Balance Sheet as Payroll and
social security payable.
|
|
For the nine-month period ended September 30, 2010, the related accrued compensation expenses
was $182,142 corresponding $78,516 to the share portion of the award credited to Additional
Paid-in Capital and $103,626 to the cash portion included in the Balance Sheet as Social
security payable.
|
|
On July 15, 2009, June 25, 2010 and August 1, 2011, the Board of Directors, upon the
recommendation of the compensation Committee approved the 2009, the 2010 and the 2011 employee
retention programs (“the 2009, 2010 and 2011 LTRP”). The 2011 LTRP was approved by the
Compensation Committee on June 27, 2011. The awards under the 2009, 2010 and 2011 LTRP are
fully payable in cash in addition to the annual salary and bonus of each employee.
|
|
The 2009, 2010 and 2011 LTRP will be paid in 8 equal annual quotas (12.5% each) commencing on
March 31, 2010, March 31, 2011 and March 31, 2012, respectively. Each quota is calculated as
follows:
|
32
| • |
6.25% of the amount is calculated in nominal terms (“the nominal basis share”),
|
| • |
6.25% is adjusted by multiplying the nominal amount by the average closing stock
price for the last 60 trading days of the year previous to the payment date and
divided by the average closing stock price for the last 60 trading days of 2008, 2009
and 2010 for the 2009, 2010 and 2011 LTRP, respectively. The average closing stock
price for the 2009, 2010 and 2011 LTRP amounted to $13.81, $45.75 and $65.41,
respectively (“the variable share”).
|
|
The 2008, 2009, 2010 and 2011 LTRP have performance and/or eligibility conditions to be
achieved at each year end and also require the employee to stay in the Company at the payment
date.
|
|
The 2008 LTRP compensation cost and the variable share compensation cost of the 2009, 2010 and
2011 LTRP are recognized in accordance with the graded-vesting attribution method and are
accrued up to each payment date. The 2009, 2010 and 2011 LTRP nominal basis share are
recognized in straight line bases using the equal annual accrual method.
|
|
The following tables summarize the LTRP accrued compensation expense for the three- and
nine-month periods ended September 30, 2011 and 2010:
|
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
|
|
||||||||||||||||
|
LTRP 2009
|
$ | (138,721 | ) | $ | 673,842 | $ | 870,504 | $ | 1,382,883 | |||||||
|
LTRP 2010
|
46,942 | 598,709 | 864,413 | 1,258,700 | ||||||||||||
|
LTRP 2011
|
287,697 | — | 1,049,182 | — | ||||||||||||
|
On October 15, 2011, the Company paid the third quarterly cash dividend distribution of $3.5
million or $0.08 per share, which was approved on August 1, 2011 by the Board of Directors.
|
33
| Item 2 |
— Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
| • |
our expectations regarding the continued growth of online commerce and Internet usage in Latin America;
|
||
| • |
our ability to expand our operations and adapt to rapidly changing technologies;
|
||
| • |
government regulation;
|
||
| • |
litigation and legal liability;
|
||
| • |
systems interruptions or failures;
|
||
| • |
our ability to attract and retain qualified personnel;
|
||
| • |
consumer trends;
|
||
| • |
security breaches and illegal uses of our services;
|
||
| • |
competition;
|
||
| • |
reliance on third-party service providers;
|
||
| • |
enforcement of intellectual property rights;
|
||
| • |
our ability to attract new customers, retain existing customers and increase revenues;
|
||
| • |
seasonal fluctuations; and
|
||
| • |
political, social and economic conditions in Latin America in general, and Venezuela and Argentina in
particular, including Venezuela’s status as a highly inflationary economy and new exchange rate
system.
|
34
| • |
a brief overview of our company;
|
||
| • |
a discussion of our principal trends and results of operations for the three- and nine-month periods ended
September 30, 2011 and 2010;
|
||
| • |
a review of our financial presentation and accounting policies, including our critical accounting policies;
|
||
| • |
a discussion of the principal factors that influence our results of operations, financial condition and liquidity;
|
||
| • |
a discussion of our liquidity and capital resources, a discussion of our capital expenditures and a description
of our contractual obligations; and
|
||
| • |
a discussion of the market risks that we face.
|
35
36
| • |
up front fees;
|
||
| • |
final value fees; and
|
||
| • |
online advertising fees.
|
| • |
commissions charged to sellers for the use of the
MercadoPago platform with respect to transactions that
occur outside of our Marketplace platform;
|
||
| • |
revenues from a financial charge when a buyer elects to pay
in installments through our MercadoPago platform, for both
transactions that occurs on or off our Marketplace
platform.
|
| Nine-Month Periods Ended | Three-Month Periods Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| (% of total consolidated net revenues) | 2011 | 2010 | 2011 | 2010 | ||||||||||||
|
|
||||||||||||||||
|
Brazil
|
56.8 | % | 57.1 | % | 56.4 | % | 55.5 | % | ||||||||
|
Argentina
|
18.3 | 18.5 | 19.4 | 19.3 | ||||||||||||
|
Venezuela
|
10.8 | 8.9 | 11.1 | 10.3 | ||||||||||||
|
Mexico
|
7.6 | 9.0 | 6.9 | 8.4 | ||||||||||||
|
Other Countries
|
6.5 | 6.5 | 6.2 | 6.5 | ||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table. The table above may not total due to rounding.
|
| Nine-Month Periods Ended | Change from 2010 | Three-Month Periods Ended | Change from 2010 | |||||||||||||||||||||||||||||
| September 30, | to 2011 (*) | September 30, | to 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Net Revenues:
|
||||||||||||||||||||||||||||||||
|
Brazil
|
$ | 120.7 | $ | 88.2 | $ | 32.5 | 36.8 | % | $ | 46.0 | $ | 31.1 | $ | 14.9 | 48.0 | % | ||||||||||||||||
|
Argentina
|
38.8 | 28.6 | 10.2 | 35.6 | 15.8 | 10.8 | 5.0 | 46.5 | ||||||||||||||||||||||||
|
Venezuela
|
23.1 | 13.7 | 9.4 | 68.2 | 9.0 | 5.8 | 3.2 | 57.0 | ||||||||||||||||||||||||
|
Mexico
|
16.2 | 13.9 | 2.3 | 17.0 | 5.6 | 4.7 | 0.9 | 18.8 | ||||||||||||||||||||||||
|
Other Countries
|
13.7 | 10.0 | 3.7 | 37.3 | 5.2 | 3.6 | 1.6 | 43.4 | ||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Total Net Revenues
|
$ | 212.5 | $ | 154.4 | $ | 58.1 | 37.6 | % | $ | 81.6 | $ | 56.0 | $ | 25.6 | 45.9 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table. The table above may not total due to rounding.
|
37
38
| • |
At the date we changed the translation exchange rate (and as of the date of this report), we have not
obtained dividends remittances at the official exchange rate (and we have not at the date of this
report),
|
||
| • |
The industry in which we operate may not influence our ability to access to the official exchange rate,
|
||
| • |
The Commission for the Administration of Foreign Exchange (“CADIVI”) volume of approvals of the use of
the Official Rate was down 50% on a year-to-year basis as of July 2009.
|
||
| • |
CADIVI has not only delayed approvals but also removed many items from priority lists (current
priorities appear to be food and medicine), causing delays in the repatriation of dividends for many
companies.
|
39
| September 30, | December 31, | |||||||
| 2011 | 2010 | |||||||
|
|
||||||||
|
Venezuelan operations
|
||||||||
|
Assets
|
$ | 24,390,518 | $ | 21,928,340 | ||||
|
Liabilities
|
(7,729,510 | ) | (8,212,581 | ) | ||||
|
|
||||||||
|
Net Assets
|
16,661,008 | 13,715,759 | ||||||
|
|
||||||||
40
41
| Nine Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||
| (In millions) | 2011 (*) | 2010 (*) | 2011 (*) | 2010 (*) | ||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
|
Net revenues
|
$ | 212.5 | $ | 154.4 | $ | 81.6 | $ | 56.0 | ||||||||
|
Cost of net revenues
|
(51.3 | ) | (32.8 | ) | (20.1 | ) | (11.5 | ) | ||||||||
|
|
||||||||||||||||
|
Gross profit
|
161.1 | 121.6 | 61.6 | 44.5 | ||||||||||||
|
|
||||||||||||||||
|
Operating expenses:
|
||||||||||||||||
|
|
||||||||||||||||
|
Product and technology development
|
(16.6 | ) | (11.4 | ) | (5.9 | ) | (4.2 | ) | ||||||||
|
Sales and marketing
|
(45.6 | ) | (34.9 | ) | (16.7 | ) | (12.3 | ) | ||||||||
|
General and administrative
|
(28.1 | ) | (21.7 | ) | (8.9 | ) | (8.7 | ) | ||||||||
|
|
||||||||||||||||
|
Total operating expenses
|
(90.3 | ) | (68.0 | ) | (31.6 | ) | (25.2 | ) | ||||||||
|
|
||||||||||||||||
|
Income from operations
|
70.8 | 53.6 | 30.0 | 19.3 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Other income (expenses):
|
||||||||||||||||
|
Interest income and other financial gains
|
7.0 | 3.1 | 2.9 | 1.4 | ||||||||||||
|
Interest expense and other financial charges
|
(2.6 | ) | (6.9 | ) | (1.1 | ) | (0.6 | ) | ||||||||
|
Foreign currency gains / losses
|
2.1 | 0.0 | 3.3 | (0.4 | ) | |||||||||||
|
Other income, net
|
0.3 | — | (0.0 | ) | — | |||||||||||
|
|
||||||||||||||||
|
Net income before income / asset tax expense
|
77.6 | 49.8 | 35.1 | 19.8 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Income / asset tax expense
|
(22.5 | ) | (9.7 | ) | (8.8 | ) | (1.0 | ) | ||||||||
|
|
||||||||||||||||
|
Net income
|
$ | 55.2 | $ | 40.1 | $ | 26.3 | $ | 18.8 | ||||||||
|
|
||||||||||||||||
|
Less: Net Income attributable to Noncontrolli
|
— | — | — | — | ||||||||||||
|
|
||||||||||||||||
|
Net income available to common shareholders
|
$ | 55.2 | $ | 40.1 | $ | 26.3 | $ | 18.8 | ||||||||
|
|
||||||||||||||||
| (*) |
The table above may not add due to rounding.
|
| Nine Months Ended September 30, | Three Months Ended September 30, | |||||||||||||||
| (In millions) | 2011 | 2010 | 2011 | 2010 | ||||||||||||
|
|
||||||||||||||||
|
Number of confirmed registered users at end of the period
1
|
62.0 | 50.2 | 62.0 | 50.2 | ||||||||||||
|
Number of confirmed new registered users during the period
2
|
9.1 | 7.7 | 3.6 | 2.8 | ||||||||||||
|
Gross merchandise volume
3
|
3,370.1 | 2,417.8 | 1,348.3 | 888.1 | ||||||||||||
|
Number of items sold
4
|
36.9 | 28.0 | 14.4 | 10.4 | ||||||||||||
|
Total payment volume
5
|
909.5 | 461.4 | 368.5 | 189.9 | ||||||||||||
|
Total payment transactions
6
|
9.6 | 4.3 | 3.9 | 1.9 | ||||||||||||
|
Capital expenditures
|
22.7 | 10.6 | 9.3 | 6.6 | ||||||||||||
|
Depreciation and amortization
|
5.2 | 3.6 | 1.9 | 1.4 | ||||||||||||
| 1- |
Measure of the cumulative number of users who have registered on the MercadoLibre
Marketplace and confirmed their registration.
|
|
| 2- |
Measure of the number of new users who have registered on the MercadoLibre Marketplace and
confirmed their registration.
|
|
| 3- |
Measure of the total U.S. dollar sum of all transactions completed through the MercadoLibre
Marketplace, excluding motor vehicles, vessels, aircraft and real estate.
|
|
| 4- |
Measure of the number of items that were sold/purchased through the MercadoLibre
Marketplace.
|
|
| 5- |
Measure of the total U.S. dollar sum of all transactions paid for using
MercadoPago.
|
|
| 6- |
Measure of the number of all transactions paid for using MercadoPago.
|
42
| Nine-Month Periods Ended | Change from 2010 | Three-Month Periods Ended | Change from 2010 to | |||||||||||||||||||||||||||||
| September 30, | to 2011 (*) | September 30, | 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Total Net Revenues
|
$ | 212.5 | $ | 154.4 | $ | 58.1 | 37.6 | % | $ | 81.6 | $ | 56.0 | $ | 25.6 | 45.9 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts that appear in the table.
|
|
|
The table above may not total due to rounding.
|
| Nine-Month Periods Ended | Change from 2010 | Three-Month Periods Ended | Change from 2010 | |||||||||||||||||||||||||||||
| September 30, | to 2011 (*) | September 30, | to 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Net Revenues:
|
||||||||||||||||||||||||||||||||
|
Brazil
|
$ | 120.7 | $ | 88.2 | $ | 32.5 | 36.8 | % | $ | 46.0 | $ | 31.1 | $ | 14.9 | 48.0 | % | ||||||||||||||||
|
Argentina
|
38.8 | 28.6 | 10.2 | 35.6 | 15.8 | 10.8 | 5.0 | 46.5 | ||||||||||||||||||||||||
|
Venezuela
|
23.1 | 13.7 | 9.4 | 68.2 | 9.0 | 5.8 | 3.2 | 57.0 | ||||||||||||||||||||||||
|
Mexico
|
16.2 | 13.9 | 2.3 | 17.0 | 5.6 | 4.7 | 0.9 | 18.8 | ||||||||||||||||||||||||
|
Other Countries
|
13.7 | 10.0 | 3.7 | 37.3 | 5.2 | 3.6 | 1.6 | 43.4 | ||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Total Net Revenues
|
$ | 212.5 | $ | 154.4 | $ | 58.1 | 37.6 | % | $ | 81.6 | $ | 56.0 | $ | 25.6 | 45.9 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table. The table above may not total due to rounding.
|
43
| Quarter Ended | ||||||||||||||||
| March 31, | June 30, | September 30, | December 31, | |||||||||||||
| (in millions, except percentages) | ||||||||||||||||
| (*) | ||||||||||||||||
|
2011
|
||||||||||||||||
|
Net Revenues
|
$ | 61.5 | $ | 69.4 | $ | 81.6 | n/a | |||||||||
|
Percent change from prior quarter
|
-1 | % | 13 | % | 18 | % | ||||||||||
|
2010
|
||||||||||||||||
|
Net Revenues
|
$ | 45.9 | $ | 52.5 | $ | 56.0 | $ | 62.3 | ||||||||
|
Percent change from prior quarter
|
-6 | % | 14 | % | 7 | % | 11 | % | ||||||||
|
2009
|
||||||||||||||||
|
Net Revenues
|
$ | 32.3 | $ | 40.9 | $ | 50.6 | $ | 49.0 | ||||||||
|
Percent change from prior quarter
|
-3 | % | 27 | % | 24 | % | -3 | % | ||||||||
|
2008
|
||||||||||||||||
|
Net Revenues
|
$ | 28.8 | $ | 34.5 | $ | 40.3 | $ | 33.4 | ||||||||
|
Percent change from prior quarter
|
7 | % | 20 | % | 17 | % | -17 | % | ||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
| Nine-Month Periods Ended | Change from 2010 | Three-Month Periods Ended | Change from 2010 | |||||||||||||||||||||||||||||
| September 30, | to 2011 (*) | September 30, | to 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Total cost of net revenues
|
$ | 51.3 | $ | 32.8 | $ | 18.5 | 56.7 | % | $ | 20.1 | $ | 11.5 | $ | 8.6 | 75.2 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
24.2 | % | 21.2 | % | 24.6 | % | 20.5 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
44
| Nine-Month Periods Ended | Change from 2010 to | Three-Month Periods Ended | Change from 2010 to | |||||||||||||||||||||||||||||
| September 30, | 2011 (*) | September 30, | 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Product and technology development
|
$ | 16.6 | $ | 11.4 | $ | 5.2 | 45.3 | % | $ | 5.9 | $ | 4.2 | $ | 1.7 | 40.3 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
7.8 | % | 7.4 | % | 7.3 | % | 7.6 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
| Nine-Month Periods Ended | Change from 2010 to | Three-Month Periods Ended | Change from 2010 | |||||||||||||||||||||||||||||
| September 30, | 2011 (*) | September 30, | to 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Sales and marketing
|
$ | 45.6 | $ | 34.9 | $ | 10.7 | 30.7 | % | $ | 16.7 | $ | 12.3 | $ | 4.4 | 36.0 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
21.4 | % | 22.6 | % | 20.5 | % | 22.0 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
45
| Nine-Month Periods Ended | Change from 2010 to | Three-Month Periods Ended | Change from 2010 | |||||||||||||||||||||||||||||
| September 30, | 2011 (*) | September 30, | to 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
General and administrative
|
$ | 28.1 | $ | 21.7 | $ | 6.4 | 29.5 | % | $ | 8.9 | $ | 8.7 | $ | 0.2 | 3.0 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
13.2 | % | 14.1 | % | 11.0 | % | 15.5 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
| Nine-Month Periods Ended | Change from 2010 to | Three-Month Periods Ended | Change from 2010 to | |||||||||||||||||||||||||||||
| September 30, | 2011 (*) | September 30, | 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Other income (expenses)
|
$ | 6.8 | $ | (3.8 | ) | $ | 10.6 | 277.4 | % | $ | 5.1 | $ | 0.4 | $ | 4.7 | 1068.4 | % | |||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues
|
3.2 | % | -2.5 | % | 6.3 | % | 0.8 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
| Nine-Month Period Ended | Change from 2010 to | Three-Month Period Ended | Change from 2010 to | |||||||||||||||||||||||||||||
| September 30, | 2011 (*) | September 30, | 2011 (*) | |||||||||||||||||||||||||||||
| 2011 | 2010 | in Dollars | in % | 2011 | 2010 | in Dollars | in % | |||||||||||||||||||||||||
| (in millions, except percentages) | (in millions, except percentages) | |||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
Income and asset tax
|
$ | 22.5 | $ | 9.7 | $ | 12.8 | 131.5 | % | $ | 8.8 | $ | 1.0 | $ | 7.8 | 820.9 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||||||||||
|
As a percentage of net revenues (*)
|
10.6 | % | 6.3 | % | 10.8 | % | 1.7 | % | ||||||||||||||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded
amounts that appear in the table.
|
46
| Nine-Month Periods Ended | Three-Month Periods Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
|
|
||||||||||||||||
|
Blended tax rate
|
28.9 | % | 19.5 | % | 25.1 | % | 4.9 | % | ||||||||
|
Effective tax rate
|
26.9 | % | 32.8 | % | 25.1 | % | 32.1 | % | ||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded
amounts that appear in the table. rounded amounts that appear in the table.
|
| Nine-Month Periods Ended | Three-Month Periods Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
|
|
||||||||||||||||
|
Effective tax rate by country
|
||||||||||||||||
|
|
||||||||||||||||
|
Argentina
|
15.3 | % | 18.5 | % | 13.9 | % | 16.9 | % | ||||||||
|
Brazil
|
29.2 | % | 34.8 | % | 26.3 | % | 31.0 | % | ||||||||
|
Mexico
|
25.7 | % | 35.2 | % | 27.9 | % | 67.4 | % | ||||||||
|
Venezuela
|
34.8 | % | 38.8 | % | 35.4 | % | 45.2 | % | ||||||||
47
48
| Nine Months Period Ended | ||||||||
| September 30, | ||||||||
| (In millions) | 2011 | 2010 | ||||||
|
|
||||||||
|
Net cash provided by (used in):
|
||||||||
|
Operating activities
|
$ | 62.3 | $ | 42.0 | ||||
|
Investing activities
|
(51.7 | ) | (44.8 | ) | ||||
|
Financing activities
|
(7.1 | ) | (2.9 | ) | ||||
|
Effect of exchange rates on cash and cash equivalents
|
(1.3 | ) | 0.3 | |||||
|
|
||||||||
|
Net increase / (decrease) in cash and cash equivalents
|
$ | 2.2 | $ | (5.4 | ) | |||
|
|
||||||||
| Nine-Month Period Ended | Change from 2010 to | |||||||||||||||
| September 30, | 2011 (*) | |||||||||||||||
| 2011 | 2010 | in Dollars | in % | |||||||||||||
| (in millions, except percentages) | ||||||||||||||||
|
|
||||||||||||||||
|
Net Cash provided by:
|
||||||||||||||||
|
Operating activities
|
$ | 62.3 | $ | 42.0 | $ | 20.3 | 48.4 | % | ||||||||
| Nine-Month Period Ended | Change from 2010 to | |||||||||||||||
| September 30, | 2011 (*) | |||||||||||||||
| 2011 | 2010 | in Dollars | in % | |||||||||||||
| (in millions, except percentages) | ||||||||||||||||
|
|
||||||||||||||||
|
Net Cash used in:
|
||||||||||||||||
|
|
||||||||||||||||
|
Investing activities
|
$ | (51.7 | ) | $ | (44.8 | ) | $ | (6.9 | ) | 15.5 | % | |||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts that
appear in the table.
|
49
| Nine-Month Periods Ended | Change from 2010 to | |||||||||||||||
| September 30, | 2011 (*) | |||||||||||||||
| 2011 | 2010 | in Dollars | in % | |||||||||||||
| (in millions, except percentages) | ||||||||||||||||
|
|
||||||||||||||||
|
Net Cash used in:
|
||||||||||||||||
|
|
||||||||||||||||
|
Financing activities
|
$ | (7.1 | ) | $ | (2.9 | ) | $ | (4.2 | ) | 144.8 | % | |||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts that
appear in the table.
|
50
| Payment due by period | ||||||||||||||||||||
| Less than | 1 to 3 | 3 to 5 | More than | |||||||||||||||||
| (in millions) | Total | 1 year | years | years | 5 years | |||||||||||||||
|
Capital lease obligations (1)
|
$ | 0.3 | $ | 0.1 | $ | 0.2 | $ | — | $ | — | ||||||||||
|
|
||||||||||||||||||||
|
Operating lease obligations (2)
|
3.5 | 0.5 | 2.2 | 0.7 | 0.1 | |||||||||||||||
|
|
||||||||||||||||||||
|
Purchase obligations
|
4.3 | 3.5 | 0.8 | — | — | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total
|
$ | 8.1 | $ | 4.1 | $ | 3.2 | $ | 0.7 | $ | 0.1 | ||||||||||
|
|
||||||||||||||||||||
| (1) |
On February 22, 2010, our Argentine subsidiary signed a Company Car Lease contract to buy 12
cars for certain employees of the Company. The total lease contract amounts to $0.4 millions and matures
in January, 2013.
|
|
|
In addition, during September of 2011, the Company signed another lease contract to buy 8 cars
for certain employees of the Company. The total lease contract amounts to $0.2 millions and
matures in September, 2014.
|
||
| (2) |
Include leases of office spaces.
|
| Item 3 |
— Qualitative and Quantitative Disclosure About Market Risk
|
51
| Nine-Month Periods Ended | Three-Month Periods Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| (% of total consolidated net revenues) | 2011 | 2010 | 2011 | 2010 | ||||||||||||
|
Brazil
|
56.8 | % | 57.1 | % | 56.4 | % | 55.5 | % | ||||||||
|
Argentina
|
18.3 | 18.5 | 19.4 | 19.3 | ||||||||||||
|
Venezuela
|
10.8 | 8.9 | 11.1 | 10.3 | ||||||||||||
|
Mexico
|
7.6 | 9.0 | 6.9 | 8.4 | ||||||||||||
|
Other Countries
|
6.5 | 6.5 | 6.2 | 6.5 | ||||||||||||
| (*) |
Percentages have been calculated using whole-dollar amounts rather than rounded amounts
that appear in the table.
|
|
|
The table above may not total due to rounding.
|
52
|
The table below shows the impact on our net revenues, expenses, other income and income
tax, net income and shareholders’ equity for a positive or negative 10% fluctuation on all
the foreign currencies to which we are exposed as of September 30, 2011 and for the
nine-month period ended September 30, 2011:
|
| (In millions) | -10% | Actual | +10% | |||||||||
| (1) | (2) | |||||||||||
|
Net revenues
|
$ | 236.0 | $ | 212.5 | $ | 193.3 | ||||||
|
Expenses
|
(157.3 | ) | (141.7 | ) | (128.9 | ) | ||||||
|
|
||||||||||||
|
Income from operations
|
78.7 | 70.8 | 64.4 | |||||||||
|
|
||||||||||||
|
Other income (expenses) and income tax
related to P&L items
|
(19.5 | ) | (17.6 | ) | (16.2 | ) | ||||||
|
Foreign Currency impact related to the remeasurement
of our Net Asset position
|
(1.7 | ) | 2.1 | 5.2 | ||||||||
|
|
||||||||||||
|
Net income
|
$ | 57.5 | $ | 55.2 | $ | 53.3 | ||||||
|
|
||||||||||||
|
|
||||||||||||
|
Total Equity
|
$ | 219.9 | $ | 207.9 | $ | 204.6 | ||||||
|
|
||||||||||||
| • |
eligible employees will receive a fixed cash payment equal
to 6.25% of his or her 2009 and/or 2010 and/or 2011 LTRP
bonus once a year for a period of eight years starting in
2010 and/or 2011 and/or 2012 (the “2009, 2010 and 2011
Annual Fixed Payment”); and
|
||
| • |
on each date we pay the Annual Fixed Payment to an eligible
employee, he or she will also receive a cash payment (the
“2009, 2010 and 2011 Variable Payment”) equal to the
product of (i) 6.25% of the applicable 2009 and/or 2010
and/or 2011 LTRP bonus and (ii) the quotient of (a) divided
by (b), where (a), the numerator, equals the Applicable
Year Stock Price (as defined below) and (b), the
denominator, equals the 2008, 2009 and 2010 Stock Price,
defined as $13.81, $45.75 and $65.41 for the 2009, 2010 and
2011 LTRP, respectively, which was the average closing
price of the Company’s common stock on the NASDAQ Global
Market during the final 60 trading days of 2008, 2009 and
2010, respectively. The “Applicable Year Stock Price” shall
equal the average closing price of the Company’s common
stock on the NASDAQ Global Market during the final 60
trading days of the year preceding the applicable payment
date.
|
53
| As of September 30, 2011 | ||||||||
| MercadoLibre, Inc | 2009, 2010 and 2011 variable | |||||||
| (In US dollars) | Equity Price | payment LTRP liability | ||||||
|
Change in equity price in percentage
|
||||||||
|
40%
|
96.52 | 15,749,094 | ||||||
|
30%
|
89.62 | 14,624,159 | ||||||
|
20%
|
82.73 | 13,499,224 | ||||||
|
10%
|
75.83 | 12,374,288 | ||||||
|
Static (*)
|
68.94 | 11,249,353 | ||||||
|
-10%
|
62.05 | 10,124,418 | ||||||
|
-20%
|
55.15 | 8,999,482 | ||||||
|
-30%
|
48.26 | 7,874,547 | ||||||
|
-40%
|
41.36 | 6,749,612 | ||||||
| (*) |
Average closing stock price for the last 60 trading days of the closing date
|
| Item 4 |
— Controls and Procedures
|
| Item 1 |
— Legal Proceedings
|
54
55
| Item 1A |
— Risk Factors
|
| Item 6 |
— Exhibits
|
| 31.1 |
Certification of Chief Executive Officer pursuant to
Securities Exchange Act Rule 13a-14, as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.*
|
|||
|
|
||||
| 31.2 |
Certification of Chief Financial Officer pursuant to
Securities Exchange Act Rule 13a-14, as adopted pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.*
|
|||
|
|
||||
| 32.1 |
Certification of Chief Executive Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.**
|
|||
|
|
||||
| 32.2 |
Certification of Chief Financial Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.**
|
|||
|
|
||||
| 101.INS |
XBRL Instance Document***
|
|||
|
|
||||
| 101.SCH |
XBRL Taxonomy Extension Schema Document***
|
|||
|
|
||||
| 101.CAL |
XBRL Taxonomy Extension Calculation Linkbase Document***
|
|||
|
|
||||
| 101.LAB |
XBRL Taxonomy Extension Label Linkbase Document***
|
|||
|
|
||||
| 101.PRE |
XBRL Taxonomy Extension Presentation Linkbase Document***
|
|||
| * |
Filed herewith
|
|
| ** |
Furnished herewith
|
|
| *** |
XBRL information is furnished and not filed or a part of a registration statement or
prospectus for purposes of sections 11 or 12 of the Securities and Exchange Act of 1933,
is deemed not filed for purposes of section 18 of the Securities and Exchange Act of 1934,
and otherwise is not subject to liability under these sections.
|
56
| MERCADOLIBRE, INC. | ||||
|
Registrant
|
||||
| Date: November 4, 2011 | By: | /s/ Marcos Galperín | ||
| Marcos Galperín | ||||
| President and Chief Executive Officer | ||||
| By: | /s/ Pedro Arnt | |||
| Pedro Arnt | ||||
| Executive Vice President and Chief Financial Officer | ||||
57
| 31.1 |
Certification of Chief Executive Officer
pursuant to Securities Exchange Act Rule
13a-14, as adopted pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.*
|
|||
|
|
||||
| 31.2 |
Certification of Chief Financial Officer
pursuant to Securities Exchange Act Rule
13a-14, as adopted pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.*
|
|||
|
|
||||
| 32.1 |
Certification of Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.**
|
|||
|
|
||||
| 32.2 |
Certification of Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.**
|
| * |
Filed herewith
|
|
| ** |
Furnished herewith
|
58
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
No Customers Found
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|