PopMail Says Subsidiary Breaks Even
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Online marketer PopMail.com said on Friday that its PopMail Network has reached cash flow breakeven, after signing several new clients.
Officials from the Irving, Texas-based firm said the firm's current client base generates about $2 million in annualized revenue -- enough to support the subsidiary.
"PopMail Network's client and recurring revenue base has now reached a point of critical mass so that revenues generated from new clients on a go forward basis will begin to substantially fall directly to the bottom line," said PopMail Network president Ed Bardwell.
PopMail.com works in the niche area of fan club marketing, serving recording artists, sports teams and broadcast and entertainment companies. The company's services include ticket discounts, merchandise, and official fan sites, while its wholly-owned PopMail Network subsidiary handles e-mail marketing.
Since December, PopMail Network has added 12 new clients to its permission e-mail marketing services, including the NHL's Edmonton Oilers, the United States Olympic Committee, the University of Arizona athletic department, the Southeastern Conference, and Gund Arena, home of the NBA's Cleveland Cavaliers and WNBA's Cleveland Rockers.
In addition to boosting revenue, these additions bring PopMail Network's total of opt-in e-mail clients to about 100 sports organizations -- covering all the major leagues, as well as several minor leagues, universities, sports venues and stations.
"Each of these organizations is an important addition to the Popmail client base. The Edmonton Oilers are the 14th NHL franchise," to sign with the company, said Scott Hull, vice president of the Popmail Network's sports division.
"The University of Arizona and the SEC represent PopMail's increased emphasis on the collegiate athletic market; the USOC is the first major governing body to use [PopMail]; and Gund Arena joins the Pepsi Center in Denver and the Fleet Center in Boston as clients representing major venues," Hull said. "Strategically, these three market segments represent significant growth opportunities for the company."
PopMail Network executives said they plan to generate additional revenues and member registrations through cross-marketing deals between clients.
While the new clients boost PopMail's bottom line, the company is also eager to prove its worth to investors and officials in the public markets -- and quickly.
PopMail is currently under review by NASDAQ officials for trading below $1 for an extended period, and for failing to maintain a minimum of two active market makers for 10 consecutive trading days. The company is scheduled to meet with exchange officials during a hearing this month to try and stave off delisting.
The company also recently completed a sizable restructuring that saw the departure of its chief executive and the selling off and discontinuation of its restaurant-operations unit.
Shares of POPM have been trading below a dollar since early November. The stock closed Thursday at $0.50, well off the company's 52-week high of $71.25.