Intershop Communications AG Reports First Quarter 2006 Financial Results

Jena, Germany – April 27, 2006 - Intershop Communications AG (Prime Standard:

ISH2) today announced financial results for the first quarter of 2006, ended March 31, 2006. First quarter 2006 revenue totaled Euro 5.1 million, compared with Euro 5.3 million in the fourth quarter of 2005 and Euro 4.4 million in the first quarter of 2005. License revenue rose by Euro 1.8 million in the first quarter of 2006 as against the fourth quarter of 2005 to Euro 1.6 million, compared with Euro 1.3 million in the first quarter of 2005.

Total operating costs (cost of revenues plus operating expenses) were Euro 6.4 million in the first quarter of 2006, compared with Euro 4.6 million in the previous quarter and Euro 5.1 million in Q1 2005. Among other things, around Euro 0.4 million of this increase relates to the expenses from stock options required to be recognized due to the conversion to IFRSs. Onetime expenses of around Euro 0.6 million were also incurred; in the fourth quarter of 2005, these were offset by one-time income of Euro 0.6 million.

Intershop reported Euro 1.5 million in net loss in the first quarter of 2006 or Euro 0.08 per share, compared to a net income of Euro 0.2 million or a net income of Euro 0.02 per share in the fourth quarter of 2005. In comparison, Intershop’s net loss in the first quarter of 2005 was Euro 0.8 million or a net loss of Euro 0.09 per share.

Intershop generated cash flow from operating activities of around Euro 0.2 million in the first quarter of 2006.Total cash, including cash and cash equivalents, marketable securities, and restricted cash climbed from Euro 13.5 million as of December 31, 2005 to Euro 13.6 million as of March 31, 2006. This includes unrestricted cash of Euro 7.4 million, which amounted to Euro 7.3 million at the end of the previous quarter.

Operating Highlights for the First Quarter of 2006

  • Intershop received a large order from a US-based international technology company.
  • Intershop signed up Music Store A.Sauer GmbH and a leading Nordic retail chain of sporting goods as new customers in Central Europe.
  • At this year's CeBIT show, Intershop announced its entry into the full-service e-commerce business. Effective immediately, the company covers the full range of e-commerce business processes-from software, service, and fulfillment to online marketing and logistics.
  • As of March 31, 2006, the company employed 219 full-time equivalent employees, as compared to 222 full-time equivalent employees as of December 31, 2005.

Business Outlook

Intershop again expects to record a net profit for fiscal year 2006.

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About Intershop

Intershop Communications AG (founded in Germany 1992; Prime Standard: ISHA) is an independent, internationally leading provider of omnichannel commerce solutions. The latter are available as cloud-based commerce-as-a-service solutions or as licensed models and combine the expertise from over 25 years of software development for online commerce. Upon request, Intershop orchestrates the entire omnichannel commerce process chain – from the design of online channels to the implementation of software to fulfillment. Around the globe more than 300 enterprise customers run Intershop solutions. Customers include large corporations such as HP, BMW, Würth and Deutsche Telekom as well as medium-sized enterprises. Intershop operates in Europe, the USA and the Asia-Pacific region.

This news release contains forward-looking statements regarding future events or the future financial and operational performance of Intershop. Actual events or performance may differ materially from those contained or implied in such forward-looking statements. Risks and uncertainties that could lead to such difference could include, among other things: Intershop's limited operating history, the unpredictability of future revenues and expenses and potential fluctuations in revenues and operating results, significant dependence on large single customer deals, consumer trends, the level of competition, seasonality, risks related to electronic security, possible governmental regulation, and general economic conditions.

Intershop Public Relations

Heide Rausch
Head of Corporate Communication