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MatchNet, a worldwide leader in the online dating industry, today announced third quarter and nine month results for the period ended September 30, 2002.

Revenues for the three months ended September 30, 2002 were $3,503,364 compared to revenues of $3,010,451 for the same three-month period in 2001, an increase of 16%. The increase is primarily attributed to growth in overall membership and higher subscription fees adopted at the Company's AmericanSingles.com website. Operating expenses increased just 2%, compared to a 16% increase in revenues, to $2,016,347 in Q3 2002 compared to $1,722,893 in Q3 2001.

Revenues for the nine-months ended September 30, 2002 increased 55% to $11,304,095, compared to $7,271,500 for the same period in 2001. The increase is due to overall growth in membership; various upgrades to the Company's websites that increased conversion rates of free memberships to paid subscriptions; and an increase in the price of subscriptions. Also, Gay11.com was not launched until after the 2001 nine-month period. Operating expenses were $6,312,709 in the nine-month period compared to $5,430,243 for the same period last year. Significantly, operating costs declined 34% as a percentage of revenues, reflecting improved operational efficiencies and the scalable nature of the Company's business model. EBITDA* grew to $1,333,968 for the nine months 2002 vs. $197,375 in the comparable period last year. Net earnings improved to $1,390,542 compared to a net loss of $5,705,584 for the same period last year, reflecting a significant reduction in depreciation and amortization. Despite major technological investments, MatchNet increased its' capital reserves and ended the 3rd Quarter 2002 with $8,752,654 in cash and marketable securities.

“We made significant financial progress over the previous period despite some down-time associated with recent technological upgrades implemented at AmericanSingles.com,” stated Joe Shapira, CEO and co-founder, MatchNet plc. “Due to the site enhancements implemented at the end of the third quarter, revenues and traffic have since increased dramatically. We expect this to be reflected when we announce in our year end 2002 results.”

3rd Quarter 2002 Highlights:

• Implementation of MatchNet's global architecture completed at AmericanSingles.com and FaceLink.com. The new platform allows seamless translation of currencies, calendars & languages worldwide and enables support of MatchNet's properties from a single application source, reducing maintenance costs.


• The launch of an enhanced AmericanSingles.com improves traffic and conversion rate of free memberships to subscriptions. The improved site provides interactive technologies & tools that increase personalization and encourage immediate member interactivity.


• Upgrade of fraud prevention tools and implementation of TeleCheck to enable online check purchases.


• MatchNet launches JDate Travel USA. The first trip, a Bahamas cruise sells-out in weeks. Other trips include a Maui vacation, a ski weekend in Vermont and a New Years' cruise.

Recent Developments and Outlook:

• Implementation of new global architecture on JDate.com, Gay11.com, and all international sites is underway.


• Upgrade of JDate.com, to be followed by Gay11.com and other websites. Upgrade offers similar enhancements that increased traffic and new subscriptions at AmericanSingles.com. In the short-term, technology migration is expected to cause some disruptions in service. Technology, once implemented, has shown to have immediate positive impact on revenues and conversion of free memberships into subscriptions.


• In October 2002, MatchNet announced its' partnership with CollegeClub.com, the #1 college website in the US, to be their exclusive provider of online dating services. The expanded service will adopt a subscription-based revenue model, be upgraded to MatchNet's global architecture and will offer a host of new features and technologies.


• In November 2002, MatchNet acquired the MatchNet.com.au website, member records, domain names, and intellectual property, from subsidiary MatchNet Australia Ltd. and divested remaining interest in shell company to Joint Venture partner, ECAT Development Capital Ltd.


• Revenues and traffic have increased substantially since the end of third quarter 2002. Launch of internal marketing campaign to AmericanSingles.com members via Email Alerts help drive revenue increases. Similar marketing efforts to be implemented during Q4 2002 at JDate.com.

What is MatchNet?