Stamps.com Inc. (STMP, Financial) filed Quarterly Report for the period ended 2009-03-31.
Stamps.com provides easy convenient and cost-effective Internet -based services for mailing or shipping letters packages or parcelsanywhere in the United States and at anytime. Their core mailing and shipping services are designed to allow individual consumers or employees of small businesses or larger enterprises to select a carrier print US postage or shipping labels from multiple carriers schedule a pick-up track a package and apply enterprise-wide business rules to manage and account for mailing and shipping costs. Stamps.com Inc. has a market cap of $154.7 million; its shares were traded at around $9.29 with a P/E ratio of 24.3 and P/S ratio of 1.9.
As a result, we estimate that PC Postage revenue for customers acquired through our enhanced promotion channel for the first quarter of 2009 was $1.8 million, a decrease of 29% from $2.5 million in the first quarter of 2008. We estimate that PC Postage revenue for customers acquired through our non-enhanced promotion channels for the first quarter of 2009 was $16.6 million, an increase of 6% from $15.6 million in the first quarter of 2008.
Product revenue increased 5% to $2.6 million in the first quarter of 2009 from $2.5 million in the first quarter of 2008. The increase in product revenue was attributable to growth in the number of orders, partially offset by a decline in the average revenue per order. The increase in product revenue consisted of a 5.3% increase in store orders shipped. Average revenue per order decreased 0.6% from $40.06 per order during the first quarter of 2008 to $39.84 during the first quarter of 2009. The increase in store orders shipped was primarily attributable to an increase in our paid customer base. As a percentage of total revenue, product revenue increased approximately one percentage point to 13% in the first quarter of 2009 from 12% in the first quarter of 2008.
PhotoStamps revenue decreased 43% to $1.7 million in the first quarter of 2009 from $3.0 million in the first quarter of 2008. The decrease in revenue was primarily attributable to a decrease in the number of sheets shipped. We shipped approximately 104,000 PhotoStamps sheets during the first quarter of 2009, a 41% decrease compared to the 178,000 shipped in the first quarter of 2008. Average revenue per sheet shipped for the first quarter of 2009 was $16.45, a 3% decrease compared to $16.91 for the first quarter of 2008. We believe the decrease in PhotoStamps sheets shipped was primarily attributable to the weaker general economy, lower high volume business orders and our reduction in PhotoStamps consumer sales and marketing spending. As a percentage of total revenue, PhotoStamps revenue decreased approximately five percentage points to 9% in the first quarter of 2009 from 14% in the first quarter of 2008.
Cost of service revenue increased 10% to $3.0 million in the first quarter of 2009 from $2.7 million in the first quarter of 2008. The increase in cost of service revenue is primarily attributable to higher customer support related expenses resulting from expanding our support personnel and increased costs related to our retention program aimed at retaining customers who call to cancel their service. Promotional expenses, which include free postage and a free digital scale offered to new customers, are included in cost of service revenue. Promotional expenses were approximately $361,000 and $464,000 during the first quarter of 2009 and the first quarter of 2008, respectively. The decrease in promotional expense is primarily attributable to a change in our estimate of future coupon redemptions made during 2008. Promotional expense, which represents a material portion of total cost of service revenue, is expensed in the period in which a customer qualifies for the promotion, while the revenue associated with the acquired customer is earned over the customer's lifetime. As a result, promotional expense for newly acquired customers may exceed the revenue earned from those customers in that period. As a percentage of total revenue, cost of service revenue increased approximately two percentage points to 15% in the first quarter of 2009 compared to 13% in the first quarter of 2008.
General and administrative expense principally consists of compensation and related costs for executive and administrative personnel, fees for legal and other professional services, depreciation of equipment and software used for general corporate purposes and amortization of intangible assets. General and administrative expense decreased 17% to $3.3 million in the first quarter of 2009 from $3.9 million in the first quarter of 2008. As a percentage of total revenue, general and administrative expense decreased approximately three percentage points to 16% in the first quarter of 2009 from 19% in the first quarter of 2008. The decrease, both on an absolute basis and as a percentage of total revenue, is primarily attributable to the following factors: (1) a decrease in legal expenses relating to existing litigation, (2) a $445,000 asset write-off of packaging material primarily relating to PhotoStamps that we incurred in the first quarter of 2008 and (3) decreased amortization expense related to the completion of our E-Stamp patent amortization schedule in the second quarter of 2008.
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Stamps.com provides easy convenient and cost-effective Internet -based services for mailing or shipping letters packages or parcelsanywhere in the United States and at anytime. Their core mailing and shipping services are designed to allow individual consumers or employees of small businesses or larger enterprises to select a carrier print US postage or shipping labels from multiple carriers schedule a pick-up track a package and apply enterprise-wide business rules to manage and account for mailing and shipping costs. Stamps.com Inc. has a market cap of $154.7 million; its shares were traded at around $9.29 with a P/E ratio of 24.3 and P/S ratio of 1.9.
Highlight of Business Operations:
Total revenue in the first quarter of 2009 was $20.0 million, a decrease of 5% from $21.1 million in the first quarter of 2008. PC Postage revenue, including service revenue, product revenue and insurance revenue, in the first quarter of 2009 was $18.3 million, an increase of 1% compared to $18.1 million in the first quarter of 2008. PhotoStamps revenue in the first quarter of 2009 was $1.7 million, a decrease of 43% compared to $3.0 million in the first quarter of 2008.As a result, we estimate that PC Postage revenue for customers acquired through our enhanced promotion channel for the first quarter of 2009 was $1.8 million, a decrease of 29% from $2.5 million in the first quarter of 2008. We estimate that PC Postage revenue for customers acquired through our non-enhanced promotion channels for the first quarter of 2009 was $16.6 million, an increase of 6% from $15.6 million in the first quarter of 2008.
Product revenue increased 5% to $2.6 million in the first quarter of 2009 from $2.5 million in the first quarter of 2008. The increase in product revenue was attributable to growth in the number of orders, partially offset by a decline in the average revenue per order. The increase in product revenue consisted of a 5.3% increase in store orders shipped. Average revenue per order decreased 0.6% from $40.06 per order during the first quarter of 2008 to $39.84 during the first quarter of 2009. The increase in store orders shipped was primarily attributable to an increase in our paid customer base. As a percentage of total revenue, product revenue increased approximately one percentage point to 13% in the first quarter of 2009 from 12% in the first quarter of 2008.
PhotoStamps revenue decreased 43% to $1.7 million in the first quarter of 2009 from $3.0 million in the first quarter of 2008. The decrease in revenue was primarily attributable to a decrease in the number of sheets shipped. We shipped approximately 104,000 PhotoStamps sheets during the first quarter of 2009, a 41% decrease compared to the 178,000 shipped in the first quarter of 2008. Average revenue per sheet shipped for the first quarter of 2009 was $16.45, a 3% decrease compared to $16.91 for the first quarter of 2008. We believe the decrease in PhotoStamps sheets shipped was primarily attributable to the weaker general economy, lower high volume business orders and our reduction in PhotoStamps consumer sales and marketing spending. As a percentage of total revenue, PhotoStamps revenue decreased approximately five percentage points to 9% in the first quarter of 2009 from 14% in the first quarter of 2008.
Cost of service revenue increased 10% to $3.0 million in the first quarter of 2009 from $2.7 million in the first quarter of 2008. The increase in cost of service revenue is primarily attributable to higher customer support related expenses resulting from expanding our support personnel and increased costs related to our retention program aimed at retaining customers who call to cancel their service. Promotional expenses, which include free postage and a free digital scale offered to new customers, are included in cost of service revenue. Promotional expenses were approximately $361,000 and $464,000 during the first quarter of 2009 and the first quarter of 2008, respectively. The decrease in promotional expense is primarily attributable to a change in our estimate of future coupon redemptions made during 2008. Promotional expense, which represents a material portion of total cost of service revenue, is expensed in the period in which a customer qualifies for the promotion, while the revenue associated with the acquired customer is earned over the customer's lifetime. As a result, promotional expense for newly acquired customers may exceed the revenue earned from those customers in that period. As a percentage of total revenue, cost of service revenue increased approximately two percentage points to 15% in the first quarter of 2009 compared to 13% in the first quarter of 2008.
General and administrative expense principally consists of compensation and related costs for executive and administrative personnel, fees for legal and other professional services, depreciation of equipment and software used for general corporate purposes and amortization of intangible assets. General and administrative expense decreased 17% to $3.3 million in the first quarter of 2009 from $3.9 million in the first quarter of 2008. As a percentage of total revenue, general and administrative expense decreased approximately three percentage points to 16% in the first quarter of 2009 from 19% in the first quarter of 2008. The decrease, both on an absolute basis and as a percentage of total revenue, is primarily attributable to the following factors: (1) a decrease in legal expenses relating to existing litigation, (2) a $445,000 asset write-off of packaging material primarily relating to PhotoStamps that we incurred in the first quarter of 2008 and (3) decreased amortization expense related to the completion of our E-Stamp patent amortization schedule in the second quarter of 2008.
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