NEW YORK, Nov. 12 /PRNewswire/ -- Cross Media Marketing Corporation (Amex: XMM - news), a leading technology-driven marketing company redefining the art and science of direct marketing, today announced record financial results for the third quarter and nine month period ended September 30, 2001.

Revenue increased 71% to $25.9 million in the third quarter compared to $15.2 million for the corresponding quarter last year. Net income for the quarter was $2.3 million, resulting in earnings per diluted share of $0.26, compared to a net loss of $5.0 million or $0.92 loss per share for the same quarter last year. Revenue increased 10% or $2.3 million and net income increased 30% or $0.5 million over the previous quarter.

For the first nine months of fiscal 2001, revenue increased 64% to $69.2 million compared to $42.2 million in the prior year. Net income for the first nine months of fiscal 2001 increased to $3.9 million or $0.46 per diluted share as compared to a loss of $37.4 million or $8.21 loss per share for the same period one year ago. Net income and EBITDA for the first nine months of fiscal 2001 include a one time non-recurring, non-cash charge of approximately $1.0 million as a special dividend in connection with the retirement of our then outstanding preferred shares.

EBITDA increased 21% or $0.7 million over the second quarter to $4.0 million and totaled $9.4 million for the first nine months of fiscal 2001. 

     2001 Summary Financial Data*

     -- Q1:  Revenues, $19.7 million; EBITDA,  $2.1 million; Net Income,
        $0.8 million. *
     -- Q2:  Revenues, $23.6 million; EBITDA,  $3.3 million; Net Income,
        $1.8 million.
     -- Q3:  Revenues, $25.9 million; EBITDA,  $4.0 million; Net Income,
        $2.3 million.

     * excludes non-recurring preferred dividend

``Quarter after quarter, this remarkably vital company continues to demonstrate that it has the ability to consistently deliver substantial growth in revenues and earnings,'' said Ronald Altbach, Cross Media Marketing's Chairman and Chief Executive Officer. ``We have created a highly powerful, recession resistant, multi-product, multi-channel sales engine whose growth continues unabated, notwithstanding the tragic events of September 11. We believe that our results this quarter further reinforce the fiscal viability of our long-term strategic vision for Cross Media.''

Mr. Altbach continued, ``We have successfully consummated the acquisition of LifeMinders and are now leveraging our marketing prowess and technology infrastructure to provide our combined 25 million consumer database targeted products and services predicated on their preferences. We are creating one of the industry's richest data sources as we continue to improve on direct marketing with better technology, strategy and execution with a commitment to create customers for life.

Mr. Altbach concluded, ``We are extraordinarily confident we will achieve the previously stated revenue projections of $100 million for fiscal 2001 and $150 million for fiscal 2002 based solely upon organic growth from operations without giving effect to any acquisitions. Cross Media is well positioned for the future with a solid, simplified balance sheet, an excellent cash position and an ever-expanding consumer database that we are leveraging with our state-of-the-art technology to drive results and ultimately shareholder value.''

About Cross Media Marketing Corporation

Cross Media Marketing Corporation is a technology-driven marketing company integrating its sophisticated direct marketing skills with cutting-edge technologies, including interactive voice response and web-based systems, resulting in a multi-dimensional marketing platform for the international marketing of products and services. Cross Media Marketing seeks to achieve revenue growth and earnings leverage by cross marketing products and services through multiple channels to an expanding multi-million customer base utilizing state-of-the-art direct marketing strategies. Through voice-driven customer acquisition programs, Cross Media Marketing contacts and retains critical data on more than thirteen million persons annually. The Company continues to exploit its expansive database in other technology-driven marketing channels, facilitating additional e-commerce transactions to increase revenues while concurrently lowering costs and increasing margins.

Cross Media Marketing finalized the acquisition of LifeMinders, Inc., an online direct marketer on October 25, 2001. Cross Media Marketing's stockholders also adopted an amendment to Cross Media Marketing's Certificate of Incorporation that, among other things, provided for a 1-for-5-share reverse split of Cross Media Marketing Corporation's common stock. Per share data reflects this reverse split. Trading in Cross Media Marketing's common stock on a post-reverse splits basis began on October 25, 2001.

For more information about Cross Media Marketing, visit the website at http://www.xmmcorp.com or email investor-relations@xmmcorp.com.

Cautionary Statement Regarding Forward-Looking Statements

This announcement contains forward-looking statements that involve risks and uncertainties that could affect Cross Media's business, prospects and future operating results. Additionally, certain statements contained herein and in the information posted on the web site of Cross Media that are not based on historical fact are ``forward looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Cross Media intends that forward-looking statements contained herein and on its web site be subject to the safe harbor created thereby. Such forward-looking statements are based on current expectations of management but involve certain risks and uncertainties. Cross Media's actual results, performance or achievements could differ materially from the results, performance or achievements projected in, or implied by, such forward-looking statements as a result of risk factors, including, without limitation, the following: Cross media's ability to integrate the recently acquired LifeMinders, Inc. operations and to make additional strategically appropriate acquisitions; the adequacy of accounts receivable reserves, changes in economic conditions or a material decline in the availability of consumer credit, interest rate fluctuations, Cross Media's limited operating history, competitive factors, the need to manage growth, volatility in the market price of the common stock and the securities markets generally, risks relating to government regulation of telemarketing and Internet marketing activities, Cross Media's ability to exploit its database and technological innovations and potential dilution. These factors are described in detail in Cross Media's filings with the Securities and Exchange Commission, including, where applicable, its most recent filings on Forms 10-KSB, 10-QSB and 8-K, and registration statement on Form S-4. Cross Media's filings with the SEC are available to the public from commercial document-retrieval services and at the web site maintained by the Sec free of charge at http://www.sec.gov. Cross Media does not assume any responsibility to update the information included in this press release or on its web site, whether as a result of new information, future events or otherwise. 

                Cross Media Marketing Corporation and Subsidiaries
                 Condensed Consolidated Statements of Operations
              Three Months and Nine Months Ended September 30,2001
            vs. Three Months and Nine Months Ended September 30, 2000
                                   (unaudited)

    I. Operating Results:
                             Three Months Ended           Nine Months Ended
                           09/30/2001   09/30/2001    09/30/2000    09/30/2000
                            Actual        Actual        Actual        Actual

    Revenues, net          $25,910       $15,152      $69,189       $42,170

    Direct costs and expenses
      Commission expense    10,590         8,731       31,453        22,743
      Other direct costs     7,202         2,622       18,635         7,401
                            17,792        11,353       50,088        30,144

    Gross profit             8,118         3,799       19,101        12,026

    General and
     Administrative          4,559         3,058       11,054         8,590

    Income from operations   3,559           741        8,047         3,436

      Interest expense       (514)         (842)      (1,465)       (3,711)

    Income (loss) before
     income taxes            3,045         (101)        6,582         (275)

    Provision for
     income taxes              607            93        1,316           385

    Net income (loss)        2,438         (194)        5,266         (660)

    Preferred dividends        129         4,866        1,387        36,732

    Net Income (loss)
     applicable to common
     stockholders           $2,309      $(5,060)       $3,879     $(37,392)

    Net Income (loss) Per Share
      - Basic                $0.32       $(0.92)        $0.56       $(8.21)
      - Diluted              $0.26       $(0.92)        $0.46       $(8.21)

    Weighted Average
     Shares Outstanding
      - Basic                7,225         5,488        6,969         4,557
      - Diluted              9,005         5,488        8,444         4,557

      ******  Per Share and Average Share Outstanding Amounts Reflect
              October 25, 2001, 1-5 Reverse Split.

SOURCE: Cross Media Marketing Corporation