VRX Worldwide - financials - 2002 - fourth quarter results

2002 Annual Report

President's Message

A year ago, I wrote of 2001 being a year of challenge, of the importance of capitalizing on the opportunities presented by the highly competitive, yet rapidly expanding online travel industry. In 2002, we seized upon these opportunities, resulting in an exciting year of growth for VRX. In a year when the American economy slowed and many companies reported declining financial results, VRX stood apart, reporting growth in both our revenues and profit. By the end of 2002, we dramatically improved our balance sheet and reported our first profitable year of operations.

The strong growth in the travel products industry has been a primary driver of VRX's growth in 2002. We believe the outlook for our products and services remains strong as beleaguered travel and leisure companies battle for market share by incorporating innovative and cost effective marketing approaches. Travel consumers are increasingly relying on online sources to plan and research vacations and, in this respect, the Internet is becoming a more important influence in the travel decision making process.

Strong Industry Outlook

According to the Travel Industry Association of America, 96 million travelers are currently using the Internet to research and plan vacations - increasing from 64 million in 2002 and 12 million in 1997. This growth in the number of travel consumers using the Internet as a travel-planning tool is still in its early stages as the travel industry is only just beginning to utilize the power of the Internet and the World Wide Web in its marketing efforts. VRX's business model is based on the demand of millions of travel consumers for high quality, reliable, and informative visual content that helps them to make educated, confident, travel decisions. In successfully meeting these growing demands, VRX has become a leader in the online travel content industry - a considerable and rapidly expanding market niche.

The online travel audience has proven to have significant disposable income - a fact that is not lost on the travel industry. Forrester Research, a leading e-commerce research company recently estimated online travel spending for 2002 in the United States at US$22.7 billion and predicted online leisure travel purchases will rise dramatically through 2007 when it is forecast to reach US$50 billion. The fastest growing segment of this rapidly growing industry is lodging. Jupiter Research predicted in January of 2003 that online hotel bookings would almost triple from US$5 billion in 2001 to $14.8 billion in 2007. It is not surprising that industry leaders such as Expedia, Sandals, and Virgin have engaged VRX's Interactive Services Division to provide high quality visual content as a means to help improve their competitive position in the rapidly evolving online hotel industry.

VRX Enjoys Industry Recognition and Growth in Key Operating Divisions

Our Interactive Services Division has had an incredible year providing content solutions to some of the most well known resort and hotel properties in Mexico, Hawaii, Florida, New York, and Nevada, as well as to the leading cruise lines of the world. The combination of our user-friendly, visually appealing interactive maps and our high-quality, reliable 360º virtual tours creates one of today's most effective and compelling online sales tools. Industry experts have recognized the power and effectiveness of our content solutions. In the October 15th, 2002 issue of PC Magazine, Expedia was awarded the coveted "Editors' Choice" award for top online hotel booking site. PC Magazine specifically identified Expedia's new "know-before-you-go" features, including virtual property tours and area-specific maps - features provided by VRX - as one of the key factors in their decision.

Our Content Licensing Division has had an excellent year as well, providing interactive maps and 360º virtual tours of the top vacation destinations throughout the Caribbean, Mexico, and the US to an increasing number of the top online travel companies in the world. Content licensing provides VRX with a high margin, re-occurring revenue stream while offering client companies a cost effective yet powerful online sales tool that would otherwise be unavailable to all but the largest travel companies. The stature of our licensing clients is all the endorsement that the offering requires. Over the past 12 months, well-known companies and organizations such as South West Airlines Vacations, Air Jamaica, and Tourism New York have joined ranks with our many repeat customers including Tourism Bermuda, Cendant, and Dollar Rent a Car.

Goals Accomplished; New Targets Set High

2002 was a year of success. Our financial statements confirm that VRX surpassed the goals that it set at the beginning of the year, exceeding one million dollars in revenue and paying down all of its debt. Having said this, we have much greater ambitions for 2003 and beyond.We followed the course we mapped out a year ago and have secured a lucrative niche in a rapidly expanding industry, but complacency is not in our nature. We recognize that many opportunities lay before us with the potential to grow VRX beyond our expectations.

Our success to date has been built upon our original licensing model and the quality of our products. The initial phase of our business plan focused on providing high quality visual content of the most popular vacation destinations for the large American market. Building upon this success, in the coming months we will begin to address the growing global demand for high quality, reliable, online destination content of popular destinations around the world. Our first step in addressing this demand is initiating coverage of the top destinations, tourist attractions, and natural wonders throughout Europe.

In addition to our syndicated destination content, we are receiving significant demand from the global hospitality industry for the custom content solutions offered by our Interactive Services Division. As we continue to expand our hotel coverage with Expedia our reputation and the demand for our custom services continues to grow. As a direct result, we are discussing opportunities with leading European travel companies that are eager to launch similar initiatives with us in their respective markets.

Our expansion into new markets and industries will be built upon the four cornerstones that have been the foundation of our success: Quality, Usability, Innovation, and Diversity. Our mandate is to provide our clients with high quality, userfriendly, web ready interactive visual content that will help their customers make informed purchasing decisions. Our expansion into new markets will be calculated and tactical, as we aim to capture market share and grow VRX's success.

We believe we offer the most effective, versatile, and userfriendly online visual content solutions available today. To maintain our leadership position we are continually evaluating competing and complementary technologies. We believe we know what works, why it works, and most importantly, what consumers want.We will continue to measure customer satisfaction and track demand in order to ensure we maintain our competitive advantage.

On behalf of the management and staff of VRX, I would like to thank our many shareholders for their ongoing support. We achieved our objective of profitability in 2002 and now, with unabated enthusiasm, we are relentlessly pursuing our goal of 100% growth in 2003.

Yours truly,

David MacLaren
President & CEO
VRX Worldwide Inc.

	Financials (2002)
	2002 Annual Report Fourth Quarter Press Release Third Quarter Press Release Schedule B & C September 30, 2002 Third Quarter Financials Statements Second Quarter Press Release Schedule B & C June 30, 2002 Second Quarter Financials Statements First Quarter Press Release Schedule B & C March 31, 2002 First Quarter Financials Statements

	2002 Annual Report and President's Message
	2002 Annual Report Click here to download President's Message A year ago, I wrote of 2001 being a year of challenge, of the importance of capitalizing on the opportunities presented by the highly competitive, yet rapidly expanding online travel industry. In 2002, we seized upon these opportunities, resulting in an exciting year of growth for VRX. In a year when the American economy slowed and many companies reported declining financial results, VRX stood apart, reporting growth in both our revenues and profit. By the end of 2002, we dramatically improved our balance sheet and reported our first profitable year of operations. The strong growth in the travel products industry has been a primary driver of VRX's growth in 2002. We believe the outlook for our products and services remains strong as beleaguered travel and leisure companies battle for market share by incorporating innovative and cost effective marketing approaches. Travel consumers are increasingly relying on online sources to plan and research vacations and, in this respect, the Internet is becoming a more important influence in the travel decision making process. Strong Industry Outlook According to the Travel Industry Association of America, 96 million travelers are currently using the Internet to research and plan vacations - increasing from 64 million in 2002 and 12 million in 1997. This growth in the number of travel consumers using the Internet as a travel-planning tool is still in its early stages as the travel industry is only just beginning to utilize the power of the Internet and the World Wide Web in its marketing efforts. VRX's business model is based on the demand of millions of travel consumers for high quality, reliable, and informative visual content that helps them to make educated, confident, travel decisions. In successfully meeting these growing demands, VRX has become a leader in the online travel content industry - a considerable and rapidly expanding market niche. The online travel audience has proven to have significant disposable income - a fact that is not lost on the travel industry. Forrester Research, a leading e-commerce research company recently estimated online travel spending for 2002 in the United States at US$22.7 billion and predicted online leisure travel purchases will rise dramatically through 2007 when it is forecast to reach US$50 billion. The fastest growing segment of this rapidly growing industry is lodging. Jupiter Research predicted in January of 2003 that online hotel bookings would almost triple from US$5 billion in 2001 to $14.8 billion in 2007. It is not surprising that industry leaders such as Expedia, Sandals, and Virgin have engaged VRX's Interactive Services Division to provide high quality visual content as a means to help improve their competitive position in the rapidly evolving online hotel industry. VRX Enjoys Industry Recognition and Growth in Key Operating Divisions Our Interactive Services Division has had an incredible year providing content solutions to some of the most well known resort and hotel properties in Mexico, Hawaii, Florida, New York, and Nevada, as well as to the leading cruise lines of the world. The combination of our user-friendly, visually appealing interactive maps and our high-quality, reliable 360º virtual tours creates one of today's most effective and compelling online sales tools. Industry experts have recognized the power and effectiveness of our content solutions. In the October 15th, 2002 issue of PC Magazine, Expedia was awarded the coveted "Editors' Choice" award for top online hotel booking site. PC Magazine specifically identified Expedia's new "know-before-you-go" features, including virtual property tours and area-specific maps - features provided by VRX - as one of the key factors in their decision. Our Content Licensing Division has had an excellent year as well, providing interactive maps and 360º virtual tours of the top vacation destinations throughout the Caribbean, Mexico, and the US to an increasing number of the top online travel companies in the world. Content licensing provides VRX with a high margin, re-occurring revenue stream while offering client companies a cost effective yet powerful online sales tool that would otherwise be unavailable to all but the largest travel companies. The stature of our licensing clients is all the endorsement that the offering requires. Over the past 12 months, well-known companies and organizations such as South West Airlines Vacations, Air Jamaica, and Tourism New York have joined ranks with our many repeat customers including Tourism Bermuda, Cendant, and Dollar Rent a Car. Goals Accomplished; New Targets Set High 2002 was a year of success. Our financial statements confirm that VRX surpassed the goals that it set at the beginning of the year, exceeding one million dollars in revenue and paying down all of its debt. Having said this, we have much greater ambitions for 2003 and beyond.We followed the course we mapped out a year ago and have secured a lucrative niche in a rapidly expanding industry, but complacency is not in our nature. We recognize that many opportunities lay before us with the potential to grow VRX beyond our expectations. Our success to date has been built upon our original licensing model and the quality of our products. The initial phase of our business plan focused on providing high quality visual content of the most popular vacation destinations for the large American market. Building upon this success, in the coming months we will begin to address the growing global demand for high quality, reliable, online destination content of popular destinations around the world. Our first step in addressing this demand is initiating coverage of the top destinations, tourist attractions, and natural wonders throughout Europe. In addition to our syndicated destination content, we are receiving significant demand from the global hospitality industry for the custom content solutions offered by our Interactive Services Division. As we continue to expand our hotel coverage with Expedia our reputation and the demand for our custom services continues to grow. As a direct result, we are discussing opportunities with leading European travel companies that are eager to launch similar initiatives with us in their respective markets. Our expansion into new markets and industries will be built upon the four cornerstones that have been the foundation of our success: Quality, Usability, Innovation, and Diversity. Our mandate is to provide our clients with high quality, userfriendly, web ready interactive visual content that will help their customers make informed purchasing decisions. Our expansion into new markets will be calculated and tactical, as we aim to capture market share and grow VRX's success. We believe we offer the most effective, versatile, and userfriendly online visual content solutions available today. To maintain our leadership position we are continually evaluating competing and complementary technologies. We believe we know what works, why it works, and most importantly, what consumers want.We will continue to measure customer satisfaction and track demand in order to ensure we maintain our competitive advantage. On behalf of the management and staff of VRX, I would like to thank our many shareholders for their ongoing support. We achieved our objective of profitability in 2002 and now, with unabated enthusiasm, we are relentlessly pursuing our goal of 100% growth in 2003. Yours truly, David MacLaren President & CEO VRX Worldwide Inc.