SEATTLE, Aug 01, 2007 /PRNewswire-FirstCall via COMTEX News Network-- Getty Images, Inc. (NYSE: GYI), the world's leading creator and distributor of visual content, today reported results for the second quarter ended June 30, 2007.

"Soon after we founded Getty Images in 1995, we recognized that the breadth of creators and users of digital imagery would expand. This trend continues and we remain the leader in all areas and categories of the visual content industry from traditional stock photography to microstock. Furthermore, we are extending our leadership position in editorial imagery, footage and our imagery-related products and services, all of which have excellent growth potential," said Jonathan Klein, co-founder and chief executive officer. "We are making wonderful strides with some of our newer businesses, including commercial music licensing and the opportunity for growth in the consumer market while remaining focused on stabilizing our traditional creative stills business."

Revenue increased 6.5 percent to $218.0 million from $204.6 million in the second quarter of 2006. Excluding the effects of changes in currency exchange rates, revenue grew 2.4 percent. Growth in almost all areas of the business was partly offset by a decline in traditional creative stills imagery revenue.

As a percentage of revenue, cost of revenue was 26.7 percent, compared to 24.8 percent in the prior year due primarily to revenue growth in certain of the company's product lines with average royalties that are higher than traditional creative stills imagery, in particular in editorial and microstock imagery.

Selling, general and administrative expenses (SG&A) totaled $84.1 million or 38.6 percent of revenue for the second quarter of 2007, compared to $77.9 million or 38.1 percent of revenue in the second quarter of 2006. Excluding $1.3 million of non-recurring professional fees, the effects of changes in currency exchange rates, and SG&A associated with acquired companies, SG&A declined on a year over year basis.

Income from operations was $53.1 million or 24.4 percent of revenue in the second quarter of 2007 compared to $41.2 million in the second quarter of 2006. Results for the second quarter of 2006 included a restructuring charge of approximately $16.5 million. Excluding this charge, income from operations for the second quarter of 2006 was $57.7 million, or 28.2 percent of revenue.

Net income for the second quarter of 2007 was $33.7 million with earnings per diluted share of $0.56, or $0.57 excluding non-recurring professional fees, compared to $23.2 million and $0.37 in the second quarter of 2006. Results for the second quarter of 2006 included a total of $14.1 million after taxes for a restructuring charge and a loss on the sale of short-term investments. Excluding these items, net income for the second quarter of 2006 was $37.3 million or $0.59 per diluted share.

Cash balances were $288.6 million at June 30, 2007. Net cash provided by operating activities during the second quarter of 2007 was $48.8 million. During the quarter, the company spent a total of $248 million for acquired businesses, of which $120 million was financed through the company's senior credit facility and the remaining $128 million paid from existing cash balances.

Business Outlook
The following forward-looking statements reflect Getty Images' expectations as of August 1, 2007. The company currently does not intend to update these forward-looking statements until the next quarterly results announcement.

The company has announced a restructuring and related reduction in workforce of about 100 employees that will result in a charge of approximately $4.0 million in the third quarter of 2007 and is expected to result in annualized savings of approximately $20 million in staff and staff related costs. The company continues to focus on managing costs effectively while investing in the areas of the business that provide the best opportunities for growth.

For the third quarter of 2007, the company expects revenue of approximately $210 million and diluted earnings per share of $0.43. Excluding approximately $0.04 for restructuring costs, diluted earnings per share would be $0.47.

For full year 2007, the company expects revenue of approximately $855 million and earnings per share of approximately $2.18. Excluding approximately $0.04 for restructuring costs in the third quarter of 2007, diluted earnings per share would be $2.22.

Guidance for 2007 assumes just over 60 million fully diluted shares for both the third quarter and for the full year.

Web cast information
The company will host a conference call today at 2:00 pm PT. The dial-in number is 877.502.9273 (North America) or 913.981.5582 (international). There will be a live web cast of the conference call, which can be accessed from the Investors page in the About Us section of the Getty Images Web site at www.gettyimages.com. The company will also provide a replay of the conference call at 888.203.1112 (North America) or 719.457.0820 (international), confirmation number 6421437, until August 3, at 9:00 pm PT. The web cast will be archived on the Getty Images Web site and will be available until August 1, 2008. Supplemental statistical information referenced in the conference call will be available in the Investors section of the Web site.

About Getty Images
Getty Images is the world's leading creator and distributor of visual content and the first place creative professionals turn to discover, purchase and manage imagery. The company's award-winning photographers and imagery help customers create inspiring work which appears every day in the world's most influential newspapers, magazines, advertising campaigns, films, television programs, books and Web sites. Headquartered in Seattle, WA and serving customers in more than 100 countries, Getty Images believes in the power of imagery to drive positive change, educate, inform, and entertain. Visit Getty Images at http://gettyimages.com.

Some of the statements in this press release may constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's expectations, assumptions and projections about our business as of the time the statements are made. These forward-looking statements are not guarantees of future performance and are subject to certain risks and uncertainties that could cause our actual results to differ materially from our past performance and our current expectations, assumptions and projections. Differences may result from actions taken by us as well as from risks and uncertainties beyond our control. These risks and uncertainties include, among others, the risks associated with currency fluctuations, changes in the economic, political, competitive and technological environments, and the risks associated with system security, upgrades, updates and service interruptions. The foregoing list of risks and uncertainties is illustrative, but by no means exhaustive. For more information on factors that may affect future performance, please review the reports filed by us with the Securities and Exchange Commission, in particular our Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 and Amended Annual Report on Form 10-K/A for the year ended December 31, 2006. Except as required by law, we do not intend to update or revise any forward-looking statements until our next quarterly earnings release.