TMP Worldwide Reports Annual Results

Commissions and Fees of $237,417,000 Internet Revenue of $18,601,000 Operating Profit of $27,232,000 Net Income of $9,500,000 EBITDA of $41,001,000

New York, N.Y., March 4, 1998 -- TMP Worldwide (NASDAQ: TMPW), the world's largest yellow page advertising agency, one of the world's largest recruitment advertising agencies and a leader in online recruiting, today announced commissions and fees for its fourth quarter and year ended December 31, 1997. Commissions and fees increased 46% to $237,417,000 for the year ended December 31, 1997 compared to $162,631,000 for the year ended December 31, 1996.

``We had a banner year posting record numbers across each of our divisions,'' said Andrew J. McKelvey, chairman and CEO of TMP Worldwide. ``Once again the revenue from our Internet offerings, including The Monster Board and Online Career Center, increased substantially.''

TMP's Internet revenue nearly tripled to $18,601,000 for the year ended December 31, 1997 from $6,659,000 for the year ended December 31, 1996. Recruitment advertising commissions and fees were $123,048,000 for the year ended December 31, 1997, a 100% increase over the same period in 1996. Yellow page advertising commissions and fees for the year ended December 31, 1997 were $95,768,000, an increase of 1% over the same period in 1996.

The company reported an operating profit for the year ended December 31, 1997 of $27,232,000, an increase of 53% when compared to a pro forma operating profit of $17,799,000 for the comparable period in 1996. The 1996 pro forma adjustment reflects the exclusion of a one-time special non-cash compensation charge incurred in connection with the company's initial public offering.

For the year ended December 31, 1997, net income applicable to common and Class B common stockholders was $9,500,000, or $0.38 per diluted share, on 24,735,000 average diluted shares, as compared to pro forma net income of $2,173,000, or $0.11 per diluted share in the prior year on 19,732,000 average diluted shares, a three-and-a-half fold increase in earnings per share.

Pro forma amounts for the fourth quarter and the year ended December 31, 1996 have been adjusted to exclude certain previously disclosed non-recurring, non-cash charges for special compensation and interest both relating to the company's initial public offering.

Earnings before interest, income taxes, depreciation and amortization (EBITDA) were $41,001,000 for the year ended December 31, 1997 as compared to a pro forma $26,201,000 in the comparable period in 1996, a 56% increase.

Fourth Quarter Performance

TMP reported commissions and fees of $70,074,000 for the quarter ended December 31, 1997, compared to $43,761,000 for the fourth quarter of the prior year, an increase of 60%.

Internet revenue for the fourth quarter ended December 31, 1997 was $5,679,000, an increase of 141% compared to the fourth quarter ended December 31, 1996 and a 20% increase compared to the third quarter ended September 30, 1997. The company reported an operating profit for the quarter ended December 31, 1997 of $5,930,000 compared to a pro forma operating profit of $7,089,000 for the same period in 1996.

Net income applicable to common and Class B common stockholders for the fourth quarter ended December 31, 1997 was $2,077,000, or $0.08 per average diluted share, as compared to a pro forma net income of $2,198,000, or $0.11 per average diluted share, for the comparable period in 1996. EBITDA in the fourth quarter ended December 31, 1997 were $10,106,000 by comparison to a pro forma $9,893,000 in the same period in 1996.

"This past year proved to be another exciting and successful one for TMP,'' McKelvey said. "The completion of our second public offering, our August acquisition of Austin Knight and the continued growth of our Internet products were just some of the highlights.''

TMP's 1997 Milestones

TMP's second public offering on September 22, 1997 of 4.0 million shares, of which, 1.6 million were sold by certain stockholders, at a price of $23 per share. The completion of 13 acquisitions with estimated annual gross billings of approximately $325 million, including the third quarter acquisition of Austin Knight Ltd., a large global recruitment advertising network with 24 offices worldwide, LBW, the company's first major acquisition in France in October and Earle Palmer Brown's Yellow Page Advertising Unit in December.

Continued growth of the company's career-based Internet business. Annual Internet revenues increased 179% from 1996. Web site traffic to TMP's leading career sites, The Monster Board and Online Career Center, grew from just over 1.2 million visits in January of 1997 to more than 3.2 million visits in January of 1998, a 173% increase. In addition, Media Metrix, THE PC METER Company's January rankings reported that The Monster Board was the number one online career Web site receiving 61% more unique visitors than its next leading competitor.

Major new account wins including American Airlines, MBNA, Morgan Stanley Dean Witter and the U.S. Air Force Reserve Command. The U.S. Air Force Reserve Command account win represents the first time a recruitment advertising agency was directly awarded a military recruitment account of any type.

Continued formation of strategic alliances with some of the Internet's dominant players including Yahoo!, AOL, Excite, Microsoft and NBC Interactive Neighborhood.

Special Note

The above paragraphs include forward-looking statements based on current management expectations. Factors that could cause future results to differ from these expectations include the following: risks associated with acquisitions, competition and seasonality. Additional factors are described in the company's reports filed with the Securities and Exchange Commission.

Founded in 1967, TMP Worldwide is the world's largest yellow pages advertising agency and one of the world's largest recruitment advertising agencies with more than 2,800 employees in 11 countries. TMP Worldwide's clients include more than 70 of the Fortune 100 and more than 285 of the Fortune 500 companies. The company's Internet offerings include The Monster Board (www.monster.com), the premier career center on the World Wide Web; Online Career Center (OCC) (www.occ.com), the Internet's earliest career site; MedSearch, (www.medsearch.com) the primary online "help wanted" service for the health care industry; and Be the Boss (www.betheboss.com), a leading provider of information on franchise opportunities.

A consolidated statement of operations for the fourth quarter and calendar year 1997 for TMP Worldwide Inc. and subsidiaries follows on the next page. For an investment information kit on TMP, please contact James J. Treacy at (212) 527-8604.

TMP WORLDWIDE INC CONDENSED CONSOLIDATED STATEMENT OF INCOME For the Twelve Months Ended (in thousands, except per share amounts) Dec 31, 1997 Dec 31, 1996 -------------- ------------- (Unaudited) Gross Billings: Yellow pages $ 457,519 $ 434,728 Recruitment 573,152 308,147 Internet 19,640 6,659-------------------- ----------- ----------- Total $ 1,050,311 $ 749,534==================== =========== =========== Commissions & fees: Yellow pages $ 95,768 $ 94,545 Recruitment 123,048 61,427 Internet 18,601 6,659--------------------- ----------- ----------- Total 237,417 162,631--------------------- ----------- ----------- Operating expenses:Salary & related costs 121,313 80,291Office & general 82,712 60,101Special compensation 0 52,019Total Amort of intangibles 6,160 4,440------------------------ --------- -----------Total operating expenses 210,185 196,851----------------------- --------- ----------- Operating income (loss) 27,232 (34,220)------------------------ -------- ----------- Other income (expense):Interest expense, net (8,772) (14,265) Other (90) (164)------------------------- -------- -----------Total other income(expense), net (8,862) (14,429)------------------------- ------- ----------- Income (loss) before taxes, minority interests& equity in earnings (losses) of affiliates 18,370 (48,649) Provision for income taxes 8,571 3,270------------------- ------- ------- Income (loss) before minority interests& equity in earnings(losses) of affiliates 9,799 (51,919) Minority interests 143 434Equity in earnings(losses) of affiliates (33) 114 ------------------------- ----------- -----------Net income (loss) 9,623 (52,239) Preferred dividend (123) (210)------------------------- ----------- ----------- Net income (loss) applicable to common and ClassB common stockholders $ 9,500 (52,449) =========== =========== Net income per basic share $ 0.39 =========== =========== Net income per diluted share $ 0.38 =========== =========== Pro forma adjustment for special charges 54,622 ----------- Pro forma net income applicable to common and Class B common stockholders $ 2,173 =========== =========== Proforma Net income per basic share $ 0.11 =========== =========== Proforma Net income per diluted share $ 0.11 =========== =========== Weighted average basicshares outstanding 24,243 19,299==================== =========== =========== Weighted average diluted shares outstanding 24,735 19,732========================= ========== =========== E B I T D A(a) $41,001 $26,201================ ================ ============= (a) Earnings before interest, income taxes, depreciation and amortization. EBITDA is presented to provide additional information about the Company's ability to meet its future debt service, capital expenditure and working capital requirements and is one of the measures which determines the Company's ability to borrow under its credit facility. EBITDA should not be considered in isolation or as a substitute for operating income, cash flows from operating activities and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of the Company's profitability or liquidity. TMP WORLDWIDE INC CONDENSED CONSOLIDATED STATEMENT OF INCOME For the Three Months Ended (in thousands, except per share amounts) (Unaudited) Dec 31, 1997 Dec 31, 1996 -------------- --------------- Gross Billings: Yellow pages $ 107,609 $ 83,139 Recruitment 178,621 91,321 Internet 6,092 2,246------------------------------- --------- --------- Total $ 292,322 $ 176,706=============================== ========= ========= Commissions & fees: Yellow pages $ 24,393 $ 23,366 Recruitment 40,002 18,035 Internet 5,679 2,360------------------------------- --------- --------- Total 70,074 43,761------------------------------- --------- --------- Operating expenses:Salary & related costs 37,733 19,381Office & general 24,629 16,024Special compensation 0 51,347Total Amort of intangibles 1,782 1,267------------------------------- --------- ---------Total operating expenses 64,144 88,019------------------------------- --------- --------- Operating income (loss) 5,930 (44,258)------------------------------- --------- --------- Other income (expense):Interest expense, net (2,338) (5,665) Other (40) (132)------------------------------- --------- ---------Total other income(expense), net (2,378) (5,797)-------------------------------- --------- --------- Income (loss) before taxes, minority interests & equity in earnings (losses) of affiliates 3,552 (50,055) Provision for income taxes 1,575 1,615-------------------------------- --------- --------- Income (loss) before minority interests & equity in earnings (losses) of affiliates 1,977 (51,670) Minority interests (113) 91Equity in earnings (losses)of affiliates (13) 61 -------------------------------- --------- --------Net income (loss) 2,077 (51,700) Preferred dividend 0 (52)--------------------------------- --------- --------- Net income (loss) applicable to common and Class B common stockholders $ 2,077 (51,752) ========= ========= Net income per basic share $ 0.08 ========= ========= Net income per diluted share $ 0.08 ========= ========= Pro forma adjustment for special charges 53,950 Pro forma net income applicable to common and Class B common stockholders $ 2,198 ========= ========= Proforma Net income per basic share $ 0.11 ========= ========= Proforma Net income per diluted share $ 0.11 ========= ========= Weighted average basic shares outstanding 26,061 19,853================================== ========= ========= Weighted average diluted shares outstanding 26,571 20,241=================================== ========= ========= E B I T D A(a) $10,106 $9,893================ ======== ========= (a) Earnings before interest, income taxes, depreciation and amortization. EBITDA is presented to provide additional information about the Company's ability to meet its future debt service, capital expenditure and working capital requirements and is one of the measures which determines the Company's ability to borrow under its credit facility. EBITDA should not be considered in isolation or as a substitute for operating income, cash flows from operating activities and other income or cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of the Company's profitability or liquidity.-0-

The Monster Board is a registered trademark of TMP Worldwide. Online Career Center, Be The Boss and MedSearch are service marks of TMP Worldwide.