Dealertrack Technologies, Inc. Reports Fourth Quarter and Full Year 2012 Financial Results
2013-02-25 16:05 ET - News Release
Full year revenue increased 15% on an organic basis 
Company Website:
http://www.dealertrack.com
LAKE SUCCESS, N.Y. -- (Business Wire)
Dealertrack Technologies, Inc. (NASDAQ: TRAK) today reported financial
results for the fourth quarter and year ended December 31, 2012.
GAAP Results for the Fourth Quarter 2012 -
Revenue for the quarter was $101.8 million, as compared to $91.3
million for the fourth quarter of 2011.
-
GAAP net income for the quarter was $0.5 million, as compared to GAAP
net income of $32.9 million for the fourth quarter of 2011.
-
Diluted GAAP net income per share for the quarter was $0.01, as
compared to GAAP net income per share of $0.76 for the fourth quarter
of 2011.
GAAP net income for the fourth quarter 2011 was positively impacted by a
$26.8 million (net of tax), or $0.62 per share, non-cash gain related to
the sale of ALG and a $2.8 million, or $0.06 per share, non-cash tax
benefit related to a reversal in the valuation allowance against the
company’s net U.S. deferred tax assets including disposed deferred tax
liabilities.
Non-GAAP Results for the Fourth Quarter 2012 -
Adjusted EBITDA for the quarter was $25.8 million, as compared to
$20.3 million for the fourth quarter of 2011.
-
Adjusted net income for the quarter was $13.7 million, as compared to
$10.3 million for the fourth quarter of 2011.
-
Diluted adjusted net income per share for the quarter was $0.31, as
compared to $0.24 for the fourth quarter of 2011.
GAAP Results for the Year Ended December 31, 2012 -
Revenue for the year was $388.9 million, as compared to $353.3 million
for 2011.
-
GAAP net income for the year was $20.5 million, as compared to $65.1
million for 2011.
-
Diluted GAAP net income per share for the year was $0.46, as compared
to $1.53 for 2011.
GAAP net income for 2011 was positively impacted by a $26.8 million (net
of tax), or $0.63 per share, non-cash gain related to the sale of ALG
and a $25.1 million, or $0.59 per share, non-cash tax benefit related to
a reversal in the valuation allowance against the company’s net U.S.
deferred tax assets including disposed deferred tax liabilities.
Non-GAAP Results for the Year Ended December 31, 2012 -
Adjusted EBITDA for the year was $97.3 million, as compared to $85.9
million for 2011.
-
Adjusted net income for the year was $49.1 million, as compared to
$43.4 million for 2011.
-
Diluted adjusted net income per share for the year was $1.12, as
compared to $1.02 for 2011.
Mark F. O’Neil, chairman and chief executive officer of Dealertrack
Technologies, commented, “We had a strong finish to 2012 with full-year
revenue that was significantly above our original expectations and
exceeded $100 million for the first time on a quarterly basis. With a
broad suite of technology solutions for auto dealers, we believe we are
making progress helping dealers transform auto retailing through an
integrated suite of software. As we continue to realize this vision, we
believe the business momentum we generated in 2012 will carry us into
2013 and beyond.”
Guidance for 2013
Dealertrack’s guidance for 2013, which does not include the impact of
the pending acquisition of Casey & Casey NPS, Inc., is as follows:
Expected GAAP Results -
Revenue for the year is expected to be between $447.0 million and
$456.0 million, an increase of 15% to 17% from 2012.
-
GAAP net income for the year is expected to be between $10.0 million
and $13.0 million.
-
Diluted GAAP net income per share for the year is expected to be
between $0.22 and $0.29.
Expected Non-GAAP Results -
Adjusted EBITDA for the year is expected to be between $111.0 millionand $115.0 million.
-
Adjusted net income for the year is expected to be between $54.0
millionand $57.0 million.
-
Diluted adjusted net income per share for the year is expected to be
between $1.19 and $1.26.
Diluted GAAP net income and adjusted net income per share guidance for
the year is based on an estimated 45.4 million diluted weighted average
shares outstanding. The guidance assumes that new car sales by
franchised dealers will be approximately 15.2 million units and used car
sales by franchised dealers will be approximately 15.0 million units in
2013.
Conference Call
Dealertrack will host a conference call to discuss its fourth quarter
and full year 2012 results and other matters on February 25, 2013 at
5:00 p.m. Eastern Time. The conference call will be webcast live on the
Internet at ir.dealertrack.com.
In addition, a live audio of the call will be accessible to the public
by calling 877-303-6648 (domestic) or 970-315-0443 (international); no
access code is necessary. Callers should dial in approximately 10
minutes before the call begins. A replay will be available on the
Dealertrack website until March 11, 2013.
Non-GAAP Financial Measures
The non-GAAP measures of adjusted EBITDA and adjusted net income
disclosures are not presented in accordance with generally accepted
accounting principles (GAAP) and are not intended to be used in lieu of
GAAP presentations of net income. Adjusted EBITDA is a non-GAAP
financial measure that represents GAAP net income (loss) excluding
interest, taxes, depreciation and amortization expenses, stock-based
compensation, contra-revenue and certain items, as applicable, such as:
impairment charges, restructuring charges, impact of acquisition-related
activity (including contingent consideration changes, compensation
expense, basis difference amortization, and professional service fees),
realized gains on sales of previously impaired securities, gains or
losses on sales or disposals of subsidiaries and other
assets, rebranding expense and certain other non-recurring items.
All stock-based compensation expense is excluded from the calculation of
the adjusted EBITDA non-GAAP measure. This may reduce the comparability
with prior periods. This non-cash expense was included in presentations
prior to the fourth quarter of 2011.
Adjusted net income is a non-GAAP financial measure that represents GAAP
net income (loss) excluding stock-based compensation expense, the
amortization of acquired identifiable intangibles, contra-revenue, and
certain items, as applicable, such as: impairment charges, restructuring
charges, impact of acquisition-related activity (including contingent
consideration changes, compensation expense, basis difference
amortization, and professional service fees), realized gains on sales of
previously impaired securities, gains or losses on sales or disposals of
subsidiaries and other assets, adjustments to deferred tax asset
valuation allowances, non-cash interest expense, rebranding expense and
certain other non-recurring items. These adjustments to net income
(loss), which are shown before taxes, are adjusted for their tax impact
at their applicable statutory rates.
Adjusted EBITDA and adjusted net income are presented because management
believes that they provide additional information with respect to the
performance of our fundamental business activities and are also
frequently used by securities analysts, investors and other interested
parties in the evaluation of comparable companies. Adjusted EBITDA and
adjusted net income are also presented because the purchase accounting
treatment of acquisitions can have a negative impact on our GAAP results
because the depreciation and amortization expenses associated with
acquired assets, in particular intangibles which tend to have a
relatively short useful life, can be substantial in the first several
years following an acquisition. As a result, we monitor our adjusted
EBITDA and adjusted net income and other business statistics as a
measure of operating performance in addition to net income and the other
measures included in our consolidated financial statements. Management
believes the adjusted EBITDA and adjusted net income information is
useful to investors for these reasons. Adjusted EBITDA and adjusted net
income are non-GAAP financial measures and should not be viewed as an
alternative to GAAP measures of performance. Management believes the
most directly comparable GAAP financial measure for adjusted EBITDA and
adjusted net income is GAAP net income (loss) and has provided a
reconciliation of adjusted EBITDA to GAAP net income (loss) and adjusted
net income to GAAP net income (loss) in this press release.
About Dealertrack Technologies (www.dealertrack.com)
Dealertrack Technologies’ intuitive and high-value web-based software
solutions and services enhance efficiency and profitability for all
major segments of the automotive retail industry, including dealers,
lenders, OEMs, third-party retailers, agents, and aftermarket providers.
In addition to the industry’s largest online credit application network,
connecting more than 19,000 dealers with more than 1,200 lenders,
Dealertrack Technologies delivers the industry’s most comprehensive
solution set for automotive retailers, including Dealer
Management System (DMS),Inventory,
Sales
and F&I, Interactive,
and Registration
and Titling solutions. For more information visit www.dealertrack.com.
Safe Harbor for Forward-Looking and Cautionary Statements
Statements in this press release regarding Dealertrack’s expected 2013
performance based on both GAAP and non-GAAP measures, the long-term
outlook for its business and all other statements in this release other
than the recitation of historical facts are forward-looking statements
(as defined in the Private Securities Litigation Reform Act of 1995).
These statements involve a number of risks, uncertainties and other
factors that could cause actual results, performance or achievements of
Dealertrack to be materially different from any future results,
performance or achievements expressed or implied by these
forward-looking statements.
Factors that might cause such a difference include: economic trends that
affect the automotive retail industry or the indirect automotive
financing industry including the number of new and used cars sold;
credit availability; reductions in auto dealerships; increased
competitive pressure from other industry participants, including Open
Dealer Exchange, RouteOne, CUDL, Finance Express and AppOne; the impact
of some vendors of software products for automotive dealers making it
more difficult for Dealertrack’s customers to use Dealertrack’s
solutions and services; security breaches, interruptions, failures
and/or other errors involving Dealertrack’s systems or networks; the
failure or inability to execute any element of Dealertrack’s business
strategy, including selling additional products and services to existing
and new customers; Dealertrack’s success in implementing an ERP system;
the volatility of Dealertrack’s stock price; new regulations or changes
to existing regulations; the integration of recent acquisitions and the
expected benefits, as well as the integration and expected benefits of
any future acquisitions that Dealertrack may pursue; Dealertrack’s
success in expanding its customer base and product and service
offerings, the impact of recent economic trends, and difficulties and
increased costs associated with raising additional capital; the
impairment of intangible assets, such as trademarks and goodwill; and
other risks listed in Dealertrack’s reports filed with the Securities
and Exchange Commission (SEC), including its most recent Annual Report
on Form 10-K. These filings can be found on Dealertrack’s website at www.dealertrack.com
and the SEC’s website at www.sec.gov.
Forward-looking statements included herein speak only as of the date
hereof and Dealertrack disclaims any obligation to revise or update such
statements to reflect events or circumstances after the date hereof or
to reflect the occurrence of unanticipated events or circumstances,
except as required by law.
| DEALERTRACK TECHNOLOGIES, INC. | | Consolidated Statements of Operations | | (In thousands, except per share amounts) | | (Unaudited) | |
| |
| |
| |
| | | | Three Months Ended | | Twelve Months Ended | | | December 31, | | December 31, | | | 2012 | | 2011 | | 2012 | | 2011 | | | | | | | | |
| |
Net revenue
| |
$
|
101,775
|
| |
$
|
91,259
|
| |
$
|
388,872
|
| |
$
|
353,294
|
| |
Cost of revenue
| | |
58,358
| | | |
52,031
| | | |
220,695
| | | |
197,152
| | |
Product development
| | |
2,920
| | | |
3,263
| | | |
11,732
| | | |
13,012
| | |
Selling, general and administrative
| |
|
39,016
|
| |
|
33,575
|
| |
|
142,518
|
| |
|
128,892
|
| |
Total operating expenses
| |
|
100,294
|
| |
|
88,869
|
| |
|
374,945
|
| |
|
339,056
|
| |
Income from operations
| | |
1,481
| | | |
2,390
| | | |
13,927
| | | |
14,238
| | |
Interest expense, net
| | |
(3,072
|
)
| | |
(288
|
)
| | |
(10,056
|
)
| | |
(596
|
)
| |
Other income (expense), net
| | |
589
| | | |
1,184
| | | |
(5,532
|
)
| | |
1,360
| | |
Gain on disposal of subsidiaries and sale of other assets
| | |
-
| | | |
47,321
| | | |
33,193
| | | |
47,321
| | |
Earnings from equity method investment, net
| | |
430
| | | |
-
| | | |
1,167
| | | |
-
| | |
Realized gain on securities
| |
|
-
|
| |
|
-
|
| |
|
4
|
| |
|
409
|
| |
(Loss) income before benefit from (provision for) income taxes, net
| | |
(572
|
)
| | |
50,607
| | | |
32,703
| | | |
62,732
| | |
Benefit from (provision for) income taxes, net
| |
|
1,071
|
| |
|
(17,727
|
)
| |
|
(12,249
|
)
| |
|
2,403
|
| |
Net income
| |
$
|
499
|
| |
$
|
32,880
|
| |
$
|
20,454
|
| |
$
|
65,135
|
| | | | | | | | |
| |
Basic net income per share
| |
$
|
0.01
| | |
$
|
0.79
| | |
$
|
0.48
| | |
$
|
1.58
| | |
Diluted net income per share
| |
$
|
0.01
| | |
$
|
0.76
| | |
$
|
0.46
| | |
$
|
1.53
| | |
Weighted average common stock outstanding (basic)
| | |
42,765
| | | |
41,613
| | | |
42,508
| | | |
41,270
| | |
Weighted average common stock outstanding (diluted)
| | |
44,221
| | | |
43,038
| | | |
43,999
| | | |
42,527
| | | | | | | | | |
| |
Adjusted EBITDA (non-GAAP) (a)
| |
$
|
25,773
| | |
$
|
20,315
| | |
$
|
97,273
| | |
$
|
85,904
| | |
Adjusted EBITDA margin (non-GAAP) (b)
| | |
25
|
%
| | |
22
|
%
| | |
25
|
%
| | |
24
|
%
| |
Adjusted EBITDA - previous presentation (non-GAAP) (a) (c)
| |
$
|
22,383
| | |
$
|
17,415
| | |
$
|
83,681
| | |
$
|
74,409
| | |
Adjusted EBITDA margin - previous presentation (non-GAAP) (b)
| | |
22
|
%
| | |
19
|
%
| | |
22
|
%
| | |
21
|
%
| |
Adjusted net income (non-GAAP) (a)
| |
$
|
13,673
| | |
$
|
10,250
| | |
$
|
49,068
| | |
$
|
43,443
| | |
Diluted adjusted net income per share (non-GAAP)
| |
$
|
0.31
| | |
$
|
0.24
| | |
$
|
1.12
| | |
$
|
1.02
| | | | | | | | | |
| |
Stock-based compensation expense was classified as follows:
| | | | | | | | | |
Cost of revenue
| |
$
|
601
| | |
$
|
483
| | |
$
|
2,429
| | |
$
|
1,791
| | |
Product development
| | |
160
| | | |
187
| | | |
749
| | | |
735
| | |
Selling, general and administrative
| |
|
2,629
|
| |
|
2,230
|
| |
|
10,414
|
| |
|
9,086
|
| | |
$
|
3,390
|
| |
$
|
2,900
|
| |
$
|
13,592
|
| |
$
|
11,612
|
| | | | | | | | |
| |
(a) See Reconciliation Data.
| |
(b) Represents adjusted EBITDA as a percentage of net revenue.
| |
(c) Includes expense for stock based compensation. Stock based
compensation expense was included in adjusted EBITDA prior to Q4
2011.
| | | | |
|
| DEALERTRACK TECHNOLOGIES, INC. | | Condensed Consolidated Balance Sheets | | (Dollars in thousands) | | (Unaudited) | |
| |
| | | | | |
| | | December 31,
2012 | | December 31,
2011 | | | | |
| |
ASSETS
| | | | | |
Cash and cash equivalents
| |
$
|
143,811
| |
$
|
78,709
| |
Marketable securities
| | |
34,031
| | |
46
| |
Customer funds
| | |
1,999
| | |
1,097
| |
Customer funds receivable
| | |
14,077
| | |
18,695
| |
Accounts receivable, net
| | |
43,679
| | |
37,588
| |
Deferred tax assets, net
| | |
4,412
| | |
9,171
| |
Prepaid expenses and other current assets
| |
|
19,142
| |
|
23,011
| |
Total current assets
| | |
261,151
| | |
168,317
| | | | |
| |
Marketable securities - long-term
| | |
4,428
| | |
-
| |
Property and equipment, net
| | |
27,407
| | |
21,637
| |
Software and website development costs, net
| | |
46,182
| | |
37,341
| |
Investments
| | |
122,808
| | |
89,000
| |
Intangible assets, net
| | |
117,599
| | |
96,441
| |
Goodwill
| | |
270,646
| | |
200,840
| |
Deferred tax assets, net
| | |
43,611
| | |
34,421
| |
Other assets - long-term
| |
|
16,684
| |
|
12,356
| |
Total assets
| |
$
|
910,516
| |
$
|
660,353
| | | | |
| |
LIABILITIES AND STOCKHOLDERS' EQUITY
| | | | | |
Accounts payable and accrued expenses
| |
$
|
50,752
| |
$
|
41,194
| |
Customer funds payable
| | |
16,076
| | |
19,792
| |
Deferred revenue
| | |
7,959
| | |
9,115
| |
Deferred tax liabilities
| | |
3,031
| | |
3,443
| |
Due to acquirees
| | |
11,124
| | |
-
| |
Capital leases payable
| |
|
100
| |
|
255
| |
Total current liabilities
| | |
89,042
| | |
73,799
| |
Long-term liabilities
| |
|
250,157
| |
|
91,798
| |
Total liabilities
| |
|
339,199
| |
|
165,597
| |
Total stockholders' equity
| |
|
571,317
| |
|
494,756
| |
Total liabilities and stockholders' equity
| |
$
|
910,516
| |
$
|
660,353
| | | | |
|
| DEALERTRACK TECHNOLOGIES, INC. | | Consolidated Statements of Cash Flows | | (Dollars in thousands) | | (Unaudited) | |
| |
| | | | Twelve Months Ended | | | December 31, | | | 2012 | | 2011 | | Operating activities: | | | | | |
Net income
| |
$
|
20,454
| | |
$
|
65,135
| | |
Adjustments to reconcile net income to net cash provided by
operating activities:
| | | | | |
Depreciation and amortization
| | |
51,678
| | | |
50,688
| | |
Deferred tax provision (benefit)
| | |
751
| | | |
(3,370
|
)
| |
Stock-based compensation expense
| | |
13,592
| | | |
11,612
| | |
Provision for doubtful accounts and sales credits
| | |
7,306
| | | |
7,008
| | |
Earnings from equity method investment, net
| | |
(1,167
|
)
| | |
-
| | |
Amortization of deferred interest
| | |
927
| | | |
31
| | |
Deferred compensation
| | |
150
| | | |
200
| | |
Stock-based compensation windfall tax benefit
| | |
(6,716
|
)
| | |
-
| | |
Gain on disposal of subsidiaries and sale of other assets
| | |
(33,193
|
)
| | |
(47,321
|
)
| |
Amortization of debt issuance costs and debt discount
| | |
7,566
| | | |
333
| | |
Change in contingent consideration
| | |
(900
|
)
| | |
(2,000
|
)
| |
Change in fair value of warrant
| | |
6,310
| | | |
(1,000
|
)
| |
Realized gain on securities
| | |
(4
|
)
| | |
(409
|
)
| |
Changes in operating assets and liabilities, net of effects of
acquisitions:
| | | | | |
Accounts receivable
| | |
(13,321
|
)
| | |
(17,157
|
)
| |
Prepaid expenses and other current assets
| | |
10,985
| | | |
(3,983
|
)
| |
Other assets — long-term
| | |
6,202
| | | |
922
| | |
Accounts payable and accrued expenses
| | |
1,075
| | | |
(609
|
)
| |
Deferred rent
| | |
397
| | | |
30
| | |
Deferred revenue
| | |
(188
|
)
| | |
2,850
| | |
Other liabilities — long-term
| |
|
(1,181
|
)
| |
|
1,966
|
| |
Net cash provided by operating activities
| | |
70,723
| | | |
64,926
| | | | | |
| | Consolidated Statements of Cash Flows (continued) | | | | | | | Twelve Months Ended | | | December 31, | | | 2012 | | 2011 | | Investing activities: | | | | | |
Capital expenditures
| | |
(9,951
|
)
| | |
(9,555
|
)
| |
Capitalized software and website development costs
| | |
(22,762
|
)
| | |
(20,086
|
)
| |
Proceeds from sale of Chrome-branded asset
| | |
5,500
| | | |
-
| | |
Purchases of marketable securities
| | |
(70,175
|
)
| | |
-
| | |
Proceeds from sales and maturities of marketable securities
| | |
30,856
| | | |
2,935
| | |
Cash contributed for equity method investment
| | |
(1,750
|
)
| | |
-
| | |
Payment for cost method investment
| | |
-
| | | |
(7,500
|
)
| |
Payment for acquisition of business and intangible assets, net of
acquired cash
| |
|
(129,882
|
)
| |
|
(151,962
|
)
| |
Net cash used in investing activities
| | |
(198,164
|
)
| | |
(186,168
|
)
| | | | |
| | Financing activities: | | | | | |
Principal payments on capital lease obligations and financing
arrangements
| | |
(538
|
)
| | |
(472
|
)
| |
Proceeds from the exercise of employee stock options
| | |
7,829
| | | |
10,101
| | |
Proceeds from employee stock purchase plan
| | |
821
| | | |
669
| | |
Purchases of treasury stock
| | |
(831
|
)
| | |
(484
|
)
| |
Proceeds from issuance of senior convertible notes
| | |
200,000
| | | |
-
| | |
Payments for debt issuance costs
| | |
(7,723
|
)
| | |
(1,908
|
)
| |
Payments for convertible note hedges
| | |
(43,940
|
)
| | |
-
| | |
Proceeds from issuance of warrants
| | |
29,740
| | | |
-
| | |
Stock-based compensation windfall tax benefit
| |
|
6,716
|
| |
|
-
|
|
Net cash provided by financing activities
| | |
192,074
| | | |
7,906
| | | | | |
| |
Net increase (decrease) in cash and cash equivalents
| | |
64,633
| | | |
(113,336
|
)
| |
Effect of exchange rate changes on cash and cash equivalents
| | |
469
| | | |
(518
|
)
| |
Cash and cash equivalents, beginning of year
| |
|
78,709
|
| |
|
192,563
|
| |
Cash and cash equivalents, end of year
| |
$
|
143,811
|
| |
$
|
78,709
|
| | | | |
| | | | |
| | Supplemental disclosure: | | | | | |
Cash paid for:
| | | | | |
Income taxes
| |
$
|
3,275
| | |
$
|
6,100
| | |
Interest
| | |
2,072
| | | |
279
| | |
Non-cash investing and financing activities:
| | | | | |
Non-cash consideration issued for investment in Chrome Data Solutions
| | |
42,301
| | | |
-
| | |
Non-cash consideration issued for acquisition of ClickMotive
| | |
250
| | | |
-
| | |
Non-cash consideration issued for acquisition of eCarList
| | |
-
| | | |
12,956
| | |
Non-cash consideration issued for investment in TrueCar and license
| | |
-
| | | |
86,100
| | |
Accrued capitalized hardware, software and fixed assets
| | |
7,316
| | | |
2,456
| | |
Assets acquired under capital leases and financing arrangements
| | |
774
| | | |
39
| | | | | |
|
| DEALERTRACK TECHNOLOGIES, INC. | | Reconciliation of GAAP Net Income to Non-GAAP Adjusted EBITDA | | (Dollars in thousands) | | (Unaudited) | |
| |
| |
| |
| | | | Three Months Ended | | Twelve Months Ended | | | December 31, | | December 31, | | | 2012 | | 2011 | | 2012 | | 2011 | | | | | | | | |
| |
GAAP net income
| |
$
|
499
| | |
$
|
32,880
| | |
$
|
20,454
| | |
$
|
65,135
| | |
Interest income
| | |
(150
|
)
| | |
(61
|
)
| | |
(745
|
)
| | |
(331
|
)
| |
Interest expense - cash
| | |
931
| | | |
349
| | | |
3,357
| | | |
927
| | |
Interest expense - non-cash
| | |
2,291
| | | |
-
| | | |
7,444
| | | |
-
| | |
Provision for (benefit from) income taxes, net
| | |
(1,071
|
)
| | |
17,727
| | | |
12,249
| | | |
(2,403
|
)
| |
Depreciation of property and equipment and amortization of
capitalized software and website costs
| | |
6,170
| | | |
5,452
| | | |
23,345
| | | |
20,961
| | |
Amortization of acquired identifiable intangibles
| |
|
7,849
|
| |
|
7,616
|
| |
|
28,333
|
| |
|
29,727
|
| |
EBITDA (non-GAAP)
| | |
16,519
| | | |
63,963
| | | |
94,437
| | | |
114,016
| | |
Adjustments:
| | | | | | | | | |
Gain on disposal of subsidiaries and sale of other assets
| | |
-
| | | |
(47,321
|
)
| | |
(33,193
|
)
| | |
(47,321
|
)
| |
Acquisition-related and other professional fees
| | |
589
| | | |
2,115
| | | |
2,711
| | | |
4,721
| | |
Contra-revenue
| | |
1,025
| | | |
1,016
| | | |
4,215
| | | |
4,248
| | |
Integration and other related costs (including amounts related to
stock-based compensation)
| | |
826
| | | |
214
| | | |
1,530
| | | |
1,223
| | |
Change in fair value of warrant
| | |
-
| | | |
(1,000
|
)
| | |
6,310
| | | |
(1,000
|
)
| |
Rebranding expense
| | |
1,053
| | | |
-
| | | |
1,909
| | | |
-
| | |
Acquisition-related contingent consideration changes and
compensation expense, net
| | |
1,374
| | | |
(1,572
|
)
| | |
1,777
| | | |
(1,069
|
)
| |
Amortization of equity method investment basis difference
| | |
997
| | | |
-
| | | |
3,985
| | | |
-
| | |
Realized gain on sale of previously impaired securities
| |
|
-
|
| |
|
-
|
| |
|
-
|
| |
|
(409
|
)
| |
Adjusted EBITDA - previous presentation (non-GAAP)
| |
$
|
22,383
| | |
$
|
17,415
| | |
$
|
83,681
| | |
$
|
74,409
| | |
Stock-based compensation (excluding amounts included in integration
and other related costs)
| |
|
3,390
|
| |
|
2,900
|
| |
|
13,592
|
| |
|
11,495
|
| |
Adjusted EBITDA (non-GAAP)
| |
$
|
25,773
|
| |
$
|
20,315
|
| |
$
|
97,273
|
| |
$
|
85,904
|
| | | | | | | | |
|
| DEALERTRACK TECHNOLOGIES, INC. | | Reconciliation of GAAP Net Income to Non-GAAP Adjusted Net Income | | (Dollars in thousands) | | (Unaudited) | |
| |
| |
| |
| | | | Three Months Ended | | Twelve Months Ended | | | December 31, | | December 31, | | | 2012 | | 2011 | | 2012 | | 2011 | | | | | | | | |
| |
GAAP net income
| |
$
|
499
| | |
$
|
32,880
| | |
$
|
20,454
| | |
$
|
65,135
| | |
Adjustments:
| | | | | | | | | |
Deferred tax asset valuation allowance (non-taxable)
| | |
-
| | | |
438
| | | |
-
| | | |
(21,912
|
)
| |
Amortization of acquired identifiable intangibles
| | |
7,849
| | | |
7,616
| | | |
28,333
| | | |
29,727
| | |
Stock-based compensation (excluding integration and other related
costs)
| | |
3,390
| | | |
2,900
| | | |
13,592
| | | |
11,495
| | |
Gain on disposal of subsidiaries and sale of other assets
| | |
-
| | | |
(47,321
|
)
| | |
(33,193
|
)
| | |
(47,321
|
)
| |
Interest expense - non-cash (not tax-impacted)
| | |
2,291
| | | |
-
| | | |
7,444
| | | |
-
| | |
Acquisition-related and other professional fees
| | |
589
| | | |
2,115
| | | |
2,711
| | | |
4,721
| | |
Contra-revenue
| | |
1,025
| | | |
1,016
| | | |
4,215
| | | |
4,248
| | |
Integration and other related costs (including amounts related to
stock-based compensation)
| | |
826
| | | |
214
| | | |
1,583
| | | |
1,223
| | |
Change in fair value of warrant
| | |
-
| | | |
(1,000
|
)
| | |
6,310
| | | |
(1,000
|
)
| |
Amortization of equity method investment basis difference
| | |
997
| | | |
-
| | | |
3,985
| | | |
-
| | |
Rebranding expense
| | |
1,053
| | | |
-
| | | |
1,909
| | | |
-
| | |
Acquisition-related contingent consideration changes and
compensation expense, net
| | |
1,374
| | | |
(1,572
|
)
| | |
1,777
| | | |
(1,069
|
)
| |
Accelerated depreciation of certain technology assets
| | |
-
| | | |
-
| | | |
1,004
| | | |
-
| | |
Disposed deferred tax liabilities (non-taxable)
| | |
-
| | | |
(3,221
|
)
| | |
-
| | | |
(3,221
|
)
| |
Amended state tax returns impact (non-taxable)
| | |
-
| | | |
-
| | | |
-
| | | |
(239
|
)
| |
Realized gain on sale of previously impaired securities (non-taxable)
| | |
-
| | | |
-
| | | |
-
| | | |
(409
|
)
| |
Tax impact of adjustments (a) | |
|
(6,220
|
)
| |
|
16,185
|
| |
|
(11,056
|
)
| |
|
2,065
|
| |
Adjusted net income (non-GAAP)
| |
$
|
13,673
|
| |
$
|
10,250
|
| |
$
|
49,068
|
| |
$
|
43,443
|
| | | | | | | | |
|
(a) The tax impact of adjustments for the three and twelve months ended
December 31, 2012 are based on a U.S. statutory tax rate of 38.2%
applied to taxable adjustments other than amortization of acquired
identifiable intangibles and stock-based compensation expense, which are
based on a blended tax rate of 38.1% and 37.8%, respectively, for the
three months ended December 31, 2012, and 38.1% and 37.7%, respectively,
for the twelve months ended December 31, 2012. The tax impact of
adjustments for the three and twelve months ended December 31, 2011 were
based on a U.S. statutory tax rate of 37.4% applied to taxable
adjustments other than amortization of acquired identifiable intangibles
and stock-based compensation expense, which are based on a blended tax
rate of 35.6% and 35.2%, respectively, for the three months ended
December 31, 2011, and 37.2% and 37.0%, respectively, for the twelve
months ended December 31, 2011.
| DEALERTRACK TECHNOLOGIES, INC. | | Reconciliation of Forward-looking GAAP Net Income to
Forward-looking Non-GAAP Adjusted EBITDA | | (Dollars in millions) | | (Unaudited) | |
| |
| | | | Year Ending December 31, 2013 | | | Expected Range | | | | |
| |
GAAP net income
| |
$
|
10.0
| |
$
|
13.0
| |
Interest, net
| | |
13.0
| | |
13.0
| |
Income taxes, net
| | |
6.1
| | |
8.0
| |
Amortization of basis difference from joint venture
| | |
2.8
| | |
2.8
| |
Depreciation and amortization
| | |
25.1
| | |
24.2
| |
Amortization of acquired identifiable intangibles
| |
|
29.7
| |
|
29.7
| |
EBITDA (non-GAAP)
| | |
86.7
| | |
90.7
| |
Adjustments:
| | | | | |
Stock-based compensation (excluding amounts included in integration
and other related costs)
| | |
15.1
| | |
15.1
| |
Non-recurring costs (a) | | |
4.0
| | |
4.0
| |
Contra-revenue
| |
|
5.2
| |
|
5.2
| |
Adjusted EBITDA - (non-GAAP)
| |
$
|
111.0
| |
$
|
115.0
| |
| | | | |
| | |
(a) Includes certain professional fees, integration and other related
costs, acquisition-related compensation expense, rebranding and fair
value adjustments.
| DEALERTRACK TECHNOLOGIES, INC. | | Reconciliation of Forward-looking GAAP Net Income to
Forward-looking Non-GAAP Adjusted Net Income | | (Dollars in millions) | | (Unaudited) | |
| Year Ending December 31, 2013 | | | Expected Range | | | |
| | |
GAAP net income
| |
$
|
10.0
| | |
$
|
13.0
| | |
Adjustments:
| | | | | |
Stock-based compensation
| | |
15.1
| | | |
15.1
| | |
Amortization of acquired identifiable intangibles
| | |
29.7
| | | |
29.7
| | |
Amortization of basis difference from joint venture
| | |
2.8
| | | |
2.8
| | |
Non-cash interest expense (not tax-impacted)
| | |
9.2
| | | |
9.2
| | |
Non-recurring costs (a) | | |
4.0
| | | |
4.0
| | |
Contra-revenue
| | |
5.2
| | | |
5.2
| | |
Tax impact of adjustments (b) | |
|
(22.0
|
)
| |
|
(22.0
|
)
| |
Adjusted net income (non-GAAP)
| |
$
|
54.0
|
| |
$
|
57.0
|
| |
| | | | |
|
(a) Includes certain professional fees, integration and other related
costs, acquisition-related compensation expense, rebranding, accelerated
depreciation and fair value adjustments.
(b) The tax impact of adjustments are based on a blended tax rate of 38%
applied to taxable adjustments.
| DEALERTRACK TECHNOLOGIES, INC. | | Summary of Business Statistics (Unaudited) | | Three months ended | |
| |
| |
| |
| |
| | | | Dec 31, | | Sep 30, | | Jun 30, | | Mar 31, | | Dec 31, | | | 2012 | | 2012 | | 2012 | | 2012 | | 2011 | | | | | | | | | | |
| |
Active U.S. dealers (a) | |
19,067
| |
19,107
| |
18,638
| |
18,345
| |
17,543
| |
Active U.S. lenders (b) | |
1,261
| |
1,237
| |
1,212
| |
1,165
| |
1,120
| |
Transactions processed (in thousands) (c) | |
20,782
| |
22,738
| |
22,562
| |
21,751
| |
18,769
| |
Active U.S. lender to dealer relationships (d) | |
174,628
| |
178,809
| |
177,570
| |
172,075
| |
164,776
| |
Subscribing dealers (e) | |
17,619
| |
16,421
| |
16,280
| |
16,143
| |
16,003
| |
| | | | | | | | | | |
(a) We consider a dealer to be active in our U.S. network as of a
date if the dealer completed at least one revenue-generating credit
application
processing transaction using the U.S. Dealertrack network during
the most recently ended calendar month. The number of
active
U.S. dealers is based on the number of dealer accounts as
communicated by lenders on the U.S. Dealertrack network.
|
(b) We consider a lender to be active in our U.S. network as of a
date if it is accepting credit application data electronically
from U.S.
dealers in the U.S. Dealertrack network.
|
(c) Represents revenue-generating transactions processed in the
U.S. Dealertrack, Dealertrack Aftermarket Services, DealerTrack
Processing
Solutions and Dealertrack Canada networks at the end of a given
period.
|
(d) Each lender to dealer relationship represents a pair between
an active U.S. lender and an active U.S. dealer at the end of a
given
period. 2011 results are recalculated to reflect an
improved methodology of accumulating relationships. As previously
reported:
December 31, 2011 - 151,126.
| |
(e) Represents the number of dealerships in the U.S. and Canada with
one or more active subscriptions at the end of a given period.
| |
|
| DEALERTRACK TECHNOLOGIES, INC. | | Summary of Business Statistics (Unaudited) | | Three months ended | |
| Dec 31, |
| Sep 30, |
| Jun 30, |
| Mar 31, |
| Dec 31, | | | 2012 | | 2012 | | 2012 | | 2012 | | 2011 | | | | | | | | | | |
| |
Transaction revenue (in thousands)
| |
$
|
54,589
| |
$
|
58,789
| |
$
|
57,493
| |
$
|
54,140
| |
$
|
47,541
| |
Subscription revenue (in thousands)
| |
$
|
42,212
| |
$
|
35,723
| |
$
|
33,932
| |
$
|
33,281
| |
$
|
38,779
| |
Other revenue (in thousands)
| |
$
|
4,974
| |
$
|
4,572
| |
$
|
4,971
| |
$
|
4,196
| |
$
|
4,939
| |
Average transaction price (a) | |
$
|
2.67
| |
$
|
2.63
| |
$
|
2.59
| |
$
|
2.53
| |
$
|
2.58
| |
Transaction revenue per car sold (b) | |
$
|
7.18
| |
$
|
6.47
| |
$
|
6.12
| |
$
|
8.61
| |
$
|
7.17
| |
Average monthly subscription revenue per subscribing dealership (c)
(d) | |
$
|
749
| |
$
|
694
| |
$
|
697
| |
$
|
691
| |
$
|
813
| |
Average monthly subscription revenue per subscribing dealership
(excluding Chrome) (e) | |
$
|
749
| |
$
|
694
| |
$
|
697
| |
$
|
691
| |
$
|
690
| |
| | | | | | | | | | | | | | | | | | | | |
|
(a) Represents the average revenue earned per transaction
processed in the U.S. Dealertrack, Dealertrack Aftermarket,
Dealertrack
Processing Solutions and Dealertrack Canada
networks during a given period. Revenue used in calculation adds
back transaction related contra-revenue.
|
(b) Represents transaction revenue (includes contra-revenue)
divided by our estimate of total new and used car sales for the
period in the U.S. and Canada.
| |
(c) Revenue used in the calculation adds back subscription related
contra-revenue.
| | | | |
(d) Subscribing dealers and subscription revenue from Dealertrack
CentralDispatch have been excluded from the calculation as a
majority
of these customers are not dealers.
| |
(e) Excludes subscription revenue from Chrome.
| | | | | | | | | | | | | | | | | | | | |
|
TRAK-E
Contacts:
Dealertrack
Garo Toomajanian, 888-450-0478
Investor Relations
investorrelations@Dealertrack.com Source: Dealertrack Technologies, Inc.
|