LAKE SUCCESS, N.Y.,
Nov. 3, 2010 /PRNewswire-FirstCall/
-- DealerTrack Holdings, Inc. (Nasdaq: TRAK) today reported
financial results for the third quarter ended September 30, 2010.
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GAAP Results for the Third Quarter 2010
- Revenue for the quarter was $63.1
million, as compared to $58.8
million for the third quarter of 2009.
- GAAP net income for the quarter was $1.2
million, as compared to GAAP net loss of $(0.2) million for the third quarter of
2009.
- Diluted GAAP net income per share for the quarter was
$0.03, as compared to GAAP net loss
per share of $(0.01) for the third
quarter of 2009.
Non-GAAP Results for the Third Quarter 2010
- Adjusted EBITDA for the quarter was $12.9 million, as compared to $10.8 million for the third quarter of 2009.
- Adjusted net income for the quarter was $6.6 million, as compared to $6.0 million for the third quarter of 2009.
- Diluted adjusted net income per share was $0.16 for the quarter, as compared to
$0.15 for the third quarter of 2009.
GAAP Results for the Nine Months Ended September 30, 2010
- Revenue for the nine months was $181.8
million, as compared to $172.4
million for the same period in 2009.
- GAAP net loss for the nine months was $(1.4) million, as compared to GAAP net loss of
$(3.7) million for the same period in
2009.
- GAAP net loss per share for the nine months was $(0.03), as compared to GAAP net loss of
$(0.09) per share for the same period
in 2009.
Non-GAAP Results for the Nine Months Ended September 30, 2010
- Adjusted EBITDA for the nine months was $27.6 million, as compared to $26.3 million for the same period in 2009.
- Adjusted net income for the nine months was $13.7 million, as compared to $16.6 million for the same period in 2009.
- Diluted adjusted net income per share for the nine months was
$0.33, as compared to $0.41 per share for the same period in 2009.
Guidance for 2010 Annual Performance
DealerTrack reaffirms its revenue and non-GAAP earnings guidance
and updates GAAP earnings guidance for the full year 2010 as
follows:
Expected GAAP Results
- Revenue for the year is expected to be between $240.0 million and $246.0 million, net of
approximately $1.6 million of
contra-revenue.
- GAAP net income for the year is expected to be between
$1.5 million and $3.8 million,
compared to the previous estimate of $2.0
million to $4.0 million.
- Diluted GAAP net income per share for the year is expected to
be between $0.04 and $0.09, compared
to the previous estimate of $0.05 to
$0.09.
Expected Non-GAAP Results
- Adjusted EBITDA for the year is expected to be between
$41.0 million and $45.0 million.
- Adjusted net income for the year is expected to be between
$21.5 million and $24.0 million.
- Diluted adjusted net income per share for the year is expected
to be between $0.51 and $0.57.
GAAP net income and adjusted net income per share guidance for
the year are based on an assumed 41.5 million diluted weighted
average shares outstanding.
The updated GAAP earnings guidance reflects the impact of
certain items that are excluded for non-GAAP financial measures.
Mark O'Neil, chairman and chief executive officer of
DealerTrack, commented, "We are very pleased with our results for
the third quarter as revenue for both our transaction and
subscription businesses rose." O'Neil continued, "We are
continuing to see the benefits of our investments as we generated
an adjusted EBITDA margin in excess of 20 percent for the
quarter."
Conference Call
DealerTrack will host a conference call to discuss its third
quarter 2010 results, 2010 guidance, and other matters on
November 3, 2010 at 5:00 p.m. Eastern Time. The conference call
will be webcast live on the Internet at
http://ir.dealertrack.com/eventdetail.cfm?eventid=87443. 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 November 17,
2010.
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,
contra-revenue and may exclude certain items such as:
impairment charges, restructuring charges,
acquisition-related earn-out compensation expense and professional
service fees, realized gains or (losses) on securities and certain
other non-recurring items. 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 may also exclude
certain items, such as: impairment charges, restructuring charges,
acquisition-related earn-out compensation expense and professional
service fees, realized gains or (losses) on securities and certain
other non-recurring items. These adjustments, which are shown
before taxes, are adjusted for their tax impact.
Adjusted EBITDA and adjusted net income are presented because
management believes they provide additional information with
respect to the performance of our fundamental business activities
as 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, as well as
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 and has provided a reconciliation of adjusted
EBITDA to GAAP net income and adjusted net income to GAAP net
income, in Attachment 4 to this press release.
About DealerTrack (www.dealertrack.com)
DealerTrack's intuitive and high-value software solutions
enhance efficiency and profitability for all major segments of the
automotive retail industry, including dealers, lenders, OEMs,
agents and aftermarket providers. Our solution set for dealers is
the industry's most comprehensive. DealerTrack operates the
industry's largest online credit application network, connecting
approximately 17,000 dealers with over 900 lenders. Our Dealer
Management System (DMS) provides dealers with easy-to-use tools and
real-time data access that will streamline any automotive business.
Dealers using DealerTrack AAX get the inventory management tools
and services needed to accelerate turns and increase profit. Our
Sales and F&I solution enables dealers to streamline the entire
sales process while structuring all types of deals from a single
integrated platform. DealerTrack's Compliance solution helps
dealers meet legal and regulatory requirements and protect their
hard-earned assets. DealerTrack's family of companies also includes
data and consulting services providers ALG and Chrome Systems.
For more information, visit www.dealertrack.com.
Safe Harbor for Forward-Looking and Cautionary
Statements
Statements in this press release regarding DealerTrack's
expected 2010 performance, 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; 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; 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 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.
Attachment (1) Actual
Results: Three-Month Period
DEALERTRACK
HOLDINGS, INC.
Consolidated
Statements of Operations
(Dollars in
thousands, except per share data)
(Unaudited)
|
|
|
Three Months
Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
Net revenue
|
$
63,128
|
$
58,809
|
|
Cost of revenue
|
31,684
|
28,665
|
|
Product
development
|
3,354
|
3,391
|
|
Selling, general and
administrative
|
25,679
|
25,471
|
|
Total
operating expenses
|
60,717
|
57,527
|
|
Income from
operations
|
2,411
|
1,282
|
|
Interest and other income,
net
|
286
|
168
|
|
Income before provision
for income taxes
|
2,697
|
1,450
|
|
Provision for income
taxes
|
(1,515)
|
(1,665)
|
|
Net income
(loss)
|
$ 1,182
|
$ (215)
|
|
|
|
|
|
Basic net income (loss)
per share
|
$0.03
|
($0.01)
|
|
Diluted net income (loss)
per share
|
$0.03
|
($0.01)
|
|
Weighted average shares
outstanding (basic)
|
40,404,126
|
39,705,553
|
|
Weighted average shares
outstanding (diluted)
|
41,354,680
|
39,705,553
|
|
|
|
|
|
Adjusted EBITDA (non-GAAP)
(a)
|
$ 12,855
|
$ 10,760
|
|
Adjusted EBITDA
margin (non-GAAP) (b)
|
20%
|
18%
|
|
Adjusted net income
(non-GAAP) (a)
|
$ 6,631
|
$ 6,046
|
|
Diluted adjusted net
income per share (non-GAAP) (c)
|
$ 0.16
|
$ 0.15
|
|
|
|
|
|
Stock-based compensation
expense was classified as follows:
|
|
|
|
Cost of revenue
|
$ 438
|
$ 582
|
|
Product
development
|
$ 164
|
$ 194
|
|
Selling, general and
administrative
|
$ 2,248
|
$ 2,400
|
|
|
|
(a) See
Reconciliation Data in Attachment 4.
(b) Represents
adjusted EBITDA as a percentage of net revenue.
(c)
For the three months ended
September 30, 2009, the adjusted net income per share of
approximately $0.15 is based on 41,463,310 diluted weighted average
shares outstanding.
|
|
|
|
|
Attachment (1) Actual
Results: Nine-Month Period
DEALERTRACK
HOLDINGS, INC.
Consolidated
Statements of Operations
(Dollars in
thousands, except per share data)
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
Net revenue
|
$
181,820
|
$
172,379
|
|
Cost of revenue
|
93,666
|
86,638
|
|
Product
development
|
10,291
|
11,037
|
|
Selling, general and
administrative
|
80,347
|
83,069
|
|
Total
operating expenses
|
184,304
|
180,744
|
|
Loss from
operations
|
(2,484)
|
(8,365)
|
|
Interest and other income,
net
|
1,316
|
837
|
|
Realized gain on
securities
|
582
|
1,393
|
|
Loss before (provision
for) benefit from income taxes
|
(586)
|
(6,135)
|
|
(Provision for) benefit
from income taxes
|
(800)
|
2,482
|
|
Net loss
|
$ (1,386)
|
$ (3,653)
|
|
|
|
|
|
Basic net loss per
share
|
($0.03)
|
($0.09)
|
|
Diluted net loss per
share
|
($0.03)
|
($0.09)
|
|
Weighted average shares
outstanding (basic)
|
40,246,374
|
39,435,766
|
|
Weighted average shares
outstanding (diluted)
|
40,246,374
|
39,435,766
|
|
|
|
|
|
Adjusted EBITDA (non-GAAP)
(a)
|
$ 27,597
|
$ 26,261
|
|
Adjusted EBITDA
margin (non-GAAP) (b)
|
15%
|
15%
|
|
Adjusted net income
(non-GAAP) (a)
|
$ 13,703
|
$ 16,607
|
|
Diluted adjusted net
income per share (non-GAAP) (c) (d)
|
$ 0.33
|
$ 0.41
|
|
|
|
|
|
Stock-based compensation
expense was classified as follows:
|
|
|
|
Cost of revenue
|
$ 1,279
|
$ 1,829
|
|
Product
development
|
$ 471
|
$ 602
|
|
Selling, general and
administrative
|
$ 6,929
|
$ 11,557
|
|
|
|
(a) See
Reconciliation Data in Attachment 4.
(b) Represents
adjusted EBITDA as a percentage of net revenue.
(c) For the nine
months ended September 30, 2010, the adjusted net income per share
of approximately $0.33 is based on 41,201,433 diluted weighted
average shares outstanding.
(d) For the nine
months ended September 30, 2009, the adjusted net income per share
of approximately $0.41 is based on 40,974,553 diluted weighted
average shares outstanding.
|
|
|
|
|
Attachment (2) Condensed
Consolidated Balance Sheets
DEALERTRACK
HOLDINGS, INC.
Condensed
Consolidated Balance Sheets
(Dollars in
thousands)
(Unaudited)
|
|
|
September 30,
2010
|
|
December 31,
2009
|
|
ASSETS
|
|
|
|
|
Cash and cash
equivalents
|
$ 177,824
|
|
$ 197,509
|
|
Short-term
investments
|
1,563
|
|
1,484
|
|
Accounts receivable,
net
|
24,538
|
|
17,478
|
|
Prepaid expenses and other
current assets
|
17,789
|
|
9,620
|
|
Total
current assets
|
221,714
|
|
226,091
|
|
|
|
|
|
|
Property and equipment,
net
|
19,615
|
|
13,514
|
|
Software and web site
development costs, net
|
28,613
|
|
21,158
|
|
Intangible assets,
net
|
27,911
|
|
41,604
|
|
Goodwill
|
135,314
|
|
134,747
|
|
Deferred taxes and other
long-term assets
|
47,124
|
|
35,213
|
|
Total
assets
|
$ 480,291
|
|
$ 472,327
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
|
|
Accounts payable and
accrued expenses
|
$ 27,468
|
|
$ 26,960
|
|
Deferred
revenue
|
5,114
|
|
4,992
|
|
Due to acquirees and other
current liabilities
|
391
|
|
2,245
|
|
Total
current liabilities
|
32,973
|
|
34,197
|
|
|
|
|
|
|
Long-term
liabilities
|
17,712
|
|
17,244
|
|
Total
liabilities
|
50,685
|
|
51,441
|
|
Total stockholders'
equity
|
429,606
|
|
420,886
|
|
Total liabilities and
stockholders' equity
|
$ 480,291
|
|
$ 472,327
|
|
|
|
|
|
|
|
Attachment
(3) Consolidated Statements of Cash Flows
DEALERTRACK HOLDINGS,
INC.
Consolidated Statements of Cash
Flows
(Dollars in
thousands)
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
|
2010
|
2009
|
|
Operating
activities:
|
|
|
|
Net loss
|
$
(1,386)
|
$
(3,653)
|
|
Adjustments to reconcile net
loss to net cash provided by operating activities:
|
|
|
|
Depreciation
and amortization
|
27,475
|
26,288
|
|
Deferred tax
benefit
|
(2,650)
|
(4,848)
|
|
Stock-based
compensation expense
|
8,679
|
13,988
|
|
Provision
for doubtful accounts and sales credits
|
4,015
|
6,478
|
|
Loss (gain)
on sale of property and equipment
|
19
|
(172)
|
|
Amortization
of bond premium
|
-
|
56
|
|
Amortization
of deferred interest
|
68
|
111
|
|
Deferred
compensation
|
-
|
225
|
|
Stock-based
compensation windfall tax benefit
|
(1,398)
|
(1,966)
|
|
Realized
gain on securities
|
(582)
|
(1,393)
|
|
Changes in
operating assets and liabilities, net of effects of
acquisitions:
|
|
|
|
Accounts
receivable
|
(10,938)
|
(8,711)
|
|
Prepaid
expenses and other current assets
|
(4,108)
|
(1,230)
|
|
Accounts
payable and accrued expenses
|
(5,121)
|
7,546
|
|
Deferred
revenue and other current liabilities
|
115
|
(39)
|
|
Other
long-term liabilities
|
6
|
(468)
|
|
Deferred
rent
|
89
|
113
|
|
Other
long-term assets
|
(11,408)
|
(200)
|
|
Net cash provided by operating
activities
|
2,875
|
32,125
|
|
|
|
|
|
Investing
activities:
|
|
|
|
Capital
expenditures
|
(9,669)
|
(4,197)
|
|
Restricted
cash
|
-
|
142
|
|
Sale of
investments
|
1,419
|
44,569
|
|
Capitalized
software and website development costs
|
(13,369)
|
(9,977)
|
|
Proceeds
from sale of property and equipment
|
1
|
83
|
|
Payment for
acquisition of business and intangible assets, net of acquired
cash
|
(3,028)
|
(34,680)
|
|
Net cash used in investing
activities
|
(24,646)
|
(4,060)
|
|
|
|
|
|
Financing
activities:
|
|
|
|
Principal payments on capital
lease obligations
|
(388)
|
(284)
|
|
Proceeds from the exercise of
employee stock options
|
1,024
|
2,152
|
|
Proceeds from employee stock
purchase plan
|
556
|
700
|
|
Purchase of treasury
stock
|
(612)
|
(352)
|
|
Principal payments on notes
payable
|
-
|
(636)
|
|
Stock-based compensation
windfall tax benefit
|
1,398
|
1,966
|
|
Net cash
provided by financing activities
|
1,978
|
3,546
|
|
|
|
|
|
Net (decrease) increase in cash
and cash equivalents
|
(19,793)
|
31,611
|
|
Effect of exchange rate changes
on cash and cash equivalents
|
108
|
2,509
|
|
Cash and cash equivalents,
beginning of period
|
197,509
|
155,456
|
|
Cash and cash equivalents, end
of period
|
$
177,824
|
$
189,756
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended September 30,
|
|
|
2010
|
2009
|
|
Supplemental
disclosure:
|
|
|
|
Cash paid
for:
|
|
|
|
Income taxes
|
$ 5,421
|
$ 4,019
|
|
Interest
|
$
47
|
$
41
|
|
|
|
|
|
|
Attachment
(4)
Reconciliation
Data
DEALERTRACK HOLDINGS,
INC.
Reconciliation of GAAP Net
Income (Loss) to Non-GAAP Adjusted EBITDA
(Dollars in
thousands)
(Unaudited)
|
|
|
Three Months
Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
GAAP net income
(loss)
|
$ 1,182
|
$ (215)
|
|
Interest income
|
(132)
|
(194)
|
|
Interest expense
|
36
|
27
|
|
Provision for income
taxes
|
1,515
|
1,665
|
|
Depreciation and
amortization
|
4,510
|
3,429
|
|
Amortization of acquired
identifiable intangibles
|
4,661
|
4,971
|
|
EBITDA (non-GAAP)
|
11,772
|
9,683
|
|
Adjustments:
|
|
|
|
Restructuring
costs
|
-
|
(17)
|
|
Acquisition related
professional fees
|
478
|
94
|
|
Acquisition related earn
out compensation expense
|
-
|
1,000
|
|
Contra-revenue
|
605
|
-
|
|
Adjusted EBITDA
(non-GAAP)
|
$
12,855
|
$
10,760
|
|
|
|
|
|
|
DEALERTRACK
HOLDINGS, INC.
Reconciliation of GAAP
Net Income
(Loss) to Non-GAAP Adjusted Net
Income
(Dollars in
thousands)
(Unaudited)
|
|
|
Three Months
Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
GAAP net income
(loss)
|
$
1,182
|
$
(215)
|
|
Adjustments:
|
|
|
|
Stock-based compensation
(excluding restructuring costs)
|
2,850
|
3,176
|
|
Amortization of acquired
identifiable intangibles
|
4,661
|
4,971
|
|
Acquisition related
professional fees
|
478
|
94
|
|
Amended state tax return
impact (non-taxable)
|
101
|
-
|
|
Restructuring
costs
|
-
|
(17)
|
|
Acquisition related
earn-out compensation expense
|
-
|
1,000
|
|
Contra-revenue
|
605
|
-
|
|
Tax impact of
adjustments (a)
|
(3,246)
|
(2,963)
|
|
Adjusted net income
(non-GAAP)
|
$
6,631
|
$
6,046
|
|
|
|
(a)
The tax impact of adjustments
for the three months ended September 30, 2010, are based on a U.S.
effective tax rate of 38.3% applied to taxable adjustments other
than amortization of acquired identifiable intangibles and
stock-based compensation expense, which are based on a blended
effective tax rate of 37.4% and 38.1%, respectively. The tax
impact of adjustments for the three months ended September 30,
2009, are based on a U.S. effective tax rate of 32.9% applied to
taxable adjustments other than amortization of acquired
identifiable intangibles and stock-based compensation, which are
based on a blended effective tax rate of 33.1% and 32.9%,
respectively.
|
|
|
|
|
Reconciliation
Data
DEALERTRACK HOLDINGS,
INC.
Reconciliation of GAAP Net Loss
to Non-GAAP Adjusted EBITDA
(Dollars in
thousands)
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
GAAP net loss
|
$ (1,386)
|
$ (3,653)
|
|
Interest income
|
(381)
|
(937)
|
|
Interest expense
|
155
|
153
|
|
Provision for (benefit from)
income taxes
|
800
|
(2,482)
|
|
Depreciation and
amortization
|
12,651
|
10,895
|
|
Amortization of acquired
identifiable intangibles
|
14,824
|
15,393
|
|
EBITDA (non-GAAP)
|
26,663
|
19,369
|
|
Adjustments:
|
|
|
|
Restructuring
costs (including stock-based
compensation) (a)
|
-
|
6,692
|
|
Acquisition related
professional fees
|
715
|
593
|
|
Realized gain on
securities
|
(582)
|
(1,393)
|
|
Acquisition related
earn-out compensation expense
|
-
|
1,000
|
|
Contra-revenue
|
801
|
-
|
|
Adjusted EBITDA
(non-GAAP)
|
$
27,597
|
$
26,261
|
|
|
|
(a)
Includes costs related to a
reduction in workforce, a plant relocation related to DealerTrack's
Digital Services business and a gain related to DealerTrack's exit
from the SCS business.
|
|
|
|
|
DEALERTRACK HOLDINGS,
INC.
Reconciliation of GAAP Net Loss
to Non-GAAP Adjusted Net Income
(Dollars in
thousands)
(Unaudited)
|
|
|
Nine Months
Ended
September 30,
|
|
|
2010
|
2009
|
|
|
|
|
|
GAAP net loss
|
$
(1,386)
|
$
(3,653)
|
|
Adjustments:
|
|
|
|
Stock-based compensation
(excluding restructuring costs)
|
8,679
|
10,104
|
|
Amortization of acquired
identifiable intangibles
|
14,824
|
15,393
|
|
Acquisition related
professional fees
|
715
|
593
|
|
Realized gain on
securities (non-taxable)
|
(582)
|
(1,393)
|
|
Amended state tax return
impact (non-taxable)
|
101
|
(1,070)
|
|
Restructuring
costs
|
-
|
6,692
|
|
Acquisition related
earn-out compensation expense
|
-
|
1,000
|
|
Contra-revenue
|
801
|
-
|
|
Tax impact of
adjustments (a)
|
(9,449)
|
(11,059)
|
|
Adjusted net income
(non-GAAP)
|
$
13,703
|
$
16,607
|
|
|
|
(a) The tax impact
of adjustments for the nine months ended September 30, 2010, are
based on a U.S. effective tax rate of 38.3% applied to taxable
adjustments other than amortization of acquired
identifiable intangibles and stock-based compensation, which are
based on a blended effective tax rate of 37.5% and 38.2%,
respectively. The tax impact of adjustments for the nine
months ended September 30, 2009, are based on a U.S. effective tax
rate of 32.9% applied to taxable adjustments other than
amortization of acquired identifiable intangibles and stock-based
compensation, which are based on a blended effective tax rate of
33.1% and 32.9%, respectively.
|
|
|
|
|
DEALERTRACK
HOLDINGS, INC.
Reconciliation of
Forward-looking GAAP Net Loss to
Forward-looking Non-GAAP
Adjusted EBITDA
(Dollars in
millions)
(Unaudited)
|
|
|
Year Ending December 31,
2010
Expected Range
|
|
|
|
|
|
GAAP net income
|
$
1.5
|
$
3.8
|
|
Interest income
|
(0.5)
|
(0.5)
|
|
Interest expense
|
0.2
|
0.2
|
|
Provision for income
taxes
|
1.0
|
2.5
|
|
Depreciation and
amortization
|
17.0
|
17.2
|
|
Amortization of acquired
identifiable intangibles
|
19.6
|
19.6
|
|
EBITDA (non-GAAP)
|
38.8
|
42.8
|
|
Adjustments:
|
|
|
|
Acquisition related
professional fees
|
1.2
|
1.2
|
|
Realized gain on
securities (non-taxable)
|
(0.6)
|
(0.6)
|
|
Contra-revenue
|
1.6
|
1.6
|
|
Adjusted EBITDA
(non-GAAP)
|
$
41.0
|
$
45.0
|
|
|
|
|
|
|
DEALERTRACK HOLDINGS,
INC.
Reconciliation of
Forward-looking GAAP Net Income to
Forward-looking Non-GAAP
Adjusted Net Income
(Dollars in
millions)
(Unaudited)
|
|
|
Year Ending
December 31, 2010
Expected Range
|
|
|
|
|
|
GAAP net income
|
$
1.5
|
$
3.8
|
|
Adjustments:
|
|
|
|
Stock-based compensation
charges
|
11.0
|
11.3
|
|
Amortization of acquired
identifiable intangibles
|
19.6
|
19.6
|
|
Acquisition related
professional fees
|
1.2
|
1.2
|
|
Realized gain on
securities (non-taxable)
|
(0.6)
|
(0.6)
|
|
Contra-revenue
|
1.6
|
1.6
|
|
Tax impact of
adjustments (a)
|
(12.8)
|
(12.9)
|
|
Adjusted net income
(non-GAAP)
|
$
21.5
|
$
24.0
|
|
|
|
(a) The tax impact
of adjustments are based on a U.S. effective tax rate of between
39.7% and 40.0% applied to all adjustments other than amortization
of acquired identifiable intangibles which is based on a blended
effective tax rate of 38.0%.
|
|
|
|
|
Attachment (5)
Summary of Business Statistics
(Unaudited)
|
|
DEALERTRACK HOLDINGS,
INC.
|
|
|
Three months
ended
|
|
|
Sep 30,
2010
|
Jun 30,
2010
|
Mar 31,
2010
|
Dec 31,
2009
|
Sep 30,
2009
|
|
|
|
|
|
|
|
|
Active U.S. dealers
(a)
|
16,961
|
17,120
|
17,102
|
16,690
|
17,241
|
|
Active U.S. lenders
(b)
|
921
|
891
|
847
|
823
|
790
|
|
Transactions processed
(c)
(in thousands)
|
13,296
|
12,239
|
11,841
|
10,114
|
13,804
|
|
Active U.S. lender to
dealer relationships (d)
|
137,388
|
137,919
|
127,724
|
118,209
|
120,305
|
|
Subscribing dealers
(e)
|
13,856
|
13,468
|
13,705
|
13,852
|
13,959
|
|
|
|
(a) We consider a
dealer to be active 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. For the three months ended March 31, 2010,
the number of active U.S. dealers was updated from the number
originally reported (16,860). For the three months ended June
30, 2010, the number of active U.S. dealers was updated from the
number originally reported (17,343). The number of active
U.S. dealers is based on the number of dealer accounts as
communicated by lenders on the DealerTrack network.
(b) We consider a
lender to be active in our DealerTrack network as of a date if it
is accepting credit application data electronically from U.S.
dealers in the DealerTrack network.
(c) Represents
revenue-generating transactions processed in the DealerTrack,
DealerTrack Digital Services 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.
(e)
Represents the number of
dealerships with one or more active subscriptions on the
DealerTrack or DealerTrack Canada networks at the end of a given
period.
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Sep 30,
2010
|
Jun 30,
2010
|
Mar 31,
2010
|
Dec 31,
2009
|
Sep 30,
2009
|
|
|
|
|
|
|
|
|
Transaction
revenue
(in thousands)
|
$27,188
|
$26,851
|
$22,870
|
$20,237
|
$25,483
|
|
Subscription
revenue
(in thousands)
|
$31,273
|
$30,341
|
$29,728
|
$28,982
|
$28,978
|
|
Other revenue
(in thousands)
|
$4,667
|
$4,715
|
$4,187
|
$4,028
|
$4,348
|
|
Average transaction price
(a)
|
$2.09
|
$2.19
|
$1.93
|
$2.00
|
$1.85
|
|
Average monthly
subscription revenue per subscribing dealership (b)
|
$759
|
$749
|
$719
|
$695
|
$692
|
|
|
|
(a) Represents the
average revenue earned per transaction processed in the
DealerTrack, DealerTrack Digital Services and DealerTrack Canada
networks during a given period. Revenue used in calculation
adds back contra-revenue.
(b)
For the 2010 periods, represents
net subscription revenue divided by average subscribing
dealers for a given period in the DealerTrack and DealerTrack
Canada networks.
|
|
|
|
|
|
|
|
TRAK-E
SOURCE DealerTrack Holdings, Inc.