8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) August 14, 2009

INNOTRAC CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Georgia
(State or Other Jurisdiction of Incorporation)
000-23741	58-1592285
(Commission File Number)	(IRS Employer Identification No.)
6655 Sugarloaf Parkway Duluth, Georgia	30097
(Address of Principal Executive Offices)	(Zip Code)
(678) 584-4000
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

          On August 14, 2009, Innotrac Corporation (“Innotrac”) issued a press release to announce its financial results for the second quarter ended June 30, 2009. A copy of the press release is attached as Exhibit 99.1.

          The information in this Report, including the Exhibit attached hereto, is furnished solely pursuant to Item 2.02 of this Form 8-K. Consequently, it is not deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Exchange Act or Securities Act of 1933 if such subsequent filing specifically references this Form 8-K.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(c)	Exhibits
Exhibit  No.			Description
99.1		Innotrac Corporation press release dated August 14, 2009, announcing Innotrac’s financial results for the second quarter ended June 30, 2009 (furnished pursuant to Item 2.02 of this Form 8-K).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

INNOTRAC CORPORATION

/s/ Scott D. Dorfman

Scott D. Dorfman

President, Chairman and Chief Executive Officer

Date: August 14, 2009

EX-99.1

Exhibit 99.1

Innotrac Corporation Announces 2009 Second Quarter Results

ATLANTA, GA (August 14, 2009) – Innotrac Corporation (NASDAQ-GM: INOC) announced financial results today for the second quarter and six months ended June 30, 2009. The Company reported revenues of $27.6 million for the quarter versus $29.5 million reported in the comparable period in 2008, a decrease of 6.6%. The decrease in revenue for the three months ended June 30, 2009 was primarily due to a $2.6 million decrease in freight revenue, which has no material impact on our operating profitability due to pricing practices for direct freight costs, offset by a $634,000 increase in service revenue for the quarter as compared to the same period in 2008. The increase in service revenue for the quarter resulted from a $1.4 million increase in service revenue from existing clients in our eCommerce and Telecom verticals offset by a $559,000 decrease in service revenue from our direct marketing vertical due to decreased volumes and a $177,000 decrease in service revenue from our DSL vertical resulting from the completed transition of a portion of the AT&T fulfillment business to AT&T’s in-house fulfillment in mid June 2009.

For the six months ended June 30, 2009, the Company reported revenues of $56.4 million compared to $62.2 million for the same period in 2008, a decrease of 9.4%. The decrease in revenue for the six months ended June 30, 2009 was primarily due to a $5.7 million decrease in freight revenue resulting from the transition of Company owned freight accounts to client owned freight accounts and an $180,000 decrease in service revenue. The slight decrease in service revenue resulted from a $1.4 million decrease in direct marketing and B2B service revenue due to reduced volumes partially offset by a $1.2 million increase in service revenue resulting from increases in volumes from existing clients in our eCommerce, DSL and Telecom verticals.

The Company reported net income of $1.8 million, or $0.15 per share, fully diluted, for the three months ended June 30, 2009, versus net income of $995,000 or $0.08 per share in the comparable period of 2008. For the six months ended June 30, 2009, the Company reported net income of $3.8 million, or $0.30 per share, fully diluted, compared to net income of $1.9 million, or $0.15 per share, in the same period in 2008.

Innotrac

Innotrac Corporation, founded in 1984 and based in Atlanta, Georgia, is a full-service fulfillment and logistics provider serving enterprise clients and world-class brands. The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and one call center in seven cities spanning all time zones across the continental United States. For more information about Innotrac, visit the Innotrac Website, www.innotrac.com.

Information contained in this press release, other than historical information, may be considered forward-looking in nature. Forward-looking statements in this press release include our expectations for future progress in our business and future generation of cash flows. Forward-looking statements are subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on Innotrac’s operating results, performance or financial condition are competition, the demand for Innotrac’s services, Innotrac’s ability to retain its current clients and attract new clients, realization of expected revenues from new clients, the general state of the industries that the Company serves, changing technologies, Innotrac’s ability to maintain profit margins in the face of pricing pressures and numerous other factors discussed in Innotrac’s 2008 Annual Report on Form 10-K and other filings on file with the Securities and Exchange Commission. Innotrac disclaims any intention or obligation to update or revise any forward-looking statement whether as a result of new information, future events or otherwise.

Contact

George Hare

Chief Financial Officer

678-584-4020

ghare@innotrac.com

###

INNOTRAC CORPORATION

Condensed Statements of Operations

(in thousands, except per share amounts)

	Three Months Ended June 30, (Unaudited)				Six Months Ended June 30, (Unaudited)
	2009		2008		2009		2008
Service revenue	$	24,052	$	23,418	$	48,708	$	48,888
Freight revenue		3,540		6,109		7,659		13,351
Total revenue		27,592		29,527		56,367		62,239
Cost of service revenues		10,327		10,559		20,987		22,657
Freight expense		3,488		6,016		7,545		13,265
Selling, general and administrative expenses		10,768		10,583		21,578		21,662
Depreciation and amortization		1,108		1,021		2,317		2,072
Total operating expenses		25,691		28,179		52,427		59,656
Operating income		1,901		1,348		3,940		2,583
Interest expense		59		353		165		726
Total other expense		59		353		165		726
Income before income taxes		1,842		995		3,775		1,857
Income tax		—		—		—		—
Net income	$	1,842	$	995	$	3,775	$	1,857
Earnings per share:
Basic	$	0.15	$	0.08	$	0.30	$	0.15
Diluted	$	0.15	$	0.08	$	0.30	$	0.15
Weighted average shares outstanding:
Basic		12,601		12,586		12,601		12,586
Diluted		12,601		12,602		12,601		12,594

INNOTRAC CORPORATION

Condensed Balance Sheets

(in thousands)

	June 30, 2009		December 31, 2008
ASSETS	(Unaudited)
Current Assets:
Cash	$	1,690	$	1,056
Accounts receivable (net of allowance for doubtful accounts of $248 at June 30, 2009 and $271 at December 31, 2008)		16,824		25,793
Inventory		1,114		1,855
Prepaid expenses and other		1,356		1,262
Total current assets		20,984		29,966
Property and equipment, net		14,810		15,842
Goodwill		25,169		25,169
Other assets, net		981		822
Total assets	$	61,944	$	71,799
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	5,203	$	9,259
Line of credit		—		10,055
Accrued expenses and other		5,143		5,253
Total current liabilities		10,346		24,567
Noncurrent Liabilities:
Equipment lease payable		503		—
Other noncurrent liabilities		798		753
Total noncurrent liabilities		1,301		753
Total shareholders’ equity		50,297		46,479
Total liabilities and shareholders’ equity	$	61,944	$	71,799

INNOTRAC CORPORATION

Condensed Statements of Cash Flows

(in thousands)

	Six Months Ended June 30, (Unaudited)
	2009			2008
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	3,775		$	1,857
Adjustments to net income:
Depreciation and amortization		2,317			2,072
Provision for bad debts		39			(50	)
Stock compensation expense-stock options		6			46
Stock compensation expense-restricted stock		37			37
Changes in working capital:
Accounts receivable, gross		8,930			6,798
Inventory		741			(223	)
Prepaid assets and other		(59	)		(504	)
Accounts payable, accrued expenses and other		(4,404	)		(8,466	)
Net cash provided by operating activities		11,382			1,567
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		( 674	)		(1,412	)
Net change in noncurrent assets and liabilities		2			57
Cash used in investing activities		(672	)		(1,355	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net repayments under line of credit		(10,055	)		(948	)
Proceeds from financing lease		130			—
Loan commitment fees		(151	)		—
Cash used in financing activities		(10,076	)		(948	)
Net increase (decrease) in cash		634			(736	)
Cash, beginning of period		1,056			1,079
Cash, end of period	$	1,690		$	343