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) May 16, 2011

 INNOTRAC CORPORATION

 (Exact Name of Registrant as Specified in Charter)

Georgia 

(State or Other Jurisdiction of Incorporation)

000-23741	58-1592285
(Commission File Number)	(IRS Employer Identification No.)

6465 East Johns Crossing Johns Creek, GA
	30097
(Address of Principal Executive Offices)	(Zip Code)

(678) 584-4000

(Registrant’s Telephone Number, Including Area Code)

(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 May 16, 2011, Innotrac Corporation ("Innotrac") issued a press release to announce its financial results for the first quarter ended March 31, 2011. 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

(d)           Exhibits.

Exhibit No.	Description
99.1	Innotrac Corporation press release dated May 16, 2011, announcing Innotrac’s financial results for the first quarter ended March 31, 2011 (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
Date:  May 16, 2011	Scott D. Dorfman  President, Chairman and Chief Executive Officer

Innotrac Corporation Announces 2011 First Quarter Results

ATLANTA, GA (May 16, 2011) – Innotrac Corporation (NASDAQ-GM: INOC) announced financial results today for the first quarter ended March 31, 2011.  The Company reported an 8.3% increase in total revenues to $21.0 million for the quarter versus $19.4 million reported in the comparable period in 2010.  The increase in revenue for the quarter ended March 31, 2011, was primarily due to the launch of new business that was added during the end of 2010.

The Company reported a net loss of $526,000, or ($0.04) per share, fully diluted, for the three months ended March 31, 2011, versus a net loss of $973,000, or ($0.08) per share in the comparable period of 2010.

“We were able to grow revenues by 8.3% with the addition of new business while keeping our gross margins strong at 45.7% compared to 45.0% in the comparable period last year.  Despite increasing investments in both our sales and marketing and information technologies areas we were still able to reduce our SG&A spending as a percentage of sales from 45.5% in the first quarter of 2010 to 43.9% this quarter.  As a result we significantly reduced our net loss when compared to first quarter 2010.  We feel we have substantial momentum in the business and with additional new clients scheduled to launch during 2011, we expect our operating results to continue to improve throughout the year.” said George Hare, CFO.

Innotrac

Innotrac Corporation, founded in 1984 and based near 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 seven fulfillment centers and one call center spanning all time zones across the continental United States.  Innotrac Europe GmbH has a network of fulfillment centers, call centers, and returns processing facilities with operations in the UK, Germany, France, Denmark, Sweden, Poland, Austria, Italy, Switzerland and the Netherlands.  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 include statements relating to expected new clients and future operating results.  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, Innotrac’s success in growing its existing client base, developing new business, Innotrac’s ability to maintain or improve gross margins in the face of increasing revenues, reducing operating costs in response to reduced service revenues, 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 2010 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

###

EX-99.1

Exhibit 99.1

INNOTRAC CORPORATION

Condensed Statements of Operations

(in thousands, except per share amounts)

		Three Months Ended March 31, (Unaudited)
	2011			2010
Service revenue	$	17,287		$	16,028
Freight revenue		3,682			3,325
Total revenue		20,969			19,353
Cost of service revenues		7,752			7,346
Freight expense		3,638			3,291
Selling, general and
administrative expenses		9,208			8,802
Depreciation and amortization		851			848
Total operating expenses		21,449			20,287
Operating loss		(480	)		(934	)
Interest expense		46			39
Total other expense		46			39
Loss before income taxes		(526	)		(973	)
Income tax		-			-
Net loss	$	(526	)	$	(973	)
Loss  per share:
Basic	$	(0.04	)	$	(0.08	)
Diluted	$	(0.04	)	$	(0.08	)
Weighted average shares
outstanding:
Basic		12,861			12,607
Diluted		12,861			12,607

INNOTRAC CORPORATION

Condensed Balance Sheets

(in thousands)

	March 31, 2011		December 31, 2010
ASSETS	(Unaudited)
Current Assets:
Cash	$	729	$	238
Accounts receivable (net of allowance for doubtful     accounts of  $139 at March 31, 2011 and $242 at     December 31, 2010)		16,213		15,279
Inventory		780		3,626
Prepaid expenses and other		1,240		1,149
Total current assets		18,962		20,292
Property and equipment, net		11,076		11,380
Other assets, net		1,143		1,122
Total assets	$	31,181	$	32,794
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	5,519	$	5,920
Line of credit		-		-
Accrued expenses and other		3,351		4,076
Total current liabilities		8,870		9,996
Noncurrent Liabilities:
Other non-current liabilities		1,611		1,499
Total noncurrent liabilities		1,611		1,499
Total shareholders' equity		20,700		21,299
Total liabilities and shareholders' equity	$	31,181	$	32,794

INNOTRAC CORPORATION

Condensed Statements of Cash Flows

(in thousands)

	Three Months Ended March 31,
	(Unaudited)
	2011			2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(526	)	$	(973	)
Adjustments to net loss:
Depreciation and amortization		851			848
Provision for bad debts		22			(48	)
(Gain) loss on disposal of fixed assets		-			1
Stock compensation expense-stock options		1			(5	)
Stock compensation expense-restricted stock		(74	)		19
Decrease in other long-term assets		19			12
Increase in other long-term liabilities		103			108
Changes in working capital:
Accounts receivable, gross		(956	)		1,745
Inventory		2,846			(880	)
Prepaid assets and other		(61	)		757
Accounts payable, accrued expenses and other		(1,268	)		(566	)
Net cash provided by operating activities		957			1,018
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(365	)		(285	)
Net change in noncurrent assets and liabilities		(6	)		(8	)
Cash used in investing activities		(371	)		(293	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net repayments under line of credit		-			-
Capital lease payments		(65	)		(59	)
Loan fees paid		(30	)		-
Cash used in financing activities		(95	)		(59	)
Net increase in cash		491			666
Cash, beginning of period		238			1,118
Cash, end of period	$	729		$	1,784