EX-99.1 2 v041257_ex99-1.htm Unassociated Document
 
  
www.bankrate.com
 
For more information contact:    

Edward J. DiMaria
Senior Vice President      
Chief Financial Officer
www.bankrate.com/investor-relations/
edimaria@bankrate.com
(561) 630-1230 

Bruce J. Zanca
Senior Vice President       
Chief Communications/Marketing Officer
bzanca@bankrate.com
(917) 368-8648    

FOR IMMEDIATE RELEASE
 
Reminder -- Conference Call and Webcast Today at 11:00 A.M. Eastern Time
Interactive Dial-In: 866-543-6407 Passcode 65109209 (10 minutes before the call)


BANKRATE ANNOUNCES FIRST QUARTER 2006 FINANCIAL RESULTS
Revenue Up 90% - EBITDA Up 128%
Company Raises 2006 Guidance


NEW YORK, NY - April 25, 2006 - Bankrate, Inc. (NASDAQ: RATE), today reported total revenue of $19.8 million for the quarter ended March 31, 2006, an increase of $9.4 million or 90% over the $10.4 million reported in the first quarter of 2005. Earnings per diluted share, excluding stock compensation expense, were $0.21 which exceeded analyst consensus estimates of $0.19 per First Call / Thomson Financial. Earnings before interest, taxes, depreciation and amortization “EBITDA”, excluding stock compensation expense for the quarter, was $6.6 million, an increase of $3.7 million or 128% over the $2.9 million for the first quarter of 2005. Pre-tax income, excluding stock compensation expense for the quarter, was $6.1 million which is an increase of 98% over the $3.1 million reported in Q1 2005.
 
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Income before taxes of $4.3 million in the first quarter of 2006, including $1.8 million in non-cash stock compensation expense during the quarter due to the adoption of FAS 123R, increased by $1.2 million or 40% over the first quarter of 2005. Net income for Q1 2006 was $2.3 million or $0.14 per diluted share including the non-cash stock compensation charge of ($0.07) per diluted share after tax, compared to $1.9 million, or $0.12 per diluted share, in Q1 2005 with no stock compensation expense.

Sequentially, total revenue increased by 42% from $13.9 million in Q4 2005 to $19.8 million in Q1 2006. EBITDA, excluding stock compensation expense, increased by 62% sequentially from $4.1 million in Q4 2005 to $6.6 million in Q1 2006. Earnings per diluted share, excluding stock compensation expense, were $0.21 for Q1 2006 compared to $0.15 for Q4 2005 which represents a sequential increase of 40%.

“We’re encouraged by our solid progress,” said Thomas R. Evans, Bankrate’s President and Chief Executive Officer. “Our integration of FastFind and MMIS/Interest.com is proceeding according to plan, and we continued to see strong momentum in our traditional core business,” Mr. Evans added.

Revised 2006 Guidance
The Company is increasing its 2006 guidance. The company now expects 2006 revenue to be in the range of $80 to $82 million, and expects EBITDA, excluding non-cash stock compensation expense to be in the range of $28 to $29 million. The non-cash stock compensation expense charge is expected to be approximately $7.8 million dollars for the year.

Recent Company Highlights:

·  
Online publishing revenue of $15.6 million in Q1 2006 was $6.3 million or 69% greater than the $9.3 million reported in Q1 2005, and was $4.0 million or 34% higher than the $11.6 million reported in Q4 05.
 
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·  
Print publishing and licensing revenue of $4.2 million was 261% higher than Q1 05 and was up $1.9 million or 83% from Q4 2005.
 
·  
The gross margin for Q1 2006 was 69%, and the EBITDA margin was 33% (excluding non-cash stock compensation expense), compared to 74% and 28%, respectively, in Q1 2005.
 
·  
The Company had no barter revenue in Q1 06. Barter revenue was $621,000 and $474,000, respectively, in Q1 05 and Q4 05.
 
·  
Page views for the quarter of 124.2 million were up 12% compared to Q1 05 and were up 27% from Q4 05. Organic (non-paid) traffic represented 96% of the page views during the quarter. The remaining page views were generated from paid search.
 
·  
The Company appointed Edward J. DiMaria as the new Senior Vice President, Chief Financial Officer.
 
·  
The Company has signed a new co-brand agreement with CNNMoney.com.
 
·  
Renewed 14 existing co-brand agreements, including NYTimes.com, Miami Herald and LA Times.
 
·  
Since January 1, the Company has signed several new newspaper agreements, including the Baltimore Sun, Cleveland Plain Dealer, Winston-Salem Journal, and the New Orleans Times-Picayune.
 

April 25, 2006 Conference Call Interactive Dial-In and Webcast Information:

To participate in the teleconference please call: 866-543-6407 Passcode: 65109209
Please access at least 10 minutes prior to the time the conference is set to begin.

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This call is being webcast by CCBN and can be accessed at Bankrate’s Web site at www.bankrate.com/investor-relations/. The Webcast is also being distributed over CCBN’s Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN’s individual investor center at www.fulldisclosure.com or by visiting any of the investor sites in CCBN’s Individual Investor Network. Institutional investors can access the call via CCBN’s password-protected event management site, StreetEvents (www.streetevents.com).

Replay Information:
 
A replay of the conference call will be available beginning April 25, 2006, 1:00 p.m. ET/ 10:00 a.m. PT through May 3, 2006. To listen to the replay, call 888-286-8010 and enter 34216291.

Non-GAAP Measures
 
To supplement the Company’s financial statements presented in accordance with generally accepted accounting principles (“GAAP”), Bankrate uses non-GAAP measures of certain components of financial performance, including income from operations, income before income taxes, and net income, which are adjusted from results based on GAAP to exclude certain expenses, gains and losses. These non-GAAP measures are provided to enhance investors’ overall understanding of the Company’s current financial performance and its prospects for the future. Specifically, the Company believes the non-GAAP results provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results. In addition, because the Company has historically reported certain non-GAAP results to investors, the Company believes the inclusion of non-GAAP measures provides consistency in its financial reporting. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. The non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure.
 
About Bankrate, Inc.
 
Bankrate, Inc. (Nasdaq: RATE) ("Bankrate") owns and operates Bankrate.com, a leading Internet consumer banking marketplace. Bankrate.com is a destination site of personal finance channels, including banking, investing, taxes, debt management and college finance. Bankrate is the leading aggregator of more than 300 financial products, including mortgages, credit cards, new and used auto loans, money market accounts and CDs, checking and ATM fees, home equity loans and online banking fees. Bankrate reviews more than 4,800 financial institutions in 575 markets in 50 states. In 2005, Bankrate.com had over 46 million unique visitors. Bankrate provides financial applications and information to a network of more than 75 partners, including Yahoo! (Nasdaq: YHOO), America Online (NYSE: TWX), The Wall Street Journal (NYSE: DJ) and The New York Times (NYSE: NYT). Bankrate's information is also distributed through more than 400 national and state publications. In addition to Bankrate.com, Bankrate also owns and operates FastFind, an internet lead aggregator and Mortgage Market Information Services, Inc. and Interest.com, Inc., each of which publishes mortgage guides and financial rates and information.
 
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"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Certain matters included in the discussion above may be considered to be "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of the Company and members of our management team. Such forward-looking statements include, without limitation, statements made with respect to potential acquisitions, raising capital, future revenue, revenue growth, market acceptance of our products, and profitability. Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following: the willingness of our advertisers to advertise on our Web sites; interest rate volatility; our ability to establish and maintain distribution arrangements; our ability to integrate the business and operations of companies that we have acquired, and those we may acquire in the future; our need and our ability to incur additional debt or equity financing; the effect of unexpected liabilities we assume from our acquisitions; the impact of resolution of lawsuits to which we are a party; the willingness of consumers to accept the Internet as a medium for obtaining financial product information; increased competition and its effect on our Web site traffic, advertising rates, margins, and market share; our ability to manage traffic on our Web sites and service interruptions; our ability to protect our intellectual property; the effects of facing liability for content on our Web sites; legislative or regulatory changes; the concentration of ownership of our common stock; the fluctuations of our results of operations from period to period; the strength of the United States economy in general; the accuracy of our financial statement estimates and assumptions; effect of changes in the stock market and other capital markets; technological changes; changes in monetary and fiscal policies of the U.S. Government; changes in consumer spending and saving habits; changes in accounting principles, policies, practices or guidelines; other risks described from time to time in our filings with the Securities and Exchange Commission; and our ability to manage the risks involved in the foregoing. These and additional important factors to be considered are set forth in the Introductory Note and under Item 1A Risk Factors and in the other sections of our Annual Report on Form 10-K for the year ended December 31, 2005, and in our other filings with the Securities and Exchange Commission ("SEC") and available at the SEC's internet site (http://www.sec.gov). We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results or expectations.
 
###


-Financial Statements Follow-
 
 
Bankrate, Inc.
Non-GAAP Condensed Consolidated Statements of Income
(Unaudited)
 
   
Three Months Ended
  
   
March 31,
  
Revenue:
  
2006
  
2005
  
Online publishing
  
$
15,615,999
  
$
9,266,553
  
Print publishing and licensing
    
4,172,433
   
1,155,296
 
Total revenue
    
19,788,432
   
10,421,849
 
Cost of revenue:
              
Online publishing
    
2,692,088
   
1,639,475
 
Print publishing and licensing
    
3,531,979
   
1,103,169
 
Total cost of revenue
    
6,224,067
   
2,742,644
 
               
Gross margin
    
13,564,365
   
7,679,205
 
               
Operating expenses:
              
Sales
   
931,390
   
841,847
 
Marketing
    
851,343
   
1,519,623
 
Product development
    
910,971
   
504,106
 
General and administrative
   
4,249,245
   
1,914,278
 
Stock compensation expense (1)
    
1,777,623
   
-
 
Depreciation and amortization
    
557,762
   
189,239
 
     
9,278,334
   
4,969,093
 
Income from operations
    
4,286,031
   
2,710,112
 
Other income:
              
Interest income, net
    
20,330
   
141,263
 
Insurance recovery in excess of costs and expenses
    
-
   
220,705
 
Total other income
    
20,330
   
361,968
 
               
Income before income taxes
    
4,306,361
   
3,072,080
 
Provision for income taxes
    
(1,964,534
)
  
(1,167,390
)
Net income
 
$
2,341,827
  
$
1,904,690
  
               
Basic and diluted net income per share:
              
Basic
  
$
0.15
  
$
0.12
  
Diluted
  
$
0.14
  
$
0.12
  
Basic and diluted net income per share excluding stock compensation expense (1):
              
Basic
  
$
0.23
  
$
0.12
  
Diluted
  
$
0.21
  
$
0.12
  
Weighted average common shares outstanding:
             
Basic
    
15,874,946
   
15,787,264
 
Diluted
    
16,771,044
   
16,561,802
 
 
(1)  
See reconciliation of GAAP to Non-GAAP Measures.
 
 
Bankrate, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
 
   
March 31,
  
December 31,
  
   
2006
  
2005
  
Assets
              
               
Cash and cash equivalents
  
$
4,431,496
  
$
3,479,609
  
Accounts and notes receivable, net of allowance for doubtful accounts of approximately
              
$1,466,000 at March 31, 2006 and $1,630,000 at December 31, 2005, respectively
    
11,011,251
   
8,838,879
 
Deferred income taxes, current portion
    
4,641,874
   
6,445,636
 
Insurance claim receivable
    
89,780
   
85,575
 
Prepaid expenses and other current assets
    
871,516
   
481,677
 
Total current assets
    
21,045,917
   
19,331,376
 
               
Furniture, fixtures and equipment, net
    
1,015,593
   
1,063,307
 
Deferred income taxes
    
379,461
   
28,769
 
Intangible assets, net
   
11,287,646
   
11,652,161
 
Goodwill
    
30,030,233
   
30,035,399
 
Other assets
    
813,055
   
442,211
 
               
Total assets
  
$
64,571,905
  
$
62,553,223
  
               
Liabilities and Stockholders' Equity
              
               
Liabilities:
              
Accounts payable
  
$
1,531,691
  
$
3,215,645
  
Accrued expenses
    
3,884,604
   
5,093,187
 
Deferred revenue
    
1,181,455
   
1,176,119
 
Other current liabilities
    
56,355
   
37,187
 
Total current liabilities
    
6,654,105
   
9,522,138
 
               
Other liabilities
    
202,054
   
178,133
 
               
Total liabilities
    
6,856,159
   
9,700,271
 
               
Stockholders' equity:
              
Preferred stock, 10,000,000 shares authorized and undesignated
    
-
   
-
 
Common stock, par value $.01 per share-- 100,000,000 shares authorized; 15,890,468 and
              
15,857,877 shares issued and outstanding at March 31, 2006 and December 31, 2005, respectively
    
158,905
   
158,579
 
Additional paid in capital
    
73,502,185
   
70,981,544
 
Accumulated deficit
    
(15,945,344
)
  
(18,287,171
)
Total stockholders' equity
    
57,715,746
   
52,852,952
 
               
Total liabilities and stockholders' equity
 
$
64,571,905
  
$
62,553,223
  
 
 
 
 
 
Three Months Ended
  
     
March 31,
    
December 31,
  
Non-GAAP Measures Reconciliation (Unaudited):
    
2006
 
 
2005
 
 
2005
  
EBITDA-
                    
Income from operations
  
$
4,286,031
  
$
2,710,112
  
$
3,774,584
  
Depreciation and amortization
    
557,762
   
189,239
   
316,981
 
EBITDA
  
$
4,843,793
  
$
2,899,351
  
$
4,091,565
  
Per diluted share
  
$
0.29
  
$
0.18
  
$
0.24
  
                     
EBITDA excluding stock compensation expense-
                    
Income from operations
  
$
4,286,031
  
$
2,710,112
  
$
3,774,584
  
Stock compensation expense
    
1,777,623
   
-
   
-
 
Depreciation and amortization
    
557,762
   
189,239
   
316,981
 
EBITDA excluding stock compensation expense
  
$
6,621,416
  
$
2,899,351
  
$
4,091,565
  
Per diluted share
  
$
0.39
  
$
0.18
  
$
0.24
  
                     
Income before income taxes excluding stock compensation expense-
                    
Income before income taxes
  
$
4,306,361
  
$
3,072,080
  
$
4,052,120
  
Stock compensation expense
    
1,777,623
   
-
   
-
 
   
$
6,083,984
  
$
3,072,080
  
$
4,052,120
  
                     
Net income excluding stock compensation expense-
                    
Net income
 
$
2,341,827
  
$
1,904,690
  
$
2,592,302
  
Stock compensation expense, net of tax
    
1,308,563
   
-
   
-
 
Net income excluding stock compensation expense
  
$
3,650,390
  
$
1,904,690
  
$
2,592,302
  
Per basic share
  
$
0.23
  
$
0.12
  
$
0.16
  
Per diluted share
  
$
0.21
  
$
0.12
  
$
0.15
  
                     
Weighted average common shares outstanding:
                   
Basic
    
15,874,946
   
-
   
-
 
                     
Diluted
    
16,771,044
   
-
   
-
 
Impact of applying SFAS No. 123R
    
700,673
   
-
   
-
 
Diluted shares excluding impact of applying SFAS No 123R
    
17,471,717
   
-
   
-
 
 
 
Bankrate, Inc.
Condensed Consolidated Statements of Income
Reconciliation of GAAP to Non-GAAP Operating Results
(Unaudited)
 
Revenue:
  
GAAP
 
Three Months Ended March 31, 2006 Adjustments (2)
 
Non-GAAP
  
Online publishing
  
$
15,615,999
  
$
-
  
$
15,615,999
  
Print publishing and licensing
    
4,172,433
   
-
   
4,172,433
 
Total revenue
    
19,788,432
   
-
   
19,788,432
 
Cost of revenue:
                    
Online publishing
    
2,900,584
   
(208,496
)
  
2,692,088
 
Print publishing and licensing
    
3,542,110
   
(10,131
)
  
3,531,979
 
Total cost of revenue
    
6,442,694
   
(218,627
)
  
6,224,067
 
                     
Gross margin
    
13,345,738
   
218,627
   
13,564,365
 
                     
Operating expenses:
                    
Sales
   
1,088,275
   
(156,885
)
  
931,390
 
Marketing
    
851,343
   
-
   
851,343
 
Product development
    
1,024,503
   
(113,532
)
  
910,971
 
General and administrative
   
5,537,824
   
(1,288,579
)
  
4,249,245
 
Stock compensation expense
    
-
   
1,777,623
   
1,777,623
 
Depreciation and amortization
    
557,762
   
-
   
557,762
 
     
9,059,707
   
218,627
   
9,278,334
 
Income from operations
    
4,286,031
   
-
   
4,286,031
 
Other income:
                    
Interest income, net
    
20,330
   
-
   
20,330
 
Insurance recovery in excess of costs and expenses
    
-
   
-
   
-
 
Total other income
    
20,330
   
-
   
20,330
 
                     
Income before income taxes
    
4,306,361
   
-
   
4,306,361
 
Provision for income taxes
    
(1,964,534
)
  
-
   
(1,964,534
)
Net income
 
$
2,341,827
  
$
-
  
$
2,341,827
  
                     
Basic and diluted net income per share:
                    
Basic
  
$
0.15
  
$
-
  
$
0.15
  
Diluted
  
$
0.14
  
$
-
  
$
0.14
  
Weighted average common shares outstanding:
                   
Basic
    
15,874,946
   
-
   
15,874,946
 
Diluted
    
16,771,044
   
-
   
16,771,044
 
 
(2) Adjustments for the impact of applying SFAS No. 123R