Delaware
|
000-51653
|
52-2336218
|
||
(State or other jurisdiction
|
(Commission
|
(I.R.S. Employer
|
||
of incorporation)
|
File Number)
|
Identification No.)
|
1111 Marcus Ave., Suite M04, Lake Success, NY
|
11042
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Exhibit No.
|
Description
|
|
99.1
|
Registrant’s Press Release dated May 9, 2011.
|
DealerTrack Holdings, Inc.
|
||
By: /s/ Eric D. Jacobs
|
||
Eric D. Jacobs
|
||
Senior Vice President, Chief Financial and Administrative Officer
|
Exhibit
No.
|
Description
|
|
99.1
|
Registrant’s Press Release dated May 9, 2011.
|
§
|
Revenue for the quarter was $77.2 million, as compared to $56.8 million for the first quarter of 2010.
|
§
|
GAAP net income for the quarter was $24.7 million, as compared to GAAP net loss of $(2.5) million for the first quarter of 2010. GAAP net income for the first quarter of 2011 was positively impacted by a $24.5 million non-cash reduction in the valuation allowance against the company’s net U.S. deferred tax assets.
|
§
|
Diluted GAAP net income per share for the quarter was $0.59, as compared to GAAP net loss per share of $(0.06) for the first quarter of 2010. Diluted GAAP net income per share for the first quarter of 2011 was positively impacted by $0.58 per share for a non-cash reduction in the valuation allowance against the company’s net U.S. deferred tax assets.
|
§
|
Adjusted EBITDA for the quarter was $12.9 million, as compared to $4.9 million for the first quarter of 2010.
|
§
|
Adjusted net income for the quarter was $7.5 million, as compared to $2.1 million for the first quarter of 2010.
|
§
|
Diluted adjusted net income per share was $0.18 for the quarter, as compared to $0.05 for the first quarter of 2010.
|
§
|
Revenue for the year is expected to be between $324.0 million and $330.0 million, net of approximately $3.7 million of contra-revenue, compared to the previous estimate of between $316.0 million and $324.0 million.
|
§
|
GAAP net income for the year is expected to be between $24.0 million and $26.5 million, compared to the previous estimate of between $2.9 million and $5.4 million.
|
§
|
Diluted GAAP net income per share for the year is expected to be between $0.56 and $0.62, compared to the previous estimate of between $0.07 and $0.13.
|
§
|
Adjusted EBITDA for the year is expected to be between $62.0 million and $66.0 million, compared to the previous estimate of between $57.0 million and $61.0 million.
|
§
|
Adjusted net income for the year is expected to be between $33.2 million and $35.7 million, compared to the previous estimate of between $29.2 million and $31.7 million.
|
§
|
Diluted adjusted net income per share for the year is expected to be between $0.78 and $0.83 compared to the previous estimate of between $0.68 and $0.74.
|
Three Months Ended
|
||||||||
March 31,
|
||||||||
2011
|
2010
|
|||||||
Net revenue
|
$ | 77,191 | $ | 56,785 | ||||
Cost of revenue
|
42,866 | 30,717 | ||||||
Product development
|
3,742 | 3,598 | ||||||
Selling, general and administrative
|
31,601 | 27,408 | ||||||
Total operating expenses
|
78,209 | 61,723 | ||||||
Loss from operations
|
(1,018 | ) | (4,938 | ) | ||||
Interest and other income, net
|
246 | 691 | ||||||
Realized gain on securities
|
- | 582 | ||||||
Loss before benefit from income taxes
|
(772 | ) | (3,665 | ) | ||||
Benefit from income taxes
|
25,500 | 1,214 | ||||||
Net income (loss)
|
$ | 24,728 | $ | (2,451 | ) | |||
Basic net income (loss) per share
|
$ | 0.61 | $ | (0.06 | ) | |||
Diluted net income (loss) per share
|
$ | 0.59 | $ | (0.06 | ) | |||
Weighted average shares outstanding (basic)
|
40,851,659 | 40,154,275 | ||||||
Weighted average shares outstanding (diluted)
|
42,103,811 | 40,154,275 | ||||||
Adjusted EBITDA (non-GAAP) (a)
|
$ | 12,901 | $ | 4,942 | ||||
Adjusted EBITDA margin (non-GAAP) (b)
|
17 | % | 9 | % | ||||
Adjusted net income (non-GAAP) (a)
|
$ | 7,490 | $ | 2,065 | ||||
Diluted adjusted net income per share (non-GAAP) (c)
|
$ | 0.18 | $ | 0.05 | ||||
Stock-based compensation expense was classified as follows:
|
||||||||
Cost of revenue
|
$ | 427 | $ | 403 | ||||
Product development
|
$ | 185 | $ | 151 | ||||
Selling, general and administrative
|
$ | 2,330 | $ | 2,188 |
(a)
|
See Reconciliation Data in Attachment 4.
|
(b)
|
Represents adjusted EBITDA as a percentage of net revenue.
|
(c)
|
For the three months ended March 31, 2010, the adjusted net income per share of approximately $0.05 is based on 41,148,416 diluted weighted average shares outstanding.
|
March 31, 2011
|
December 31, 2010
|
|||||||
ASSETS
|
||||||||
Cash and cash equivalents
|
$ | 57,549 | $ | 192,563 | ||||
Short-term investments
|
578 | 490 | ||||||
Customer funds
|
2,408 | - | ||||||
Customer funds receivable
|
14,141 | - | ||||||
Accounts receivable, net
|
33,864 | 24,273 | ||||||
Prepaid expenses and other current assets
|
25,905 | 17,929 | ||||||
Total current assets
|
134,445 | 235,255 | ||||||
Property and equipment, net
|
22,504 | 18,875 | ||||||
Software and website development costs, net
|
32,625 | 29,875 | ||||||
Intangible assets, net
|
102,728 | 23,163 | ||||||
Goodwill
|
212,223 | 136,408 | ||||||
Deferred taxes and other long-term assets
|
46,049 | 15,387 | ||||||
Total assets
|
$ | 550,574 | $ | 458,963 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Accounts payable and accrued expenses
|
$ | 32,355 | $ | 28,575 | ||||
Deferred revenue
|
7,196 | 5,010 | ||||||
Customer funds payable
|
16,549 | - | ||||||
Other current liabilities
|
803 | 728 | ||||||
Total current liabilities
|
56,903 | 34,313 | ||||||
Long-term liabilities
|
52,549 | 15,733 | ||||||
Total liabilities
|
109,452 | 50,046 | ||||||
Total stockholders' equity
|
441,122 | 408,917 | ||||||
Total liabilities and stockholders' equity
|
$ | 550,574 | $ | 458,963 |
Three Months Ended
|
||||||||
March 31,
|
||||||||
2011
|
2010
|
|||||||
Operating activities:
|
||||||||
Net income (loss)
|
$ | 24,728 | $ | (2,451 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities:
|
||||||||
Depreciation and amortization
|
11,745 | 9,240 | ||||||
Deferred tax (benefit) provision
|
(24,670 | ) | 13,372 | |||||
Stock-based compensation expense
|
2,942 | 2,742 | ||||||
Provision for doubtful accounts and sales credits
|
1,737 | 1,463 | ||||||
Amortization of deferred interest
|
- | 41 | ||||||
Deferred compensation
|
50 | - | ||||||
Stock-based compensation windfall tax benefit
|
(1,304 | ) | (629 | ) | ||||
Realized gain on securities
|
- | (582 | ) | |||||
Changes in operating assets and liabilities, net of effects of acquisitions:
|
||||||||
Accounts receivable
|
(6,420 | ) | (5,004 | ) | ||||
Customer funds and customer funds receivable
|
(6,057 | ) | - | |||||
Prepaid expenses and other current assets
|
(3,301 | ) | (18,016 | ) | ||||
Accounts payable and accrued expenses
|
(11,350 | ) | 5,219 | |||||
Customer funds payable
|
6,057 | - | ||||||
Deferred revenue and other current liabilities
|
788 | (69 | ) | |||||
Other long-term liabilities
|
705 | 184 | ||||||
Deferred rent
|
92 | 30 | ||||||
Other long-term assets
|
809 | (13,206 | ) | |||||
Net cash used in operating activities
|
(3,449 | ) | (7,666 | ) | ||||
Investing activities:
|
||||||||
Capital expenditures
|
(3,102 | ) | (2,527 | ) | ||||
Capitalized software and website development costs
|
(3,359 | ) | (2,244 | ) | ||||
Payment for acquisition of business and intangible assets, net of acquired cash
|
(128,482 | ) | (2,278 | ) | ||||
Net cash used in investing activities
|
(134,943 | ) | (7,049 | ) | ||||
Financing activities:
|
||||||||
Principal payments on capital lease obligations
|
(159 | ) | (126 | ) | ||||
Proceeds from the exercise of employee stock options
|
2,215 | 97 | ||||||
Proceeds from employee stock purchase plan
|
175 | 236 | ||||||
Purchase of treasury stock
|
(437 | ) | (590 | ) | ||||
Stock-based compensation windfall tax benefit
|
1,304 | 629 | ||||||
Net cash provided by financing activities
|
3,098 | 246 | ||||||
Net decrease in cash and cash equivalents
|
(135,294 | ) | (14,469 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents
|
280 | 170 | ||||||
Cash and cash equivalents, beginning of period
|
192,563 | 197,509 | ||||||
Cash and cash equivalents, end of period
|
$ | 57,549 | $ | 183,210 |
Three Months Ended
|
||||||||
March 31,
|
||||||||
2011
|
2010
|
|||||||
Supplemental disclosure:
|
||||||||
Cash paid for:
|
||||||||
Income taxes
|
$ | 1,280 | $ | 2,536 | ||||
Interest
|
14 | 18 | ||||||
Non-cash investing and financing activities:
|
||||||||
Accrued capitalized hardware, software and fixed assets
|
3,725 | 1,843 | ||||||
Capitalized stock-based compensation
|
31 | 18 | ||||||
Receivable for sale of securities
|
- | 1,419 | ||||||
Assets acquired under capitalized leases
|
- | 289 |
Three Months Ended
|
||||||||
March 31,
|
||||||||
2011
|
2010
|
|||||||
GAAP net income (loss)
|
$ | 24,728 | $ | (2,451 | ) | |||
Interest income
|
(104 | ) | (126 | ) | ||||
Interest expense
|
32 | 59 | ||||||
Benefit from income taxes
|
(25,500 | ) | (1,214 | ) | ||||
Depreciation of property and equipment and amortization of capitalized software and website costs
|
4,885 | 4,006 | ||||||
Amortization of acquired identifiable intangibles
|
6,860 | 5,234 | ||||||
EBITDA (non-GAAP)
|
10,901 | 5,508 | ||||||
Adjustments:
|
||||||||
Contra-revenue
|
943 | - | ||||||
Integration and other related costs (including stock-based compensation)
|
652 | - | ||||||
Acquisition related and other professional fees
|
330 | 16 | ||||||
Acquisition related earn-out compensation expense
|
75 | - | ||||||
Realized gain on securities
|
- | (582 | ) | |||||
Adjusted EBITDA (non-GAAP)
|
$ | 12,901 | $ | 4,942 |
Three Months Ended
|
||||||||
March 31,
|
||||||||
2011
|
2010
|
|||||||
GAAP net income (loss)
|
$ | 24,728 | $ | (2,451 | ) | |||
Adjustments:
|
||||||||
Amortization of acquired identifiable intangibles
|
6,860 | 5,234 | ||||||
Stock-based compensation (excluding integration and other related costs)
|
2,815 | 2,742 | ||||||
Integration and other related costs (including stock-based compensation)
|
652 | - | ||||||
Acquisition related and other professional fees
|
330 | 16 | ||||||
Contra-revenue
|
943 | - | ||||||
Acquisition related earn-out compensation expense (a)
|
75 | - | ||||||
Amended state tax return impact (non-taxable)
|
32 | - | ||||||
Realized gain on securities (non-taxable)
|
- | (582 | ) | |||||
Deferred tax asset valuation allowance (non-taxable)
|
(24,548 | ) | - | |||||
Tax impact of adjustments (b)
|
(4,397 | ) | (2,894 | ) | ||||
Adjusted net income (non-GAAP)
|
$ | 7,490 | $ | 2,065 |
(a)
|
$45 thousand of the acquistion related earn-out compensation expense is non-taxable.
|
(b)
|
The tax impact of adjustments for the three months ended March 31, 2011, are based on a U.S. statutory 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 tax rate of 37.6% and 38.0%, respectively. The tax impact of adjustments for the three months ended March 31, 2010, are based on a U.S. effective tax rate of 36.8% 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 35.9% and 36.8%, respectively.
|
Year Ending December 31, 2011
|
||||||||
Expected Range
|
||||||||
GAAP net income
|
$ | 24.0 | $ | 26.5 | ||||
Interest, net
|
(0.1 | ) | (0.1 | ) | ||||
Benefit from income taxes
|
(16.5 | ) | (15.3 | ) | ||||
Depreciation and amortization
|
20.7 | 21.0 | ||||||
Amortization of acquired identifiable intangibles
|
28.2 | 28.2 | ||||||
EBITDA (non-GAAP)
|
56.3 | 60.3 | ||||||
Adjustments:
|
||||||||
Non-recurring costs (a)
|
2.0 | 2.0 | ||||||
Contra-revenue
|
3.7 | 3.7 | ||||||
Adjusted EBITDA (non-GAAP)
|
$ | 62.0 | $ | 66.0 |
(a)
|
Includes certain professional fees, and integration and other related costs.
|
Year Ending December 31, 2011
|
||||||||
Expected Range
|
||||||||
GAAP net income
|
$ | 24.0 | $ | 26.5 | ||||
Adjustments:
|
||||||||
Stock-based compensation
|
12.0 | 12.0 | ||||||
Amortization of acquired identifiable intangibles
|
28.2 | 28.2 | ||||||
Non-recurring costs (a)
|
2.0 | 2.0 | ||||||
Deferred tax asset valuation allowance (non-taxable)
|
(19.0 | ) | (19.0 | ) | ||||
Contra-revenue
|
3.7 | 3.7 | ||||||
Tax impact of adjustments (b)
|
(17.7 | ) | (17.7 | ) | ||||
Adjusted net income (non-GAAP)
|
$ | 33.2 | $ | 35.7 |
(a)
|
Includes certain professional fees and integration and other related costs.
|
(b)
|
The tax impact of adjustments are based on a blended tax rate of 38.6% applied to taxable adjustments.
|
Mar 31,
|
Dec 31,
|
Sep 30,
|
Jun 30,
|
Mar 31,
|
||||||||||||||||
2011
|
2010
|
2010
|
2010
|
2010
|
||||||||||||||||
Active U.S. dealers (a)
|
17,373 | 16,829 | 16,961 | 17,120 | 17,102 | |||||||||||||||
Active U.S. lenders (b)
|
1,010 | 970 | 921 | 891 | 847 | |||||||||||||||
Transactions processed (in thousands) (c)
|
16,774 | 11,997 | 13,296 | 12,239 | 11,841 | |||||||||||||||
Active U.S. lender to dealer relationships (d)
|
146,660 | 137,058 | 137,388 | 137,919 | 127,724 | |||||||||||||||
Subscribing dealers (e)
|
14,239 | 13,996 | 13,856 | 13,468 | 13,705 |
(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 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.
|
(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.
|
Mar 31,
|
Dec 31,
|
Sep 30,
|
Jun 30,
|
Mar 31,
|
||||||||||||||||
2011
|
2010
|
2010
|
2010
|
2010
|
||||||||||||||||
Transaction revenue (in thousands)
|
$ | 38,435 | $ | 25,091 | $ | 27,188 | $ | 26,851 | $ | 22,870 | ||||||||||
Subscription revenue (in thousands)
|
$ | 33,865 | $ | 32,205 | $ | 31,273 | $ | 30,341 | $ | 29,728 | ||||||||||
Other revenue (in thousands)
|
$ | 4,891 | $ | 4,710 | $ | 4,667 | $ | 4,715 | $ | 4,187 | ||||||||||
Average transaction price (a)
|
$ | 2.35 | $ | 2.16 | $ | 2.09 | $ | 2.19 | $ | 1.93 | ||||||||||
$ | 798 | $ | 769 | $ | 759 | $ | 749 | $ | 719 |
(a)
|
Represents the average revenue earned per transaction processed in the DealerTrack, DealerTrack Aftermarket, DealerTrack Processing Solutions and DealerTrack Canada networks during a given period. Revenue used in calculation adds back contra-revenue.
|