Autobytel Doubles Net Income
IRVINE, CA--Nov. 9, 2013: Autobytel Inc. , the company dedicated to connecting automotive consumers with dealers, today announced financial results for the third quarter ended September 30, 2013, that reflect a more than doubling of net income and 24% growth in total revenues, compared with last year’s third quarter.
“We recently completed the acquisition of Advanced Mobile, a leader in providing mobile technologies to the automotive industry”
“We are continuing to execute on our strategic initiatives, including generating high sales conversion rates for our customers from the leads we deliver to them,” said Jeffrey H. Coats, President and Chief Executive Officer. “Our strong revenue for the third quarter, combined with appropriate cost management, allowed Autobytel to post a significant improvement in our financial results compared with last year. With a steadily expanding automotive market and ongoing demand for our high-quality leads from both retail and wholesale customers, we remain enthusiastic about Autobytel’s prospects.
“We recently completed the acquisition of Advanced Mobile, a leader in providing mobile technologies to the automotive industry,” Coats added. “We are excited to be able to provide dealers with a new way to engage with car shoppers through mobile devices, at the time, place and in a manner preferred by consumers. Mobile use has exploded over the last several years, and this acquisition helps us leverage that trend to assist dealers in selling more cars.”
Total revenues for the 2013 third quarter rose to $21.6 million from $17.5 million last year. Revenues generated from automotive leads advanced 26% to $19.0 million for the 2013 third quarter, up from $15.1 million for last year’s third quarter. The improvement primarily reflected strong demand from automotive dealers (retail) and auto manufacturers (wholesale). Retail revenues grew approximately 10%, and wholesale revenues increased approximately 39% for the 2013 third quarter, compared with last year’s third quarter.
Gross profit increased 31% to $8.8 million, or 40.7% of revenues, for the 2013 third quarter, up from $6.7 million, or 38.5% of revenues, last year.
Total operating expenses were $7.4 million, or 34.3% of revenues, for the third quarter of 2013, compared with $6.1 million, or 34.9% of revenues, for the third quarter of last year. Third quarter 2013 total operating expenses included approximately $250,000 in costs related to the acquisition of Advanced Mobile as well as increased marketing and branding expenditures.
Net income for the 2013 third quarter more than doubled to $1.3 million, or $0.13 per diluted share, based on 10.6 million diluted average weighted shares outstanding. Net income for the 2012 third quarter was $551,000, or $0.06 per diluted share, based on 10.1 million diluted average weighted shares outstanding.
EBITDA for the third quarter of 2013 rose to $2.0 million, from $1.3 million for the same quarter last year. Cash net income grew to $1.9 million, or $0.18 per diluted share, for the third quarter of 2013, up from $1.4 million, or $0.14 per diluted share, for last year’s third quarter.
Nine-Month Results For the year-to-date period ended September 30, 2013, revenues grew 16% to $57.7 million, up from $49.9 million for the first nine months of 2012. Auto lead revenues increased 18% for the first nine months of 2013, compared with the same period last year. Retail revenues grew 11%, and wholesale revenues improved 24% for the first nine months of 2013, versus the first nine months of 2012.
Gross profit increased to $22.4 million, or 38.8% of revenues, for the 2013 year-to-date period, compared with $19.9 million, or 39.9% of revenues, for the same period last year.
Total operating expenses for the first nine months of 2013 amounted to $20.4 million, or 35.4% of total revenues, versus $18.6 million, or 37.3% of total revenues, for the first nine months of last year.
Net income for the 2013 year-to-date period rose to $2.0 million, or $0.21 per diluted share, based on 10.3 million diluted average weighted shares outstanding. Net income for the year-ago period was $1.0 million, or $0.11 per diluted share, based on 9.3 million diluted average weighted shares outstanding.
EBITDA for the first nine months of 2013 totaled $4.0 million, up from $3.1 million for the first nine months of last year. Cash net income totaled $4.1 million, or $0.40 per diluted share, for the first nine months of 2013, versus $3.4 million, or $0.36 per diluted share, for the same period last year.
Cash and cash equivalents increased to $17.4 million at September 30, 2013, from $15.3 million at December 31, 2012.
Cash flow provided by operations was $1.8 million for the third quarter of 2013, compared with $1.5 million last year. Cash flow provided by operations totaled $2.7 million for the first nine months of 2013, versus $4.4 million for the first nine months of 2012. The nine months decrease in cash flow provided by operations is related to an increase in working capital resulting from the significant increase in revenue compared with the prior period.
Recent Business Developments During the third quarter of 2013, Autobytel made a $2.5 million strategic investment in AutoWeb, a new, pay-per-click, auction-driven automotive advertising marketplace that will help automotive content publishers monetize traffic that has previously been under-monetized. In addition to the $2.5 million cash investment, Autobytel also assigned to AutoWeb Autobytel’s rights to the AutoWeb trademarks and domain name (valued by the parties at $1.5 million). The investment represents Autobytel’s ongoing commitment to deliver serious car buyers to customers and a personalized online experience to consumers.
Autobytel teamed with SaleMove, whose patent-pending technology allows auto dealers and manufacturers to enhance the online shopping experience by interacting with consumers in real-time, using the method most comfortable to them, including live video, audio, text-based chat or phone. During the 2013 third quarter, Autobytel made an initial investment in SaleMove and plans to support the company in SaleMove’s ongoing development of its innovative technology.
Subsequent to the end of the third quarter, the company acquired Advanced Mobile, LLC for an initial consideration of $2.5 million. Advanced Mobile can earn up to an additional $1.5 million in contingent payments based on the revenue and gross profit performance of the acquired business over a three-year period beginning on January 1, 2014. Advanced Mobile’s suite of services, which helps facilitate communication between dealers and car buyers through smart phones and tablets, forms the basis of a collection of mobile services that Autobytel plans to offer to auto dealer and manufacturer customers, as well as to consumers through Autobytel’s own websites.
Business Outlook Based on current business trends, Autobytel estimates 2013 fourth quarter revenues in the range of $19 million to $20 million, representing solid year-over-year growth and the usual, expected seasonal softening, and anticipates gross margin of 40%.
Conference Call Autobytel management will host a conference call today at 5 p.m. ET/2 p.m. PT to discuss its 2013 third quarter financial results. Interested parties may participate in the live call by dialing (877) 852-2929, passcode 86973459. An audio broadcast will also be available through a live webcast at www.autobytel.com (click on ”Investor Relations” and then click on ”Events & Presentations”). Please visit the website at least 15 minutes prior to the start of the call to register and download any necessary software. For those unable to listen to the live broadcast, the call will be archived for one year on Autobytel’s website. A telephone replay of the call will also be available through November 14, 2013 by dialing (855) 859-2056, passcode 86973459. The slides that will be referenced during the call will be available on the company’s website at www.autobytel.com (click on ”Investor Relations” and then click on ”Events & Presentations”). The slides will contain disclosures of EBITDA, cash flow, cash net income and cash net income per diluted share, which are non-GAAP financial measures as defined by SEC Regulation G. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures will be included in the slides.
Note about Non-GAAP Financial Measures Autobytel has disclosed EBITDA, cash net income and cash net income per diluted share, which are non-GAAP financial measures as defined by SEC Regulation G, for the 2012 and 2013 third quarter and nine-month period. The company defines EBITDA as earnings before interest, taxes, depreciation and amortization. The company defines cash net income as net income plus depreciation and amortization and non-cash share-based compensation and defines cash net income per diluted share as cash net income divided by weighted average diluted shares outstanding. The company’s management believes that presenting EBITDA, cash net income and cash net income per diluted share provides useful information to investors regarding the underlying business trends and performance of the company’s ongoing operations. These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management strongly encourages investors to review the company’s consolidated financial statements in their entirety and to not rely on any single financial measure. A table providing a reconciliation of EBITDA, cash net income and cash net income per diluted share to the closest GAAP financial measures is included at the end of this press release.