Navidec Reports 154% Fourth Quarter, 42% Annual Revenue Growth
30 March 1999
Navidec Reports 154% Fourth Quarter, 42% Annual Revenue Growth
NetSolutions Group Increases 131%; Automotive Group Up 321%
Key milestones:
Automotive Group
-- Considering a plan to establish a new entity for its Internet based
auto buying solutions
-- Increased monthly Internet auto purchase requests up 3,500 percent
-- Acquired LeaseSource and CarWizard
NetSolutions Group
-- Named one of only 14 Authorized Java Centers by Sun Microsystems
-- Reached month-to-month profitability in September 1998
DENVER, March 30 -- Navidec Inc. today
reported that continued success from its Internet-based growth strategy
produced consolidated revenues for the fourth quarter ended December 31, 1998,
of $2,877,000, a 154 percent increase over fourth quarter 1997 revenues of
$1,131,000. Consolidated revenues for the year ended December 31, 1998,
increased to $8,555,000, a 42 percent increase over 1997 revenues of
$6,008,000. The company reported a loss for the year of $3,928,000, or $1.10
per share compared with a loss in 1997 of $4,107,000, or $1.47 per share.
Revenues from the company's Automotive Group were $939,000 for 1998, up
321 percent from revenues of $223,000 in 1997. The company's NetSolutions
Group which provides enterprise-level and E-commerce solutions for Fortune
1000 clients generated revenues of $5,443,000 in 1998, a 131 percent increase
from revenues of $2,359,000 in 1997.
The company said that growth continued to accelerate as its Internet
products and vertical market focus on the online automotive industry benefited
from an explosive E-commerce market and its own competitive business
advantages. The company expects continued future rapid revenue growth.
Growth Platform
The company reported substantial gains in building its Internet growth
platform through increased relicensing of its online automotive products, such
as its agreement with CBS New Media to create CBS.CarWizard.com. Strong
demand for Navidec's enterprise integration and development services are
driving ongoing growth for the company's NetSolutions Group.
Recent Acquisitions
In December 1998, Navidec acquired Ohio-based LeaseSource, Inc. and
CarWizard, Inc. The companies operated LeaseSource.com and CarWizard.com, two
of the Internet's top automotive information web sites. Aside from bringing
two of the web's most highly respected auto research sites to the Navidec
automotive network, these acquisitions established Navidec as the auto
research content provider for major Internet portals including Excite,
Netscape, WebCrawler, Magellan and Prodigy.
CarWizard and LeaseSource were incorporated into Navidec's Automotive
Group, creating 1998 proforma combined revenues of $1,546,000, a 593 percent
increase over 1997 Automotive Group revenues. Proforma combined revenues for
the company were $9,162,000 in 1998, an increase of 52 percent from 1997.
Comments from Management
Navidec's president and CEO Ralph Armijo said, "The explosive growth we
experienced in the fourth quarter was sparked by growing consumer acceptance
of the USWheels.com product as well as enhancing our NetSolutions Group
client-base with companies including Columbine JDS and Pentax."
"In 1998, Navidec enhanced its position in the online auto buying industry
by signing a five-year partnership with Bank One Credit Company to expand the
USWheels.com network to 75 markets by the end of 2000; partnering with CBS New
Media to jointly market USWheels.com to CBS affiliates nationwide; and
partnering with Automotive Lease Guide to market Navidec's CarWizard tool to
lending institutions and affinity groups," added Armijo.
Navidec's Growth
Navidec's growth is a direct result of the strategic business decisions
made by the company's management team. In 1997, Navidec was well established
as a leading Internet integrator in the Rocky Mountain region. The company's
expertise in the online automotive industry was exhibited by developing
numerous successful automotive dealer web sites. Through this online
automotive expertise, Navidec's first vertical market focus was born.
While the company continued enhancing its Internet and E-commerce
solutions, the first site in the USWheels.com network was launched in December
1997. Navidec partners with Bank One and a local television station or
newspaper to produce each site in the USWheels.com network. These
partnerships create and promote regional sites that showcase the continually
updated inventory of each market's top auto dealers.
In 1998, Navidec expanded USWheels.com and the rest of the company's
automotive network. In January 1998, the USWheels.com network generated 331
vehicle purchase requests. Through the year, Navidec continued opening new
markets and two of the year's top automotive highlights came in December when
the company developed CBS CarWizard for CBS.com and also acquired LeaseSource
and CarWizard, two leading online automotive companies.
By December 1998, the number of web sites in Navidec's automotive network
increased to fourteen, with purchase requests increasing 3,500 percent from
January 1998 to more than 11,500 consumer requests for new and used vehicles
in December 1998.
In achieving a more than 150 percent revenue increase in 1998, the
company's NetSolutions Group landed many new top-tier clients and strengthened
its partnerships with Internet leaders including Sun Microsystems and
Netscape. In August, Sun Microsystems named Navidec one of the first four
Authorized Java Centers in the United States. Sun gave Navidec this status
based on its expertise in providing Internet and electronic commerce solutions
as well as automotive industry applications using Java. The company also
became the only Premier Netscape Solutions Expert in Colorado during the
fourth quarter of 1998.
Sales Force Growth
Continuing its rapid growth, Navidec increased sales staff in its
NetSolutions Group and Automotive Group by 38 percent in the fourth quarter.
This sales staff increase includes the establishment of sales forces in
regional USWheels.com markets to expand and provide better service to dealers
in its automotive network.
Business Partners
Aside from enhancing the company's existing partnerships with Bank One,
Sun Microsystems and Netscape, Navidec established additional strategic
partnerships in 1998. Part of Navidec's fourth quarter agreement to develop
the CBS CarWizard for CBS New Media was that Navidec and CBS will jointly
market USWheels.com to CBS affiliates nationwide. This simplifies the process
of opening new USWheels.com markets. Other online automotive partnerships
include Motor Trend, Chrome Data and Automotive Lease Guide. Navidec's
NetSolutions Group also expanded its partner base to include numerous Internet
leaders including BEA/WebXpress, Verio, Oblix, Resonate, Marimba and Kana
Communications.
About the Company
Navidec Inc., based in Englewood, Colo., is a leading national provider of
products and solutions that use web-based technologies to achieve its
customers' business objectives. From commercial web site development to the
design and implementation of intranet and extranet applications and tools,
Navidec helps customers develop successful online solutions. Navidec's
premier vertical market focus is on the automotive industry with its
USWheels.com, CarWizard.com and LeaseSource.com web sites. Navidec partners
with Bank One and regional media outlets to produce USWheels.com web sites in
markets nationwide. The company's web site address is http://www.navidec.com.
Note to financial community: Navidec management will host a conference
call to discuss financial results and company direction today at 4:00 p.m.
EST. Call 800-754-1053 or visit http://www.vcall.com to attend.
FINANCIAL HIGHLIGHTS:
Statement of Operations
Three Months Ended Dec. 31, Year Ended Dec. 31,
1998 1997 1998 1997
Net Sales $2,877,000 $1,131,000 $8,555,000 $6,008,000
Gross Margin 740,000 146,000 2,685,000 1,789,000
Net Loss (2,072,000) (2,537,000) (3,928,000) (4,107,000)
Net Loss Per Share
(basic/diluted) (.58) (.83) (1.10) (1.47)
All statements in this press release, other than historical facts, are
forward looking statements. These statements are based on certain assumptions
and analyses made by Navidec in light of its experience and its perception of
historical trends, current conditions, expected future developments and other
factors it believes are appropriate under the circumstances. Such statements
are subject to a number of risks and uncertainties, including general and
economic business conditions, demand for automobiles, competition from other
automotive online services, market acceptance of the Wheels solutions, the
ability of Navidec to reach agreements with local media partners and other
risk factors indicated from time to time in Navidec's filings with the
Securities and Exchange Commission. Those filings are available online at
http://www.freeedgar.com