Autobytel Inc. Files Form 10-Q Quarterly Report with the SEC and Reports First Quarter 2006 Results.IRVINE Irvine, town, Scotland Irvine (ûr`vĭn), town (1991 pop. 32,507), North Ayrshire, SW Scotland, on the Irvine River estuary. Industries include iron and brass foundries. Other products are chemicals, electric goods, and clothing. , Calif. -- Autobytel Autobytel, Inc. NASDAQ: ABTL is an Irvine, California, company and the largest online automotive marketplaces. Autobytel owns and operates websites including Autobytel.com, myRide.com, Autoweb.com, CarSmart.com, Car.com, and CarTV.com which facilitate car-shopping decisions. Inc. (Nasdaq:ABTL ABTL Association Belge des Technologues de Laboratoire ), a leading Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the automotive marketing services company, today announced it filed with the Securities and Exchange Commission its Form 10-Q Form 10-Q See 10-Q. Quarterly Report for the first quarter ended March 31, 2006. "The results of this quarter have reinforced re·in·force also re-en·force or re·en·force tr.v. re·in·forced, re·in·forc·ing, re·in·forc·es 1. To give more force or effectiveness to; strengthen: The news reinforced her hopes. my goal to refocus Verb 1. refocus - focus once again; The physicist refocused the light beam" focus - cause to converge on or toward a central point; "Focus the light on this image" 2. the company on its core mission of providing increased value to consumers which, we believe, will result in enhanced value for our dealer and OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and customers and greater leverage for our business," said Autobytel President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Jim Riesenbach. "This means transitioning the company toward a more media-centric business model as we look for synergies and integration opportunities between our business units and new ways to reduce costs and capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. , with the ultimate goal of putting the company in a position to succeed long term." Summary of the Quarter Ended March 31, 2006: Revenue for the first quarter of 2006 was $29.1 million, of which $18.0 million was related to Lead Fees, $3.8 million was related to Advertising, $6.3 million was related to CRM (Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. services, and $1.0 million was related to Data, Applications and Other. Total revenue declined $4.3 million, or 13% from revenue of $33.3 million in the first quarter of 2005. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were $38.0 million in the first quarter of 2006, an increase of $1.7 million from operating expenses of $36.3 million in the first quarter 2005. Due to the adoption of SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 123R, operating expenses in the first quarter of 2006 included $1.3 million of compensation expense. Net loss for the first quarter was $8.5 million, or a loss of $0.20 per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. The Company delivered approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 0.9 million Purchase Requests in the first quarter of 2006. Of these, approximately 0.5 million were delivered to retail dealers and approximately 0.4 million were delivered to enterprise dealers. Additionally, the Company delivered 0.2 million Finance Leads in the first quarter of 2006. As of March 31, 2006, the Company had approximately 6,320 lead referral dealer relationships comprised of approximately 5,560 retail dealer relationships (including approximately 160 suspended sus·pend v. sus·pend·ed, sus·pend·ing, sus·pends v.tr. 1. To bar for a period from a privilege, office, or position, usually as a punishment: suspend a student from school. dealers) and approximately 760 enterprise dealer relationships attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to major dealer group customers. In addition, as of March 31, 2006, the Company had 9 direct relationships with automotive manufacturers or their automotive buying service affiliates, encompassing 19 vehicle brands representing up to approximately 20,460 enterprise dealer relationships. As of March 31, 2006, the Company's finance lead referral network included approximately 350 relationships with retail dealers, finance request intermediaries, and automotive finance companies. In addition, as of March 31, 2006, CRM customer relationships consisted of 3,020 Web Control(R) system and approximately 870 Retention Performance Marketing(R) program relationships. Domestic cash, cash equivalents, and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments totaled $43.8 million as of March 31, 2006. Net cash used in operations was $4.3 million in the first quarter of 2006. Business Outlook "Dealers and consumers are waiting for new world-class world-class adj. 1. Ranking among the foremost in the world; of an international standard of excellence; of the highest order: a world-class figure skater. 2. products and experiences to help with each side of the car buying equation. I believe that those who innovate in·no·vate v. in·no·vat·ed, in·no·vat·ing, in·no·vates v.tr. To begin or introduce (something new) for or as if for the first time. v.intr. To begin or introduce something new. and deliver ever-increasing value to all their customers, while operating their business with discipline and efficiency, win in the marketplace," continued Riesenbach. "I'm I'm Contraction of I am. Our Living Language Speakers of some scattered varieties of American English sometimes use I'm instead of I've or I have in present perfect constructions, as in looking forward to leading this charge and creating shareholder value as we transform this company." Conference Call A conference call to discuss first quarter 2006 financial results will be webcast live on Wednesday Wednesday: see week. , May 10, 2006, at 5:00 PM Eastern Time. Participants may listen to a webcast of the live conference call over the Internet by visiting the investor relations Investor relations The process by which the corporation communicates with its investors. section of the Company's website located at: www.autobytel.com. Below is a direct link to the registration page. Please go to the website at least ten minutes prior to the call to register, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. , and install any necessary audio software. http://www.irconnect.com/abtl/conf/1q2006.html A replay number is available beginning at 8:00 p.m. Eastern Time (5:00 p.m. Pacific Time). The replay of the conference call may be accessed by dialing (800) 642-1687 or (706) 645-9291 for international callers. The conference ID for the replay is 8861017. About Autobytel Inc. Autobytel Inc. (Nasdaq:ABTL), a leading Internet automotive marketing services company, helps retailers sell cars and manufacturers build brands through marketing, advertising, data and CRM products and programs. Autobytel owns and operates automotive websites, including Autobytel.com, Autoweb.com, Carsmart.com, Car.com, AutoSite autosite /au·to·site/ (aw´to-sit) the larger, more normal member of asymmetrical conjoined twin fetuses, to which the parasite is attached. au·to·site n. .com, Autoahorros.com, and CarTV.com. This automotive research and buying network reaches millions of car shoppers each month as they make their vehicle buying decisions, generating billions of dollars in sales for dealers. A leader in dealership customer management and CRM solutions, Autobytel also owns and operates AVV AVV Adviesdienst Verkeer en Vervoer AVV Augsburger Verkehrsverbund (German) AVV Aachener Verkehrsverbund GmbH (German) AVV Aruba Exempt Company , Inc., a top provider of dealership CRM and sales management Sales Management Role and Goal Importance of sales management is critical for any commercial organization. Expanding business in not possible without increasing sales volumes, and effective sales management goal is to organize sales team work in such a manner that ensures a products, and Retention Performance Marketing, Inc. (RPM (1) (Revolutions Per Minute) With electric and electronics devices, RPM measures the rotational speed of the motor's spindle. Floppy disks rotate at 300 RPM, while hard disks rotate from 3,000 to 15,000 RPM. (R)), which powers dealerships with cutting-edge customer loyalty and retention marketing programs. Autobytel's Automotive Information Center has been a trusted industry source of automotive marketing data and technology for nearly 24 years. FORWARD-LOOKING STATEMENT forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. DISCLAIMER (networking) disclaimer - Statement ritually appended to many Usenet postings (sometimes automatically, by the posting software) reiterating the fact (which should be obvious, but is easily forgotten) that the article reflects its author's opinions and not necessarily those of the The statements contained in this press release that are not historical facts are forward-looking statements under the federal securities laws. These forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Actual outcomes and results may differ materially from what is expressed in, or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by, such forward-looking statements. Autobytel undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those expressed in, or implied by, the forward-looking statements are changes in general economic conditions, the economic impact of terrorist attacks or military actions, increased dealer attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: , pressure on dealer fees, increased or unexpected competition, the failure to realize anticipated synergies from acquired entities, costs related to acquisitions, failure to retain key employees at acquired entities, difficulties in successfully integrating the businesses and technologies of acquired entities and Autobytel, that actual costs and expenses exceed the charges taken by Autobytel, changes in laws and regulations, costs of defending lawsuits and undertaking investigations and related matters and other matters disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). in Autobytel's filings with the Securities and Exchange Commission. Investors are strongly encouraged to review our annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December December: see month. 31, 2005, and other filings with the Securities and Exchange Commission for a discussion of risks and uncertainties that could affect operating results and the market price of our stock.
Autobytel Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
(unaudited)
March 31, December 31,
2006 2005
------------ ------------
ASSETS
Current assets:
Domestic cash and cash equivalents $31,819 $33,353
Restricted international cash and cash
equivalents 238 241
Short-term investments 12,000 12,000
Accounts receivable, net of allowance for
bad debts and customer credits of $899
and $1,124, respectively 19,236 19,042
Prepaid expenses and other current assets 1,774 2,456
------------ ------------
Total current assets 65,067 67,092
Long-term investments - 3,000
Property and equipment, net 4,517 4,226
Goodwill 70,697 70,697
Acquired intangible assets, net 1,794 2,189
Other assets 86 124
------------ ------------
Total assets $142,161 $147,328
============ ============
LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $7,291 $5,709
Accrued expenses 6,576 7,417
Deferred revenues 4,432 3,874
Other current liabilities 1,776 1,666
------------ ------------
Total current liabilities 20,075 18,666
Deferred rent - non-current 140 131
Deferred revenues - non-current 10 21
------------ ------------
Total liabilities 20,225 18,818
Minority interest 166 163
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.001 par value;
11,445,187 shares authorized; none
outstanding - -
Common stock, $0.001 par value;
200,000,000 shares authorized; 42,324,055
and 42,133,410 shares issued and
outstanding, respectively 42 42
Additional paid-in capital 284,810 282,924
Accumulated deficit (163,082) (154,619)
------------ ------------
Total stockholders' equity 121,770 128,347
------------ ------------
Total liabilities, minority interest and
stockholders' equity $142,161 $147,328
============ ============
Autobytel Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Amounts in thousands, except share and per share data)
(unaudited)
Three Months Ended
March 31,
-----------------------
2006 2005
----------- -----------
Revenues $29,072 $33,328
Costs and expenses:
Cost of revenues 14,789 13,387
Sales and marketing 7,533 8,082
Product and technology development 5,624 6,071
General and administrative 9,703 8,328
Amortization of acquired intangible assets 357 460
----------- -----------
Total costs and expenses 38,006 36,328
----------- -----------
Loss from operations (8,934) (3,000)
Interest income 471 349
Foreign currency exchange gain 3 2
----------- -----------
Loss before income taxes and minority
interest (8,460) (2,649)
Provision for income taxes - (144)
Minority interest (3) (17)
----------- -----------
Net loss $(8,463) $(2,810)
=========== ===========
Net loss per share:
Basic $(0.20) $(0.07)
=========== ===========
Diluted $(0.20) $(0.07)
=========== ===========
Shares used in computing net loss per share:
Basic 42,192,349 41,905,848
=========== ===========
Diluted 42,192,349 41,905,848
=========== ===========
Comprehensive loss:
Net loss $(8,463) $(2,810)
Foreign currency translation adjustment - (65)
----------- -----------
Comprehensive loss $(8,463) $(2,875)
=========== ===========
Autobytel Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(unaudited)
Three Months Ended
March 31,
-------------------
2006 2005
-------------------
Cash flows from operating activities:
Net loss $(8,463) $(2,810)
Adjustments to reconcile net loss to net cash
used in operating activities:
Non-cash charges:
Depreciation and amortization 503 565
Amortization of acquired intangible assets 395 499
Provision for bad debt 2 210
Provision for customer credits 524 814
Loss on disposal of property and equipment 4 -
Stock-based compensation 1,290 -
Minority interest 3 17
Foreign currency exchange gain 3 -
Changes in assets and liabilities:
Accounts receivable (720) (1,769)
Prepaid expenses and other current assets 682 172
Other assets 38 4
Accounts payable 1,582 2,048
Accrued expenses (841) 324
Deferred revenues 547 (7)
Other current liabilities 119 (123)
-------------------
Net cash used in operating activities (4,332) (56)
-------------------
Cash flows from investing activities:
Maturities of short-term and long-term
investments 3,000 7,500
Purchases of short-term and long-term investments - (6,000)
Change in restricted international cash and cash
equivalents - (73)
Purchases of property and equipment (808) (478)
Proceeds from sale of property and equipment 10 -
-------------------
Net cash provided by investing activities 2,202 949
-------------------
Cash flows from financing activities:
Proceeds from exercise of stock options and
awards issued under the employee stock purchase
plan 596 -
-------------------
Net cash provided by financing activities 596 -
-------------------
Net (decrease) increase in cash and cash
equivalents (1,534) 893
Cash and cash equivalents, beginning of period 33,353 24,287
-------------------
Cash and cash equivalents, end of period $31,819 $25,180
===================
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes $114 $407
===================
Autobytel Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Amounts in thousands, except per share data)
(unaudited)
Three Months Ended
-----------------------------------------------
March 31, Dec. 31, Sept. 30, June 30, March 31,
2006 2005 2005 2005 2005
--------- -------- --------- -------- ---------
Revenues $29,072 $29,961 $30,595 $31,385 $33,328
Costs and expenses:
Cost of revenues 14,789 13,368 12,811 12,682 13,387
Sales and marketing 7,533 6,099 6,069 7,008 8,082
Product and
technology
development 5,624 5,067 5,713 6,279 6,071
General and
administrative 9,703 6,662 6,476 8,539 8,328
Amortization of
acquired intangible
assets 357 356 370 354 460
--------- -------- --------- -------- ---------
Total costs and
expenses 38,006 31,552 31,439 34,862 36,328
--------- -------- --------- -------- ---------
Loss from operations (8,934) (1,591) (844) (3,477) (3,000)
Interest income 471 423 401 389 349
Foreign currency
exchange gain 3 1,548 11 8 2
--------- -------- --------- -------- ---------
(Loss) income before
income taxes and
minority interest (8,460) 380 (432) (3,080) (2,649)
(Provision) benefit
for income taxes - (102) 145 (127) (144)
Minority interest (3) (156) - (76) (17)
--------- -------- --------- -------- ---------
Net (loss) income $(8,463) $122 $(287) $(3,283) $(2,810)
========= ======== ========= ======== =========
Net (loss) income per
share:
Basic $(0.20) $0.00 $(0.01) $(0.08) $(0.07)
========= ======== ========= ======== =========
Diluted $(0.20) $0.00 $(0.01) $(0.08) $(0.07)
========= ======== ========= ======== =========
Shares used in
computing net (loss)
income per share:
Basic 42,192 42,058 41,955 41,907 41,906
========= ======== ========= ======== =========
Diluted 42,192 43,746 41,955 41,907 41,906
========= ======== ========= ======== =========
Comprehensive (loss)
income:
Net (loss) income $(8,463) $122 $(287) $(3,283) $(2,810)
Foreign currency
translation
adjustment - (165) (87) (249) (65)
Reclassification of
foreign cumulative
translation
adjustment for
liquidation of
Autobytel.Europe
recognized in net
(loss) income - (1,533) - - -
--------- -------- --------- -------- ---------
Comprehensive loss $(8,463) $(1,576) $(374) $(3,532) $(2,875)
========= ======== ========= ======== =========
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