CoStar Group, Inc. Announces Second Quarter 2003 Results; Company Reports 108% Year-Over-Year EBITDA Growth.Business Editors BETHESDA Bethesda, city, United States Bethesda, uninc. city (1990 pop. 62,936), Montgomery co., W central Md., an affluent residential and commercial suburb of Washington, D.C. The area was settled in the late 17th cent. , Md.--(BUSINESS WIRE)--July 22, 2003 CoStar Group CoStar Group, Inc. (NASDAQ: CSGP) is a leading provider of information services to commercial real estate professionals in the United States and the United Kingdom. CoStar's suite of services offers customers access via the Internet to the most comprehensive database of , Inc. (Nasdaq:CSGP CSGP Combat Support Group (USAF squadron type) CSGP Computer Systems Group ) revenues increased 18.6% and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Year 2002-2003 Quarterly Results
($'s in millions, except per share data)
2002 2003
------------------------ ------------
Q1 Q2 Q3 Q4 Q1 Q2
------------------------ ------------
Revenues $19.1 $19.5 $20.1 $20.7 $22.6 $23.2
EBITDA 1.3 1.4 1.6 2.0 2.4 2.9
Pro forma net income 0.2 0.3 0.4 0.8 1.0 1.4
Pro forma net income per share 0.01 0.02 0.03 0.05 0.06 0.09
Net income (loss) (1.6) (1.3) (1.1) (0.8) (0.8) (0.4)
Net income (loss) per share (0.10)(0.08)(0.07)(0.05) (0.05)(0.02)
Weighted average common shares 15.7 15.7 15.8 15.8 15.8 15.9
CoStar Group, based in Bethesda, MD, is the leading provider of information services See Information Systems. to the commercial real estate industry in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and the United Kingdom. Revenues for the second quarter of 2003 were $23.2 million, an increase of 18.6% compared to the second quarter of 2002. In addition, revenues increased sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen by 2.7% for the second quarter of 2003 over the first quarter of 2003. CoStar has reported revenue increases in 20 consecutive quarters since its IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. . "Our subscription-based model has produced consistent quarterly increases in revenues, which have translated into consistent earnings growth," stated CoStar President & 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. Andrew C. Florance. "The investments we have made in developing our products and our infrastructure are now paying off with strong EBITDA and cash flow." For the quarter ended June June: see month. 30, 2003, pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net income, which excludes only purchase amortization, improved to $1.4 million or $0.09 per share versus pro forma net income of $256,000 or $0.02 per share for the same quarter in 2002. EBITDA increased to $2.9 million for the second quarter of 2003 compared to EBITDA of $1.4 million in the second quarter of 2002. The Company's GAAP-basis net loss for the second quarter of 2003 narrowed to ($367,000) or $(0.02) per share, compared to a net loss of $(1.3) million or $(0.08) per share for the second quarter of 2002. As of June 30, 2003, the Company had $31.6 million in 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, an increase of $5.3 million or 20% compared to March 31, 2003. This substantial increase resulted from strong operating cash flows Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. and proceeds of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $2.2 million from stock option exercises for approximately 122,000 shares of common stock. In addition, the Company continues to have no long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . "The new product platform we released in December December: see month. 2002 has been very well received," Florance added. "Usage of CoStar Property 8.0, our flagship This article is about the lead ship, store, or product of a group. For other uses, see Flagship (disambiguation). A flagship is the ship used by the commanding officer of a group of naval ships. leasing and analysis product, increased 79% in the second quarter of 2003 from an average of approximately 1.4 million weekly page views at the end of March 2003 to an average of approximately 2.5 million weekly page views at the end of June 2003. We believe that our new generation of products, together with our strong balance sheet and experienced team, positions us very well for continued growth." "For the third quarter of 2003, we expect overall sequential One after the other in some consecutive order such as by name or number. quarterly revenue growth of approximately 2.5% to 3.0% over the second quarter of 2003, and pro forma net income of approximately $0.12 per share," said Frank Carchedi, CoStar's Chief Financial Officer. "Adjusting these pro forma amounts for purchase amortization, which we anticipate will be consistent with the charges for the second quarter of 2003, we expect to have GAAP-basis net income of approximately $0.01 per share in the third quarter of 2003."
CoStar Group, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
2003 2002 2003 2002
----------- -------- ----------- --------
(unaudited) (unaudited)
Revenues $23,174 $19,539 $45,727 $38,600
Cost of revenues 7,716 6,937 15,319 14,033
----------- -------- ----------- --------
Gross margin 15,458 12,602 30,408 24,567
Operating expenses:
Selling and marketing 6,397 5,565 12,966 11,234
Software development 1,702 1,385 3,402 2,782
General and administrative 6,669 6,235 13,158 12,102
Purchase amortization 1,113 898 2,225 1,791
----------- -------- ----------- --------
15,881 14,083 31,751 27,909
----------- -------- ----------- --------
Loss from operations (423) (1,481) (1,343) (3,342)
Other income, net 56 214 133 453
----------- -------- ----------- --------
Net loss $(367) $(1,267) $(1,210) $(2,889)
=========== ======== =========== ========
Net loss per share $(0.02) $(0.08) $(0.08) $(0.18)
=========== ======== =========== ========
Pro forma net income $1,450 $256 $2,422 $481
=========== ======== =========== ========
Pro forma net income per
share $0.09 $0.02 $0.15 $0.03
=========== ======== =========== ========
Weighted average common
shares 15,856 15,742 15,835 15,730
=========== ======== =========== ========
Reconciliation of Non-GAAP Financial
Measures with Net Loss
Net loss $(367) $(1,267) $(1,210) $(2,889)
Purchase amortization in
cost of revenues 704 625 1,407 1,579
Purchase amortization in
operating expenses 1,113 898 2,225 1,791
----------- -------- ----------- --------
Pro forma net income $1,450 $256 $2,422 $481
=========== ======== =========== ========
Pro forma net income $1,450 $256 $2,422 $481
Depreciation and other
amortization 1,464 1,329 2,920 2,680
Interest income, net (56) (214) (134) (453)
----------- -------- ----------- --------
EBITDA $2,858 $1,371 $5,208 $2,708
=========== ======== =========== ========
Costar Group, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
June 30, March 31, December 31,
2003 2003 2002
---------- ---------- ------------
(unaudited)(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $30,507 $24,910 $25,546
Short-term investments 1,094 1,405 1,598
Cash held for acquisition 0 0 16,386
Accounts receivable, net 5,859 7,123 6,786
Prepaid and other current assets 1,579 1,723 1,567
---------- ---------- ------------
Total current assets 39,039 35,161 51,883
Property and equipment, net 10,087 10,689 11,048
Intangible and other assets, net 71,574 72,755 55,704
Deposits 290 280 272
---------- ---------- ------------
Total assets $120,990 $118,885 $118,907
========== ========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued
expenses $9,884 $9,050 $10,124
Deferred revenue 5,094 6,505 4,766
---------- ---------- ------------
Total current liabilities 14,978 15,555 14,890
Stockholders' equity 106,012 103,330 104,017
---------- ---------- ------------
Total liabilities and stockholders'
equity $120,990 $118,885 $118,907
========== ========== ============
Management will conduct a conference call to discuss earnings results for the quarter ended June 30, 2003 and financial outlook for 2003 at 11:00 am ET, Wednesday Wednesday: see week. , July July: see month. 23, 2003. This conference call will be broadcast live over the 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 at www.costar.com/corporate/investor. If you would like to join by telephone, please call (800) 329-4405 within the United States or (706) 634-0964 outside the United States. A telephonic replay of the conference call will be available two hours after the live call concludes through midnight on August 1, 2003. The replay telephone number is (800) 642-1687 within the United States or (706) 645-9291 outside the United States. Refer to Conference ID 1429694. The replay will also be available over the Internet at www.costar.com/corporate/investor for a period of time following the call. About CoStar Group, Inc. CoStar Group, Inc., (NASDAQ:CSGP) is the leading provider of information services to commercial real estate professionals in the United States and the United Kingdom. CoStar's suite of products offers customers access via the Internet to the most comprehensive, verified ver·i·fy tr.v. ver·i·fied, ver·i·fy·ing, ver·i·fies 1. To prove the truth of by presentation of evidence or testimony; substantiate. 2. database of commercial real estate information on 50 U.S. markets, London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. and the United Kingdom. Based in Bethesda, MD, the company has approximately 800 employees in 34 offices throughout the United States and the United Kingdom, including the largest professional research organization in the industry. This news release includes "forward-looking statements 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. " including, without limitation, statements regarding CoStar's expectations, beliefs, intentions or strategies regarding the future. These statements are subject to many risks and uncertainties that could cause actual results to differ materially from these statements. More information about potential factors that could cause actual results to differ materially include, but are not limited to, those stated in CoStar's filings from time to time with the Securities and Exchange Commission, including CoStar's Form 10-Q Form 10-Q See 10-Q. for the quarter ended March 31, 2003, under the heading "Risk Factors". In addition to these statements, there can be no assurance that CoStar's revenues will grow at the rates specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. herein, that CoStar's pro forma net income for the third quarter of 2003 will be as stated in this press release, that CoStar's GAAP-basis net income/loss for the third quarter of 2003 will be as stated in this press release, that CoStar's estimated purchase amortization will be as stated in this press release, that CoStar's sequential quarterly growth rate or earnings will continue to improve, or that CoStar will reach GAAP-basis net income during 2003. All forward-looking statements are based on information available to CoStar on the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , and CoStar assumes no obligation to update such statements. |
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