CoStar profits rise in second quarter.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. revenues increased 18.5% and pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. increased 131% in the second quarter of 2004 over the second quarter of 2003, the company announced recently. CoStar also reported GAAP-basis net income of $0.09 per share in the second quarter of 2004, compared to a GAAP-basis net loss of $(0.02) per share in the second quarter of 2003. Revenues for the second quarter of 2004 were $27.5 million, increasing sequentially by 4.5% for the second quarter of 2004 over the first quarter of 2004. CoStar has reported revenue increases in 24 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. . "We have continued to produce strong revenue and earnings growth on the strength of our core product offerings, while investing in and meeting the operational challenges of our 21-market expansion," said CoStar 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. Andrew C. Florence. "Our new technology has been in place for 18 months and is clearly becoming an industry utility. We have continued to reach new customers and our renewal rates have continued to increase." The renewal rate for CoStar's subscription services increased approximately seven percentage points to 92% in the second quarter of 2004, compared to approximately 85% in the second quarter of 2003. "We are making solid progress on our planned expansion into 21 new U.S. markets in 2004 and 2005," Florance added. "We have collected information on and photographed over 27,000 properties since deploying our field research teams into these markets in May and we added over 8,500 high-resolution images to our U.K. database in the second quarter of 2004." "In addition, we are beginning advance sales activity in a handful of U.S. markets that could open by the end of 2004. While we will not realize revenue from these customers until we deliver our service in these markets, we believe we can open some of these markets with enough monthly revenue from pre-sales to cover the monthly baseline The horizontal line to which the bottoms of lowercase characters (without descenders) are aligned. See typeface. baseline - released version operating costs operating costs npl → gastos mpl operacionales of those markets." PeerMark and Scottish Property Network were acquired during the second quarter of 2004, but did not materially impact revenues or earnings in the quarter. "These strategic acquisitions are an integral part of CoStar's expansion plans in the U.S. and U.K.," Florence said. "The acquisition of these strong, local information providers gives additional momentum to the aggressive organic expansion efforts under way and could help us reach revenue and earnings goals on a faster timetable." For the quarter ended June 30, 2004, GAAP-basis net income increased to $1.7 million or $0.09 per share, compared to a net loss of $(367,000) or ($0.02) per share for the second quarter of 2003. Pro forma earnings improved to $3.4 million or $0.18 per share for the second quarter of 2004, compared to pro forma earnings of $1.5 million or $0.09 per share for the same quarter in 2003. 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.
As of June 30, 2004, the company had $107.3 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, a net increase of $2.7 million compared to March 31, 2004 after the acquisition of PeerMark and Scottish Property Network and capital investments in equipment and photography to support the company's expansion. This increase resulted from growing EBITDA, improved cash collections and $2.4 million of cash proceeds from stock option exercises of approximately 107,000 shares of common stock during the second quarter. "For the third quarter of 2004, we expect overall sequential quarterly revenue growth of approximately 4% and pro forma earnings of approximately $0.20 per share," said Frank A. Carchedi, CoStar's chief financial officer. "Adjusting these 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 amounts for purchase amortization and the related income tax benefit, which we expect to be consistent with the amounts for the second quarter of 2004, we expect 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. GAAP-basis net income of approximately $0.11 per share in the third quarter of 2004. In the third quarter, we expect continued investment in our expansion into 21 new U.S. markets and we plan to continue to focus on balancing that investment in long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth with expected earnings growth from existing operations." |
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