SOURCE: InsWeb Corporation

InsWeb Corporation

February 07, 2011 16:30 ET

InsWeb Reports Fourth Quarter and Fiscal 2010 Results

Revenue and Adjusted EBITDA Reach Fourth Quarter and Fiscal Year Records

SACRAMENTO, CA--(Marketwire - February 7, 2011) - InsWeb Corp. (NASDAQ: INSW), a leading online insurance comparison provider, today announced financial results for the fourth quarter and year ended December 31, 2010, which include the fourth quarter results of Potrero Media Corporation acquired on October 1, 2010.

Revenues for fiscal 2010 were $42.4 million, an increase of 20% as compared to $35.2 million for fiscal 2009. Net income for fiscal 2010 was $1.3 million, or $0.23 per diluted share. This compares to a net loss of $1.3 million, or $0.26 per diluted share, for fiscal 2009.

Revenues for the fourth quarter of 2010 were $13.2 million, an increase of approximately 52% as compared to $8.7 million in the fourth quarter of 2009, and an increase of approximately 26% as compared to $10.5 million in the third quarter of 2010. Net income for the fourth quarter of 2010 was $146,000, or $0.02 per diluted share. This compares to net income of $705,000, or $0.14 per diluted share, in the fourth quarter of 2009, and net income of $357,000 or $0.07 per diluted share, in the third quarter of 2010.

Adjusted EBITDA, a non-GAAP financial measure used by InsWeb's management and defined below, was $1.0 million in the fourth quarter of 2010, as compared to Adjusted EBITDA of $785,000 in the fourth quarter of 2009, and $1.3 million in the third quarter of 2010. Adjusted EBITDA for fiscal 2010 was $3.4 million, compared to $103,000 for fiscal 2009.

"Our record fourth quarter results capped off a year of tremendous progress and execution for InsWeb as we continued our efforts to refine our model, align our cost structure and improve our operating leverage. In addition, we completed a sizeable acquisition that broadens our offerings in the health insurance segment as well as complements our marketing efforts, positioning the company for continued growth moving forward," stated InsWeb Chairman & CEO Hussein Enan. "We believe InsWeb is very well-positioned in the online lead generation market for personal lines insurance, and we look forward to building on our record of growth and profitability in 2011. We remain focused on cash generation and continue to evaluate potential acquisitions that are synergistic with our business and that conform to our profitability goals."

InsWeb also announced that the Board of Directors authorized the Company to file a universal shelf registration statement on Form S-3. Once filed with and declared effective by the Securities Exchange Commission, the shelf registration statement will cover the potential issuance of up to $15 million of new securities. The filing of the shelf registration statement is designed to provide InsWeb with greater flexibility to take advantage of acquisition, financing and other business opportunities when and if such opportunities arise. As of the date of this release, InsWeb has no specific plans to issue securities under the shelf registration statement. Accordingly, no assurances can be given as to whether or when any offering under this registration statement will be completed or the exact number of shares that may be issued by InsWeb. This announcement does not constitute an offer of any securities for sale.

Earnings Call Information

The InsWeb fourth quarter and fiscal year 2010 teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific Time, on Monday, February 7, 2011. To participate on the live call, analysts and investors should dial 1-877-941-8416 at least ten minutes prior to the call. InsWeb will also offer a live and archived webcast of the conference call, accessible from the "Events & Presentations" page of InsWeb's Investor Relations website at http://investor.insweb.com/events.cfm.

Non-GAAP Financial Information

In evaluating InsWeb's business, the Company's management considers and uses Adjusted EBITDA as a supplemental measure of operating performance. Adjusted EBITDA refers to a financial measure that the Company defines as net income (loss) excluding interest, taxes, depreciation, amortization, share-based compensation, and other non-recurring gains and losses that are not related to the Company's continuing operations. This measure is an essential component of InsWeb's internal planning process because it facilitates period-to-period comparisons of the Company's operating performance by eliminating potential differences in net income (loss) caused by the existence and timing of non-cash charges and non-recurring gains and losses. Furthermore, Adjusted EBITDA reflects the key revenue and expense items for which InsWeb's operating managers are responsible.

Adjusted EBITDA is not a measurement of the Company's financial performance under U.S. GAAP and has limitations as an analytical tool. You should not consider it in isolation or as a substitute for the Company's U.S. GAAP net income (loss). The principal limitations of this measure are that: 1) it does not reflect the Company's actual expenses and may thus have the effect of inflating or reducing the Company's net income (loss) and net income (loss) per share; and 2) it may not be comparable to Adjusted EBITDA as reported by other companies.

About InsWeb

InsWeb Corporation (NASDAQ: INSW) owns and operates a network of leading insurance marketplace and education websites. Founded in 1995 and headquartered in Sacramento, California, InsWeb's primary properties include InsWeb.com, InsuranceRates.com, LocalInsuranceAgents.com, and AgentInsider.com. InsWeb has invented multiple e-commerce and online insurance distribution technologies and owns the following patents: 6,898,597; 7,107,325; 7,389,246; 7,640,176 and 7,707,505.

For further information regarding InsWeb Corporation, please review the Company's filings with the Securities and Exchange Commission, including Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, and in particular Management's Discussion and Analysis of Financial Condition and Results of Operations.

This news release contains forward-looking statements reflecting management's current forecast of certain aspects of the Company's future. It is based on current information, which we have assessed, but which by its nature is dynamic and subject to rapid and even abrupt changes. Forward-looking statements include statements expressing the intent, belief or current expectations of the Company and members of our management team regarding: projected future revenues, revenue growth, expenses, profitability and financial position; marketing and consumer acquisition; strategic initiatives aimed at accelerating growth and profitability, including strategic acquisitions; increased or decreased participation by insurance companies, agents and other purchasers of consumer leads; and product and technological implementations. The Company's actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with the Company's business, which include, but are not limited to: variations in consumer usage of the internet to shop for and purchase insurance; the willingness and capability of insurance companies or other insurance entities to offer their products or instant quotes on the Company's website or through the Company's licensed subsidiaries; changes in the Company's relationships with existing insurance companies or other customers, including, changes due to consolidation within the insurance industry; the effects of competition on the Company's consumer acquisition strategies; the Company's ability to attract and integrate new insurance providers and strategic partners; implementation and consumer acceptance of new product or service offerings; the outcome of litigation in which the Company is a party; insurance and financial services industry regulation; fluctuations in operating results; or other unforeseen factors. The forward-looking statements should be considered in the context of these and other risk factors disclosed in the Company's filings with the Securities and Exchange Commission.

"INSWEB" and "AGENTINSIDER" are registered service marks of InsWeb Corporation. All marks above are those of InsWeb Corporation, except for those of insurance insurers, brokers, agents, industry organizations, financial institutions, online partners, service providers, other mentioned companies and educational institutions, which are the marks of their respective entities.

                            INSWEB CORPORATION
              NON-GAAP FINANCIAL MEASURE AND RECONCILIATION
                              (In thousands)
                                (unaudited)

                               Three months ended       Twelve months ended
                          December  September December  December  December
                            31,        30,       31,       31,       31,
                          --------  --------- --------- --------- --------
                            2010      2010      2009      2010      2009
                          --------  --------- --------- --------- --------
Net income (loss)         $    146  $     357 $     705 $   1,295 $ (1,261)
Less
  Interest income                5          8         5        25       28
Add
  Interest expense              26          -         -        26        -
  Provision (benefit)
   for income taxes            (17)        10         -         -        -
  Share-based
   compensation expense        337        277        28       928      820
  Depreciation and
   amortization of
   property, equipment
   and intangible assets
   from continuing
   operations                  363         34        46       474      188
  Acquisition costs            152        592         -       744        -
  Severance and other            -          -        11         -      384
                          ========  ========= ========= ========= ========
Adjusted EBITDA from
 continuing operations    $  1,002  $   1,262 $     785 $   3,442 $    103
                          ========  ========= ========= ========= ========




                            INSWEB CORPORATION
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
              (Amounts in thousands, except per share amounts)
                                 (unaudited)


                                    Three months ended      Year ended
                                       December 31,        December 31,
                                    ------------------  ------------------
                                      2010      2009      2010      2009
                                    --------  --------- --------  --------
Revenues:
  Transactions                      $ 13,153  $   8,670 $ 42,199  $ 35,002
  Other                                   36         41      160       167
                                    --------  --------- --------  --------
Total revenues                        13,189      8,711   42,359    35,169

Operating expenses:
  Direct marketing                     8,945      5,684   28,370    23,397
  Sales and marketing                  1,874      1,282    5,743     6,588
  Technology                             944        467    2,629     3,418
  General and administrative           1,276        578    4,321     3,055
                                    --------  --------- --------  --------
Total operating expenses              13,039      8,011   41,063    36,458
                                    --------  --------- --------  --------
Income (loss) from operations            150        700    1,296    (1,289)
  Interest expense                       (26)         -      (26)        -
  Interest income                          5          5       25        28
                                    --------  --------- --------  --------
Income (loss) before income taxes        129        705    1,295    (1,261)
Benefit for income taxes                  17          -        -         -
                                    --------  --------- --------  --------
Net income (loss)                   $    146  $     705 $  1,295  $ (1,261)
                                    ========  ========= ========  ========

Net income (loss) per share:
  Basic                             $   0.02  $    0.15 $   0.26  $  (0.26)
                                    ========  ========= ========  ========
  Diluted                           $   0.02  $    0.14 $   0.23  $  (0.26)
                                    ========  ========= ========  ========

Weighted average shares used in
 computing
  Net income (loss) per share:
  Basic                                5,369      4,806    4,972     4,796
                                    ========  ========= ========  ========
  Diluted                              6,309      5,076    5,611     4,796
                                    ========  ========= ========  ========




                            INSWEB CORPORATION
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                          (Amounts in thousands)
                                (unaudited)

                                                December 31,  December 31,
                                                    2010          2009
                                                ------------  ------------
ASSETS

Current assets:
  Cash and cash equivalents                     $      6,733  $      6,401
  Short-term investments                               1,137             -
  Accounts receivable, net                             3,307         2,014
  Restricted cash equivalents and short-term
   investments                                           580         2,105
  Prepaid expenses and other current assets              559           710
  Related party receivable                               319             -
                                                ------------  ------------
    Total current assets                              12,635        11,230

Intangible assets                                      6,965           150
Goodwill                                               2,689             -
Related party receivable                                   -           311
Property and equipment                                   171           109
Other assets                                              32            80
                                                ------------  ------------
       Total assets                             $     22,492  $     11,880
                                                ============  ============

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Accounts payable                              $      3,740  $      2,113
  Accrued expenses                                       428           635
  Current liability, Potrero                           1,172             -
  Deferred revenue                                     2,321           804
                                                ------------  ------------
    Total current liabilities                          7,661         3,552

Noncurrent liability, Potrero                          2,071             -
                                                ------------  ------------
       Total liabilities                               9,732         3,552
                                                ------------  ------------
Shareholders' equity:
  Common stock                                             9             8
  Paid-in capital                                    210,753       207,617
  Treasury stock                                      (6,334)       (6,334)
  Accumulated deficit                               (191,668)     (192,963)
                                                ------------  ------------
    Total shareholders' equity                        12,760         8,328
                                                ------------  ------------
       Total liabilities and shareholders'
        equity                                  $     22,492  $     11,880
                                                ============  ============

Contact Information

  • Investor Relations Contact:
    Jennifer Jarman
    The Blueshirt Group, for InsWeb
    415-217-5866
    Email Contact