SOURCE: InsWeb

July 19, 2007 06:30 ET

InsWeb Reports Second Consecutive Quarter of Profitability

SACRAMENTO, CA--(Marketwire - July 19, 2007) - InsWeb Corp. (NASDAQ: INSW) today announced results for the second quarter ended June 30, 2007.

Revenues for the second quarter of 2007 were $8.1 million, compared to $7.5 million in the second quarter of 2006 and $8.1 million in the first quarter of 2007. Net income for the second quarter of 2007 was $214,000, or $0.05 per share, compared to net income in the second quarter of 2006 of $247,000, or $0.06 per share, and $402,000, or $0.10 per share, in the first quarter of 2007.

Adjusted EBIDA, a non-GAAP financial measure used by InsWeb's management and defined below, was $715,000 in the second quarter of 2007, compared to $688,000 in the first quarter of 2007.

InsWeb Chairman & CEO Hussein Enan stated, "Achieving our second consecutive quarter of profit further demonstrates the ongoing viability of our lead-referral based business model. With our scalable technology infrastructure in place, we are now focused on generating additional top-line revenue while continuing to improve our operating margin. Along these lines, we recently renewed and expanded our relationship with NetQuote, which we expect to have a positive impact on both top- and bottom-line growth. We are also working on additional revenue streams leveraging our existing platform, whose effects we expect to manifest in the coming quarters. As we look at the second half of the year, we are optimistic regarding our outlook and expect to continue to post year-over-year quarterly revenue growth while maintaining operating profitability for fiscal 2007 and beyond, as previously stated."

Non-GAAP Financial Information

In evaluating our business, our management considers and uses Adjusted EBIDA as a supplemental measure of operating performance. Adjusted EBIDA refers to a financial measure that we define as net income excluding net interest, depreciation, amortization, share-based compensation expense, severance expenses, and other one-time gains and losses that are not related to our continuing operations. This measure is an essential component of our internal planning process because it facilitates period-to-period comparisons of our operating performance by eliminating potential differences in net income caused by the existence and timing of non-cash charges and non-recurring gains and losses. Furthermore, Adjusted EBIDA reflects the key revenue and expense items for which our operating managers are responsible and upon which we evaluate their performance.



                            InsWeb Corporation
              NON-GAAP FINANCIAL MEASURE AND RECONCILIATION
                              (In thousands)
                                (unaudited)

                                                   Three months ended
                                              ----------------------------
                                              June 30,  March 31, June 30,
                                                2007      2007      2006
                                              --------- --------- --------
Net income                                    $     214 $     402 $    247
   Less
      Interest income, net                          107        72      101
      Gain on sale of InsWeb Insurance
       Services' property and casualty book
       of business                                    -         -    2,044
   Add
      Share-based compensation expense              260       314       81
      Depreciation and amortization of
       property and equipment from continuing
       operations                                    40        44       49
      Severance expense                             308         -       25
                                              --------- --------- --------
   Adjusted EBIDA from continuing operations  $     715 $     688 $ (1,743)
                                              --------- --------- --------


Adjusted EBIDA is not a measurement of our 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 our U.S. GAAP net income. The principal limitations of this measure are that: 1) it does not reflect our actual expenses and may thus have the effect of inflating our net income and net income per share; and 2) it may not be comparable to Adjusted EBIDA as reported by other companies.

About InsWeb

InsWeb (NASDAQ: INSW) enables consumers to compare multiple, actionable quotes for auto, term life, health, homeowners, renters and condominium insurance offerings from many of the nation's highly rated insurers. The top-rated online insurance marketplace also provides interactive tools and independent research. Headquartered in Sacramento, Calif., InsWeb is accessible at www.insweb.com.

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; the results of strategic initiatives, including AgentInsider; increased or decreased participation by insurance companies; 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; changes in the Company's relationship with strategic and/or marketing partners; the Company's ability to attract and integrate new insurance providers and strategic partners; implementation of competing Internet strategies by existing and potential competitors; 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
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
             [Amounts in thousands, except per share amounts]
                                [unaudited]


                                    Three months ended   Six months ended
                                         June 30,            June 30,
                                    ------------------- -------------------
                                      2007      2006      2007      2006
                                    --------- --------  --------- --------
Revenues:
   Transaction fees                 $   8,063 $  7,429  $  16,106 $ 14,994
   Development and maintenance fees        66       88        133      178
                                    --------- --------  --------- --------
Total revenues                          8,129    7,517     16,239   15,172

Operating expenses:
   Direct marketing                     4,597    5,158      9,125   10,103
   Sales and marketing                  1,327    1,967      2,805    4,031
   Technology                             777    1,216      1,653    2,469
   General and administrative           1,323    1,074      2,225    2,250
                                    --------- --------  --------- --------
Total operating expenses                8,024    9,415     15,808   18,853
                                    --------- --------  --------- --------
Income (loss) from operations             105   (1,898)       431   (3,681)
Interest income                           107      101        179      193
Other income (expense), net                 2    2,044          6    2,044
                                    --------- --------  --------- --------
Net income (loss)                   $     214 $    247  $     616 ($ 1,444)
                                    ========= ========  ========= ========


Net income (loss) per share:
   Basic                            $    0.05 $   0.06  $    0.15 ($  0.35)
                                    ========= ========  ========= ========
   Diluted                          $    0.04 $   0.06  $    0.13 ($  0.35)
                                    ========= ========  ========= ========


Weighted-average shares used in
 computing net income (loss) per
 share:
   Basic                                4,340    4,089      4,208    4,087
                                    ========= ========  ========= ========
   Diluted                              5,267    4,200      4,840    4,087
                                    ========= ========  ========= ========



                            INSWEB CORPORATION
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                          [Amounts in thousands]
                                [unaudited]


                                                    June 30,   December 31,
                                                      2007         2006
                                                  -----------  -----------
ASSETS

Current assets:
   Cash and cash equivalents                      $     8,293  $     6,750
   Accounts receivable, net                             3,658        2,804
   Prepaid expenses and other current assets              392          398
                                                  -----------  -----------
      Total current assets                             12,343        9,952

Property and equipment                                    312          389
Other assets                                              113          115
                                                  -----------  -----------
      Total assets                                $    12,768  $    10,456
                                                  ===========  ===========

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Accounts payable                               $     2,341  $     2,248
   Accrued expenses                                     2,714        2,672
   Deferred revenue                                       177          245
                                                  -----------  -----------
      Total current liabilities                         5,232        5,165

Commitments and contingencies

Shareholders' equity:
   Common stock                                             8            7
   Paid-in capital                                    205,206      203,578
   Treasury stock                                      (6,334)      (6,334)
   Accumulated deficit                               (191,344)    (191,960)
                                                  -----------  -----------
      Total shareholders' equity                        7,536        5,291
                                                  -----------  -----------
         Total liabilities and shareholders'
          equity                                  $    12,768  $    10,456
                                                  ===========  ===========



                   Financial Highlights and Key Metrics


                                               Three months ended
                                     -------------------------------------
                                       June 30,    March 31,     June 30,
                                         2007         2007         2006
                                     -----------  -----------  -----------

Revenues:
    Auto                             $ 6,566,000  $ 6,411,000  $ 5,692,000
    All Other                        $ 1,563,000  $ 1,699,000  $ 1,825,000
                                     -----------  -----------  -----------
    Total                            $ 8,129,000  $ 8,110,000  $ 7,517,000

# of Consumers:
    Auto                               1,448,000    1,318,000    1,378,000
    All Other                             84,000      137,000      140,000
                                     -----------  -----------  -----------
    Total                              1,532,000    1,455,000    1,518,000

Revenues per Consumer:
    Auto                             $      4.53  $      4.86  $      4.13
    All Other                        $     18.61  $     12.40  $     13.04
                                     -----------  -----------  -----------
    Total                            $      5.31  $      5.57  $      4.95


Direct Marketing Costs:              $ 4,597,000  $ 4,528,000  $ 5,158,000
Direct Marketing Costs as
 a percent of Revenues                        57%          56%          69%
Marketing Costs per Consumer         $      3.00  $      3.11  $      3.40


Cash and Cash Equivalents:           $ 8,293,000  $ 7,091,000  $ 8,145,000
Accounts Receivable:                 $ 3,658,000  $ 3,412,000  $ 3,236,000
Day Sales Outstanding (DSO):                  40           35           40

Staffing:                                     64           85          127


Definitions:
"# of Consumers"            Represents a consumer who has started an InsWeb
                            quote form
"Direct Marketing Costs"    Represents expenses incurred by InsWeb to drive
                            consumers to InsWeb's online insurance
                            marketplace
"Per Consumer Information"  Represents Revenues earned or marketing costs
                            incurred per consumer who has started an InsWeb
                            quote form

Contact Information

  • Investor Relations Contact:
    Jennifer Jarman
    The Blueshirt Group
    415-217-7722
    Email Contact