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DealerTrack Raises 2012 Guidance on Q3 Performance

November 13, 2012

LAKE SUCCESS, N.Y. — Based on what it saw during the first nine months, DealerTrack Technologies Inc. said in its third-quarter performance report that it expects franchised dealers to end the year with approximately 14.3 million and 14.5 million used and new vehicles sold, respectively.

The technology company, which acquired ClickMotive and Ford of Canada’s iConnect Direct DMS last month, reported a net loss of $2.9 million in the third quarter, compared to a net income of $5.4 million in the year-ago period. Revenue, however, grew from $95.8 million a year ago to $99.1 million during the quarter.

“Our healthy third-quarter performance allows us to remain squarely on track to achieve our full-year revenue expectation and our adjusted EBITDA (earnings before interest, tax, depreciation and amortization) margin target of approximately 25 percent, with revenue from recent acquisitions further contributing to our results," CEO Mark O'Neil stated in the company's third quarter earnings report.

Revenue for the first nine months of 2012 totaled $287.1 million, up from $262 million a year ago. Net income was $35.4 million for the period, up from $33.2 million a year ago. Based on those results, DealerTrack raised its 2012 guidance for revenue, but lowered its expectation for net income.

Based on its third quarter results and the acquisition of ClickMotive and iConnect Direct DMS, DealerTrack expects revenue for this year to be between $387 and $390 million, up from its prior guidance of between $381 and $385 million.

DealerTrack also expects to end the year with net income of between $21.5 million and $23 million, down from its prior guidance of between $24.5 million and $26.5 million.

The company also raised its expectation for year-end sales totals, with officials putting new-car sales by franchised dealers at approximately 14.3 million units vs. its previous assumption of 14.2 million units. As for used-car sales, the technology company raised its expectations from 14 million units to 14.5 million.

“In additional to organic growth in our transaction and subscription businesses in the quarter, we are excited to further broaden our market opportunity with the addition of ClickMotive to our digital retailing suite,” O’Neil added. “ClickMotive significantly strengthens DealerTrack’s existing eCarList digital retailing capabilities with an expanded website and digital marketing platform.

“More importantly, it gives DealerTrack access to a part of dealership advertising budget, in addition to their technology budgets,” he continued. “We believe investments we are making to both broaden and deepen our product portfolio are improving our market leadership and position us for long-term growth.”

 

 

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