Autobytel Inc., the automotive marketing service company which helped pioneer online auto sales referrals and which has been in business since 1995, has reported its first-ever quarterly profit for the fourth quarter of 2001.

"We are very pleased that Autobytel delivered its first EBITDA profitable quarter on a pro forma basis, especially given the economic climate in 2001," said Jeffrey Schwartz,

president and CEO of Autobytel Inc.

Revenues for the fourth quarter ended Dec. 31, 2001 totaled $20.5 million, compared to revenues of $16.8 million for the fourth quarter ended Dec. 31, 2000, and revenues

of $18.2 million in the third quarter ended Sept. 30, 2001, all on a reported basis. Fourth quarter 2001 revenues include revenues from Autoweb which was acquired Aug. 14, 2001.

The company reported the first pro forma EBITDA profitable quarter in its history. Pro forma earnings before interest, taxes, depreciation, amortization and one-time charges (proforma EBITDA), for the fourth quarter of 2001 were $0.2 million or $0.01 per share. This compares to pro forma EBITDA of $(5.9) million or $(0.29) per share for the fourth quarter of 2000 and, pro forma EBITDA of $(1.9) million or

$(0.07) per share for the third quarter ended Sept. 30, 2001.

The company reported a net loss for the fourth quarter ended Dec. 31, 2001 of $0.9 million or $0.03 loss per share. This compares to a net loss for the fourth quarter ended Dec. 31, 2000 of $3.3 million or $0.16 loss per share,

and a net loss for the third quarter ended Sept. 30, 2001 of $3.2 million or $0.13 loss per share.

Net revenues for fiscal 2001 were $71.1 million compared to net revenues of $66.5 million in fiscal 2000, an improvement of 7 percent. Net loss in fiscal 2001 was $44.9 million or $1.84 loss per share compared to net loss of $29.0

million or $1.45 loss per share in fiscal 2000. The net loss in fiscal 2001 included goodwill impairment, restructuring, and other charges totaling $34.6 million, according to the company.

As of Dec. 31, 2001, the domestic cash and cash

equivalents were $33.0 million.

The company also reported $28.8 million of cash at Autobytel Europe (ABTE) for European operations. This amount may be reduced substantially as a result of ongoing discussions

with other investors in ABTE.

Business Outlook

"Autobytel neither manufactures cars nor sells them," Schwartz said. "We are an automotive marketing service company responsible for generating over 4 percent of domestic automotive sales in 2001. We have expanded our marketing platform through acquisition and partnership, and continue to generate more vehicle sales than our next three competitors combined. By focusing on our core business, we are positioning ourselves to garner a greater share of the $21 billion spent annually by manufacturers and dealers on marketing and advertising services," said Schwartz.

Based on the current economic conditions and the substantial reduction of the aggressive incentive programs that were launched by the automotive manufacturers following the events of Sept. 11, the company said it does not anticipate revenue growth in the first half of 2002, based on the fourth quarter 2001 run rate.

The company expects revenues for the first quarter of 2002 to be flat compared to the fourth quarter of 2001, and for revenues to increase approximately 6 to 10 percent for the

full year above fourth quarter 2001 annualized revenues. This represents approximately a 25 percent increase over the full year 2001 revenues.

In the first quarter of 2002, Autobytel expects EBITDA to remain flat versus the fourth quarter of 2001 at approximately $0.01 per share. For the full year 2002, EBITDA is expected to be between $0.07 and $0.09 per share.

"In spite of the forecasted downturn in automotive sales, the softness in the advertising market, the virtual elimination of zero percent financing and the overall economic environment, we are focused on increasing

EBITDA profitability," Schwartz vowed.

The company bases its 2002 business outlook on the following objectives:

• Expand market share by increasing the number of monetizable purchase requests and the number of dealers using the company’s marketing services.
  

• Core product initiatives designed to improve lead quality and dealer profitability.
  

• Strengthen the advertising component of the company’s business model designed to deliver targeted media products to manufacturers and dealers.
  

• Emphasize enterprise sales to automotive manufacturers and major dealer groups across all of the company’s marketing services.
  

• Substantially enhance the quality of the user experience on the company’s branded Web sites, Autobytel, Autoweb, CarSmart, and AutoSite.

Key Financial and Operating Metrics

The company has realigned the organization to focus all resources around four business categories: Program Fees, Advertising, Enterprise Sales, and Other Products and

Services.

Revenues: Autobytel reported fourth quarter revenues of $20.5 million, of which $14.8 million was related to program fees, $2.3 million was related to advertising, $1.8

million was related to enterprise sales and $1.7 million was related to other products and services.

Pro Forma Operating Expenses: Total pro forma operating expenses in the fourth quarter of 2001 were $20.3 million. Sales and marketing expenses totaled $12.5 million or 61 percent of revenues, compared to 66 percent of revenues in the third quarter of 2001. These expenses include online marketing programs and dealer

sales costs. Product development and technology costs totaled $5.0 million, or 24 percent of revenues in the fourth quarter of 2001, compared with 27 percent of revenues in the third quarter of 2001. General and administrative costs totaled $2.9 million, or 14 percent of revenues in the fourth quarter of

2001, compared with 18 percent of revenues in the third quarter of 2001.

Unique Visitor Count: Autobytel’s four

Web site properties, Autobytel.com, Autoweb.com, Carsmart.com and AutoSite.com,

received 9 million unique visitors in the fourth quarter of 2001 according to Nielsen Net Ratings, positioning the company as the number one online car-buying network.

Headcount: As of Dec. 31, 2001, the company had 264 employees down from 315 in the third quarter of 2001. This reduction was achieved through the continued integration of Autoweb and resulting efficiencies.

Dealer Count: The company has revised its methodology of counting dealers to reflect its operation of three separate Internet car buying brands. Based on that revision, its third quarter count would have been in excess of 6,900. As of Dec. 31, 2001, the company reported approximately 6,800 dealer relationships. The reduction in dealer count

was due to a decline in dealer relationships at the company’s CarSmart brand.

Both Autobytel.com and Autoweb.com brands had increases in dealer count from the third quarter of 2001. These dealer counts exclude more than 2,000 dealer relationships at the end of the fourth quarter, generated through our Enterprise Sales initiatives and to whom marketing services are delivered.

Used Car Program: As of Dec. 31, 2001 the company had approximately 145,000 vehicles listed on its Web sites. "More than one-third of used vehicle buyers log on the Internet to help them during the shopping process and that

number is expected to grow considerably," said Schwartz. "The used-car market represents a significant opportunity and we intend to further expand our used-car program."

Fourth Quarter Highlights

Acquisition: The integration of Autoweb during the fourth quarter continued to progress smoothly and generated additional efficiencies. The company now owns and operates four Web site properties: Autobytel.com, Autoweb.com,

Carsmart.com and AutoSite.com, as well as AIC (Automotive Information Center), a provider of automotive marketing data and technology.

Automotive Manufacturer Relationships: At the end of the fourth quarter 2001, Autobytel had relationships with 30 automotive manufacturers that either use its data, content, and tools or advertise on one of its four Web sites. The

company launched the new AutoSuite 2002 product with Ford in October. Of the total advertising revenue in the fourth quarter, 70 percent came from the company’s relationships with leading automotive manufacturers. The remaining 30

percent came from other automotive related companies.

Yahoo! Autos: In December 2001, the company announced a marketing relationship with Yahoo! Autos, allowing consumers to submit purchase requests for both new and used vehicles that are distributed to dealers participating in the

Autobytel, Autoweb and Carsmart programs.

Car Sales: The J.D. Power & Associates 2001 New

Autoshopper.com Study found that Autobytel.com generated more vehicle sales than any other Web site for the third year in a row.

Pro Forma Results

The pro forma operating results exclude the following items on the company's statements of operations:

• Goodwill impairment
  

• International restructuring and related charges
  

• Domestic restructuring and other charges
  

• Depreciation, amortization and stock-based compensation
  

• Executive severance payments
  

Conference Call

In conjunction with Autobytel Inc.’s fourth quarter and year-end 2001 earnings release, there was a conference call broadcast live over the Internet on Jan. 24, 2002, at 4:30 p.m. ET.

The Webcast was archived within 24 hours of the end of the call until the next quarter earnings announcement. To listen to the archived Webcast go to www.autobytel.com/info/investor.

About Autobytel Inc.

Autobytel Inc., an Internet automotive marketing services company, says it helps retailers sell cars and manufacturers build brands through marketing and CRM (customer relationship management) programs.

Autobytel Inc. owns and operates the popular Web sites Autobytel.com,

Autoweb.com, Carsmart.com and Autosite.com, as well as AIC (Automotive Information Center), a provider of automotive marketing data and technology.

Autobytel Inc. says it generated an estimated four percent of all domestic new vehicle sales - $17 billion in car sales in 2001 - for dealers through its Web sites.

With approximately 8,800 dealer relationships and 30 international automotive manufacturer customers, Autobytel Inc. says it is the largest

syndicated car-buying content network, reaching millions of unique visitors as they are making their vehicle buying decisions.

Autobytel Inc. says its content and technology has potential exposure to more than 90 percent of total Web traffic.