Wednesday, Aug. 08, 2007, 08:00 PM UPDATED 11:59 AMBy Nick Zulovich
LAKE SUCCESS, N.Y. — DealerTrack announced that GAAP net income for the quarter came in at $6.3 million, up 35 percent from $4.7 million for the second quarter of last year.
Additionally, revenue for the quarter was $58.5 million, up 35 percent from $43.4 million in the same period of 2006.
"DealerTrack's growth is driven by our ability to provide innovative solutions that meet the needs of the automotive retail industry," explained Mark O'Neil, chairman and chief executive officer. "Our second-quarter financial results were generated from ongoing momentum in cross-selling our subscription products and strong performance across our transaction business.
"We remain focused on creating value for our customers and stockholders by expanding the range of products and services we offer, enhancing the integration between our products and adding new participants to the DealerTrack network," he continued.
As for the six-month period, officials said GAAP net income came in at $11.1 million, a 37-percent jump from $8.1 million in 2006.
Meanwhile, revenue for the six-month time frame was $110.2 million, up 36 percent from $81.3 million for the same period in 2006.
The company reported that there were 22,630 active dealers in its network as of June 30, a 3-percent increase from a year ago. The number of active financing sources jumped to 380, up 56 percent from last year.
Officials also said transactions processed via their network for the second quarter came in at about 23.5 million, a 35-percent climb from the same quarter of last year. Moreover, total subscriptions were 25,621, including about 784 Arkona subscriptions.
The number of revenue-generating subscriptions grew 42 percent from a year ago, executives said. About 54 percent of active dealers in the network now have one or more of DealerTrack's subscription products, officials indicated.
Commenting on the company's acquisition of Arkona, O'Neil said, "The addition of Arkona enables DealerTrack to meet a critical customer demand for seamless integration between the dealer management system and other technology solutions. We believe that Arkona provides an exciting growth opportunity and lower cost, uniquely open approach to technology integration within our industry."
He also discussed the company's recent acquisition of AutoStyle Mart.
"While the growing vehicle accessories market is estimated at $34 billion in U.S. sales per year, only 10 percent of those sales occur through the dealer channel today," he said. "With AutoStyleMart, we believe we can deliver a unique and innovative solution enabling dealers to more easily sell a broader variety and higher number of accessories.
"As consumer increase spending to customize and update their vehicles, selling more accessories could be an attractive source of incremental profit for dealers. This opportunity is consistent with our mission of offering products that can help dealers improve their profitability and efficiency," he added.
Looking ahead, company officials said they expect revenue to reach $230 to $232 million for the year. As for GAAP net income, executives predicted it will come in at $20.6 to $21 million.