The
Internet consumer car buyers guide Autobytel.com said today that weaker than expected
market conditions affected its financial performance during the second quarter
of 2001.
For the second quarter, the company expects to report revenues of approximately
$US15.5 million to $16 million, an EBITDA per common share of approximately
$0.25 to $0.29, excluding extraordinary charges, and a net loss per common share
of approximately $0.13 to $0.17, again excluding extraordinary charges.
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Autobytel expects to report a second quarter net loss per share of approximately
$1.75 to $1.85, including the extraordinary charges.
As of June 30, 2001, the company expects to report a cash balance of approximately
$67 million, of which approximately $37 million is at Autobytel.com and approximately
$30 million represents funds of Autobytel Europe (ABTE) and is reserved for
the operations of ABTE.
Cash on hand at ABTE may be reduced substantially as a result of ongoing discussions
with other investors in ABTE. Cash used by Autobytel.com (excluding cash used
by ABTE) in the second quarter is estimated to have been approximately $3.6
million.
The company attributed the lower than expected results to the economic environment
which has reduced the amount spent by dealers on online marketing.
In addition, softness in the advertising market led to an inability to sell
off previously committed-to television time and a longer than expected renegotiating
process of the economic terms of some of its affiliate relationships, Autobytel
said in a statement.
The company expects to take charges totaling approximately $34 million in the
second quarter. The estimated charges are comprised of $22 million related to
the write-down of goodwill booked in connection with its acquisition of CarSmart,
$6 million related to costs associated with obsolete international software
and the write-off of investments in certain ventures, $5 million related to
the previously announced restructuring of ABTE, and $1 million related to contract
terminations and other costs.
In light of the current business outlook, Autobytel is also taking a charge
in the second quarter to reflect the write down of substantially all of the
goodwill related to the acquisition of CarSmart.
The result of this action adjusts the asset value on the company’s books for
the acquisition to reflect current market valuations.
"Given the current market conditions, we believe we will reach EBITDA
break-even in the fourth quarter of 2001 on a combined basis with Autoweb,"
said Autobytel CEO and President Mark Lorimer.
The Autoweb transaction is expected to close in the third quarter.
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