Exhibit 99.1
Innotrac Corporation Announces 2008 Fourth Quarter and Year End Results
ATLANTA, GA (March 30, 2009) – Innotrac Corporation (NASDAQ-GM: INOC) announced financial results today for the fourth quarter and year ended December 31, 2008. The Company reported revenues of $37.2 million for the quarter versus $36.9 million reported in the comparable period in 2007, a slight increase of 0.7%. For the year ended December 31, 2008, the Company reported revenues of $131.4 million compared to $121.8 million for the same period in 2007, an increase of 7.9%. The increase in revenue for the twelve months ended December 31, 2008 was primarily due to increased revenue from existing clients in our eCommerce, DSL and direct marketing verticals. These increases were offset by a decrease in revenues from our B2B and telecom verticals.
The Company reported net income of $592,000, or $0.05 per share, fully diluted, for the three months ended December 31, 2008, versus net income of $425,000 or $0.03 per share in the comparable period of 2007. For the year ended December 31, 2008, the Company reported net income of $3.3 million, or $0.26 per share, fully diluted, compared to net income of $712,000, or $0.06 per share in the same period in 2007. Included in net income for the year ended December 31, 2008 was approximately $959,000 of expenses directly related to the terminated merger transaction with GSI Commerce, which termination was announced on January 29, 2009.
On March 27, 2009, the Company extended its existing agreement with Wachovia Bank, National Association through June 30, 2012. The amended and restated agreement has a maximum borrowing limit of $15.0 million. The amended and restated loan agreement is filed as an exhibit to the Company's 2008 Annual Report on Form 10-K filed with the Securities and Exchange Commission today.
Innotrac
Innotrac Corporation, founded in 1984 and based in Atlanta, Georgia, is a full-service fulfillment and logistics provider serving enterprise clients and world-class brands. The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and two call centers in seven cities spanning all time zones across the continental United States. For more information about Innotrac, visit the Innotrac Website, www.innotrac.com.
Information contained in this press release, other than historical information, may be considered forward-looking in nature. Forward-looking statements in this press release include our expectations for future progress in our business and future generation of cash flows. Forward-looking statements are subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Among the key factors that may have a direct bearing on Innotrac's operating results, performance or financial condition are competition, the demand for Innotrac's services, Innotrac's ability to retain its current clients and attract new clients, realization of expected revenues from new clients, the state of the telecommunications and direct response industries in general, changing technologies, Innotrac’s ability to maintain profit margins in the face of pricing pressures and numerous other factors discussed in Innotrac's 2008 Annual Report on Form 10-K and other filings on file with the Securities and Exchange Commission. Innotrac disclaims any intention or obligation to update or revise any forward-looking statement whether as a result of new information, future events or otherwise.
Contact
George Hare
Chief Financial Officer
678-584-4020
ghare@innotrac.com
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INNOTRAC CORPORATION | ||||||||||||||||
Condensed Statements of Operations | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
(Unaudited) | ||||||||||||||||
2008 | 2007 | 2008 | 2007 | |||||||||||||
Service revenue | $ | 30,461 | $ | 29,030 | $ | 104,487 | $ | 97,215 | ||||||||
Freight revenue | 6,699 | 7,870 | 26,913 | 24,601 | ||||||||||||
Total revenue | 37,160 | 36,900 | 131,400 | 121,816 | ||||||||||||
Cost of service revenues | 16,607 | 16,351 | 50,797 | 47,723 | ||||||||||||
Cost of freight revenues | 6,436 | 7,711 | 26,458 | 24,299 | ||||||||||||
Selling, general and | ||||||||||||||||
administrative expenses | 12,212 | 10,950 | 45,293 | 43,342 | ||||||||||||
Depreciation and amortization | 1,166 | 1,066 | 4,343 | 4,846 | ||||||||||||
Total operating expenses | 36,421 | 36,078 | 126,891 | 120,210 | ||||||||||||
Operating income | 739 | 822 | 4,509 | 1,606 | ||||||||||||
Interest expense | 147 | 397 | 1,231 | 894 | ||||||||||||
Total other expense | 147 | 397 | 1,231 | 894 | ||||||||||||
Income before income taxes | 592 | 425 | 3,278 | 712 | ||||||||||||
Income tax | - | - | - | - | ||||||||||||
Net income | $ | 592 | $ | 425 | $ | 3,278 | $ | 712 | ||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.05 | $ | 0.03 | $ | 0.27 | $ | 0.06 | ||||||||
Diluted | $ | 0.05 | $ | 0.03 | $ | 0.26 | $ | 0.06 | ||||||||
Weighted average shares | ||||||||||||||||
outstanding: | ||||||||||||||||
Basic | 12,335 | 12,586 | 12,327 | 12,301 | ||||||||||||
Diluted | 12,340 | 12,586 | 12,401 | 12,301 |
INNOTRAC CORPORATION | ||||||||
Condensed Balance Sheets | ||||||||
(in thousands) | ||||||||
December 31, | December 31, | |||||||
2008 | 2007 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash | $ | 1,056 | $ | 1,079 | ||||
Accounts receivable (net of allowance for doubtful accounts of $271 at December 31, 2008 and $288 at December 31, 2007) | 25,793 | 28,090 | ||||||
Inventory | 1,855 | 599 | ||||||
Prepaid expenses and other | 1,262 | 1,100 | ||||||
Total current assets | 29,966 | 30,868 | ||||||
Property and equipment, net | 15,842 | 17,702 | ||||||
Goodwill | 25,169 | 25,169 | ||||||
Other assets, net | 822 | 1,192 | ||||||
Total assets | $ | 71,799 | $ | 74,931 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 9,259 | $ | 14,050 | ||||
Line of credit | 10,055 | 6,168 | ||||||
Term loan | - | 5,000 | ||||||
Accrued expenses and other | 5,253 | 5,708 | ||||||
Total current liabilities | 24,567 | 30,926 | ||||||
Noncurrent Liabilities: | ||||||||
Other noncurrent liabilities | 753 | 993 | ||||||
Total noncurrent liabilities | 753 | 993 | ||||||
Total shareholders' equity | 46,479 | 43,012 | ||||||
Total liabilities and shareholders' equity | $ | 71,799 | $ | 74,931 | ||||
INNOTRAC CORPORATION | ||||||||
Condensed Statements of Cash Flows | ||||||||
(in thousands) | ||||||||
Twelve Months Ended | ||||||||
December 31, | ||||||||
2008 | 2007 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 3,278 | $ | 712 | ||||
Adjustments to net income: | ||||||||
Depreciation and amortization | 4,343 | 4,846 | ||||||
Provision for bad debts | 8 | 43 | ||||||
Loss on disposal of fixed assets | 47 | 16 | ||||||
Stock compensation expense-stock options | 72 | 102 | ||||||
Stock compensation expense-restricted stock | 75 | 53 | ||||||
Stock issued to settle employee stock bonus | - | 111 | ||||||
Changes in working capital: | ||||||||
Accounts receivable, gross | 2,289 | (5,194 | ) | |||||
Inventory | (1,256 | ) | 1,130 | |||||
Prepaid assets and other | (101 | ) | 294 | |||||
Accounts payable, accrued expenses and other | (5,246 | ) | 1,797 | |||||
Net cash provided by operating activities | 3,509 | 3,910 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (2,530 | ) | (4,827 | ) | ||||
Installment payment on previous acquisition of business | - | (800 | ) | |||||
Net change in noncurrent assets and liabilities | 130 | (476 | ) | |||||
Cash used in investing activities | (2,400 | ) | (6,103 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Net borrowings (repayments) under line of credit | 3,887 | (2,418 | ) | |||||
(Repayment) proceeds of term loan | (5,000 | ) | 5,000 | |||||
Issuance of stock, net | 42 | - | ||||||
Loan commitment fees | (61 | ) | (324 | ) | ||||
Cash (used in) provided by financing activities | (1,132 | ) | 2,258 | |||||
Net (decrease) increase in cash | (23 | ) | 65 | |||||
Cash, beginning of period | 1,079 | 1,014 | ||||||
Cash, end of period | $ | 1,056 | $ | 1,079 | ||||