Current Report
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
Of the Securities Exchange Act of 1934
Date of Report:
October 22, 2009
(Date of earliest event reported)
INSWEB CORPORATION
(Exact name of Registrant as specified in its charter)
|
Delaware
|
0-26083
|
94-3220749
|
||
|
(State or other jurisdiction of
|
(Commission file number)
|
(IRS Employer
|
||
|
incorporation or organization)
|
Identification Number)
|
11290 Pyrites Way, Suite 200
Gold River, California 95670
(Address of principal executive offices)
(916) 853-3300
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
|
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Item 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On October 22, 2009, InsWeb Corporation issued a press release announcing financial results for the three months ended September 30, 2009. The press release is attached to this report as Exhibit 99.1.
The attached Press Release shall be considered “furnished” pursuant to this Current Report on Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section nor shall it be deemed incorporated by reference
into any of InsWeb Corporation’s reports or filings with the Securities and Exchange Commission, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing.
InsWeb Corporation has made reference to non-GAAP financial information in the press release; a reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures is contained in the attached press release.
Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
Exhibit No.99.1 Press release issued by InsWeb Corporation dated October
22, 2009
2
SIGNATURE
In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
Dated: October 22, 2009
|
INSWEB CORPORATION
|
|
(Registrant)
|
|
|
/s/ Kiran Rasaretnam
|
|
|
Kiran Rasaretnam
|
|
|
Chief Financial Officer
|
3
News Release
Investor Relations Contact:
Alex Wellins
The Blueshirt Group, for Insweb
415-217-5861
alex@blueshirtgroup.com
InsWeb Reports Third Quarter 2009 Results
|
·
|
Recent launches of
InsuranceRates.com
,
BestInsuranceMatch.com
and
FreeInsuranceAdvice.com
expand market opportunity
|
|
·
|
Net Loss of $870,000; Positive Adjusted EBITDA of $191,000
|
|
·
|
Staff reductions significantly lower go-forward cost base
|
SACRAMENTO, Calif., October 22, 2009
– InsWeb Corp. (NASDAQ: INSW), a leading online insurance marketplace, today announced results for the third quarter ended September 30, 2009.
Revenues for the third quarter of 2009 were $8.9 million, an increase of 12% as compared to $8.0 million in the second quarter of 2009, and a decrease of approximately 1% as compared to $9.0 million in the third quarter of 2008. Net loss for the third quarter of 2009 was $870,000, or $0.18 per diluted share. This compares with a net loss of
$595,000, or $0.12 per diluted share, in the second quarter of 2009, and a net loss of $552,000, or $0.12 per diluted share, in the third quarter of 2008.
Adjusted EBITDA, a non-GAAP financial measure used by InsWeb’s management and defined below, was income of $191,000 in the third quarter of 2009, as compared to a loss of $471,000 in the second quarter of 2009 and to a loss of $432,000 in the third quarter of 2008.
Costs associated with InsWeb’s recently announced staff reductions amounted to $896,000 during the third quarter, of which $523,000 were related to share-based compensation expenses for stock options granted to retained employees. As previously announced, InsWeb expects annual savings of approximately $2.5 million on an on-going
basis as a result of these changes. InsWeb ended the third quarter of 2009 with 61 employees, down from 87 at the end of the second quarter of 2009.
"We experienced solid sequential growth during the third quarter and are very pleased with the development results for our three new insurance destinations that we believe will redefine the way insurance is sold online," stated InsWeb Chairman & CEO Hussein Enan. "We have aggressively lowered our cost structure and have returned the company
to staffing levels of early 2008, prior to our development efforts on the new sites, meaning that InsWeb is entering the fourth quarter with an expense base that is properly aligned with the current scale of our business. We were pleased to return to Adjusted EBITDA profitability in the third quarter and while the fourth quarter is seasonally weak for the insurance industry, we have set the stage for a return to sustained profitability and our new network of sites positions our company for long-term
growth."
Non-GAAP Financial Information
In evaluating InsWeb’s business, the Company’s management considers and uses
Adjusted EBITDA as a supplemental measure of operating performance. Adjusted EBITDA refers to a financial measure that the Company defines as
net income (loss) excluding interest, taxes, depreciation, amortization, share-based compensation, and other non-recurring gains and losses that are not related to the Company’s continuing operations. This measure is an essential component of InsWeb’s internal planning process because it facilitates period-to-period comparisons of the Company’s operating performance by eliminating potential differences in net income (loss) caused by the existence and timing of non-cash charges and
non-recurring gains and losses. Furthermore, Adjusted EBITDA reflects the key revenue and expense items for which InsWeb’s operating managers are responsible.
|
InsWeb Corporation
|
||||
|
NON-GAAP FINANCIAL MEASURE AND RECONCILIATION
|
||||
|
(In thousands)
|
||||
|
(unaudited)
|
||||
|
Three months ended
|
||||
|
September 30,
|
June 30,
|
September 30,
|
||
|
2009
|
2009
|
2008
|
||
|
Net loss
|
$ (870)
|
$ (595)
|
$ (552)
|
|
|
Less
|
||||
|
Interest income
|
3
|
6
|
47
|
|
|
Add
|
||||
|
Provision (benefit) for income taxes
|
-
|
35
|
(44)
|
|
|
Share-based compensation expense
|
644
|
47
|
164
|
|
|
Depreciation and amortization of property,
equipment and intangible assets
|
47
|
48
|
47
|
|
|
Severance and other
|
373
|
-
|
-
|
|
|
Adjusted EBITDA from continuing operations
|
$ 191
|
$ (471)
|
$ (432)
|
|
Adjusted EBITDA is not a measurement of the Company’s financial performance under U.S. GAAP and has limitations as an analytical tool. You should not consider it in isolation or as a substitute for the Company’s U.S. GAAP net income (loss). The principal limitations of this measure are that: 1) it does not reflect the Company’s actual expenses and may
thus have the effect of inflating or reducing the Company’s net income (loss) and net income (loss) per share; and 2) it may not be comparable to Adjusted EBITDA as reported by other companies.
About InsWeb
InsWeb Corporation (NASDAQ: INSW) owns and operates a network of leading insurance marketplace and education websites. Founded in 1995 and headquartered in Sacramento, California, InsWeb’s primary properties include
InsWeb.com
,
InsuranceRates.com
,
BestInsuranceMatch.com
,
FreeInsuranceAdvice.com
,
LocalInsuranceAgents.com
,
and
AgentInsider.com
. In 2008, more than 10 million consumers turned to InsWeb for answers to their insurance questions. To learn more about InsWeb Corporation, visit
www.InsWeb.com
.
For further information regarding InsWeb Corporation, please review the Company’s filings with the Securities and Exchange Commission, including Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, and in particular Management’s Discussion and Analysis of Financial Condition and Results of Operations.
This news release contains forward-looking statements reflecting management's current forecast of certain aspects of the Company's future. It is based on current information, which we have assessed, but which by its nature is dynamic and subject to rapid and even abrupt changes. Forward-looking
statements include statements expressing the intent, belief or current expectations of the Company and members of our management team
regarding: projected future revenues, revenue growth, expenses, profitability and financial position; marketing and consumer acquisition; the results of strategic initiatives, including BestInsuranceMatch.com, FreeInsuranceAdvice.com and InsuranceRates.com; increased or decreased participation by insurance companies, agents
and other purchasers of consumer leads; and product and technological implementations. The Company's actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with the Company's business, which include, but are not limited to: variations in consumer usage of the internet to shop for and purchase insurance; the willingness and capability of insurance companies or other insurance entities to offer their products or instant quotes
on the Company’s website or through the Company’s licensed subsidiaries; changes in the Company's relationships with existing insurance companies or other customers, including, changes due to consolidation within the insurance industry; the effects of competition on the Company’s consumer acquisition strategies;the Company's ability to attract and integrate new insurance providers and strategic partners; implementation and consumer acceptance of new product or service offerings; the outcome
of litigation in which the Company is a party; insurance and financial services industry regulation; fluctuations in operating results; or other unforeseen factors. The forward-looking statements should be considered in the context of these and other risk factors disclosed in the Company's filings with the Securities and Exchange Commission.
“INSWEB” and “AGENTINSIDER” are registered service marks of InsWeb Corporation. All marks above are those of InsWeb Corporation, except for those of insurance insurers, brokers, agents, industry organizations, financial institutions, online partners, service providers, other mentioned companies and educational institutions,
which are the marks of their respective entities.
|
INSWEB CORPORATION
|
|||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||||
|
[ Amounts in thousands, except per share amounts ]
|
|||||||||
|
[ unaudited ]
|
|||||||||
|
Three months ended
|
Nine months ended
|
||||||||
|
September 30,
|
September 30,
|
||||||||
|
2009
|
2008
|
2009
|
2008
|
||||||
|
Revenues:
|
|||||||||
|
Transactions
|
$8,907
|
$8,955
|
$26,332
|
$30,677
|
|||||
|
Other
|
42
|
55
|
126
|
174
|
|||||
|
Total revenues
|
8,949
|
9,010
|
26,458
|
30,851
|
|||||
|
Operating expenses:
|
|||||||||
|
Direct marketing
|
5,834
|
6,497
|
17,713
|
22,040
|
|||||
|
Sales and marketing
|
1,865
|
1,505
|
5,306
|
4,233
|
|||||
|
Technology
|
1,092
|
774
|
2,951
|
2,401
|
|||||
|
General and administrative
|
1,031
|
877
|
2,477
|
3,276
|
|||||
|
Total operating expenses
|
9,822
|
9,653
|
28,447
|
31,950
|
|||||
|
Loss from operations
|
(873)
|
(643)
|
(1,989)
|
(1,099)
|
|||||
|
Interest income
|
3
|
47
|
23
|
196
|
|||||
|
Loss before income taxes
|
(870)
|
(596)
|
(1,966)
|
(903)
|
|||||
|
Provision (benefit) for income taxes
|
-
|
(44)
|
-
|
(44)
|
|||||
|
Net loss
|
$(870)
|
$(552)
|
$(1,966)
|
$(859)
|
|||||
|
Net loss per share:
|
|||||||||
|
Basic
|
$(0.18)
|
$(0.12)
|
$(0.41)
|
$(0.18)
|
|||||
|
Diluted
|
$(0.18)
|
$(0.12)
|
$(0.41)
|
$(0.18)
|
|||||
|
Weighted average shares used in computing
|
|||||||||
|
Net loss per share:
|
|||||||||
|
Basic
|
4,799
|
4,703
|
4,793
|
4,677
|
|||||
|
Diluted
|
4,799
|
4,703
|
4,793
|
4,677
|
|||||
|
INSWEB CORPORATION
|
||||||||||||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||||||||
|
[Amounts in thousands]
|
||||||||||||||
|
[unaudited]
|
||||||||||||||
|
September 30,
|
December 31,
|
|||||||||||||
|
2009
|
2008
|
|||||||||||||
|
ASSETS
|
||||||||||||||
|
Current assets:
|
||||||||||||||
|
Cash and cash equivalents
|
$5,836
|
$9,238
|
||||||||||||
|
Accounts receivable, net
|
2,286
|
1,450
|
||||||||||||
|
Prepaid expenses and other current assets
|
588
|
711
|
||||||||||||
|
Restricted cash
|
2,105
|
-
|
||||||||||||
|
Total current assets
|
10,815
|
11,399
|
||||||||||||
|
Related party receivable
|
309
|
304
|
||||||||||||
|
Property and equipment
|
144
|
249
|
||||||||||||
|
Other assets
|
247
|
329
|
||||||||||||
|
Total assets
|
$11,515
|
$12,281
|
||||||||||||
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||||||||
|
Current liabilities:
|
||||||||||||||
|
Accounts payable
|
$2,850
|
$2,138
|
||||||||||||
|
Accrued expenses
|
609
|
1,014
|
||||||||||||
|
Deferred revenue
|
495
|
437
|
||||||||||||
|
Total current liabilities
|
3,954
|
3,589
|
||||||||||||
|
Commitments and contingencies
Shareholders' equity:
|
||||||||||||||
|
Common stock
|
8
|
8
|
||||||||||||
|
Paid-in capital
|
207,555
|
206,719
|
||||||||||||
|
Treasury stock
|
(6,334)
|
(6,334)
|
||||||||||||
|
Unrealized gain on available-for-sale securities
|
-
|
1
|
||||||||||||
|
Accumulated deficit
|
(193,668)
|
(191,702)
|
||||||||||||
|
Total shareholders' equity
|
7,561
|
8,692
|
||||||||||||
|
Total liabilities and shareholders’ equity
|
$11,515
|
$12,281
|
||||||||||||