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DealerTrack Holdings Reports Results for Fourth Quarter and 2010 and Issues Guidance for 2011
Feb 16, 2011 (03:02 PM EST)


LAKE SUCCESS, N.Y., Feb. 16, 2011 /PRNewswire/ -- DealerTrack Holdings, Inc. (Nasdaq: TRAK) today reported financial results for the fourth quarter and year ended December 31, 2010.

(Logo:  http://photos.prnewswire.com/prnh/20101028/DEALERTRACKLOGO)

GAAP Results for the Fourth Quarter 2010

  • Revenue for the quarter was $62.0 million, as compared to $53.2 million for the fourth quarter of 2009.
  • GAAP net loss for the quarter was $(26.4) million, as compared to GAAP net loss of $(0.7) million for the fourth quarter of 2009. GAAP net loss for the fourth quarter of 2010 was negatively impacted by a non-cash $28.4 million valuation allowance on the company's net U.S. deferred tax assets.  
  • GAAP net loss per share for the quarter was $(0.65), as compared to GAAP net loss per share of $(0.02) for the fourth quarter of 2009. GAAP net loss per share for the fourth quarter of 2010 was negatively impacted by $0.70 per share (non-cash) for a valuation allowance on the company's net U.S. deferred tax assets.  

Non-GAAP Results for the Fourth Quarter 2010

  • Adjusted EBITDA for the quarter was $14.5 million, as compared to $8.2 million for the fourth quarter of 2009.      
  • Adjusted net income for the quarter was $7.8 million, as compared to $4.8 million for the fourth quarter of 2009.  
  • Diluted adjusted net income per share was $0.19 for the quarter, as compared to $0.12 for the fourth quarter of 2009.  

GAAP Results for the Year Ended December 31, 2010

  • Revenue for the year was $243.8 million, as compared to $225.6 million for 2009.
  • GAAP net loss for the year was $(27.8) million, as compared to GAAP net loss of $(4.3) million for 2009.  GAAP net loss for 2010 was negatively impacted by a non-cash $28.4 million valuation allowance on the company's net U.S. deferred tax assets.  
  • GAAP net loss per share for the year was $(0.69), as compared to GAAP net loss per share of $(0.11) for 2009.  GAAP net loss per share for 2010 was negatively impacted by $0.70 per share (non-cash) for a valuation allowance on the company's net U.S. deferred tax assets.  

Non-GAAP Results for the Year Ended December 31, 2010

  • Adjusted EBITDA for the year was $42.1 million, as compared to $34.4 million for 2009.
  • Adjusted net income for the year was $21.9 million, as compared to $20.0 million for 2009.  
  • Diluted adjusted net income per share for the year was $0.53, as compared to $0.49 for 2009.  

Guidance for 2011 Annual Performance

DealerTrack's revenue and GAAP and non-GAAP earnings guidance for the full year 2011 is as follows:

Expected GAAP Results

  • Revenue for the year is expected to be between $316.0 million and $324.0 million, net of approximately $3.7 million of contra-revenue.
  • GAAP net income for the year is expected to be between $2.9 million and $5.4 million.
  • Diluted GAAP net income per share for the year is expected to be between $0.07 and $0.13.

Expected Non-GAAP Results

  • Adjusted EBITDA for the year is expected to be between $57.0 million and $61.0 million.
  • Adjusted net income for the year is expected to be between $29.2 million and $31.7 million.
  • Diluted adjusted net income per share for the year is expected to be between $0.68 and $0.74.

GAAP net income and adjusted net income per share guidance for the year are based on an assumed 42.8 million diluted weighted average shares outstanding.   The guidance assumes that for 2011 new car sales will be approximately 12.8 million units and used car sales will be approximately 13.0 million units.  The guidance also includes the impact of DealerTrack's recent acquisition of triVIN Holdings, Inc. which closed at the end of January.

Mark O'Neil, chairman and chief executive officer of DealerTrack, commented, "We are very pleased with our non-GAAP results for the fourth quarter as our businesses benefited from an improving operating environment."  O'Neil continued, "We are continuing to see the benefits of our investments as we generated an adjusted EBITDA margin in excess of 20 percent for the second consecutive quarter."

Conference Call

DealerTrack will host a conference call to discuss its fourth quarter and full year 2010 results and other matters on February 16, 2011 at 5:00 p.m. Eastern Time.  The conference call will be webcast live on the Internet at http://ir.dealertrack.com/eventdetail.cfm?eventid=91881. In addition, a live audio of the call will be accessible to the public by calling 877-303-6648 (domestic) or 970-315-0443 (international); no access code is necessary. Callers should dial in approximately 10 minutes before the call begins. A replay will be available on the DealerTrack website until March 9, 2011.

Non-GAAP Financial Measures  

The non-GAAP measures of adjusted EBITDA and adjusted net income disclosures are not presented in accordance with generally accepted accounting principles (GAAP) and are not intended to be used in lieu of GAAP presentations of net income. Adjusted EBITDA is a non-GAAP financial measure that represents GAAP net income (loss) excluding interest, taxes, depreciation and amortization expenses, contra-revenue and may exclude certain items such as:  impairment charges, restructuring charges, acquisition-related earn-out compensation expense and professional service fees, realized gains or (losses) on securities and certain other non-recurring items.  Adjusted net income is a non-GAAP financial measure that represents GAAP net income (loss) excluding stock-based compensation expense, the amortization of acquired identifiable intangibles, contra-revenue and may also exclude certain items, such as: impairment charges, restructuring charges, acquisition-related earn-out compensation expense and professional service fees, realized gains or (losses) on securities and certain other non-recurring items.  These adjustments to net income, which are shown before taxes, are adjusted for their tax impact.  

Adjusted EBITDA and adjusted net income are presented because management believes they provide additional information with respect to the performance of our fundamental business activities as the purchase accounting treatment of acquisitions can have a negative impact on our GAAP results because the depreciation and amortization expenses associated with acquired assets, as well as particular intangibles (which tend to have a relatively short useful life), can be substantial in the first several years following an acquisition. As a result, we monitor our adjusted EBITDA and adjusted net income and other business statistics as a measure of operating performance in addition to net income and the other measures included in our consolidated financial statements. Management believes the adjusted EBITDA and adjusted net income information is useful to investors for these reasons. Adjusted EBITDA and adjusted net income are nonGAAP financial measures and should not be viewed as an alternative to GAAP measures of performance. Management believes the most directly comparable GAAP financial measure for adjusted EBITDA and adjusted net income is GAAP net income and has provided a reconciliation of adjusted EBITDA to GAAP net income and adjusted net income to GAAP net income, in Attachment 4 to this press release.

About DealerTrack (www.dealertrack.com)

DealerTrack's intuitive and high-value software solutions enhance efficiency and profitability for all major segments of the automotive retail industry, including dealers, lenders, OEMs, agents and aftermarket providers. Our solution set for dealers is the industry's most comprehensive. DealerTrack operates the industry's largest online credit application network in the United States, connecting approximately 17,000 dealers with over 950 lenders. Our Dealer Management System (DMS) provides dealers with easy-to-use tools and real-time data access that will streamline any automotive business. Dealers using DealerTrack AAX get the inventory management tools and services needed to accelerate turns and increase profit. Our Sales/Finance and Insurance solution enables dealers to streamline the entire sales process while structuring all types of deals from a single integrated platform. DealerTrack's Compliance solution helps dealers meet legal and regulatory requirements and protect their assets. DealerTrack's family of companies also includes data and consulting services providers ALG and Chrome Systems.  For more information, visit www.dealertrack.com.

Safe Harbor for Forward-Looking and Cautionary Statements

Statements in this press release regarding DealerTrack's expected 2011 performance, the long-term outlook for its business, and all other statements in this release other than the recitation of historical facts are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995).  These statements involve a number of risks, uncertainties and other factors that could cause actual results, performance or achievements of DealerTrack to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements.

Factors that might cause such a difference include: economic trends that affect the automotive retail industry or the indirect automotive financing industry including the number of new and used cars sold; reductions in auto dealerships; increased competitive pressure from other industry participants, including Open Dealer Exchange, RouteOne, CUDL, Finance Express and AppOne; the impact of some vendors of software products for automotive dealers making it more difficult for DealerTrack's customers to use DealerTrack's solutions and services; security breaches, interruptions, failures and/or other errors involving DealerTrack's systems or networks; the failure or inability to execute any element of DealerTrack's business strategy, including selling additional products and services to existing and new customers; DealerTrack's success in implementing an ERP system; the volatility of DealerTrack's stock price; new regulations or changes to existing regulations; the integration of recent acquisitions and the expected benefits, as well as the integration and expected benefits of any future acquisitions that DealerTrack may pursue; DealerTrack's success in expanding its customer base and product and service offerings, the impact of recent economic trends, and difficulties and increased costs associated with raising additional capital; the impairment of intangible assets, such as trademarks and goodwill; and other risks listed in DealerTrack's reports filed with the Securities and Exchange Commission (SEC), including its most recent Annual Report on Form 10-K. These filings can be found on DealerTrack's website at www.dealertrack.com and the SEC's website at www.sec.gov. Forward-looking statements included herein speak only as of the date hereof and DealerTrack disclaims any obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances.

Attachment (1) Actual Results

Three-Month Period

DEALERTRACK HOLDINGS, INC.

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)


Three Months Ended


December 31,


2010


2009





Net revenue

$      62,006


$      53,247

Cost of revenue

30,404


27,237

Product development

3,095


2,957

Selling, general and administrative

25,368


25,638

     Total operating expenses

58,867


55,832

Income (loss) from operations

3,139


(2,585)

Interest and other income, net

211


867

Income (loss) before (provision for) benefit from income taxes

3,350


(1,718)

(Provision for) benefit from income taxes

(29,797)


1,037

 Net loss

$    (26,447)


$         (681)





Basic net loss per share

$        (0.65)


$        (0.02)

Diluted net loss per share

$        (0.65)


$        (0.02)

Weighted average shares outstanding (basic)

40,595,939


39,787,985

Weighted average shares outstanding (diluted)

40,595,939


39,787,985





Adjusted EBITDA (non-GAAP) (a)

$      14,463


$        8,177

Adjusted EBITDA margin (non-GAAP) (b)

23%


15%

Adjusted net income (non-GAAP) (a)

$        7,787


$        4,820

Diluted adjusted net income per share (non-GAAP) (c)(d)

$          0.19


$          0.12





Stock-based compensation expense was classified as follows:  




Cost of revenue

$           361


$           525

Product development

$           143


$           153

Selling, general and administrative

$        2,050


$        2,322





(a)     See Reconciliation Data in Attachment 4.

(b)     Represents adjusted EBITDA as a percentage of net revenue.

(c)     For the three months ended December 31, 2010, the adjusted net income per share of approximately $0.19 is based on 41,774,695 diluted weighted average shares outstanding.

(d)     For the three months ended December 31, 2009, the adjusted net income per share of approximately $0.12 is based on 40,898,826 diluted weighted average shares outstanding.



Attachment (1) Actual Results

Twelve-Month Period

DEALERTRACK HOLDINGS, INC.

Consolidated Statements of Operations

(Dollars in thousands, except per share data)

(Unaudited)


Twelve Months Ended


December 31,


2010


2009

Net revenue

$    243,826


$    225,626

Cost of revenue

124,070


113,875

Product development

13,386


13,994

Selling, general and administrative

105,715


108,707

     Total operating expenses

243,171


236,576

Income (loss) from operations

655


(10,950)

Interest and other income, net

1,527


1,704

Realized gain on securities

582


1,393

Income (loss) before (provision for) benefit from income taxes

2,764


(7,853)

(Provision for) benefit from income taxes

(30,597)


3,519

 Net loss

$    (27,833)


$      (4,334)





Basic net loss per share

$        (0.69)


$        (0.11)

Diluted net loss per share

$        (0.69)


$        (0.11)

Weighted average shares outstanding (basic)

40,322,939


39,524,544

Weighted average shares outstanding (diluted)

40,322,939


39,524,544





Adjusted EBITDA (non-GAAP) (a)

$      42,070


$      34,438

Adjusted EBITDA margin (non-GAAP) (b)

17%


15%

Adjusted net income (non-GAAP) (a)

$      21,943


$      19,967

Diluted adjusted net income per share (non-GAAP) (c) (d)

$          0.53


$          0.49





Stock-based compensation expense was classified as follows:  




Cost of revenue

$        1,640


$        2,354

Product development

$           614


$           755

Selling, general and administrative (e)

$        8,979


$      13,880





(a)     See Reconciliation Data in Attachment 4.

(b)     Represents adjusted EBITDA as a percentage of net revenue.

(c)     For the twelve months ended December 31, 2010, the adjusted net income per share of approximately $0.53 is based on 41,299,993 diluted weighted average shares outstanding.

(d)     For the twelve months ended December 31, 2009, the adjusted net income per share of approximately $0.49 is based on 40,509,324 diluted weighted average shares outstanding.

(e)     Included in stock-based compensation expense for the year ended December 31, 2009 was $3.9 million of stock-based compensation expense related to the realignment of our workforce and business on January 5, 2009, which was primarily allocated to selling, general and administrative expenses.



Attachment (2) Condensed Consolidated Balance Sheets

DEALERTRACK HOLDINGS, INC.

Condensed Consolidated Balance Sheets

(Dollars in thousands)

(Unaudited)


December 31, 2010


December 31, 2009

ASSETS




Cash and cash equivalents

$               192,563


$               197,509

Short-term investments

490


1,484

Accounts receivable, net

24,273


17,478

Prepaid expenses and other current assets

17,929


9,620

Total current assets

235,255


226,091





Property and equipment, net

18,875


13,514

Software and website development costs, net

29,875


21,158

Intangible assets, net

23,163


41,604

Goodwill

136,408


134,747

Deferred taxes and other long-term assets

15,387


35,213

Total assets

$               458,963


$               472,327





LIABILITIES AND STOCKHOLDERS' EQUITY




Accounts payable and accrued expenses

$                 28,575


$                 26,960

Deferred revenue

5,010


4,992

Due to acquirees and other current liabilities

728


2,245

Total current liabilities

34,313


34,197





Long-term liabilities

15,733


17,244

Total liabilities

50,046


51,441

Total stockholders' equity

408,917


420,886

Total liabilities and stockholders' equity

$               458,963


$               472,327



Attachment (3) Consolidated Statements of Cash Flows

DEALERTRACK HOLDINGS, INC.

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)


Twelve Months Ended


December 31,


2010


2009

Operating activities:




Net loss

$ (27,833)


$   (4,334)

Adjustments to reconcile net loss to net cash provided by operating activities:




Depreciation and amortization

36,753


35,060

Deferred tax provision (benefit)

29,174


(7,262)

Stock-based compensation expense

11,233


16,989

Provision for doubtful accounts and sales credits

5,488


7,698

Loss (gain) on sale of property and equipment

23


(184)

Reversal of pre-acquisition accrued contingency

-


(609)

Amortization of bond premium

-


55

Amortization of deferred interest

68


152

Deferred compensation

-


300

Stock-based compensation windfall tax benefit

(1,714)


(673)

Realized gain on securities

(582)


(1,393)

Changes in operating assets and liabilities, net of effects of acquisitions:




Accounts receivable

(12,059)


(6,342)

Prepaid expenses and other current assets

(9,627)


3,725

Accounts payable and accrued expenses

(1,403)


3,025

Deferred revenue and other current liabilities

7


14

Other long-term liabilities

(1)


(642)

Deferred rent

195


145

Other long-term assets

(10,574)


(257)

Net cash provided by operating activities

19,148


45,467





Investing activities:




Capital expenditures

(10,801)


(5,360)

Restricted cash

-


142

Sale of investments

2,519


44,569

Capitalized software and website development costs

(16,899)


(13,021)

Proceeds from sale of property and equipment

1


109

Payment for acquisition of business and intangible assets, net of acquired cash

(3,028)


(34,722)

Net cash used in investing activities

(28,208)


(8,283)



Attachment (3) Consolidated Statements of Cash Flows (cont'd)

DEALERTRACK HOLDINGS, INC.

Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)





Financing activities:

2010


2009

Principal payments on capital lease obligations

(513)


(414)

Proceeds from the exercise of employee stock options

2,270


2,202

Proceeds from employee stock purchase plan

697


875

Purchase of treasury stock

(643)


(379)

Principal payments on notes payable

-


(848)

Stock-based compensation windfall tax benefit

1,714


673

Net cash provided by financing activities

3,525


2,109





Net (decrease) increase in cash and cash equivalents

(5,535)


39,293

Effect of exchange rate changes on cash and cash equivalents

589


2,760

Cash and cash equivalents, beginning of period

197,509


155,456

Cash and cash equivalents, end of period

$ 192,563


$ 197,509










Twelve Months Ended


December 31,


2010


2009

Supplemental disclosure:




Cash paid for:




Income taxes

$     6,776


$     4,961

Interest

$          57


$          60



Attachment (4) Reconciliation Data 

DEALERTRACK HOLDINGS, INC.

Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA

(Dollars in thousands)

(Unaudited)






Three Months Ended


December 31,


2010


2009





GAAP net loss

$ (26,447)


$    (681)

Interest income

(144)


(144)

Interest expense

20


68

Provision for (benefit from) income taxes

29,797


(1,037)

Depreciation and amortization

4,678


3,824

Amortization of acquired identifiable intangibles

4,600


4,948

EBITDA (non-GAAP)

12,504


6,978

  Adjustments:




  Acquisition related and other non-recurring professional fees

1,180


1,808

  Reversal of pre-acquisition accrued contingency

-


(609)

  Contra-revenue

779


-

Adjusted EBITDA (non-GAAP)

$  14,463


$   8,177



Attachment (4) Reconciliation Data

DEALERTRACK HOLDINGS, INC.

Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Income

(Dollars in thousands)

(Unaudited)






Three Months Ended


December 31,


2010


2009





GAAP net loss

$ (26,447)


$    (681)

Adjustments:




Deferred tax asset valuation allowance (non-taxable)

28,406


-

Stock-based compensation

2,554


3,000

Amortization of acquired identifiable intangibles

4,600


4,948

Acquisition related and other non-recurring professional fees

1,180


1,808

  Reversal of pre-acquisition accrued contingency

-


(609)

Contra-revenue

779


-

Tax impact of adjustments (a)

(3,285)


(3,646)

Adjusted net income (non-GAAP)

$    7,787


$   4,820





(a)      The tax impact of adjustments for the three months ended December 31, 2010, are based on a U.S. statutory tax rate of 36.9% applied to taxable adjustments other than amortization of acquired identifiable intangibles and stock-based compensation expense, which are based on a blended tax rate of 35.3% and 36.7%, respectively. The tax impact of adjustments for the three months ended December 31, 2009, are based on a U.S. effective tax rate of 37.8% applied to taxable adjustments other than amortization of acquired identifiable intangibles and stock-based compensation expense, which are based on a blended tax rate of 37.0% and 37.8%, respectively.



Attachment (4) Reconciliation Data

DEALERTRACK HOLDINGS, INC.

Reconciliation of GAAP Loss to Non-GAAP Adjusted EBITDA

(Dollars in thousands)

(Unaudited)






Twelve Months Ended


December 31,


2010


2009





GAAP net loss

$ (27,833)


$ (4,334)

Interest income

(525)


(1,081)

Interest expense

175


221

Provision for (benefit from) income taxes

30,597


(3,519)

Depreciation and amortization

17,329


14,719

Amortization of acquired identifiable intangibles

19,424


20,341

EBITDA (non-GAAP)

39,167


26,347

  Adjustments:




Restructuring costs (including stock-based compensation) (a)

-


6,686

  Acquisition related and other non-recurring professional fees

1,905


2,407

  Realized gain on securities

(582)


(1,393)

Reversal of pre-acquisition accrued contingency

-


(609)

Acquisition related earn-out compensation expense

-


1,000

  Contra-revenue

1,580


-

Adjusted EBITDA (non-GAAP)

$  42,070


$ 34,438









(a)      Includes $3.9 million in non-cash costs related to a reduction in workforce.



Attachment (4) Reconciliation Data 

DEALERTRACK HOLDINGS, INC.

Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Income

(Dollars in thousands)

(Unaudited)






Twelve Months Ended


December 31,


2010


2009





GAAP net loss

$ (27,833)


$ (4,334)

Adjustments:




Deferred tax asset valuation allowance (non-taxable)

28,406


-

Stock-based compensation (excluding restructuring costs)

11,233


13,104

Amortization of acquired identifiable intangibles

19,424


20,341

Acquisition related and other non-recurring professional fees

1,905


2,407

Realized gain on securities (non-taxable)

(582)


(1,393)

Amended state tax return impact (non-taxable)

101


(1,070)

Restructuring costs (including stock-based compensation) (a)

-


6,686

Reversal of pre-acquisition accrued contingency

-


(609)

  Acquisition related earn-out compensation expense

-


1,000

Contra-revenue

1,580


-

Tax impact of adjustments (b)

(12,291)


(16,165)

Adjusted net income (non-GAAP)

$  21,943


$ 19,967





(a)  Includes $3.9 million in non-cash costs related to a reduction in workforce.

(b)  The tax impact of adjustments for the year ended December 31, 2010, are based on a U.S. statutory tax rate of 36.9% applied to taxable adjustments other than amortization of acquired identifiable intangibles and stock-based compensation expense, which are based on a blended tax rate of 35.4% and 36.7%, respectively. The tax impact of adjustments for the year ended December 31, 2009, are based on a U.S. effective tax rate of 37.8% applied to taxable adjustments other than amortization of acquired identifiable intangibles and stock-based compensation expense, which are based on a blended tax rate of 37.0% and 37.8%, respectively.



Attachment (4) Reconciliation Data

DEALERTRACK HOLDINGS, INC.

Reconciliation of Forward-looking GAAP Net Income to Forward-looking Non-GAAP Adjusted EBITDA

(Dollars in millions)

(Unaudited)






Year Ending December 31, 2011


Expected Range





GAAP net income

$        2.9


$       5.4

Net interest income

(0.1)


(0.1)

Provision for income taxes

4.0


5.5

Depreciation and amortization

23.0


23.0

Amortization of acquired identifiable intangibles

21.5


21.5

EBITDA (non-GAAP)

51.3


55.3

  Adjustments:




  Non-recurring costs (a)

2.0


2.0

  Contra-revenue

3.7


3.7

Adjusted EBITDA (non-GAAP)

$      57.0


$     61.0









(a)  Includes certain professional fees, integration costs and restructuring costs.



Attachment (4) Reconciliation Data 

DEALERTRACK HOLDINGS, INC.

Reconciliation of Forward-looking GAAP Net Income to Forward-looking Non-GAAP Adjusted Net Income

(Dollars in millions)

(Unaudited)


Year Ending December 31, 2011


Expected Range





GAAP net income

$        2.9


$       5.4

Adjustments:




Stock-based compensation charges

11.6


11.6

Amortization of acquired identifiable intangibles

21.5


21.5

Non-recurring costs (a)

2.0


2.0

Deferred tax asset valuation allowance (non-taxable)

1.5


1.5

Contra-revenue

3.7


3.7

Tax impact of adjustments (b)

(14.0)


(14.0)

Adjusted net income (non-GAAP)

$      29.2


$     31.7





(a)  Includes certain professional fees, integration costs and restructuring costs.

(b)  The tax impact of adjustments are based on a blended tax rate of 36.1% applied to taxable adjustments.  



Attachment (5) Summary of Business Statistics

DEALERTRACK HOLDINGS, INC.

Summary of Business Statistics (Unaudited)

Three months ended












Dec 31,


Sep 30,


Jun 30,


Mar 31,


Dec 31,


2010


2010


2010


2010


2009











Active U.S. dealers (a)

16,829


16,961


17,120


17,102


16,690

Active U.S. lenders (b)

970


921


891


847


823

Transactions processed (in thousands)(c)

11,997


13,296


12,239


11,841


10,114

Active U.S. lender to dealer relationships (d)

137,058


137,388


137,919


127,724


118,209

Subscribing dealers (e)

13,996


13,856


13,468


13,705


13,852





















(a)     We consider a dealer to be active as of a date if the dealer completed at least one revenue-generating credit application processing transaction using the U.S. DealerTrack network during the most recently ended calendar month.  For the three months ended March 31, 2010, the number of active U.S. dealers was updated from the number originally reported (16,860).  For the three months ended June 30, 2010, the number of active U.S. dealers was updated from the number originally reported (17,343).   The number of active U.S. dealers is based on the number of dealer accounts as communicated by lenders on the DealerTrack network.  

(b)     We consider a lender to be active in our DealerTrack network as of a date if it is accepting credit application data electronically from U.S. dealers in the DealerTrack network.

(c)     Represents revenue-generating transactions processed in the DealerTrack, DealerTrack Digital Services and DealerTrack Canada networks at the end of a given period.

(d)     Each lender to dealer relationship represents a pair between an active U.S. lender and an active U.S. dealer.

(e)     Represents the number of dealerships with one or more active subscriptions on the DealerTrack or DealerTrack Canada networks at the end of a given period.



Attachment (5) Summary of Business Statistics

DEALERTRACK HOLDINGS, INC.

Summary of Business Statistics (Unaudited)

Three months ended


Dec 31,


Sep 30,


Jun 30,


Mar 31,


Dec 31,


2010


2010


2010


2010


2009











Transaction revenue (in thousands)

$25,091


$27,188


$26,851


$22,870


$20,237

Subscription revenue (in thousands)

$32,205


$31,273


$30,341


$29,728


$28,982

Other revenue (in thousands)

$4,710


$4,667


$4,715


$4,187


$4,028

Average transaction price (a)

$2.16


$2.09


$2.19


$1.93


$2.00

Average monthly subscription revenue per subscribing dealership (b)

$769


$759


$749


$719


$695





















(a)     Represents the average revenue earned per transaction processed in the DealerTrack, DealerTrack Aftermarket, DealerTrack Digital Services and DealerTrack Canada networks during a given period.  Revenue used in calculation adds back contra-revenue.

(b)     For the 2010 periods, represents  net subscription revenue divided by average subscribing dealers for a given period in the DealerTrack and DealerTrack Canada networks.



TRAK-E

SOURCE DealerTrack Holdings, Inc.