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Innotrac Corporation Announces 2012 Third Quarter Results

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ATLANTA, Nov. 13, 2012 /PRNewswire/ -- Innotrac Corporation (NASDAQ-GM: INOC) announced financial results today for the third quarter and nine months ended September 30, 2012.  The Company reported a 25.3% increase in service revenues to $22.1 million for the quarter versus $17.6 million reported in the comparable period in 2011.  For the nine months ended September 30, 2012, the Company reported a 24.0% increase in service revenues to $63.9 million from $51.5 million reported in the comparable period in 2011.  The increase in service revenue for both the quarter and nine months ended September 30, 2012 was primarily due to the addition of new client programs and a net increase in volume from existing clients. 

Total revenues, which include service and freight revenue, increased 31.6% to $25.7 million from $19.5 million for the three months ended September 30, 2012 and 2011 respectively and increased 23.2% to $72.8 million from $59.1 million for the nine months ended September 30, 2012 and 2011 respectively.  Changes in freight revenue have minimal impact on the Company's operating income since they are billed as pass through expenses with a low markup over cost.

The Company reported net income of $1.1million, or $0.08 per share, fully diluted, for the three months ended September 30, 2012, versus a net loss of $490,000, or ($0.04) per share in the comparable period of 2011.  For the nine months ended September 30, 2012, the Company reported net income of $2.0 million, or $0.15 per share, fully diluted, versus a net loss of $1.8 million, or ($0.14) per share in the comparable period of 2011. 

"We are pleased with the results of the quarter, which saw a growth in service revenue of over 25% for the quarter and 24% year-to-date. We are seeing very nice momentum as our 'best-of-breed' offering continues to gain market share.  In addition, growth in online sales continues to outperform traditional brick-and-mortar, which has provided solid organic growth throughout our client base.  Our addition of new clients along with a strong sales pipeline gives us confidence that our efforts are paying off.   We are actively adding new leading brands looking for best-of-breed services that fit within our robust network of eight fulfillment centers across the U.S. ," said Scott Dorfman, Innotrac's CEO. 

"Our balance sheet remains strong.  We ended the quarter with a $1.7 million cash balance and no advance on our line of credit as we approach the higher seasonal volumes expected at the end of the year," said George Hare, CFO.

Innotrac  
Innotrac Corporation (NASDAQ INOC), founded in 1984 and based near Atlanta, Georgia, is a best-of-breed commerce provider integrating digital technology, fulfillment and contact center solutions to support global brands.  The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and one call center spanning all time zones across the continental United States.  Innotrac Europe GmbH has a network of fulfillment centers, call centers, and returns processing facilities with operations in the UK, Germany, France, Denmark, Sweden, Poland, Austria, Italy, Switzerland, Ireland, Spain and the Netherlands. Connect with Innotrac at www.innotrac.com or http://www.linkedin.com/company/innotrac.

Information contained in this press release, other than historical information, may be considered forward-looking in nature.  Forward-looking statements in this release include statements relating to future events and developments, as well as management's expectations, beliefs, plans, estimates and projections relating to the future.  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, Innotrac's success in developing new business, Innotrac's ability to maintain or improve gross margins in the face of increasing revenues and pricing pressures, realization of expected revenues from new clients, the general state of the  industries that the Company serves, changing technologies, and numerous other factors discussed in Innotrac's 2011 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  

 

INNOTRAC CORPORATION

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)







Three Months Ended


Nine Months Ended


September 30,


September 30,


(Unaudited)


(Unaudited)


2012


2011


2012


2011

Service revenue

$         22,088


$   17,623


$ 63,857


$ 51,499

Freight revenue

3,606


1,894


8,953


7,601

     Total revenue

25,694


19,517


72,810


59,100









Cost of service revenues

10,368


8,072


30,326


23,508

Freight expense

3,463


1,855


8,639


7,557

Selling, general and








    administrative expenses

9,674


9,189


28,931


27,191

Depreciation and amortization

995


847


2,711


2,538

    Total operating expenses

24,500


19,963


70,607


60,794

Operating income (loss)

1,194


(446)


2,203


(1,694)

    Interest expense

90


44


212


138

    Other expense

(2)


2


-


2

        Total other expense

88


46


212


140

Income (loss) before income taxes and

   noncontrolling interest in net loss

1,106


(492)


1,991


(1,834)

   Income tax

-


-


-


-

   Noncontrolling interest in net loss

(1)


2


-


2

Net income (loss) 

$            1,105


$     (490)


$   1,991


$  (1,832)









Earnings per share:








    Basic

$            0.08


$    (0.04)


$     0.15


$   (0.14)

    Diluted

$            0.08


$    (0.04)


$     0.15


$   (0.14)









Weighted average shares








    outstanding:








    Basic

13,058


13,045


13,033


12,908

    Diluted

13,058


13,045


13,033


12,908

 

 


 

INNOTRAC CORPORATION


Condensed Consolidated Balance Sheets


(in thousands)










September 30, 2012


December 31, 2011


ASSETS

(Unaudited)



Current Assets:





 Cash

$            1,662


$            3,283


 Accounts receivable (net of allowance for doubtful 
     accounts of  $114 at September 30, 2012 and $97 at
     December 31, 2011)

18,570


16,977


 Inventory

583


743


 Prepaid expenses and other

1,331


1,066


       Total current assets

22,146


22,069






 Property and equipment, net

14,313


11,173

 Other assets, net

1,272


1,100


        Total assets

$          37,731


$          34,342







LIABILITIES AND SHAREHOLDERS' EQUITY




Current Liabilities:





 Accounts payable

$            6,540


$            7,914


 Line of credit

-


-


 Equipment loan

1,710


-


 Accrued expenses and other

5,020


4,484


       Total current liabilities

13,270


12,398






Noncurrent Liabilities:





 Other non-current liabilities

2,529


2,128


       Total noncurrent liabilities

2,529


2,128







       Total shareholders' equity

21,932


19,816


       Total liabilities and shareholders' equity

$          37,731


$          34,342







 

 


 

 

INNOTRAC CORPORATION



Condensed Consolidated Statements of Cash Flows



(in thousands)














Nine Months Ended

September 30,






(Unaudited)






2012


2011



CASH FLOWS FROM OPERATING ACTIVITIES:






Net income (loss)

$        1,991


$     (1,834)



Adjustments to net income (loss):







Depreciation and amortization

2,711


2,538




Provision for bad debts

18


37




Loss on disposal of fixed assets

-


(16)




Stock compensation expense-stock options

-


2




Stock compensation expense-restricted stock

124


4




Changes in operating assets and liabilities:








Accounts receivable, gross

(1,611)


3,580





Inventory

160


2,719





Prepaid assets and other

(230)


(6)





Other long-term assets

(69)


38





Accounts payable, accrued expenses and other

(1,265)


(2,948)




     Other long-term liabilities

(91)


607




Net cash provided by operating activities

1,738


4,721











CASH FLOWS FROM INVESTING ACTIVITIES:






Capital expenditures

(4,703)


(1,467)



Proceeds from disposition of assets

1


17



Net change in noncurrent assets and liabilities

(9)


(8)




Net cash used in investing activities

(4,711)


(1,458)











CASH FLOWS FROM FINANCING ACTIVITIES:






Borrowings on equipment loan

1,800


-



Payments on equipment loan

(90)


-



Capital lease payments

(321)


(212)



Contribution from non-controlling interest

-


17



Loan commitment fees

(37)


(34)




Net cash provided by (used in) financing activities

1,352


(229)











Net (decrease) increase  in cash

(1,621)


3,034



Cash, beginning of period

3,283


238



Cash, end of period

$       1,662


$       3,272










SOURCE Innotrac Corporation



RELATED LINKS
http://www.innotrac.com

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