| NORTH PALM BEACH, Fla., Feb. 5, 2003 (BUSINESS WIRE)
-- Bankrate, Inc. (RATE), the Internet's leading consumer banking marketplace,
today reported a 46% increase in total revenue for the year ended December
31, 2002 to $26.6 million from $18.3 million in 2001. The Company reported
its first profitable year with net income of $6.7 million, or $0.46 per
share on a diluted basis, compared to a net loss of $936,000, or $0.07 per
share on a diluted basis, reported for 2001. Excluding the non-cash gain
on early extinguishment of debt of $2.0 million, or $0.14 per share, in
the quarter ended March 31, 2002, the Company would have reported net income
of $4.7 million, or $0.32 per share on a diluted basis, for 2002. These
results exceed the earlier guidance for the year that the Company provided
Commenting on Bankrate's record year performance, President
and CEO Elisabeth DeMarse said, "The substantial revenue and earnings
increases generated throughout 2002 reflect our ability to execute a highly
disciplined long-term growth strategy. We ended 2002 with robust traffic
and advertising demand, producing record fourth quarter revenue. These
patterns have continued into this year's first quarter, which is seasonally
our strongest quarter. In fact, our traffic during January 2003 broke
all previous records with an average of over 1.1 million page views per
day and over 34.5 million page views for the month."
For the fourth quarter of 2002, total revenues rose 46%
to $7.5 million from $5.1 million in the fourth quarter of 2001. The Company
reported a substantial increase in net income in the fourth quarter to
$1.3 million, or $0.09 per share on a diluted basis, from $317,000, or
$0.02 per share on a diluted basis, in the fourth quarter one year earlier.
These results reflect Bankrate's fifth consecutive profitable quarter
as a result of strong advertiser demand and traffic patterns.
"Over the past two years, we have established the Bankrate
brand as the gold standard for consumers seeking objective data and education
for their most important banking needs and, at the same time, built a
solid financial foundation for our Company," Ms. DeMarse continued.
Fourth Quarter Highlights
Bankrate continued to experience unprecedented strength in revenue in
all categories, resulting in higher year-over-year and consecutive quarter
revenue for the three-month period:
Total revenue of $7.5 million was 46% higher than the fourth
quarter a year earlier, and 3% higher than the third quarter of 2002.
-- Online publishing revenue of $6.4 million was up $2.1 million, or 50%,
over the 2001 fourth quarter, and 2% over the third quarter of 2002. --
Hyperlink (rate table listings) revenue increased $482,000, or 34%, over
the same quarter of 2001. -- Graphic ad revenue was up $1.2 million, or
57%, over the fourth quarter of 2001. -- Print publishing and licensing
revenue of $1.1 million was up $223,000, or 26%, over 2001 and was 11%
above the $978,000 reported in the third quarter of 2002. -- Page views
for the fourth quarter of 2002 of 79.3 million were up 19% over the 66.5
million reported in the same quarter in 2001 while revenue per thousand
page views increased 37% over the same period.
For the seventh consecutive quarter, the Company generated
cash from operations. Cash increased to $11.0 million at December 31,
2002 from $9.8 million at December 31, 2001. "We paid off our $4.35
million subordinated debt for $3.4 million in February 2002 with available
cash, leaving the Company virtually debt-free, while generating over $4.6
million in cash flow for the year," explained Bob DeFranco, Senior
Vice President-Chief Financial Officer. "We remain sharply focused
on maintaining a lean and highly profitable operation. At the same time,
we are making important investments in the growth of our business both
in terms of people and technology to remain efficient and cutting edge,"
Online publishing revenue for the three months ended December
31, 2002 and 2001 included barter revenue of $509,000 and $643,000, representing
approximately 7% and 13% of total revenue, respectively. Excluding barter
revenue, gross margin improved to 71% for the three months ended December
31, 2002 from 68% for the same period in 2001. Barter expense was $532,000
and $636,000 for the three months ended December 31, 2002 and 2001, respectively.
2002 Full Year Highlights -- Total revenue for the 12 months
ended December 31, 2002 of $26.6 million was $8.3 million, or 46%, higher
than the $18.3 million reported for the same period in 2001. -- Online
publishing revenue of $22.7 million was $7.7 million, or 51%, above the
$15.0 million reported for the 12 months of 2001. -- Hyperlink revenue
of $8.8 million increased $4.1 million, or 86%, over the same period in
2001. -- Graphic ad revenue was up $3.3 million, or 44%, over 2001. --
Print publishing and licensing revenue of $3.9 million was $649,000, or
20%, higher than the $3.3 million reported in the same period in 2001.
-- Page views were up 31.1 million, or 13%, to 267.7 million from 2001
and revenue per thousand pages increased 40% over 2001.
Online publishing revenue for 2002 and 2001 included barter
revenue of $2.9 million and $2.6 million, representing approximately 11%
and 14% of total revenue, respectively. Excluding barter revenue, gross
margin improved to 70% in 2002 from 65% in 2001. Excluding barter expense,
operating expenses for the year ended December 31, 2002 of $12.0 million
were within 10% of the comparable amount reported for 2001. Barter expense
was $2.9 million and $2.8 million in 2002 and 2001, respectively.
On January 9, 2003, Bankrate's common stock began trading on the Nasdaq
SmallCap Market under the stock symbol RATE. "This is a milestone
achievement for our Company. We are committed to increasing shareholder
value and we believe the move back to Nasdaq will provide high visibility
for our performance," concluded Ms. DeMarse.
Class Action Suit Dismissed
On January 28, 2003, the United States Court of Appeals for the Second
Circuit affirmed the dismissal of a shareholders' class action suit in
As previously disclosed, a shareholder class action lawsuit
was filed against the Company and certain of its officers and directors,
its auditor and its underwriters in the United States District Court for
the Southern District of New York on March 28, 2000. On March 29, 2001,
the United States District Court of the Southern District of New York
dismissed the shareholders class action suit in its entirety with prejudice.
On April 25, 2001, plaintiffs appealed the decision to dismiss the suit
to the United States Court of Appeals for the Second Circuit.
February 5, 2003 Conference Call Information
The Company has scheduled a teleconference on its 2002 results today at
11:00 am Eastern Standard Time. Please dial in 1-800-580-9496 10 minutes
prior to the start time.
A replay of the teleconference will be available through
February 26 by calling 1-888-843-8996 (domestic) or 1-630-652-3044 (international)
and entering the pass code 6715886#.
About Bankrate, Inc.
Bankrate, Inc. (RATE) owns and operates Bankrate.com, the Internet's leading
consumer banking marketplace. Bankrate.com averages 4 million unique visitors
per month, according to comScore Media Metrix, which ranks Bankrate.com
first in unique visitors in the "Financial information and advice"
category. Bankrate.com reviews more than 4,800 financial institutions
in 173 markets in 50 states. Bankrate.com is a destination site of personal
finance channels, including banking, investing, taxes and small business
finance. It is the leading aggregator of over 191 financial products,
including mortgages, credit cards, new and used auto loans, money market
accounts and CDs, checking and ATM fees, home equity loans and online
banking fees. Bankrate.com provides financial applications and information
to a network of more than 80 partners, including MSN (MSFT) , Yahoo! (YHOO)
, America Online (AOL) , CNN and Smart Money. Bankrate.com's information
is also distributed through more than 100 national and state publications.
Certain matters discussed in this press release are or may
be considered to be "forward-looking statements" within the
meaning of the Securities Act of 1933 and the Securities Exchange Act
of 1934, as amended by the Private Securities Litigation Reform Act of
1995. Those statements include statements regarding the intent, belief
or current expectations of the Company and members of our management team.
Such forward-looking statements include without limitation statements
made with respect to future revenue, revenue growth, market acceptance
of our products, and profitability. Investors and prospective investors
are cautioned that any such forward-looking statements are not guarantees
of future performance and involve risks and uncertainties, and that actual
results may differ materially from those contemplated by such forward-looking
statements. Important factors currently known to management that could
cause actual results to differ materially from those in forward-looking
statements include the following: we have a history of losses and could
run out of cash; we use barter transactions that do not generate cash;
our success depends on Internet advertising revenue, interest rate volatility,
establishing and maintaining distribution arrangements, and increasing
brand awareness of our Web site; our markets are highly competitive; our
Web site may encounter technical problems and service interruptions; we
rely on the protection of our intellectual property; we may face liability
for information on our Web site; future government regulation of the Internet
is uncertain and subject to change; our ownership is heavily concentrated;
our success may depend on management and key employees; we may encounter
difficulties with future acquisitions; our results of operation may fluctuate
significantly; and our stock price may be volatile in the future. These
and additional important factors to be considered are set forth under
"Item 1. Business - Risk Factors,'' "Item 7. Management's Discussion
and Analysis of Financial Condition and Results of Operations'' and in
the other sections of our Annual Report on Form 10-K for the year ended
December 31, 2001, and in our other filings with the Securities and Exchange
Commission. We undertake no obligation to update or revise forward-looking
statements to reflect changed assumptions, the occurrence of unanticipated
events or changes to future operating results or expectations.
Reminder -- Conference Call Today at 11:00 a.m. Eastern
Standard Time; Interactive Dial-In: 1-800-580-9496 (10 minutes before
Financial Statements Follow
Bankrate, Inc., North Palm Beach
Robert J. DeFranco, 561/630-1230