Wednesday, Nov. 07, 2007, 07:00 PM UPDATED 11:59 AMBy Nick Zulovich
LAKE SUCCESS, N.Y. — DealerTrack Holdings revealed its third-quarter financial results late last week and found that transactions processed are on the upswing, officials reported.
The number of transactions processed increased to 23.8 million last quarter, hiking 26 percent from this time last year, officials noted. Total subscriptions also saw a significant rise to 27,469, a 38-percent climb.
Executives also point out that roughly 56 percent of active dealers have at least one of the subscriptions DealerTrack produces.
As of the end of the third quarter, 22,551 dealers were active with DealerTrack as were 427 financing services, an increase of 59 percent.
Looking at the Generally Accepted Accounting Principles for the quarter, the company hauled in $62.9 million in revenue, up 36 percent from the $46.3 million one year ago.
Net income, however, dipped from $5.6 million to $4.5 million, a 19-percent decline, officials noted. Income before considering income taxes was recorded as $7.7 million, climbing 136 percent from the $3.3 million in the same period of 2006.
"Our strong third-quarter performance represents continued execution of our growth strategy and increased awareness of the value of DearlerTrack's products and services to the automotive retail industry," noted Mark O'Neil, chairman and chief executive officer.
"Through the continued expansion of our network and the addition of exciting growth opportunities in the dealer management systems and Leads Network, we have developed a very compelling offering," O'Neil continued. "Our ability to create efficiencies within the automotive and related industries through on-demand technology and our broad network relationships is driving value for our customers."
Regarding the nine-month period, increases were experienced across the board. Revenue climbed 36 percent to $173.1 million, up from $127.6 in a year.
Net income jumped to $15.6 million from $13.7 million, a 14-percent increase. Income before taxes was $26.9 million, climbing 60 percent from the $16.8 million in 2006.
DealerTrack Partners with Commerce Bank
In other news from DealerTrack, the company announced last week it has struck a deal with Commerce Bank, who is planning to utilize the company's online specialty financing services.
"It is our commitment to provider dealers with the access to a wide variety of products and services that will help them be more successful," noted Patrick Staudt, vice president of DealerTrack's specialty solutions group. "Adding Commerce Bank to our growing lender community is a continuation of that commitment."
The crux of the agreement is that recreational vehicle and marine dealers will use DealerTrack's programs to process loan applications and finalize contracts with Commerce Bank.
"Commerce Bank's partnership with DealerTrack goes back many years in the auto industry and I'm excited that we'll now have the ability to offer this technology to our dealers in the RV and marine industries," noted Leonard Metzger, senior vice president of dealer financial services for Commerce Bank. "The reality is that consumers expect and demand that the loan process be handled quickly and efficiently.
"DealerTrack's platform will help Commerce Bank meet both our dealers' and customers' needs," Metzger continued.
MB Financial Bank, DealerTrack Agree to Deal
Earlier last month, DealerTrack announced a similar agreement with MB Financial Bank, with the bank planning to utilize DearlerTrack's financing program for motorcycle purchases.
Like the partnership with Commerce Bank, motorcycle dealers can access DealersTrack features to process loans and contracts with MB Financial.
"We believe our partnership with DealerTrack Specialty Solutions Group provides additional value and options while still granting access to our tailored high-touch customer service they also desire, explained Steve Towne, senior vice president of MB Financial. "This partnership lets MB expand our offerings from our full-service motorcycle indirect lending and dealer banking group."
Added Staudt: "The addition of MB Financial Bank to our platform provides a more efficient way for MB Financial Bank to serve motorcycle dealers. We are an organization that listens to our customers, and adding MB Financial to our community helps address dealers' request for more finance operations."
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