INSW- January 25, 2000 16:21
InsWeb Corporation Reports Fourth Quarter and Fiscal 1999 Results
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Q4 Revenues Increase 218% to $6.4 Million
Q4 Loss of $0.32 Beats Consensus Estimates of $0.36
REDWOOD CITY, Calif., Jan. 25 /PRNewswire/ -- InsWeb (Nasdaq: INSW), the
Internet's leading insurance marketplace, today reported financial results for the fourth
quarter and fiscal
year ended December 31, 1999. Revenues for the fourth quarter totaled $6.4 million, an
increase of 218% from revenues of $2.0 million in the fourth quarter of 1998. InsWeb
reported a net
loss for the fourth quarter of $11.0 million, or $0.32 per share, beating First Call
consensus net loss estimates of $0.36 per share. This compares to a net loss of $10.3
million, or $0.42 per
pro forma share, for the fourth quarter of the prior year.
(Photo: newscom.com )
Revenues for fiscal 1999 totaled $21.8 million, an increase of 407% over revenues of
$4.3 million for fiscal 1998. The Company incurred a net loss for the year of $36.2
million, or $1.17 per
pro forma share, compared to a net loss of $22.5 million, or $0.92 per pro forma share,
for the prior year.
During the fourth quarter of 1999, more than 610,000 shopping sessions were
completed on www.insweb.com, a 274% increase over the more than 163,000
shopping sessions completed
in the fourth quarter of 1998. For the year, the number of completed shopping sessions
totaled more than 2 million, an increase of 418% over the more than 387,000 completed
shopping
sessions in the prior year. InsWeb recorded more than 2.7 million unique user sessions
during the fourth quarter, an increase of 268% over the approximately 1 million unique
user sessions
recorded in the prior year quarter. For the year, unique user sessions on InsWeb totaled
more than 7.8 million, a 166% increase from the more than 2.9 million user sessions
during 1998.
Hussein Enan, Chief Executive Officer of InsWeb, commented, "1999 was a pivotal
year for InsWeb as we achieved tremendous growth in: consumer interest in shopping
for insurance on
our site; the number of insurance carriers integrated into our platform; the number of
established online partnerships with insurance centers powered by InsWeb; the
geographic coverage
and range of our product offerings; and the breadth and depth of our technology
platform. We believe that 2000 is the year that online insurance will go mainstream and
that InsWeb is well
positioned to capitalize on this opportunity."
As anticipated, completed shopping sessions and revenues declined slightly in the fourth
quarter from the third quarter of 1999. Mr. Enan added, "As in the same period of
1998, we
experienced a seasonal slowdown in traffic from our online partners as many consumers
focused their attention on the holidays and deferred shopping for insurance to the new
year. With
the holidays behind us, we are already experiencing a resumption of growth in shopping
sessions. For the first three weeks of January, average weekly shopping sessions are up
more than
25%, as compared to average weekly levels in the fourth quarter."
"Looking ahead, InsWeb is focused on enhancing the value we provide both to
consumers and to our insurance company partners. In the coming months, in addition to
increasing the
number of insurance carriers offered on the insweb.com marketplace, InsWeb also plans
to significantly expand the number of carriers on whose behalf it acts as agent, with the
expectation of providing policy fulfillment to more consumers in a number of states
nationwide. In addition, by the end of the first quarter, InsWeb's agency intends to
introduce additional
services including the ability to 'bind online' for auto insurance."
Developments at InsWeb continue to enhance the value proposition for consumers. In
the fourth quarter, InsWeb increased online access, expanded the insurance offerings
available from
its integrated insurance company partners, assisted consumers through additional phases
of the insurance-shopping process, added new functionality to the InsWeb technology
platform,
and became accessible to Japanese consumers through the launch of the initial phase of
InsWeb Japan K.K. Fourth quarter highlights included:
More Online Partnerships
InsWeb continues to rapidly add new online partners, including many of the most
popular online sites where consumers can find and access InsWeb to simplify their
insurance shopping
experience. InsWeb now has 147 online partnerships. In December, InsWeb
significantly expanded its relationship with Microsoft with the launch of the MSN(TM)
Insurance Center on the
MSN MoneyCentral(R) online personal finance service located at
moneycentral.msn.com. Also in the fourth quarter, InsWeb unveiled a co-branded
insurance marketplace with Morningstar,
a leading provider of investment information, research and analysis.
"We believe that InsWeb remains unmatched in our network of key online partners,
many of whom have chosen InsWeb because of our leadership position in the industry
and for the
superior functionality of our technology," continued Mr. Enan. "We view our online
partnerships as a key competitive advantage and a complement to our extensive
branding and advertising
campaigns, which we plan to aggressively execute during the first half of this year."
More Insurance Carriers
InsWeb continues to expand its industry-leading insurance platform as more carriers
begin to leverage its efficiencies. The company integrated several new carriers during the
fourth quarter,
increasing to a total of 49 the number of carriers offering automobile, term life,
homeowners, renters, individual health and other insurance products. InsWeb will
continue to expand its
product offerings, and plans to unveil a small group health product with a major carrier
this quarter.
"There has been significantly more carrier interest in InsWeb since Allstate announced in
November that it plans to offer its branded products on the Web," commented Mr.
Enan. "We
believe Allstate's decision has prompted many of the nation's leading auto carriers to
accelerate their Internet strategies, and as the largest aggregator of online insurance
shoppers,
InsWeb stands to benefit from this heightened level of commitment to the Internet as a
key delivery channel for insurance."
Closing Business on Behalf of Insurers
InsWeb achieved another milestone in the fourth quarter by enabling California residents
to buy their policies from InsWeb agents acting on behalf of four auto carriers. For the
first time,
consumers were able to comparison shop, select and purchase insurance through
InsWeb. The company plans to aggressively expand its closing and policy fulfillment
services capabilities
with additional carriers throughout the year. In addition, InsWeb expects to introduce
online binding services that enable payment, binding of actual auto coverage and
distribution of
proof-of-coverage certification. InsWeb is scheduled to begin online binding and
certification for auto insurance in California this quarter, with additional states expected
to rollout later in the
year.
Focus on Technology
Over the past four years, InsWeb has built a state-of-the-art technology platform which
has web-enabled the underwriting, rating and data delivery processes for all of the major
personal
lines insurance products. During the fourth quarter, InsWeb extended its technology
platform and range of services to integrate policy fulfillment and servicing. In addition,
InsWeb continued
to lead the effort with industry organizations such as ACORD to develop and promote a
single standard for Extensible Markup Language (XML), which is designed to streamline
the
exchange of data among insurance carriers and other online partners connected to
InsWeb. In ensuing quarters, InsWeb intends to further leverage its technology platform
to address
opportunities in other parts of the insurance value chain.
InsWeb Japan
InsWeb Japan K.K., a joint venture with SOFTBANK Finance Corp., InsWeb, Marsh
McLennan Companies and Microsoft, recently launched the initial phase of its online
insurance site at
www.insweb.co.jp for Japanese consumers. The new site currently features a range of
interactive tools and useful information on Japanese insurance matters. During the first
quarter,
InsWeb Japan K.K. expects to feature auto-insurance offerings from five of Japan's
leading insurance carriers.
Japan's sizeable insurance business accounts for 25 percent of the world's personal and
commercial insurance premiums, according to research by Swiss Reinsurance Company.
Combined, the U.S. and Japanese InsWeb-branded Internet sites will cover markets
accountable for 56 percent of all personal and commercial premiums worldwide.
About InsWeb
InsWeb, the leading online insurance marketplace (http://www.insweb.com), helps
consumers save time and money by providing free, multiple insurance quotes sponsored
by the nation's
leading insurance companies. InsWeb's 49 participating insurers offer auto, health,
homeowners, renters, term life, and pet insurance. InsWeb is accessible from 147
leading sites on the
Internet, including Yahoo!, MSN, Snap.com, E*TRADE and cars.com. InsWeb
provides real-time customer service, interactive tools, and research capabilities that help
consumers make
confident and better-informed decisions. InsWeb is rated the No. 1 insurance site by
Gomez Advisors and by Lafferty Group, and was recently named one of 50 "Best of the
Web" financial
sites by Money and the top insurance site by Yahoo! Internet Life. Across the Pacific,
the InsWeb brand and technical platform support InsWeb Japan K.K. -- a joint venture
with co-founder
SOFTBANK Finance Corp., Marsh & McLennan Companies Inc. and Microsoft.
InsWeb is headquartered in Redwood City, Calif.
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 the
company has assessed, but which by its nature is dynamic and subject to rapid and even
abrupt changes. Forward-looking statements include statements: regarding optimism
about
achieving sequentially higher revenues in subsequent quarters; optimism about the results
of certain strategic and consumer initiatives; product and technological implementations;
and
projected expenditures and growth. 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 demand or acceptance; the willingness of insurance companies to offer their
products
over the Internet; changes in the company's relationships with existing insurance
companies and/or strategic partners; the company's ability to attract and integrate new
insurance
companies and strategic partners; implementation of competing Internet strategies by
existing and potential insurance company participants; implementation and acceptance of
new
product or service offerings, such as binding online, policy fulfillment and other agency
based services; implementation and acceptance of new initiatives in the U.S. and abroad,
such as
InsWeb Japan; insurance industry regulation; competition in all aspects of the company's
business; 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.
NOTE: "INSWEB" is a registered service mark of InsWeb Corporation. All marks
above are those of InsWeb Corporation, except for those of insurance carriers, 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 and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands except for per share amounts)
For the Three Months For the Twelve Months
Ended December 31, Ended December 31,
1998 1999 1998 1999
(unaudited)
Revenues:
Transaction fees $1,430 $5,553 $3,151 $19,138
Development and maintenance
fees 239 865 789 2,674
Other revenues 351 9 370 29
Total revenues 2,020 6,427 4,310 21,841
Operating expenses:
Product development 6,805 2,318 10,077 8,871
Sales and marketing 2,957 11,031 8,954 33,477
General and administrative 2,529 4,802 7,180 14,747
Amortization of intangibles -- 782 -- 3,129
Total operating expenses 12,291 18,933 26,211 60,224
Operating loss (10,271) (12,506) (21,901) (38,383)
Other income (expense) 600 72 600 (166)
Interest income (expense), net (609) 1,423 (1,189) 2,348
Net loss $(10,280) $(11,011) $(22,490) $(36,201)
Loss per share - basic and
diluted $(0.69) $(0.32) $(1.52) $(1.52)
Shares 14,958 34,675 14,813 23,864
Loss per share- proforma $(0.42) $(0.32) $(0.92) $(1.17)
Shares - Proforma 24,458 34,675 24,408 31,000
Note: Proforma shares for periods prior to the Company's initial public offering in July
1999 assume conversion of the then outstanding preferred shares.
InsWeb Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
December 31, December 31,
1998 1999
ASSETS
Current assets:
Cash and cash equivalents $8,337 $25,689
Short-term investments -- 64,063
Total cash and short term investments 8,337 89,752
Accounts receivable 1,192 4,268
Prepaid expenses and other current assets 654 2,974
Receivable for purchase of preferred stock 22,999 --
Total current assets 33,182 96,994
Property and equipment, net 3,998 7,357
Investment in joint venture 2,089 1,450
Intangible assets, net 8,697 5,568
Long term investments -- 4,978
Deposits 1,391 1,934
Total assets $49,357 $118,281
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $525 $289
Accrued expenses 3,145 5,160
Deferred revenue 226 183
Payable to Series B stockholder 4,500 --
Line of credit from affiliate 19,290 --
Total current liabilities 27,686 5,632
Note payable to strategic partner 2,089 1,464
Total liabilities 29,775 7,096
Total stockholders' equity 19,582 111,185
Total liabilities and stockholders' equity $49,357 $118,281
SOURCE InsWeb Corporation
/CONTACT: investors, Alex Wellins or Jennifer Jarman of the blueshirt
group, 415-217-7722, or jennifer@blueshirtgroup.com, for InsWeb; or media,.
Greg Jones of InsWeb Corporation, 650-817-0213, or gjones@insweb.com/
INSW- Earnings terrific... chart terrific..look for this as a mover tomorrow.
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