Attached files
| file | filename |
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| 8-K - CURRENT REPORT - INTERSECTIONS INC | intersections-8k_031714.htm |
| EX-99.1 - PRESS RELEASE - INTERSECTIONS INC | intersections-ex991_031714.htm |
Exhibit 99.2
Year End 2013 Earnings Review and 2014 Business Update
March 17, 2014
March 17, 2014
1
Intersections Corporate Overview
Statements in this presentation relating to future plans, results, performance,
expectations, achievements and the like are considered “forward-looking
statements.” These forward-looking statements involve known and unknown
risks and are subject to change based on various factors and uncertainties that
may cause actual results to differ materially from those expressed or implied by
these statements, including the impact of the regulatory environment on our
business and our ability to execute our business strategy. Factors and
uncertainties that may cause actual results to differ include, but are not limited
to, the risks disclosed in the company’s filings with the U.S. Securities and
Exchange Commission. The company undertakes no obligation to revise or
update any forward-looking statements.
expectations, achievements and the like are considered “forward-looking
statements.” These forward-looking statements involve known and unknown
risks and are subject to change based on various factors and uncertainties that
may cause actual results to differ materially from those expressed or implied by
these statements, including the impact of the regulatory environment on our
business and our ability to execute our business strategy. Factors and
uncertainties that may cause actual results to differ include, but are not limited
to, the risks disclosed in the company’s filings with the U.S. Securities and
Exchange Commission. The company undertakes no obligation to revise or
update any forward-looking statements.
2
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
About Intersections Inc.
Intersections Inc. (Nasdaq: INTX) is a leading provider of identity risk management,
privacy protection and other subscription based services for consumers. Our core
services monitor personal information for our consumers, aggregate it into digestible,
consumer-friendly reports and alerts, and provide personalized education and support to
help our customers understand their information and take the actions they deem
appropriate. Since our business was founded in 1996, Intersections has protected the
identities of more than 36 million consumers. To learn more, visit
www.intersections.com.
privacy protection and other subscription based services for consumers. Our core
services monitor personal information for our consumers, aggregate it into digestible,
consumer-friendly reports and alerts, and provide personalized education and support to
help our customers understand their information and take the actions they deem
appropriate. Since our business was founded in 1996, Intersections has protected the
identities of more than 36 million consumers. To learn more, visit
www.intersections.com.
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Founded:
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1996
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NASDAQ Symbol:
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INTX
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Headquarters:
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Chantilly, VA
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Employees:
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644
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Consumers
Protected To Date: |
Over 36 million
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Fast Facts
3
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
FY 2013 Consolidated Operating Results
► Revenue for FY 2013 was $310.3 million, a decrease of 10.7 percent from FY 2012.
► Adjusted EBITDA was $29.2 million for FY 2013, a decrease of 50.5 percent from FY 2012.*
These results was driven primarily by:
These results was driven primarily by:
• The decrease in revenue from our large U.S. Bank clients.
• An increase of approximately $7 million in G&A expenses for VoyceTM
• An increase of approximately $5 million in marketing spend in our IDENTITY GUARD® brand.
• An increase in the Loss from Operations in our Market Intelligence segment of approximately
$3.3.**
$3.3.**
• An increase of approximately $1 million in severance related expenses.
► Consolidated Net Income for FY 2013 was $2.4 million, or $0.13 per diluted share,
compared to $19.7 million, or $1.04 per diluted share, for FY 2012.
compared to $19.7 million, or $1.04 per diluted share, for FY 2012.
► Intersections generated $23.1 million in cash flow from operations in FY 2013.
• We ended FY 2013 with a cash balance of $20.9 million and no borrowings under our credit facility.
*Consolidated adjusted EBITDA before share related compensation and non-cash impairment charges.
** We ceased all business activities in our subsidiary Net Enforcers in the Second Quarter of 2013, our FY 2013 financials have been recast to represent
Net Enforcers as a discontinued operations. We have subsequently announced our intent to discontinue our Market Intelligence segment businesses in the
second quarter of 2014.
Net Enforcers as a discontinued operations. We have subsequently announced our intent to discontinue our Market Intelligence segment businesses in the
second quarter of 2014.
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
4
Q4 2013 Consolidated Operating Results
► Revenue for the 4th quarter of 2013 was $72.1 million, a 14 percent decrease from the
4th quarter of 2012 and a 5 percent decrease from the 3rd quarter of 2013.
4th quarter of 2012 and a 5 percent decrease from the 3rd quarter of 2013.
► Adjusted EBITDA before share related compensation and non-cash impairment charges
for the 4th Quarter of 2013 was $5.2 million, a 53.6 percent decrease from the 4th
quarter of 2012 and a 1.2 percent decrease from the 3rd quarter of 2013.
for the 4th Quarter of 2013 was $5.2 million, a 53.6 percent decrease from the 4th
quarter of 2012 and a 1.2 percent decrease from the 3rd quarter of 2013.
► Net income for the 4th quarter of 2013 was $119 thousand, or less than $0.01 per
diluted share, compared to $1.6 million for the 4th quarter of 2012, or $0.08 per diluted
share, and a net loss of ($1.5) million, or ($0.08) per diluted share, for the 3rd quarter of
2013.
diluted share, compared to $1.6 million for the 4th quarter of 2012, or $0.08 per diluted
share, and a net loss of ($1.5) million, or ($0.08) per diluted share, for the 3rd quarter of
2013.
► Intersections generated $5.7 million in cash flow from operations in the fourth quarter
of 2013.
of 2013.
5
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
*Consolidated adjusted EBITDA before share related compensation and non-cash impairment charges.
2013 Performance Compared to Guidance
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
6
|
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FY 2013
Guidance
(declared
3/18/13) |
FY 2013
Guidance
(updated
11/12/13) |
FY 2013
Actual
Results |
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Revenue
|
$300 to $315
million |
High-end of
3/18/13 Guidance |
$310.3
million
|
|
Adj. EBITDA *
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$29.3 to
$35.2 million
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Slightly lower
than 3/18/13 Guidance |
$29.2
million
|
* Consolidated adjusted EBITDA before share related compensation and non-cash impairment charges.
Market Intelligence Segment Update
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
7
Ø Intersections’ Board made the determination to cease ongoing operations at
our subsidiary, Intersections Business Intelligence Services (DBA Zumetrics).
These operations are expected to wind down and cease during the Second
Quarter of 2014. We plan to classify Zumetrics as a discontinued operation
once at the time it meets the requirements under U.S. GAAP and at that time,
will no longer have a Market Intelligence segment.
our subsidiary, Intersections Business Intelligence Services (DBA Zumetrics).
These operations are expected to wind down and cease during the Second
Quarter of 2014. We plan to classify Zumetrics as a discontinued operation
once at the time it meets the requirements under U.S. GAAP and at that time,
will no longer have a Market Intelligence segment.
• For FY 2013 Zumetrics recorded a Loss from Operations of approximately $3.7
million.
million.
Our Strategy to Fuel Future Growth
8
► For the last few years Intersections has faced strong headwinds from the heightened
regulatory focus on our large U.S. bank partners and the sales, marketing and
administration of add-on products.
regulatory focus on our large U.S. bank partners and the sales, marketing and
administration of add-on products.
► We expect to reignite growth at Intersections by pursuing three primary objectives:
• Grow our IDENTITY GUARD® brand by expanding product offerings, increasing marketing
and creating new non-financial institution endorsed partnerships.
and creating new non-financial institution endorsed partnerships.
• Launch and grow VOYCE®, our new pet health monitoring platform.
• Manage our U.S. large bank business to exceed the expectations of the millions of
subscribers who continue to use and value our products and services, grow this business
where possible and maximize cash generation to fund higher growth initiatives.
subscribers who continue to use and value our products and services, grow this business
where possible and maximize cash generation to fund higher growth initiatives.
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
An Expanded Identity Guard®
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► We are launching new products under the IDENTITY GUARD® brand and
steadily increasing our marketing budgets to drive greater growth.
steadily increasing our marketing budgets to drive greater growth.
o In December on 2013, we launched IDENTITY GUARD ® Essentials, which we
believe is the best product in the marketplace for $9.99 per month with greater
data monitoring coverage across deposit and credit accounts than competing
offerings and exclusive access to our trained victim assistance agents.
believe is the best product in the marketplace for $9.99 per month with greater
data monitoring coverage across deposit and credit accounts than competing
offerings and exclusive access to our trained victim assistance agents.
o In March 2014, we launched SafeConnex™ powered by IDENTITY GUARD®, a
free online identity theft protection tool providing secure pin and password
storage, secure account login and payment data form filling, and safe browsing
capabilities for consumers. SafeConnex™ also offers Intersections exclusive and
secure marketing opportunities within the user experience as well as search
related revenue opportunities as we expand usage of this “freemium”
protection offering.
free online identity theft protection tool providing secure pin and password
storage, secure account login and payment data form filling, and safe browsing
capabilities for consumers. SafeConnex™ also offers Intersections exclusive and
secure marketing opportunities within the user experience as well as search
related revenue opportunities as we expand usage of this “freemium”
protection offering.
o We expect to launch a new suite of IDENTITY GUARD® privacy protection
products targeting a broader consumer population with low cost solutions for
the developing threats to identity and privacy.
products targeting a broader consumer population with low cost solutions for
the developing threats to identity and privacy.
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
“Count on IDENTITY GUARD® to help protect what makes you… you.” Visit www.identityguard.com to learn more.
Introducing VoyceTM
10
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
Ø VoyceTM is a highly sophisticated, durable and attractive health and wellness band for
dogs that monitors key vital signs including health and respiratory rates, along with other
indicators such as activity, rest, calories burned and more.
dogs that monitors key vital signs including health and respiratory rates, along with other
indicators such as activity, rest, calories burned and more.
Ø In addition, the VoyceTM experience provides exclusive expert advice relevant to a dog’s
breed and age, including health, behavior, training, cognition and more.
breed and age, including health, behavior, training, cognition and more.
Ø For the last two years we have invested over $11 million in designing and testing the
VoyceTM technology and building a highly trained team of pet experts, veterinarians,
mathematicians, bio-engineers, and independent business leaders.
VoyceTM technology and building a highly trained team of pet experts, veterinarians,
mathematicians, bio-engineers, and independent business leaders.
Ø VOYCE® was launched in January 2014 at the Consumer Electronics Show, and the
response has been tremendous.
response has been tremendous.
• Named “Best of CES 2014” by PC World / Tech Hive
and Yahoo Tech
and Yahoo Tech
• Made world-wide headlines and featured on
“Live with Kelly and Michael”, NBC Nightly News,
CNN, “The Today Show,” The Wall Street Journal,
USA Today and many more
“Live with Kelly and Michael”, NBC Nightly News,
CNN, “The Today Show,” The Wall Street Journal,
USA Today and many more
What is the Opportunity for VoyceTM
11
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
(1) According to the 2013-2014 American Pet Products Association National Pet Owners Survey there are approximately
83 million dogs owned in the United States.
Ø The original concept for the VoyceTM technology was a high-quality monitoring
service for “Pet Parents”
service for “Pet Parents”
Ø Since launching at CES 2014, we quickly learned the demand
for animal health monitoring technology is significantly
larger and broader.
for animal health monitoring technology is significantly
larger and broader.
Ø In the last two months we have been approached by doctors,
medical device manufacturers, pet nutrition companies,
pharmaceutical researchers, bio-engineers, and potential
distribution partners from over 30 countries.
medical device manufacturers, pet nutrition companies,
pharmaceutical researchers, bio-engineers, and potential
distribution partners from over 30 countries.
Ø Given there are an estimated 83 million dogs owned in the U.S.
alone, with just 5 percent penetration we believe domestically the
market for VoyceTM could approach a $1 billion in revenue.(1)
What is Next for VoyceTM?
12
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
Ø VoyceTM is expected be available for pre-order in the Spring of 2014 and available this
Summer at $299 for the collar and $15 per month for ongoing monitoring and platform
access.
Summer at $299 for the collar and $15 per month for ongoing monitoring and platform
access.
Ø We are moving quickly to:
• Create the next version for smaller dogs and cats;
• Create a professional version to serve the unique needs of the animal medical industry;
• Create a version to service the needs of professional canine and equine managers; and,
• Find distribution partners to accelerate our overseas expansion.
Ø With the VoyceTM technology, we believe we have secured a strong advantage for
years across a wide spectrum of product and platform applications.
years across a wide spectrum of product and platform applications.
Visit www.mydogsvoyce.com to “understand your dog like never before.”
Future Revenue Guidance
13
We currently project revenue as follows:
►2014 revenue is projected to be in the range of $260 to $275 million on a
consolidated basis.
consolidated basis.
►2015 revenue is projected to exceed $300 million.
►2016 revenue is projected to approach $400 million based largely upon growth in
revenues for the IDENTITY GUARD® and VoyceTM brands.
revenues for the IDENTITY GUARD® and VoyceTM brands.
►These forecasts are subject to substantial uncertainty, including:
• Changes in our U.S. financial institution business and regulatory environment.
• Adjustments in investments in our IDENTITY GUARD® and VoyceTM brands and/or other
growth initiatives.
growth initiatives.
• The factors and risks disclosed in our SEC filings.
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
Investor Relations Update
►In FY 2013 Intersections returned approximately $16.8 million to shareholders in the
form of $14.4 million in cash dividends and $2.4 million in share repurchases.
form of $14.4 million in cash dividends and $2.4 million in share repurchases.
►Intersections’ Board declared an ordinary quarterly cash dividend of $0.20 per share of
common stock payable on April 3, 2014 to shareholders of record as of March 20, 2014.
common stock payable on April 3, 2014 to shareholders of record as of March 20, 2014.
• Based on the closing price on March 14, 2014 of $6.46 per share, this quarterly cash
dividend represents an effective annual dividend yield of 12.4 %.
dividend represents an effective annual dividend yield of 12.4 %.
►Dividends are considered quarterly and may be paid only when approved by the Board
of Directors. Future dividends, if any, will depend on among other things, our results
of operations, capital requirements and such other factors as our Board of Directors
may consider relevant.
of Directors. Future dividends, if any, will depend on among other things, our results
of operations, capital requirements and such other factors as our Board of Directors
may consider relevant.
Please see the company’s release and website at www.intersections.com for additional details on quarterly results.
14
Corporate Headquarters
Intersections Inc.
3901 Stonecroft Boulevard
Chantilly, VA 20151
Toll-free: 800.695.7536
www.intersections.com
Investor Relations
Eric S. Miller
IR@intersections.com
Tel: 703.488.6100
VOYCE
www.mydogsvoyce.com
Identity Guard
www.identityguard.com