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Quotesmith.com Reports Third Quarter 2000 Financial Results

Quotesmith.com, Inc. (ticker: QUOT, exchange: NASDAQ) News Release - 10/17/2000


Quotesmith.com Reports Third Quarter Financial Results

DARIEN, Ill., Oct. 17 /PRNewswire/ -- Quotesmith.com, Inc., (Nasdaq: QUOT), the buyer-driven insurance exchange which provides instant quotes from more than 300 leading insurance companies, today announced financial results for the third quarter ended September 30, 2000.

Financial Results

Revenues for the third quarter ended September 30, 2000 were $3.8 million, a 23% decrease compared to revenues of $4.9 million reported for the second quarter of 2000 and a 61% increase over revenues of $2.4 million reported for the same period last year.

Net loss for the third quarter decreased to $3.5 million, or $0.18 per share, compared with a net loss $3.6 million, or $0.19 per share reported for the second quarter of 2000 and a loss of $3.9 million, or $0.23 per share, in the third quarter of 1999.

On a year-to-date basis, the Company achieved record revenues of $12.6 million for the first nine months of 2000, up 133% as compared to $5.4 million for the same period in 1999. Net loss for the first nine months of 2000 totaled $16.2 million, or $.84 per share, vs. $7.1 million, or $.49 per share, for the first nine months of 1999.

Quotesmith.com chairman and CEO, Robert Bland, commented, "We are excited about the coming launch of our new comparative automobile insurance and long term care insurance rating engines and believe that these additional content technologies will, over time, help us to realize more commission income per visitor to our site. Quotesmith.com intends to further reduce its sales and marketing expenditures in the fourth quarter until our planned expansion into auto and long term care insurance is fully implemented. This planned reduction in marketing expenses is expected to result in reduced revenue and operating losses in the fourth quarter as compared to the third quarter of 2000."

Quotesmith.com ended the quarter with $32.1 million, or $1.67 per share, in cash and short-term investments. The Company has no debt.

Total Policies Sold Recap

For the third quarter, Quotesmith.com sold 8,998 new policies, representing a quarterly decrease of 26% from the 12,148 policies sold in the second quarter of 2000 and an increase of 78% from the 5,053 policies sold in the third quarter of 1999. Newly paid policies for the first nine months of 2000 amounted to 30,534, up 176% from 11,053 policies sold in the like period of 1999.

Health Insurance Policy Sales Recap

New sales of health insurance policies (including dental and Medicare supplement policies) in the third quarter amounted to 1,029, an 8% sequential decrease as compared to 1,119 for the second quarter of 2000 and a 547% increase from the 159 sales reported in the third quarter of 1999. For the nine month period ended September 30, 2000, new sales of health insurance policies surged 1,042% to 2,934 from 257 reported in the like period of 1999.

About Quotesmith.com

Quotesmith.com owns and operates the industry's largest and most comprehensive insurance price comparison service. The Quotesmith.com Insurance Commerce Platform allows insurance shoppers to instantly view the best prices being offered by more than 300 leading companies, achieve maximum savings and have the freedom to buy from the company of their choice. Quotesmith.com generates revenues from the receipt of commissions and fees paid by insurance companies. Quotesmith.com also provides personalized customer service assistance and policy placement services for its customers. Shares of Quotesmith.com trade on the Nasdaq Exchange under the symbol "QUOT."

Cautions about Forward-Looking Statements

This announcement may contain forward-looking statements that involve risks, assumptions and uncertainties pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. This announcement also contains forward-looking statements about events and circumstances that have not yet occurred and may not occur. Expressions of future goals and similar expressions including, without limitation, "may," "will," "believes," "should," "could," "hope," "expects," "expected," "does not currently expect," "anticipates," "predicts," "potential" and "forecast," reflecting something other than historical fact, are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. Investors should be aware that actual results may differ materially from the results predicted and reported results should not be considered an indication of future performance. Reported Web site activity and/or quotes are not necessarily indicative of any present or future revenue. The Company will not necessarily update the information in this press release if any forward- looking statement later turns out to be inaccurate. Potential risks and uncertainties include, among others, Quotesmith.com's limited e-commerce operating history, anticipated losses, unpredictability of future revenues, potential fluctuations in quarterly operating results, seasonality, consumer trends, competition, risks of system interruption, the evolving nature of its business model, the increasingly competitive online commerce environment, dependence on continuing growth of online commerce and risks associated with capacity constraints and the management of growth. More information about potential factors that could affect the company's financial results is included in the company's Annual Report on Form 10-K for the year ended December 31, 1999, which is on file with the United States Securities and Exchange Commission. Some insurance companies appear at Quotesmith.com for purely informational purposes only and pay no compensation to Quotesmith.com and some insurers pay commissions or fees to Quotesmith.com based upon premium volume or traffic activity produced by Quotesmith.com. Quote availability by state or any other factor is subject to change without notice.

Quotesmith.com is a service mark of Quotesmith.com, Inc. All other names are trademarks of their respective owners.

 
QUOTESMITH.COM, INC.
STATEMENT OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
 
  Quarter Ended
September 30,
  Nine Months Ended
September 30,
  2000 1999   2000 1999
Revenues:  
Commissions and fees
$3,782 $2,349   $12,556 $5,358
Other
13 10   34 51
Total revenues 3,795 2,359   12,590 5,409
 
Expenses:  
Selling & Marketing
5,103 4,639   21,164 6,771
Operations
1,787 1,219   5,882 3,910
General & admin.
956 871   3,490 2,255
Total expenses 7,846 6,729   30,536 12,936
Operating loss
(4,051) (4,370)   (17,946) (7,527)
 
Interest income 545 421   1,729 462
 
Net loss $(3,506) $(3,949)   $(16,217) $(7,065)
 
Net loss per common
share, basic and
diluted
$(0.18) $(0.23)   $(0.84) $(0.49)
 
Weighted average common
shares and equivalents
outstanding, basic and
diluted
19,227 16,999   19,226 14,527
 
SELECTED BALANCE SHEET DATA
(In thousands)
 
  (Unaudited)
September 30,
2000
   
December 31,
1999
 
Cash and investments
$32,136   $49,661  
Commissions receivable
1,861   1,695  
Other assets
712   2,934  
Total current assets
34,709   54,290  
Total assets
$36,562   $55,178  
 
Total current liabilities
$3,278   $5,982  
Total liabilities
3,416   5,982  
Total stockholders' equity
33,146   49,196  
Total liabilities &
  stockholders' equity
$36,562   $55,178  
 
OTHER STATISTICAL DATA
(Unaudited)
 
  Quarter Ended
September 30,
  Nine Months Ended
September 30,
  2000 1999   2000 1999
Completed Quotes  
Term life
508,322 390,036   1,689,930 848,039
Health and Other
450,815 303,232   1,606,558 547,172
Total completed quotes
959,137 693,268   3,296,488 1,395,211
 
Applications received  
Term life
7,734 7,847   29,383 20,104
Health and Other
1,870 844   5,715 1,112
Total applications received
9,604 8,691   35,098 21,216
 
Policies paid  
Term life
7,969 4,894   27,600 10,796
Health and Other
1,029 159   2,934 257
Total policies paid
8,998 5,053   30,534 11,053
 
Average first year  
revenue per Term life policy
$403 $445   $397 $466
Operating cost per policy
199 241   193 304*
 

 

  • Excludes the effect of the stock compensation charge of $549,000 in 1999.



SOURCE Quotesmith.com, Inc.

CONTACT: David Vickers, CFO of Quotesmith.com, 630-515-0170, ext. 210, email, dvickers@quotesmith.com/

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