Back to GetFilings.com



Table of Contents
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 10-Q
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended June 30, 2002
 
Commission File No. 0-25681
 
 
 
LOGO
(Exact name of registrant as specified in its charter)
 
Florida
  
65-0423422
(State or other jurisdiction of
incorporation or organization)
  
(I.R.S. Employer
Identification No.)
11811 U.S. Highway One, Suite 101
North Palm Beach, Florida
  
33408
(Address of principal executive offices)
  
(Zip Code)
 
Registrant’s telephone number, including area code: (561) 630-2400
 
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes  x     No  ¨
 
The number of outstanding shares of the issuer’s common stock as of July 31, 2002 was as follows: 13,996,950 shares of Common Stock, $.01 par value.
 

Table of Contents
 
Bankrate, Inc.
Quarterly Report on Form 10-Q for the Quarter Ended June 30, 2002
Index
 
          
PAGE NO.
PART I.
         
Item 1.
         
        
3
        
4
        
5
        
6
Item 2.
       
11
Item 3.
       
15
PART II.
         
Item 1.
       
15
Item 2.
       
15
Item 3.
       
16
Item 4.
       
16
Item 5.
       
16
Item 6.
       
16
        
17
 
Introductory Note
 
This Report and our other communications and statements may contain “forward-looking statements,” including statements about our beliefs, plans, objectives, goals, expectations, estimates, projections and intentions. These statements are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. For information concerning these factors and related matters, see “Forward-Looking Statements” in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in this Report, and the following sections of our Annual Report on Form 10-K for the year ended December 31, 2001 (the “2001 10-K”): (a) “Risk Factors” in Item 1, “Business,” and (b) “Forward-Looking Statements” in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

2

Table of Contents
Bankrate, Inc.
Condensed Balance Sheets
(Unaudited)
 
    
June 30,
2002
     
December 31, 2001
  
Assets
                  
Cash and cash equivalents
   
$
7,309,975
 
   
$
9,755,032
 
Accounts receivable, net of allowance for doubtful accounts of $140,000 at June 30, 2002 and December 31, 2001
   
 
2,179,918
 
   
 
1,259,256
 
Other current assets
   
 
304,519
 
   
 
231,134
 
    
  
Total current assets
   
 
9,794,412
 
   
 
11,245,422
 
Furniture, fixtures and equipment, net
   
 
899,335
 
   
 
1,076,508
 
Intangible assets, net
   
 
56,001
 
   
 
69,622
 
Other assets
   
 
411,599
 
   
 
134,460
 
    
  
Total assets
   
$
11,161,347
 
   
$
12,526,012
 
    
  
Liabilities and Stockholders’ Equity
                  
Liabilities:
                  
Accounts payable
   
$
749,974
 
   
$
699,054
 
Other accrued expenses
   
 
2,150,244
 
   
 
1,871,492
 
Accrued interest
   
 
—  
 
   
 
217,500
 
Deferred revenue
   
 
255,294
 
   
 
347,869
 
Current portion of obligations under capital leases
   
 
9,264
 
   
 
36,406
 
Other current liabilities
   
 
236,543
 
   
 
207,952
 
    
  
Total current liabilities
   
 
3,401,319
 
   
 
3,380,273
 
10% convertible subordinated note payable
   
 
—  
 
   
 
4,350,000
 
Accrued interest
   
 
—  
 
   
 
810,363
 
Other liabilities
   
 
64,251
 
   
 
3,264
 
    
  
Total liabilities
   
 
3,465,570
 
   
 
8,543,900
 
    
  
Stockholders’ equity:
                  
Preferred stock, 10,000,000 shares authorized and undesignated
   
 
—  
 
   
 
—  
 
Common stock, par value $.01 per share—100,000,000 shares authorized; 13,996,950 shares issued and outstanding
   
 
139,969
 
   
 
139,969
 
Additional paid in capital
   
 
63,931,555
 
   
 
63,931,555
 
Accumulated deficit
   
 
(56,375,747
)
   
 
(60,089,412
)
    
  
Total stockholders’ equity
   
 
7,695,777
 
   
 
3,982,112
 
    
  
Total liabilities and stockholders' equity
   
$
11,161,347
 
   
$
12,526,012
 
    
  
 
See accompanying notes to condensed financial statements.

3

Table of Contents
Bankrate, Inc.
Condensed Statements of Operations
(Unaudited)
 
    
Three Months Ended
June 30,
     
Six Months Ended
June 30,
  
    
2002
   
2001
     
2002
   
2001
  
Revenue:
                                
Online publishing
   
$
5,267,775
   
$
3,393,437
 
   
$
9,980,744
   
$
7,354,353
 
Print publishing and licensing
   
 
934,274
   
 
807,954
 
   
 
1,858,223
   
 
1,592,713
 
    
  
  
  
Total revenue
   
 
6,202,049
   
 
4,201,391
 
   
 
11,838,967
   
 
8,947,066
 
    
  
  
  
Cost of revenue:
                                
Online publishing
   
 
934,968
   
 
727,907
 
   
 
1,817,065
   
 
1,676,268
 
Print publishing and licensing
   
 
667,206
   
 
518,022
 
   
 
1,338,969
   
 
1,043,510
 
    
  
  
  
Total cost of revenue
   
 
1,602,174
   
 
1,245,929
 
   
 
3,156,034
   
 
2,719,778
 
    
  
  
  
Gross margin
   
 
4,599,875
   
 
2,955,462
 
   
 
8,682,933
   
 
6,227,288
 
    
  
  
  
Operating expenses:
                                
Sales
   
 
944,433
   
 
714,466
 
   
 
1,795,317
   
 
1,572,999
 
Marketing
   
 
966,692
   
 
716,474
 
   
 
1,890,287
   
 
1,797,865
 
Product development
   
 
350,845
   
 
320,450
 
   
 
680,725
   
 
686,557
 
General and administrative
   
 
1,243,169
   
 
1,242,943
 
   
 
2,377,396
   
 
2,630,566
 
Depreciation and amortization
   
 
123,286
   
 
187,105
 
   
 
266,993
   
 
381,570
 
    
  
  
  
    
 
3,628,425
   
 
3,181,438
 
   
 
7,010,718
   
 
7,069,557
 
    
  
  
  
Income (loss) from operations
   
 
971,450
   
 
(225,977
)
   
 
1,672,215
   
 
(842,270
)
Interest income (expense), net
   
 
30,492
   
 
(22,566
)
   
 
19,658
   
 
(30,941
)
Gain on early extinguishment of debt
   
 
—  
   
 
—  
 
   
 
2,021,792
   
 
—  
 
    
  
  
  
Income (loss) before income taxes
   
 
1,001,942
   
 
(248,543
)
   
 
3,713,665
   
 
(873,211
)
Income taxes
   
 
—  
   
 
—  
 
   
 
—  
   
 
—  
 
    
  
  
  
Net income (loss)
   
$
1,001,942
   
$
(248,543
)
   
$
3,713,665
   
$
(873,211
)
    
  
  
  
Basic and diluted net income (loss) per share:
                                
Basic
   
$
0.07
   
$
(0.02
)
   
$
0.27
   
$
(0.06
)
    
  
  
  
Diluted
   
$
0.07
   
$
(0.02
)
   
$
0.26
   
$
(0.06
)
    
  
  
  
Weighted average common shares outstanding:
                                
Basic
   
 
13,996,950
   
 
13,996,950
 
   
 
13,996,950
   
 
13,996,950
 
Diluted
   
 
14,375,393
   
 
13,996,950
 
   
 
14,261,815
   
 
13,996,950
 
 
See accompanying notes to condensed financial statements.

4

Table of Contents
Bankrate, Inc.
Condensed Statements of Cash Flows
(Unaudited)
 
    
Six Months Ended
June 30,
  
    
2002
     
2001
  
Cash flows from operating activities:
                  
Net income (loss)
   
$
3,713,665
 
   
$
(873,211
)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
                  
Gain on early extinguishment of debt
   
 
(2,021,792
)
   
 
—  
 
Depreciation and amortization
   
 
266,993
 
   
 
381,570
 
Provision for doubtful accounts
   
 
19,392
 
   
 
33,253
 
Loss on disposal of fixed assets
   
 
—  
 
   
 
3,065
 
Noncash stock compensation
   
 
—  
 
   
 
310,800
 
Changes in operating assets and liabilities:
                  
(Increase) in accounts receivable
   
 
(940,054
)
   
 
(255,901
)
(Increase) decrease in other assets
   
 
(287,659
)
   
 
387,362
 
Increase (decrease) in accounts payable
   
 
50,920
 
   
 
(171,335
)
Increase (decrease) in accrued expenses
   
 
281,918
 
   
 
(300,923
)
Increase in other liabilities
   
 
136,771
 
   
 
250,635
 
(Decrease) in deferred revenue
   
 
(92,575
)