WESTCEHSTER, IL - Insurance Auto Auctions, Inc. (IAA), a provider of automotive salvage and claims processing services in the U.S., announced results for the second quarter of 2006. The company recorded revenues for the quarter of $78.3 million compared to $71.9 million in the second quarter of 2005, an increase of 9 percent year-over-year. Fee income in the second quarter increased to $66.4 million versus $61.3 million in the second quarter of last year. IAA reported Consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization), consistent with the definition in the company’s senior credit agreement, of $13.2 million during the quarter. Consolidated EBITDA is a non-GAAP measure the company uses as a primary measurement of its financial results before it is indicative of the relative strength of the company’s operating performance. As previously reported, the quarter was down compared to the prior year as a result of lower same store volumes in large part due to the inability to sell those vehicles damaged in a flood at the company’s Grand Prairie, Texas, facility.
“In the second quarter, we saw a continuation of the trends that we have seen over the past several quarters, including higher sales, record returns for our suppliers, and strong cash flow generation,” said Tom O’Brien, CEO.
IAA has expanded its geographic footprint during the year, making seven acquisitions that have added 15 new locations to the company’s national network of sites. In March, IAA purchased NW Penn. Auction/Sales Warren County Salvage, located in Erie, Pa. In April, IAA purchased Indiana Auto Storage Pools’ two locations in Indianapolis and South Bend.
After the end of the second quarter, IAA acquired Gardner’s Insurance Auction in Missoula, Mont. This acquisition was followed by the purchase of Auto Disposal Systems, Inc., in Dayton, Ohio. The Auto Disposal Systems acquisition links the adjacent IAA facilities in the Midwest and East with the addition of five facilities in Cincinnati, Cleveland, Columbus, Dayton, and Lima, Ohio, plus facilities in Ashland, Ky., and Buckhannon, WV. Next, the company announced the purchase of Lenders & Insurers’ three locations in the state of Iowa. The sites are located in Des Moines, Cedar Falls, and Sioux City. Just last week, IAA acquired Salvage Management of Syracuse in Cicero, N.Y.