NEW YORK and TUNBRIDGE WELLS, U.K., Sept. 19, 2005 (PRIMEZONE) -- Auto Data Network (Pink Sheets:ADNW), a provider of software and real-time data services to the worldwide automotive industry, today released an update on the current status of its spin-out strategy and year end audit.
Chairman & CEO, Chris Glover, commented, "As previously announced, we are in the process of listing our dealer management software division, Dealer Management Services, and our Aftermarket Software Division, Aftersoft. We expect both spin-outs to be separately listed and trading within the next six weeks."
With regards to Aftersoft, the Company has entered into a definitive merger agreement with W3 Group, Inc (OTCBB:WWWT), which is expected to close imminently after all requisite consents and conditions of closing are satisfied. The Company estimates that the dividend ratio for the spin-out for this entity will be 0.65 shares of Aftersoft for every one share of ADN, held at the record date."
Glover continued, "With regards to Auto Dealer Management, we have appointed advisors who are currently working with us on listing this division on the AIM stock market in London. Unfortunately, a change in AIM listing rules in July delayed our planned listing, however, we expect the listing to be completed by the end of next month. We estimate that the dividend ratio for the spin-out of this entity will be two shares of the AIM listed company for every one share of ADN held at record date."
Glover concluded, "With regards to the audit of Auto Data Network, our previous auditor, F.E. Hanson, did not receive PCAOB approval, which has meant that a new auditor had to be engaged and re-audit Hanson's previous audits. As previously explained, all of our subsidiaries were separately audited by other qualified independent auditors, including the entities involved in the spin-outs, Aftersoft and Auto Dealer Management. We intend to appoint a new auditor this week to complete the re-audit and bring our financial reporting requirements current."
With regards to results for Fiscal Year ended February 28, 2005, the Company's revenues are projected to come in at $72 million, $8 million lower than previously projected due to the delay is completing planned acquisitions. This compares to $25 million for the previous fiscal year. The Company's earnings per share are estimated to be $0.20c, which is $0.02c lower than anticipated due to an unexpected loss at an associated company and the delay in completing planned acquisitions. This compares to $0.19c per share for the previous fiscal year.
About Auto Data Network
Auto Data Network is a group of established companies which provide software products and services to the automotive industry. The Company's main customer base is the auto dealership marketplace. This marketplace consists of approximately 78,000 dealers in North America and 92,000 dealers in Europe. The Company estimates that this represents a $15 billion market for Software and Services specifically for auto dealerships. The Company supplies a suite of software solutions and services that enable dealerships to run their businesses more efficiently whilst achieving considerable cost savings. The majority of the Company's current solutions are focused on serving the aftermarket and finance areas of dealerships. These areas are of particular importance as the aftermarket business is responsible for 48% of a dealership's profit from 12% of their overall revenue. The second most profitable area is vehicle finance and insurance, this area contributes 35% of profits from 2% of revenues.
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting the Company's business including increased competition; the ability of the Company to expand its operations through either acquisitions or internal growth, to attract and retain qualified professionals, and to expand commercial relationships; technological obsolescence; general economic conditions; and other risks detailed time to time in the Company's filings with the Securities and Exchange Commission (SEC).