UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K
Current Report Pursuant to Section 13 or 15(d)
Of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 2, 2018

INTERSECTIONS INC.
(Exact Name of Registrant as Specified in its Charter)

Delaware
(State or Other Jurisdiction of Incorporation)

000-50580
 
54-1956515
(Commission File Number)
 
(IRS Employer Identification No.)

3901 Stonecroft Boulevard
Chantilly, Virginia 20151
(Address of Principal Executive Offices) (Zip Code)

(703) 488-6100
(Registrant's Telephone Number, Including Area Code)

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in  Rule 405 of the Securities Act of 1933 (Sec.230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (Sec.240.12b-2 of this chapter).
 
 
Emerging growth company ☐
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 


Item 2.02.
Results of Operations and Financial Condition
 
On April 2, 2018, Intersections Inc. (the "Company") issued a press release announcing its results for the quarter and year ended December 31, 2017 and posted an Investor Update presentation on its website (www.intersections.com).  The text of the press release and the presentation are attached hereto as Exhibits 99.1 and 99.2, respectively.
 
Item 7.01.
Regulation FD Disclosure.
 
The information set forth under Item 2.02 above is incorporated by reference into this Item 7.01.
 
The Company will hold a conference call to provide a fourth quarter 2017 business update on Tuesday, April 3, 2018 at 4:30 p.m. Eastern Time. Please see the section of the press release entitled “Fourth Quarter 2017 Business Update Conference Call” for details on how to access the conference call.
 
The information in this Current Report on Form 8-K, including the exhibits, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any general incorporation language in such filings, except to the extent expressly set forth by specific reference in such a filing. The filing of this Current Report on Form 8-K shall not be deemed an admission as to the materiality of any information herein that is required to be disclosed solely by reason of Regulation FD.
 
Item 9.01.
Financial Statements and Exhibits.
 
(d)
Exhibits
 
Exhibit No.
Description
 
 
Press Release issued April 2, 2018
     
 
Investor Presentation dated April 2018

SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Dated:  April 2, 2018
 
INTERSECTIONS INC.
     
  By:
/s/ Ronald L. Barden
 
   
Name: Ronald L. Barden
   
Title: Chief Financial Officer
 
 


Exhibit 99.1
 

For more information:
Ron Barden, CFO
Intersections Inc.
703.488.6810
IR@intersections.com
 
Intersections Inc. Reports Fourth Quarter 2017 Results
 
·
$160 million consolidated revenue for full year 2017
·
$40 million fourth quarter 2017 consolidated revenue, up 1.9% compared to third quarter 2017
·
1.1 million subscribers as of December 31, 2017
 
CHANTILLY, VA – April 2, 2018 Intersections Inc. (NASDAQ: INTX) today announced financial results for the quarter ended December 31, 2017.
 
“I am very pleased with the fourth quarter 2017 results, posting an increase in total revenue compared to the third quarter, generating consolidated income from continuing operations before income taxes of $1.3 million after six consecutive loss quarters, and reporting adjusted EBITDA of $4.0 million, which is the highest of the last eight quarters,” said Michael R. Stanfield, Executive Chairman and President. “After navigating the shock to our business from the regulatory impact of the CFPB, and the disappointing results of our non-identity theft protection ventures, Intersections has effectively invested in and built new and innovative tools for the world of identity fraud and data theft.” Mr. Stanfield continued, “New marketing channels, an invigorated team, and the highest level of compromised data and identity crimes in history are creating a significant opportunity for success.”
 
Key Accomplishments and Developments:
 
·
The Identity Guard® with Watson™ technology platform and product suite was launched on June 26, 2017. During the fourth quarter, development activities were completed to expand the Identity Guard® with Watson™ platform to offer consumers both an entry level service, Value, and a premium service, Premier, in addition to our Total service plan. All three tiers of service for Identity Guard® with Watson™ include an option for a robust family coverage service. The Identity Guard® with Watson™ product suite is now the Company’s primary offering.
 
·
Successfully completed first business development campaign working with employers and their employee benefits advisors to make Identity Guard® offerings available to employees across the U.S. New employer programs acquired were launched in the fourth quarter of 2017 and the first quarter of 2018. As of December 31, 2017, contracts were in place with employers with approximately 170,000 eligible employees.
 
1

·
Significantly advanced the transformation of sales and marketing capabilities by continuing to invest in in-house business development capabilities covering employee benefits, partner and breach channels as well as the client support team. The cumulative month’s experience with Intersections of the employee benefits sales team more than doubled from 40 months to over 100 months during 2017 and the distribution network was significantly expanded by establishing relationships with 15 national and over 125 regional/local employee benefits advisors and brokerages.
 
·
The completion of the divestiture program in the third quarter of 2017 eliminated discontinued operations that used cash of $2.4 million and $17.2 million in 2017 and 2016, respectively.
 
Consolidated Fourth Quarter and Year-to-Date Results:
 
Consolidated revenue for the quarter ended December 31, 2017 was $40.0 million, compared to $42.2 million for the quarter ended December 31, 2016. Income (loss) from continuing operations before income taxes for the quarter ended December 31, 2017 was $1.3 million, compared to $(1.2) million for the quarter ended December 31, 2016. Adjusted EBITDA for the quarter ended December 31, 2017 was $4.0 million, compared to $2.4 million for the quarter ended December 31, 2016. Basic and diluted income (loss) from continuing operations per share for the quarter ended December 31, 2017 was $0.13, compared to $(0.06) for the quarter ended December 31, 2016.
 
Consolidated revenue for the year ended December 31, 2017 was $159.6 million, compared to $175.6 million for the year ended December 31, 2016. Loss from continuing operations before income taxes for the year ended December 31, 2017 was $(13.7) million, compared to $(3.4) million for the year ended December 31, 2016. Adjusted EBITDA for the year ended December 31, 2017 was $3.2 million, compared to $10.7 million for the year ended December 31, 2016. Basic and diluted loss from continuing operations per share for the year ended December 31, 2017 was $(0.49), compared to $(0.15) for the year ended December 31, 2016.
 
Consolidated Fourth Quarter Highlights:
 
·
Identity Guard® subscriber revenue was $13.6 million for the quarter ended December 31, 2017, compared to $12.4 million for the quarter ended September 30, 2017 and $12.1 million for the quarter ended December 31, 2016. The Identity Guard® subscriber base was 359 thousand subscribers as of December 31, 2017, compared to 338 thousand subscribers as of September 30, 2017. The increase in the subscriber base was primarily from growth in the direct to consumer and employee benefits channels.
 
·
Revenue from U.S. financial institution clients was $20.0 million for the quarter ended December 31, 2017 compared to revenue of $20.8 million for the quarter ended September 30, 2017. Revenue decreased on average by 1.2% per month during the fourth quarter, which the Company believes is representative of normal attrition given the discontinuation of marketing and retention efforts for this population.
 
·
Income (loss) from continuing operations before income taxes for the quarter ended December 31, 2017 was $1.3 million, compared to $(3.0) million for the quarter ended September 30, 2017, and $(1.2) million for the quarter ended December 31, 2016.
 
·
Adjusted EBITDA for the quarter ended December 31, 2017 was $4.0 million, compared to $1.0 million for the quarter ended September 30, 2017 and $2.4 million for the quarter ended December 31, 2016. The fourth quarter marked the third consecutive quarter of improvement in Adjusted EBITDA and the second consecutive quarter of positive Adjusted EBITDA.
 
2

Liquidity:
 
As of December 31, 2017, the Company had a cash balance of $8.5 million, and an outstanding principal balance of $21.5 million under its new credit agreement, as amended. Cash (used in) operating activities of continuing operations for the year ended December 31, 2017 was $(50) thousand. Cash provided by operating activities of continuing operations for the quarter ended December 31, 2017 was $1.8 million.
 
The Company began expanding its business development capabilities in 2016 to address market channel and distribution opportunities and continued the expansion of this team in 2017. As a result, cash used in operating activities for the year includes approximately $4.7 million for business development activities, the significant majority of which is personnel cost. The Company expects to continue its spending on business development activities at approximately the same level as 2017 for 2018.
 
Cash used in operating activities included $6.9 million in the year ended December 31, 2017 for deferred subscription and solicitation costs related to our direct-to-consumer marketing, including $595 thousand in the fourth quarter. The Company implemented changes beginning in the second quarter to reduce the cash marketing spending in this channel and expects the use of cash for this purpose to continue to decline into 2018.
 
The Company continued to develop new product features primarily for the Identity Guard® with Watson platform during the year ended December 31, 2017. As a result, the Company invested approximately $4.5 million in internally developed capitalized software for the year. The Company expects to continue its investments in product development at approximately the same level as 2017 for 2018.
 
For additional information, please see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” in our most recent Annual Report on Form 10-K.
 
3

Fourth Quarter 2017 Business Update Conference Call:
 
The Company will hold a conference call to provide a fourth quarter 2017 business update on Tuesday, April 3, 2018 at 4:30 p.m. Eastern Time.
 
Interested parties can access the live webcast on the Investor's page at Intersections Inc.’s website www.intersections.com. The live call can be accessed by dialing the toll-free numbers below. Those who wish to participate in the Q&A session must dial in.
 
WHAT:
Intersections Inc. Fourth Quarter 2017 Conference Call
   
WHEN:
April 3, 2018
 
4:30 p.m. Eastern Time
 
 
HOW:
Dial in: 888-771-4384
  International: 847-585-4409
 
For a current list of alternate local and International Freephone telephone numbers, please click here.
   
 
Participant Pass code: 7563542#
   
 
To pre-register for the conference, please click here.
 
The replay of the webcast will be available April 3, 2018 at 7:00 p.m. (Eastern Time) through April 10, 2018 at 11:59 PM (Eastern Time). The dial-in for the replay is 888-843-7419 or 630-652-3042 with the replay access code of 7563542#.
 
Non-GAAP Financial Measures:
 
“Adjusted EBITDA” represents consolidated (loss) income from continuing operations before income taxes plus (minus): share related compensation; non-cash impairment of goodwill, intangibles and other assets; loss on disposal of fixed assets; (gain) loss on sale of Captira Analytical and Habits at Work; loss on extinguishment of debt; (benefit) from change in vacation policy; depreciation and amortization; and interest expense.

Intersections' Consolidated Financial Statements, "Other Data" and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures and related notes can be found in the accompanying tables and footnotes to this release and in the "GAAP and Non-GAAP Measures" link under the "Investor & Media" page on our website at www.intersections.com.
 
4

Forward-Looking Statements:
 
Statements in this release relating to future plans, results, performance, expectations, achievements and the like are considered “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. Those forward-looking statements involve known and unknown risks and uncertainties 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 those statements, including the success of our strategic objectives; our ability to meet the targets disclosed by management with respect to costs and revenue, and that these targets do not represent historical performance, projected results or guidance; our ability to generate revenue from our partner sales strategy and business development pipeline with our distribution partners; the impact of shutting down and then divesting our Pet Health Monitoring segment; the timing and success of new product launches and other growth initiatives, including our Identity Guard® with Watson product; the continuing impact of the regulatory environment on our business; the continued dependence on a small number of financial institutions for a majority of our revenue and to service our U.S. financial institution customer base; our ability to execute our strategy and previously announced transformation plan; our incurring additional restructuring charges; our incurring additional charges for non-income business taxes or otherwise, or impairment costs or charges on goodwill and/or other assets; our ability to control costs; our failure to protect private data due to a security breach or other unauthorized access; our ability to maintain sufficient liquidity and produce sufficient cash flow to fund our business, growth strategy and debt service obligations; the impact of our recent senior management changes; and our needs for additional capital to grow our business, including our ability to maintain compliance with the covenants under our term loan or seek additional sources of debt and/or equity financing. Factors and uncertainties that may cause actual results to differ include but are not limited to the risks disclosed under “Forward-Looking Statements,” “Item 1. Business—Government Regulation” and “Item 1A. Risk Factors” in the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and in its recent other filings with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to revise or update any forward-looking statements unless required by applicable law.
 
About Intersections:
 
Intersections Inc. (Nasdaq: INTX) provides innovative software solutions to help consumers and businesses manage the potential risks associated with the proliferation of their data in the virtual world. Under its IDENTITY GUARD® brand, the company utilizes advanced data-enabled technologies, including artificial intelligence, to help monitor, manage and protect sensitive information. Headquartered in Chantilly, Virginia, the company was founded in 1996. To learn more, visit www.intersections.com.
 
5

Explanatory Note:
 
The information in the following tables is presented giving effect to the disposal of Voyce, with its historical financial results reflected as discontinued operations. We made adjustments to our historical financial results for certain costs and overhead allocations to either discontinued or continuing operations for the year ended December 31, 2017 and 2016; for additional information, please see "Note 2 — Basis of Presentation and Consolidation" in our most recent Annual Report on Form 10-K.

INTERSECTIONS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)

   
Year Ended December 31,
 
   
2017
   
2016
 
REVENUE
 
$
159,620
   
$
175,592
 
OPERATING EXPENSES:
               
Marketing
   
11,330
     
13,156
 
Commission
   
38,386
     
42,775
 
Cost of revenue
   
51,710
     
53,797
 
General and administrative
   
62,530
     
59,671
 
Loss on dispositions of Captira and Habits at Work
   
106
     
 
Impairment of intangibles and other assets
   
     
1,428
 
Depreciation
   
5,485
     
4,763
 
Amortization
   
152
     
513
 
Total operating expenses
   
169,699
     
176,103
 
LOSS FROM OPERATIONS
   
(10,079
)
   
(511
)
Interest expense, net
   
(2,227
)
   
(2,366
)
Loss on extinguishment of debt
   
(1,525
)
   
 
Other income (expense), net
   
126
     
(487
)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
   
(13,705
)
   
(3,364
)
Income tax benefit (expense) from continuing operations
   
1,915
     
(75
)
LOSS FROM CONTINUING OPERATIONS
   
(11,790
)
   
(3,439
)
Loss from discontinued operations, net of tax
   
(2,534
)
   
(27,030
)
NET LOSS
 
$
(14,324
)
 
$
(30,469
)
Basic and diluted loss per common share:
               
Loss from continuing operations
 
$
(0.49
)
 
$
(0.15
)
Loss from discontinued operations
   
(0.11
)
   
(1.16
)
Net loss per common share, basic and diluted
 
$
(0.60
)
 
$
(1.31
)
Weighted average common shares outstanding, basic and diluted
   
23,885
     
23,259
 
 
6

INTERSECTIONS INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except par value)

   
December 31,
 
   
2017
   
2016
 
ASSETS
           
CURRENT ASSETS:
           
Cash and cash equivalents
 
$
8,502
   
$
10,797
 
Accounts receivable, net of allowance for doubtful accounts of $34 (2017) and $15 (2016)
   
8,225
     
9,449
 
Prepaid expenses and other current assets
   
3,232
     
3,711
 
Income tax receivable
   
2,545
     
3,314
 
Deferred subscription solicitation and commission costs
   
1,655
     
5,050
 
Current assets of discontinued operations and assets held for sale
   
     
575
 
Total current assets
   
24,159
     
32,896
 
PROPERTY AND EQUIPMENT, net
   
11,040
     
10,611
 
GOODWILL
   
9,763
     
9,763
 
INTANGIBLE ASSETS, net
   
58
     
210
 
OTHER ASSETS
   
1,459
     
862
 
TOTAL ASSETS
 
$
46,479
   
$
54,342
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
CURRENT LIABILITIES:
               
Accounts payable
 
$
3,498
   
$
2,000
 
Accrued expenses and other current liabilities
   
8,533
     
10,978
 
Accrued payroll and employee benefits
   
1,501
     
4,128
 
Commissions payable
   
141
     
99
 
Current portion of long-term debt, net
   
     
2,146
 
Capital leases, current portion
   
423
     
471
 
Deferred revenue
   
7,759
     
11,430
 
Current liabilities of discontinued operations and liabilities held for sale
   
     
858
 
Total current liabilities
   
21,855
     
32,110
 
LONG-TERM DEBT, net
   
20,736
     
10,092
 
OBLIGATIONS UNDER CAPITAL LEASES, less current portion
   
392
     
865
 
OTHER LONG-TERM LIABILITIES
   
2,895
     
3,436
 
DEFERRED TAX LIABILITY, net
   
7
     
1,905
 
TOTAL LIABILITIES
   
45,885
     
48,408
 
                 
STOCKHOLDERS’ EQUITY:
               
Common stock at $0.01 par value, shares authorized 50,000; shares issued 28,194 (2017) and 27,303 (2016); shares outstanding 24,102 (2017) and 23,733 (2016)
   
282
     
273
 
Additional paid-in capital
   
150,305
     
142,247
 
Warrants
   
2,840
     
 
Treasury stock, shares at cost; 4,092 (2017) and 3,570 (2016)
   
(35,745
)
   
(33,822
)
Accumulated deficit
   
(117,088
)
   
(102,764
)
TOTAL STOCKHOLDERS’ EQUITY
   
594
     
5,934
 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 
$
46,479
   
$
54,342
 
 
7

INTERSECTIONS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 
   
Year Ended December 31,
 
   
2017
   
2016
 
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
 
$
(14,324
)
 
$
(30,469
)
Loss from discontinued operations, net of tax
   
(2,534
)
   
(27,030
)
Loss from continuing operations
   
(11,790
)
   
(3,439
)
Adjustments to reconcile net loss to cash flows used in operating activities:
               
Depreciation and amortization
   
5,637
     
5,275
 
Deferred income tax, net
   
(1,898
)
   
 
Amortization of debt issuance cost
   
200
     
884
 
Accretion of debt discount
   
104
         
Provision for doubtful accounts
   
19
     
(89
)
Loss on disposal of fixed assets
   
     
267
 
Share based compensation
   
8,530
     
4,745
 
Amortization of deferred subscription solicitation and commission costs
   
10,326
     
12,655
 
Loss on disposition of Captira Analytical
   
130
     
 
Gain on disposition of Habits at Work
   
(24
)
   
 
Loss on extinguishment of debt
   
1,525
     
 
Impairment of goodwill, intangibles and other assets
   
     
1,428
 
Changes in assets and liabilities:
               
Accounts receivable
   
1,204
     
65
 
Prepaid expenses, other current assets and other assets
   
(91
)
   
796
 
Income tax receivable, net
   
769
     
4,415
 
Deferred subscription solicitation and commission costs
   
(6,931
)
   
(10,744
)
Accounts payable and accrued liabilities
   
(3,608
)
   
(8,308
)
Commissions payable
   
28
     
(59
)
Deferred revenue
   
(3,639
)
   
5,925
 
Other long-term liabilities
   
(541
)
   
(554
)
Cash flows (used in) provided by continuing operations
   
(50
)
   
13,262
 
Cash flows used in discontinued operations
   
(2,398
)
   
(17,183
)
Net cash used in operating activities
   
(2,448
)
   
(3,921
)
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Cash received for the liquidating distribution of White Sky, Inc.
   
     
57
 
Net cash paid for the disposition of Captira Analytical
   
(315
)
   
 
Decrease (increase) in restricted cash
   
135
     
(265
)
Cash paid for withholding tax on vesting of RSUs in exchange for promissory note
   
(130
)
   
 
Proceeds from sale of property and equipment
   
     
394
 
Acquisition of property and equipment
   
(6,077
)
   
(5,764
)
Cash flows used in continuing operations
   
(6,387
)
   
(5,578
)
Cash flows provided by (used in) discontinued operations
   
4
     
(1,031
)
Net cash used in investing activities
   
(6,383
)
   
(6,609
)
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from issuance of debt
   
21,500
     
20,000
 
Repayments of debt
   
(13,920
)
   
(6,568
)
Repurchase of common stock
   
(1,511
)
   
 
Proceeds from issuance of warrants
   
2,200
     
 
Cash paid for debt and equity issuance costs
   
(322
)
   
(1,990
)
Capital lease payments
   
(548
)
   
(719
)
Withholding tax payment on vesting of restricted stock units
   
(1,244
)
   
(486
)
Net cash provided by financing activities
   
6,155
     
10,237
 
DECREASE IN CASH AND CASH EQUIVALENTS
   
(2,676
)
   
(293
)
CASH AND CASH EQUIVALENTS — Beginning of period
   
10,797
     
11,471
 
Cash reclassified to assets held for sale at beginning of period
   
381
     
 
Less: cash reclassified to assets held for sale at end of period
   
     
(381
)
CASH AND CASH EQUIVALENTS — End of period
 
$
8,502
   
$
10,797
 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
               
Cash paid for interest
 
$
1,874
   
$
1,641
 
Cash paid for taxes
 
$
9
   
$
28
 
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES:
               
Equipment obtained under capital lease, including acquisition costs
 
$
202
   
$
241
 
Equipment additions accrued but not paid
 
$
22
   
$
173
 
Withholding tax payments accrued on vesting of restricted stock units and stock option exercises
 
$
27
   
$
 
Shares withheld in lieu of withholding taxes on vesting of restricted stock awards
 
$
35
   
$
39
 
 
8

INTERSECTIONS INC.
OTHER DATA
(in thousands)
(unaudited)
 
Revenue
 
The following tables provide comparative details of our revenue information for the quarters ended December 31, 2017, September 30, 2017 and December 31, 2016, and for the years ended December 31, 2017 and 2016:
 
   
Quarter Ended
 
   
December 31,
2017
   
September 30,
2017
   
Change
   
December 31,
2016
   
Change
 
Identity Guard® (1)
 
$
13,618
   
$
12,396
     
9.9
%
 
$
12,097
     
12.6
%
Canadian business
   
3,412
     
3,405
     
0.2
%
   
3,084
     
10.6
%
U.S. financial institutions
   
20,022
     
20,774
     
(3.6
)%
   
22,803
     
(12.2
)%
Breach services & other (1)
   
1,266
     
1,270
     
(0.3
)%
   
1,601
     
(20.9
)%
Personal Information Services revenue
   
38,318
     
37,845
     
1.2
%
   
39,585
     
(3.2
)%
Other business units
   
1,670
     
1,403
     
19.0
%
   
2,615
     
(36.1
)%
Consolidated revenue
 
$
39,988
   
$
39,248
     
1.9
%
 
$
42,200
     
(5.2
)%

   
Year Ended December 31,
 
   
2017
   
2016
   
Change
 
Identity Guard® (1)
 
$
50,507
   
$
50,571
     
(0.1
)%
Canadian business
   
13,096
     
12,488
     
4.9
%
U.S. financial institutions
   
84,064
     
96,202
     
(12.6
)%
Breach services & other (1)
   
5,484
     
4,441
     
23.5
%
Personal Information Services revenue
   
153,151
     
163,702
     
(6.4
)%
Other business units
   
6,469
     
11,890
     
(45.6
)%
Consolidated revenue
 
$
159,620
   
$
175,592
     
(9.1
)%
 

(1)
We periodically refine the criteria used to calculate and report our subscriber data. In the year ended December 31, 2017, we determined that certain subscribers who receive our breach response services should no longer be included in the presentation of Identity Guard® subscribers or revenue due to the nonrecurring nature of our breach response services. For comparability, all periods presented have been recast to reflect this change in subscribers and revenue.
 
9

INTERSECTIONS INC.
OTHER DATA, continued
(in thousands)
(unaudited)
 
Personal Information Services Segment Subscribers
 
The following tables provide details of our Personal Information Services segment subscriber information for the three months and year ended December 31, 2017:
 
Three months ended:
 
   
Financial
Institution
   
Identity Guard®
(1)
   
Canadian
Business Lines
   
Total
 
   
(in thousands)
 
Balance at September 30, 2017
   
640
     
338
     
159
     
1,137
 
Additions
   
     
44
     
25
     
69
 
Cancellations
   
(20
)
   
(23
)
   
(23
)
   
(66
)
Balance at December 31, 2017
   
620
     
359
     
161
     
1,140
 
 
Year ended:
 
   
Financial
Institution
   
Identity Guard®
 (1)
   
Canadian
Business Lines
   
Total
 
   
(in thousands)
 
Balance at December 31, 2016
   
705
     
317
     
162
     
1,184
 
Additions
   
2
     
160
     
106
     
268
 
Cancellations
   
(87
)
   
(118
)
   
(107
)
   
(312
)
Balance at December 31, 2017
   
620
     
359
     
161
     
1,140
 
 

(1)
We periodically refine the criteria used to calculate and report our subscriber data. In the year ended December 31, 2017, we determined that certain subscribers who receive our breach response services should no longer be included in the presentation of Identity Guard® subscribers or revenue due to the nonrecurring nature of our breach response services. For comparability, all periods presented have been recast to reflect this change in subscribers and revenue.
 
10

INTERSECTIONS INC.
OTHER DATA, continued
(unaudited)
 
Intersections Inc.
Reconciliation of Non-GAAP Financial Measures
 
The tables below include financial information prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), as well as other financial measures referred to as non-GAAP financial measures. Adjusted EBITDA (as defined below) is presented in a manner consistent with the way management evaluates operating results and which management believes is useful to investors and others. Share related compensation includes non-cash share based compensation. An explanation regarding the Company’s use of non-GAAP financial measures and a reconciliation of non-GAAP financial measures used by the Company to GAAP measures is provided below. These non-GAAP financial measures should be considered in addition to, but not as a substitute for, net income (loss), general and administrative expense, and the other information prepared in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies. Management strongly encourages shareholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.
 
Adjusted EBITDA represents consolidated (loss) income from continuing operations before income taxes plus (minus): share related compensation; non-cash impairment of goodwill, intangibles and other assets; loss on disposal of fixed assets; (gain) loss on sale of Captira Analytical and Habits at Work; loss on extinguishment of debt; (benefit) from change in vacation policy; depreciation and amortization; and interest expense. We believe that the consolidated Adjusted EBITDA calculation provides useful information to investors because they are indicators of our operating performance, and we use these measures in communications with our board of directors, creditors, investors and others concerning our financial performance. Adjusted EBITDA is commonly used as a basis for investors and analysts to evaluate and compare the periodic and future operating performance and value of companies within our industry. Our Board of Directors and management use Adjusted EBITDA to evaluate the operating performance of the Company. In addition, consolidated Adjusted EBITDA, as defined in our Credit Agreement with PEAK6 Investments, L.P., as amended, is used to measure covenant compliance.
 
We provide this information to show the impact of share related compensation on our operating results, as it is excluded from our internal operating and budgeting plans and measurements of financial performance; however, we do consider the dilutive impact to our shareholders when awarding share related compensation and consider both the Black-Scholes value and GAAP value (to the extent applicable) in connection therewith, and value such awards accordingly.
 
11

INTERSECTIONS INC.
OTHER DATA, continued
(unaudited)
 
We do not consider share related compensation charges when we evaluate the performance of our individual business groups or formulate our short and long-term operating plans. Due to its nature, individual managers generally are unable to project the impact of share related compensation and accordingly we do not hold them accountable for the impact of equity award grants. When we consider making share related compensation grants, we primarily take into account the need to attract and retain high quality employees, overall shareholder dilution and the Black-Scholes values of the equity grant to the recipient, rather than the potential accounting charges associated with such grants. For comparability purposes, we believe it is useful to provide a non-GAAP financial measure that excludes share related compensation in order to better understand the long-term performance of our core business and to compare our results to the results of our peer companies because of varying available valuation methodologies and the variety of award types that companies can use under GAAP. Furthermore, the value of share related compensation is determined using a complex formula that incorporates factors, such as market volatility, that are beyond our control. Accordingly, we believe that the presentation of Adjusted EBITDA when read in conjunction with our reported GAAP results can provide useful supplemental information to our management, to investors and to our lenders regarding financial and business trends relating to our financial condition and results of operations.
 
Adjusted EBITDA has limitations due to the fact it does not include all compensation related expenses. For example, if we only paid cash based compensation as opposed to a portion in share related compensation, the cash compensation expense included in our general and administrative expenses would be higher. We compensate for this limitation by providing information required by GAAP about outstanding share based awards in the footnotes to our financial statements in our SEC filings. We believe equity based compensation is an important element of our compensation program and all forms of share related awards are valued and included as appropriate in our operating results.
 
The following tables reconcile consolidated (loss) income from continuing operations before income taxes to Adjusted EBITDA, as defined, for the previous eight quarters through December 31, 2017. The information in the following tables is presented giving effect to the disposal of Voyce, with its historical financial results reflected as discontinued operations. We made adjustments to our historical financial results for certain costs and overhead allocations to either discontinued or continuing operations for the year ended December 31, 2016 and 2017; for additional information, please see "Note 2 — Basis of Presentation and Consolidation" in our most recent Form 10-Q. In managing our business, we analyze our performance quarterly on a consolidated income (loss) before income tax basis.
 
In the second quarter of 2016, we ceased adding other expense (income) to consolidated loss before income taxes as part of our calculation of Adjusted EBITDA, to be consistent with the definition of Adjusted EBITDA in our Prior Credit Agreement. Prior periods have been recast to reflect the new presentation. For additional information, please see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” in our most recent Form 10-Q.
 
12

INTERSECTIONS INC.
OTHER DATA, continued
(in thousands, unaudited)
 
Consolidated Adjusted EBITDA (as recast and revised):
 
   
2017 Quarter Ended
   
2016 Quarter Ended
 
   
December 31
   
September 30
   
June 30
   
March 31
   
December 31
   
September 30
   
June 30
   
March 31
 
Reconciliation from consolidated income (loss) from continuing operations before income taxes to consolidated Adjusted EBITDA:
                                               
Consolidated income (loss) from continuing operations before income taxes (1)
 
$
1,270
   
$
(2,960
)
 
$
(7,765
)
 
$
(4,250
)
 
$
(1,150
)
 
$
(2,176
)
 
$
(668
)
 
$
630
 
Non-cash share based compensation (1)
   
1,948
     
1,809
     
3,676
     
1,097
     
87
     
2,216
     
1,364
     
1,078
 
Impairment of goodwill, intangibles and other assets
   
     
     
(86
)
   
86
     
1,428
     
     
     
 
Loss on disposal of fixed assets
   
     
     
     
     
6
     
5
     
256
     
 
(Gain) loss on sales of Captira Analytical and Habits at Work
   
     
     
(24
)
   
130
     
     
     
     
 
Loss on extinguishment of debt
   
     
     
1,525
     
     
     
     
     
 
Benefit from change in vacation policy
   
(1,113
)
   
     
     
     
     
     
     
 
Depreciation and amortization
   
1,548
     
1,407
     
1,336
     
1,346
     
1,323
     
1,167
     
1,359
     
1,426
 
Interest expense, net
   
332
     
701
     
603
     
591
     
664
     
621
     
839
     
242
 
Consolidated Adjusted EBITDA
 
$
3,985
   
$
957
   
$
(735
)
 
$
(1,000
)
 
$
2,358
   
$
1,833
   
$
3,150
   
$
3,376
 
 
   
Year Ended December 31,
 
   
2017
   
2016
 
Reconciliation from consolidated loss from continuing operations before income taxes to consolidated Adjusted EBITDA:
           
Consolidated loss from continuing operations before income taxes
 
$
(13,705
)
 
$
(3,364
)
Non-cash share based compensation
   
8,530
     
4,745
 
Impairment of goodwill, intangibles and other assets
   
     
1,428
 
Loss on disposal of fixed assets
   
     
267
 
Loss on sales of Captira Analytical and Habits at Work
   
106
     
 
Loss on extinguishment of debt
   
1,525
     
 
Benefit from change in vacation policy
   
(1,113
)
   
 
Depreciation and amortization
   
5,637
     
5,275
 
Interest expense, net
   
2,227
     
2,366
 
Consolidated Adjusted EBITDA
 
$
3,207
   
$
10,717
 
Consolidated Revenue from Continuing Operations
 
$
159,620
   
$
175,592
 
Consolidated Adjusted EBITDA % of Revenue
   
2.0
%
   
6.1
%
 
Note (1): The results of operations for the years ended December 31, 2017 and 2016 have been recast to show the effects of our discontinued operations and to reflect an adjustment to our share based compensation expense. For additional information, please see Note 21 to our consolidated financial statements in our most recent Form 10-K.
 
13

INTERSECTIONS INC.
OTHER DATA, continued
(in thousands, unaudited)
 
Consolidated Adjusted G&A Expense (as recast and revised):
 
   
2017 Quarter Ended
   
2016 Quarter Ended
 
   
December 31
   
September 30
   
June 30
   
March 31
   
December 31
   
September 30
   
June 30
   
March 31
 
Reconciliation from consolidated general and administrative expenses to Adjusted G&A Expense:
                                               
Consolidated general and administrative expenses (1)
 
$
13,361
   
$
14,826
   
$
17,962
   
$
16,381
   
$
14,361
   
$
15,729
   
$
15,940
   
$
13,641
 
Non-cash share based compensation (1)
   
(1,948
)
   
(1,809
)
   
(3,676
)
   
(1,097
)
   
(87
)
   
(2,216
)
   
(1,364
)
   
(1,078
)
Benefit from change in vacation policy
   
1,113
     
     
     
     
     
     
     
 
Adjusted G&A Expense
 
$
12,526
   
$
13,017
   
$
14,286
   
$
15,284
   
$
14,274
   
$
13,513
   
$
14,576
   
$
12,563
 
 
   
Year Ended December 31,
 
   
2017
   
2017
 
Reconciliation from consolidated general and administrative expenses to Adjusted G&A Expense:
           
Consolidated general and administrative expenses
 
$
62,530
   
$
59,671
 
Non-cash share based compensation
   
(8,530
)
   
(4,745
)
Benefit from change in vacation policy
   
1,113
     
 
Adjusted G&A Expense
 
$
55,113
   
$
54,926
 
 
Note (1): The results of operations for the years ended December 31, 2017 and 2016 have been recast to show the effects of our discontinued operations and to reflect an adjustment to our share based compensation expense. For additional information, please see Note 21 to our consolidated financial statements in our most recent Form 10-K.
 
 
14


Exhibit 99.2
 
   Business Update April 3, 2018 
 

 Disclaimers  Forward-Looking StatementsStatements in this presentation relating to future plans, results, performance, expectations, achievements and the like are considered “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. Those forward-looking statements involve known and unknown risks and uncertainties 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 those statements, including the success of our strategic objectives; our ability to meet the targets disclosed by management with respect to costs and revenue, and that these targets do not represent historical performance, projected results or guidance; our ability to generate revenue from our partner sales strategy and business development pipeline with our distribution partners; the impact of shutting down and then divesting our Pet Health Monitoring segment; the timing and success of new product launches and other growth initiatives, including our Identity Guard® with Watson™ product; the continuing impact of the regulatory environment on our business; the continued dependence on a small number of financial institutions for a majority of our revenue and to service our U.S. financial institution customer base; our ability to execute our strategy and previously announced transformation plan; our incurring additional restructuring charges; our incurring additional charges for non-income business taxes or otherwise, or impairment costs or charges on goodwill and/or other assets; our ability to control costs; our failure to protect private data due to a security breach or other unauthorized access; our ability to maintain sufficient liquidity and produce sufficient cash flow to fund our business, growth strategy and debt service obligations; the impact of our recent senior management changes; and our needs for additional capital to grow our business, including our ability to maintain compliance with the covenants under our term loan or seek additional sources of debt and/or equity financing. Factors and uncertainties that may cause actual results to differ include but are not limited to the risks disclosed under “Forward-Looking Statements,” “Item 1. Business—Government Regulation” and “Item 1A. Risk Factors” in the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and in its recent other filings with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to revise or update any forward-looking statements unless required by applicable law.Non-GAAP Financial MeasuresThis presentation includes financial information prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), as well as other financial measures referred to as non-GAAP financial measures. “Adjusted EBITDA” represents consolidated (loss) income from continuing operations before income taxes plus (minus): share related compensation; non-cash impairment of goodwill, intangibles and other assets; loss on disposal of fixed assets; gain (loss) on sale of Captira Analytical and Habits at Work; loss on extinguishment of debt; (benefit) from change in vacation policy; depreciation and amortization; and interest expense. A reconciliation of non-GAAP financial measures used by the Company to GAAP measures is provided in the Appendix. These non-GAAP financial measures should be considered in addition to, but not as a substitute for, net income (loss), general and administrative expense, and the other information prepared in accordance with GAAP, and may not be comparable to similarly titled measures reported by other companies. Management strongly encourages stockholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. Further description of the reconciliation of Non-GAAP Financial Measures can be found in the tables and footnotes accompanying the Company’s earnings release and the “GAAP and Non-GAAP Measures” link under the “Investor and Media” page on our website at www.intersections.com.   2 
 

 Intersections Inc. (Nasdaq: INTX)  47 million Number of consumers Intersections has protected.Largest independent identity theft monitoring provider in the U.S.Intersections Inc. provides innovative software and data monitoring and analytics solutions that help consumers manage financial and personal risks associated with the proliferation of their personal data in the virtual and financial world.Intersections delivers its services via a broad base of partner and employer engagement channels. Under our IDENTITY GUARD® brand, we utilize technology solutions, including artificial intelligence to help monitor, manage and protect against the risks associated with identities and personal information, including: Helping prevent, detect and resolve identity theft associated with financial fraud,Providing social media monitoring and information adjustment or deletion to help protect one’s reputation that may impact school choice, job choice and life experiences,Providing AI based monitoring services to help protect children from cyberbullying,Creating and delivering software services to protect computers and personal devices against “bad” browsing sites and phishing attacks, andProviding Breach prevention and management tools to small and medium sized businesses.  3 
 

 Strategic Objectives  2017  2018  2019  2020  Significant product enhancement – Identity Guard® with Watson™ Sales & Business Development Team Expansion Channel Diversification & Expansion Identity Guard® with Watson™ drives growth Cost Structure positioned to gain operating leverage  4 
 

 2017 Business Transition  Identity Guard® with Watson™Partner distribution modelGrew in-house business development team to 13 professionals plus support teamDivested Bail Bonds Industry Solutions, Insurance Consulting, and Pet Health Monitoring businesses by mid-year  2016  Identity theft protection products undifferentiated from competitionConsumer direct marketing focusBegan adding in-house business development, sales & marketing capabilitiesSignificant management and financial devotion to non-core business activities  $1.3 million consolidated income from continuing operations before income taxes for Q4 2017 after six quarters of lossesReturned to continuing operations Adjusted EBITDA(1) profitability in Q3 and Q4 2017Established position in employee benefits channelEliminated Discontinued Operations that used cash of $17.2 million in 2016 and $2.4 million in 2017  2017  Results  5  (1) See reconciliation of non-GAAP financial measures in appendix.  
 

 2017 Financial Summary  $160 million consolidated revenue for year ended December 31, 2017.$40.0 million in fourth quarter 2017, an increase of 1.9% vs. third quarter 2017Sequential growth in revenue from Identity Guard® business lines in second through fourth quarters 2017.$1.3 million consolidated income from continuing operations before income taxes in fourth quarter of 2017 after six consecutive quarters with reported losses.Generated approximately $4.0 million Adjusted EBITDA in fourth quarter 2017 and $3.2 million for the full year 2017.Returned to positive Adjusted EBITDA in third quarter 2017 after losses in first and second quarters.1.1 million subscribers as of December 31, 20176.2% growth in Identity Guard® subscribers in fourth quarter, and 1.3% growth of Canadian subscriber base, more than offset the decrease in the run-off financial institution subscriber base of 3.1% during the quarter.Developed significant new business pipeline and client base.Signed contracts with employers with 170,000 eligible employees in the aggregateOver 200 employer opportunities in pipeline with over 1 million eligible employees in the aggregate  6 
 

 Our Brand Promise  THE REALITYAs people engage in today’s digital, interconnected world, and as our institutional world becomes more data driven, consumers’ personal data becomes pervasive in the virtual world, and is sought by criminals to perpetrate crimes.OUR PURPOSETo create advanced software solutions and help protect individuals, families and businesses from threats arising from the theft and misuse of personal data and to provide avenues to understand and manage other nonfinancial threats when discovered and analyzed.  7 
 

 Reinvented Capabilities, Business Model, Trajectory       FROM  TO   Building upon our foundational expertise in credit, financial services and data integration, we have built the capabilities and roadmap to lead and redefine what identity protection means in the 21st century   Wholesaler of other’s financial data   SaaS: IP creator of algorithms rooted in AI  7 primary data resources  71 data resources; 23 IBM Watson API’s; more to follow  Physical delivery, web based  Mobile-focus, web accessible  Credit monitoring and alerts  Financial, digital, social, personal protection and alerts     White label provider, some DTC  DTC, Employee Benefit, Partners  Primarily ID protection  Comprehensive as well as multiple audience-driven solutions  BUSINESS MODEL  DEPTH OF DATA  SOLUTIONS PLATFORM  CONSUMER PROMISE  BREADTH OF DISTRIBUTION  PRODUCT  8 
 

 Identity Guard® Tool Kit  SOCIAL & DIGITALSELF & FAMILY  FINANCIAL WELL BEING  Credit monitoringCredit reportsExpanded Public recordsBank/financial recordsGovernment ID monitoringExpanded Dark Web monitoringTax fraud  EXCEEDINGcategory expectations  Social reputation managerCyberbullying monitoringSafe browsing technologyAnti Phishing appJob & ReputationPersonalized real time scam alertsAlchemy news event detectionInternet of things  PERSONAL SAFETY  Geo-location aware alertsPolice reportsSex-Offender alerts  SUPPORT & RESOLUTION   $1M Theft InsuranceFastest alerts vs major competitorsVictim recovery specialistsU.S.-based call center  PHYSICAL awareness/protection   INDUSTRY LEADINGalerts/remediation  DIGITALtools/alerts/information  Dynamic Artificial Intelligence technology for broadest data monitoring capability.Uses Watson to digest more than 250,000 news articles from 75,000 sources every day to identify news that could impact a consumer’s digital safety.Scans millions of news articles, blogs, and posts to warn of potential, emerging threats such as data breaches, software vulnerabilities, and dangerous online habits.Proactively search the dark web, public records, credit files, thousands of news sources to detect identity risks.   9 
 

 Sales & Marketing Transformation  Digital display and direct response consumer advertising led to high cost of acquisition & low ROIOn-line marketing affiliate program in place secondary to direct marketing effortsMinimal investment in business development capabilities, new partner acquisition and distribution network developmentNo presence in employee benefit channelOpportunistic presence in breach response services market  2015 – 1H 2017  2017 - Forward  Eliminated low return direct marketing programsFocus on effective on-line affiliates with cash efficient financial incentive programsContinue growth of experienced in-house development professionalsEstablished strong position in high growth employee benefit channel with highly differentiated solutionsHighly competitive in large scale breach responses with differentiated solutions.First to market among competitors with breach preparedness services for small and medium businesses  Sales & Marketing infrastructure for recurring revenue businessPartner DistributionLower Cost of AcquisitionCash EfficiencyHigher Retention & Renewal Rates    10 
 

 Revenue Trends  Combined Identity Guard channels grew to 43% of consolidated revenue.Sequential growth in Identity Guard Revenue Q2 – Q4 2017.Q3 – Q4 2017 was first selling season for Employee benefits channel.Revenue from financial institution clients continues to attrite at approximately 1% per month.Full launch of Identity Guard with Watson is expected to drive 2018 revenue.Identity Guard revenue expected to exceed run-off revenue on a run-rate basis in second half 2018(a).  Key Trends  11  Identity Guard® U.S. and Canadian Revenue  (In $USD millions)  (a) The foregoing goals are objectives and targets developed by management with respect to revenue. They are qualified by and subject to the “Forward Looking Statements” section of this presentation on the page entitled “Disclaimers”. In addition, readers are cautioned that such target objectives do not represent historical performance, projected results or guidance and should not be relied upon or construed as such. 
 

 Growth Strategy: Employee Benefits Sales & Distribution Network  Ended 2017 with 7 experienced in-house business development professionals with an aggregate 100 months with the Company.Successful first full selling season in 2H 2017 with signed contracts covering 170,000 eligible employees.Ended 2017 with brokerage relationships with 15 of the largest benefits advisory and brokerage firms in the U.S. and over 125 regional/local firms.   12 
 

 Growth Strategy: Consumer and Partner Channels  22 new partner marketing & distribution agreements were signed in 2017 and an additional 17 were signed in the first quarter of 2018.New partner pipeline opportunities consist of potential partners with which dialogue is active.Pipeline increased from 13 opportunities at the beginning of 2017 to 20 as of March 31, 2018Range in size from large to small affinity marketing and other membership organizationsAll new partners will be marketing Identity Guard® with Watson™  13 
 

   Management Financial Objectives  $millions  2017 Actual    2018 Goal  3 Yr. Objective  2020 Goal  Revenue  $159.6    $153 - $158  25% - 30% cumulative growth  +/- $200              Marketing  11.3  7.1%  2.0% – 2.2%  Minimal direct response spend  $2.0 Million per year              Commission  38.4  24.0%  24% – 25%  Consistent run rate  24% – 25% of Revenue              Cost of Revenue  51.7  32.3%  32% - 34%  Consistent % of Revenue  32% - 34% of Revenue              G&A ExpenseAdjusted G&A Expense (a)  62.555.1  39.2%34.5%  $54 -$55  Hold adjusted G&A flat  $54 - $55 million annual adjusted G&A              Loss from Continuing Operations before Tax  ($13.7)    (b)    (b)              Adjusted EBITDA(a)  $3.2  2.0%  $6.5 - $7.5    15% of Revenue  The foregoing objectives and goals are targets developed by management with respect to costs and revenue. They are qualified by and subject to the “Forward Looking Statements” section of this presentation on the page entitled “Disclaimers”. In addition, readers are cautioned that such target objectives do not represent historical performance, projected results or guidance and should not be relied upon or construed as such.See reconciliation of non-GAAP financial measures in the appendix.(b) We are unable to present a quantitative reconciliation of this forward-looking non-GAAP financial measure to its most directly comparable forward-looking GAAP financial measure because management cannot reliably predict or estimate, without unreasonable effort, all the necessary components of such GAAP measure. See reconciliation of non-GAAP financial measures in the appendix. Such amounts may also be excluded in the future periods and could be significant.  14 
 

 Investment Summary  Largest independent identity and personal information protection provider in the U.S.$160 million consolidated revenue in 2017 with return to positive adjusted EBITDA in 3rd and 4th quarters.2018 management goal(a) of $153 – $158 million consolidated revenue and adjusted EBITDA of $6.5 - $7.5 million.1.1 million active subscribers (3/31/18):Leading innovator – first to release almost every enhancement over the last 20 years.Leading offering – Identity Guard® with Watson™ leverages AI to deliver the broadest data monitoring capability and fastest alerts vs. major competitors.Leading platform – scalable to support high growth through partner relationships.  Management believes the Company is well-positioned to achieve the financial objectives of top-line growth and increasing profitability over the next three years.  15  (a) The foregoing objectives and goals are targets developed by management with respect to costs and revenue. They are qualified by and subject to the “Forward Looking Statements” section of this presentation on the page entitled “Disclaimers”. In addition, readers are cautioned that such target objectives do not represent historical performance, projected results or guidance and should not be relied upon or construed as such. 
 

 Appendix 
 

 Revenue  Identity Guard® revenue increased 9.9% in the fourth quarter of 2017 compared to the third quarter of 2017 due to subscriber increases late in the third quarter in our consumer direct business and during the fourth quarter in our employee benefits business. These subscriber increases also resulted in a 12.6% increase in revenue in the year ended December 31, 2017 compared to 2016.Revenue from the Canadian business increased 10.6% in the fourth quarter of 2017 compared to the fourth quarter of 2016 as a result of an increase in average price per subscriber.Revenue from U.S. financial institution clients decreased at an average monthly rate of 1.1% per month during 2017, which the Company continues to believe is representative of normal attrition given the discontinuation of marketing and retention efforts for this subscriber population.Note (1): We periodically refine the criteria used to calculate and report our subscriber data. In the year ended December 31, 2017, we determined that certain subscribers who receive our breach response services should no longer be included in the presentation of Identity Guard® subscribers or revenue due to the nonrecurring nature of our breach response services. For comparability, all periods presented have been recast to reflect this change in subscribers and revenue.   17 
 

 Subscribers  The Identity Guard® subscriber base increased 6.2% during the fourth quarter, and 13.2% since December 31, 2016, primarily in its direct to consumer and employee benefits channels. Subscribers acquired through our Canadian business marketing relationship were relatively consistent with the base as of September 30, 2017 and December 31, 2016.U.S. financial institution subscribers declined approximately 1% per month on average since December 31, 2016, a rate we believe continues to represent normal attrition.Note (1): We periodically refine the criteria used to calculate and report our subscriber data. In the year ended December 31, 2017, we determined that certain subscribers who receive our breach response services should no longer be included in the presentation of Identity Guard® subscribers or revenue due to the nonrecurring nature of our breach response services. For comparability, all periods presented have been recast to reflect this change in subscribers and revenue.   18  (in thousands) 
 

 Cash Flow  19  Cash used in operating activities for the year includes approximately $4.7 million for business development activities, the significant majority of which is personnel cost. The Company expects to continue its spending on business development activities at approximately the same level as 2017 for 2018.Cash used in operating activities included $6.9 million in the year ended December 31, 2017 for deferred subscription and solicitation costs related to our direct-to-consumer marketing, including $595 thousand in the fourth quarter. The Company implemented changes beginning in the second quarter to reduce the cash marketing spending in this channel and expects the use of cash for this purpose to continue to decline into 2018.The Company continued to develop new product features primarily for the Identity Guard® with Watson™ platform during the year ended December 31, 2017. As a result, the Company invested approximately $4.5 million in internally developed capitalized software for the year. The Company expects to continue its investments in product development at approximately the same level as 2017 for 2018. 
 

 Reconciliation of Non-GAAP Financial Measures  20  Reconciliation of consolidated adjusted EBITDA (loss) before share related compensation and other non-cash (expenses) benefits (“Adjusted G&A”) ($ in thousands):  Further description of the reconciliation of Non-GAAP Financial Measures can be found in the tables and footnotes accompanying the Company’s earnings release and the “GAAP and Non-GAAP Measures” link under the “Investor and Media” page on our website at www.intersections.com.   Note (1): The results of operations for the years ended December 31, 2017 and 2016 have been recast to show the effects of our discontinued operations and to reflect an adjustment to our share based compensation expense. For additional information, please see Note 21 to our consolidated financial statements in our most recent Form 10-K. 
 

 Reconciliation of Non-GAAP Financial Measures: General and Administrative Expenses  Further description of the reconciliation of Non-GAAP Financial Measures can be found in the tables and footnotes accompanying the Company’s earnings release and the “GAAP and Non-GAAP Measures” link under the “Investor and Media” page on our website at www.intersections.com.   21  Note (1): The results of operations for the years ended December 31, 2017 and 2016 have been recast to show the effects of our discontinued operations and to reflect an adjustment to our share based compensation expense. For additional information, please see Note 21 to our consolidated financial statements in our most recent Form 10-K.  Reconciliation of consolidated adjusted general and administrative expenses before share related compensation and other non-cash (expenses) benefits (“Adjusted G&A”) ($ in thousands): 
 

 Thank You  Corporate HeadquartersIntersections Inc.3901 Stonecroft BoulevardChantilly, VA 20151Toll-free: 800.695.7536www.intersections.com  Investor RelationsRon Barden, CFO rbarden@intersections.com Tel: 703.488.6810