ID Watchdog Announces Results for Third Quarter 2013

DENVER, Nov. 20, 2013 /PRNewswire/ -- 

  • Revenues from core distribution channels increased 42.0%
  • Total revenues increased 37.5%
  • Gross profit increased 139.7%

ID Watchdog, Inc. (TSX VENTURE: IDW) (PINKSHEETS: IDWAF) ("ID Watchdog" or the "Company"), provider of consumer-facing identity theft protection and resolution services, today announced its results for the 3rd quarter ended September 30, 2013. All amounts are in U.S. dollars.

(Logo: http://photos.prnewswire.com/prnh/20130829/NY71341LOGO )

3rd Quarter 2013 Highlights:

  • Revenue: Revenue totaled $596,680 for the third quarter of 2013, an increase of $162,628, or 37.5%, from the third quarter of 2012.  During the third quarter of 2013, revenue from our Employee Benefits, Tech Support and Anti-virus channels, contributed $116,504 to the total increase in revenues and revenues from the iSekurity customers, which we purchased in May 2013, contributed $97,884 to the total increase in revenues.  These increases were partially offset by a $51,760 decrease in revenues from our Consumer Marketing Channel.
  • Gross Profit: Gross profit increased by $240,969, or 139.7%, from $172,469 during the third quarter of 2012 to $413,438 during the third quarter of 2013.  The gross margin rate for the third quarter of 2013 and 2012 was 69.3% and 39.7%, respectively. In the fourth quarter of 2012, we entered into a new data agreement which substantially decreased our cost of revenue beginning in January 2013.
  • Total Operating Expense: Total Operating Expense decreased by $88,759, or 13.9%, from the third quarter of 2012.
  • Balance Sheet: Cash and cash equivalents as of September 30, 2013 was $493,925.

ID Watchdog CEO, Michael Greene, commented, "We are pleased to report strong top line growth in the third quarter as we continue to expand the distribution of our employee benefit and our tech support channels and improve our operating and financial performance."

 

ID Watchdog, Inc.

Consolidated Interim Condensed Statements of Operations

(Unaudited)








Three months ended September 30,


Nine months ended

September 30,



2013


2012


2013


2012










Revenue


$ 596,680


$ 434,052


$ 1,679,364


$ 1,348,429

Cost of revenue


183,242


261,583


519,809


847,312

Gross profit


413,438


172,469


1,159,555


501,117










Operating expense:









General and administrative expense


333,207


277,087


1,081,437


1,131,101

Sales and Marketing expense


163,985


235,847


407,157


449,026

Stock – based compensation expense


29,166


103,725


130,221


445,896

Depreciation and amortization expense


23,479


21,937


68,061


68,835



549,837


638,596


1,686,876


2,094,858

Operating loss


(136,399)


(466,127)


(527,321)


(1,593,741)










Other income (expense):









Interest expense


(203,797)


(184,902)


(588,526)


(556,121)

Interest income


87


400


97


5,011

Gain (loss) on warrant liability


19,966


3,639


(79,863)


384,158



(183,744)


(180,863)


(668,292)


(166,952)










Net loss and comprehensive loss applicable to ordinary shares


$ (320,143)


$ (646,990)


$ (1,195,613)


$ (1,760,693)

Basic and diluted net loss per share applicable to ordinary shares


$ (0.00)


$ ( 0.01)


$ (0.01)


$ (0.01)

Weighted average number of shares outstanding - basic and diluted


121,498,040


118,834,997


120,446,719


118,537,114










 

 

 


Consolidated Condensed Balance Sheets





September 30,

2013



December 31,

2012





(Unaudited)



(Unaudited)



ASSETS










Cash and cash equivalents


$

493,925



$

319,073



Accounts receivable



216,289




144,561



Prepaid expenses and other



133,868




73,466




Total current assets



844,082




537,100



Customer agreements, net



30,859





Property and equipment, net



95,610




153,735




Total Assets


$

970,551



$

690,835



LIABILITIES










Accounts payable, accrued liabilities and other


$

448,298



$

534,708



Deferred Revenue



567,741




267,056




Total current liabilities



1,016,039




801,764



Deferred Rent



86,864




89,923



Finance lease obligations, net of current portion



34,490




44,875


Credit Facility, net



445,008






Series C Preferred mandatorily redeemable preferred shares, net of discount and conversion feature



3,431,437




2,892,031



Warrants liability



179,693




99,830





Total Liabilities



5,193,531




3,928,423





Total Shareholders' Deficit



(4,222,980)




(3,237,588)



TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT


$

970,551



$

690,835










 

Financial information contained in this press release should be read in conjunction with the consolidated financial statements and notes thereto included in our most recent quarterly reports and our annual report. These documents are available online at www.sedar.com and in the "Company Overview" section of our website at www.IDWatchdog.com.

About ID Watchdog, Inc.

ID Watchdog was founded in 2005 and is headquartered in Denver, Colorado. The Company provides three-tiered comprehensive monitoring, detection and resolution for identity theft. ID Watchdog proactively detects identity theft problems at their source and provides immediate resolution services to ensure complete peace of mind for individuals. All the Company's services have been developed with input from industry experts; national consumer advocacy groups; federal, state, and local law enforcement agencies; consumer protection agencies; and adhere to guidelines published by the Consumer Federation of America. For more information, please visit www.IDWatchdog.com.

Forward-Looking Statement

This news release includes certain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 which address future events and conditions which are subject to various risks and uncertainties. The actual results could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. Although the Company believes that its expectations reflected in these forward-looking statements are reasonable, no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed in the company's filings with Canadian regulators at www.sedar.com. ID Watchdog assumes no obligation to update the forward-looking statements of management beliefs, opinions, projections, or other factors should they change.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Company Contact:
ID Watchdog, Inc.
Jay B. Lewis
Chief Financial Officer
303-339-8099
InvestorRelations@idwatchdog.com 
www.idwatchdog.com 

SOURCE ID Watchdog, Inc.



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