NEWPORT BEACH, Calif., May 24, 2012 /PRNewswire/ -- SearchCore, Inc. (OTCBB: SRER), (OTCQX: SRER), a technology-based Internet marketing services company that connects consumers with brands, products and services, today announced its consolidated financial results for the first quarter ended March 31, 2012.
(Logo: http://photos.prnewswire.com/prnh/20120106/LA31342LOGO)
First Quarter 2012 Highlights
- Revenues increased 78% year-over-year.
- EBITDA was $0.9 million, as compared to ($0.1) million in the first quarter of 2011.
- EBITDA margin was 25%.
- Operating income was $0.7 million, as compared to ($0.2) million in first quarter of 2011.
Management Commentary
"We continued to deliver strong growth in revenue, EBITDA and operating income during the first quarter reflecting the ongoing demand for our technology-based services and corresponding customer and pricing expansion," said Jim Pakulis, CEO of SearchCore, Inc.
"As we continue to decrease our operating expenses as a percentage of revenue, the operating leverage in our business model is driving solid improvement in profitability," added Doug Francis, President of SearchCore, Inc. "We are enthusiastic about our prospects for further business development and performance improvements throughout 2012."
First Quarter 2012 Financial Results
SearchCore's revenues for the first quarter ended March 31, 2012 totaled $3.6 million, a year-over-year increase of 78% as compared with $2.0 million for the first quarter ended March 31, 2011.The increase in revenues was primarily due to an increase in the number of customers, the number of 'listing packages' offered to customers and the fees charged for the packages.
Total operating expenses were $2.9 million for the first quarter of 2012, or 79% of revenue, as compared with $2.2 million, or 109% of revenue for the first quarter of 2011. The increase in operating expenses was primarily due to higher investments in research and development expenses in support of business expansion efforts.
EBITDA for the first quarter ended March 31, 2012 increased to $0.9 million, as compared to negative EBITDA of $0.1 million for the first quarter of 2011. EBITDA as a percentage of total revenue was 25% for the first quarter ended March 31, 2012, as compared to negative 4% for the first quarter of 2011. Operating income for the first quarter ended March 31, 2012 increased to $0.7 million, as compared to an operating loss of $0.2 million for the first quarter of 2011.
Income from continuing operations increased to $3.5 million for the first quarter ended March 31, 2012, as compared to a loss from continuing operations of $0.2 million for the first quarter of 2011. Income from continuing operations for the first quarter of 2012 included a pre-tax, non-cash gain of $3.0 million on the change in fair value of earn-out liability.
Including the pre-tax, non-cash gain, net income increased to $3.4 million for the first quarter ended March 31, 2012, as compared to a net loss of $0.1 million for the first quarter of 2011.
Balance Sheet Overview
At March 31, 2012, SearchCore had cash and cash equivalents of $1.4 million, total debt of $7.9 million and non-cash earn-out liability of $15.7 million, as compared with cash and cash equivalents of $1.5 million, total debt of $8.3 million and non-cash earn-out liability of $18.6 million at December 31, 2011.
About SearchCore, Inc.
SearchCore, Inc., formerly General Cannabis, Inc., is a technology-based Internet marketing services company that offers customers an integrated suite of services including media, technology, marketing and information. Founded in 2010, SearchCore is headquartered in Newport Beach, California. The Company's common stock trades on the OTC market's highest tier, OTCQX, under the ticker symbol "SRER." www.SearchCore.com
Safe Harbor Notice
Certain statements contained herein are "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995). SearchCore, Inc. cautions that statements made in this news release constitute forward-looking statements and makes no guarantee of future performance. Forward-looking statements are based on estimates and opinions of management at the time statements are made. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. Actual results could differ materially from current projections or implied results. SearchCore, Inc. undertakes no obligation to revise these statements following the date of this news release.
– financial tables to follow –
SEARCHCORE, INC. |
||||||
Condensed Consolidated Statements of Operations (Unaudited) |
||||||
Three Months Ended |
||||||
March 31, 2012 |
March 31, 2011 |
|||||
REVENUE |
||||||
Sales |
$ |
3,613,339 |
$ |
2,032,005 |
||
Total revenue |
3,613,339 |
2,032,005 |
||||
OPERATING EXPENSES |
||||||
Cost of sales |
184,955 |
47,795 |
||||
Selling, general and administrative expenses |
2,679,630 |
2,162,286 |
||||
Total operating expenses |
2,864,585 |
2,210,081 |
||||
Operating Income (loss) |
748,754 |
(178,076) |
||||
Other Income (Expense) |
||||||
Gain on change in fair value of earn-out liability |
2,964,115 |
— |
||||
Interest income |
— |
178 |
||||
Interest expense |
(13,245) |
— |
||||
Total other income |
2,950,870 |
178 |
||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES |
3,699,624 |
(177,898) |
||||
Provision for Income Taxes |
217,000 |
— |
||||
INCOME (LOSS) FROM CONTINUING OPERATIONS |
3,482,624 |
(177,898) |
||||
(Loss) income from discontinued operations, net of $39,000 and zero tax benefit for the quarters ended March 31, 2012 and 2011, respectively |
(58,859) |
126,107 |
||||
NET INCOME (LOSS) |
$ |
3,423,765 |
$ |
(51,791) |
||
Income (loss) per share, Basic and Diluted |
||||||
Income (loss) from continuing operations |
$ |
0.04 |
$ |
(0.00) |
||
Income (loss) from discontinued operations |
(0.00) |
0.00 |
||||
Total income (loss) per share |
$ |
0.04 |
$ |
(0.00) |
||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING |
83,331,465 |
83,068,034 |
SEARCHCORE, INC. |
|||||
Condensed Consolidated Balance Sheets |
|||||
March 31, |
December 31, |
||||
2012 |
2011 |
||||
(Unaudited) |
(Audited) |
||||
ASSETS |
|||||
CURRENT ASSETS |
|||||
Cash and cash equivalents |
$ |
1,432,841 |
$ |
1,512,590 |
|
Accounts receivable |
217,252 |
206,091 |
|||
Inventory |
— |
9,830 |
|||
Other current assets |
444,024 |
379,860 |
|||
Current assets - discontinued operations |
125,762 |
51,795 |
|||
TOTAL CURRENT ASSETS |
$ |
2,219,879 |
$ |
2,160,166 |
|
Property and equipment, net |
437,705 |
430,041 |
|||
Intangible assets: |
|||||
Domain names |
226,970 |
114,119 |
|||
Domain name - Marijuana.com, net |
4,247,918 |
4,250,000 |
|||
Web software, net |
804,370 |
501,343 |
|||
Goodwill |
505,132 |
486,403 |
|||
Other assets |
82,332 |
82,332 |
|||
Other assets - discontinued operations |
— |
51,976 |
|||
TOTAL ASSETS |
$ |
8,524,306 |
$ |
8,076,380 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
|||||
CURRENT LIABILITIES |
|||||
Accounts payable |
$ |
188,787 |
$ |
50,632 |
|
Accrued liabilities |
877,791 |
759,312 |
|||
Note payable |
708,901 |
708,901 |
|||
Note payable - related party |
2,605,000 |
1,130,000 |
|||
Earn-out provisions |
9,120,000 |
— |
|||
Current liabilities - discontinued operations |
125,535 |
243,017 |
|||
TOTAL CURRENT LIABILITIES |
$ |
13,626,014 |
$ |
2,891,862 |
|
LONG TERM LIABILITIES |
|||||
Other accrued liabilities |
140,000 |
155,025 |
|||
Note payable |
3,239,206 |
3,416,099 |
|||
Note payable - related party |
— |
1,800,000 |
|||
Earn-out provisions |
6,569,150 |
18,567,223 |
|||
TOTAL LONG TERM LIABILITIES |
9,948,356 |
23,938,347 |
|||
TOTAL LIABILITIES |
$ |
23,574,370 |
$ |
26,830,209 |
|
STOCKHOLDERS' EQUITY (DEFICIT) |
|||||
Preferred stock, $0.001 par value: 20,000,000 shares authorized; |
|||||
zero shares issued and outstanding at March 31, 2012; |
|||||
zero shares issued and outstanding at December 31, 2011; |
— |
— |
|||
Common stock, $0.001 par value: 200,000,000 shares authorized; |
|||||
83,340,256 shares issued and outstanding at March 31, 2012; |
|||||
83,140,256 shares issued and outstanding at December 31, 2011; |
83,340 |
83,140 |
|||
Paid-in capital |
(15,685,244) |
(15,965,044) |
|||
Retained earnings (accumulated deficit) |
551,840 |
(2,871,925) |
|||
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) |
(15,050,064) |
(18,753,829) |
|||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
$ |
8,524,306 |
$ |
8,076,380 |
SEARCHCORE, INC. |
|||||
Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||
Three Months Ended |
|||||
March 31, |
March 31, |
||||
2012 |
2011 |
||||
Cash flows from operating activities: |
|||||
Net (loss) income |
$ |
3,423,765 |
$ |
(51,791) |
|
Adjustments to reconcile net income (loss) to net cash used in operating activities: |
|||||
Depreciation |
98,467 |
17,301 |
|||
Amortization |
44,418 |
84,581 |
|||
Gain on change in fair value of earn-out liability |
(2,878,073) |
— |
|||
Changes in operating assets and liabilities: |
|||||
Accounts receivable |
(11,161) |
(409,331) |
|||
Inventories |
9,830 |
(3,401) |
|||
Prepaid expenses and deposits |
(138,131) |
(8,300) |
|||
Other assets |
51,976 |
(26,734) |
|||
Accounts payable and accrued liabilities |
124,127 |
211,501 |
|||
Net cash provided by (used in) operating activities |
725,218 |
(186,174) |
|||
Cash flows from investing activities: |
|||||
Purchases of property and equipment |
(106,131) |
(258,166) |
|||
Purchases of intangible assets |
(196,943) |
(11,596) |
|||
Net cash used in investing activities |
(303,074) |
(269,762) |
|||
Cash flows from financing activities: |
|||||
Payments on note payable |
(176,893) |
— |
|||
Payments on note payable - related party |
(325,000) |
(20,000) |
|||
Net cash used in financing activities |
(501,893) |
(20,000) |
|||
Net decrease in cash and cash equivalents |
(79,749) |
(475,936) |
|||
Cash and cash equivalents at beginning of period |
1,512,590 |
1,388,574 |
|||
Cash and cash equivalents at end of period |
$ |
1,432,841 |
$ |
912,638 |
|
Non-cash investing and financing activity: |
|||||
Shares issued pursuant to Revyv acquisition |
— |
500,000 |
|||
Shares issued pursuant to MMJMenu acquisition |
200,000 |
— |
SOURCE SearchCore, Inc.
Share this article