Verecloud Reports First Quarter Fiscal Year 2011 Results
Delivers strong sequential revenue growth
ENGLEWOOD, Colo.--(BUSINESS WIRE)-- Verecloud (OTCBB:VCLD), which enables communications service providers (CSPs) to capture market share in the emerging cloud computing services business, today announced financial results for its first fiscal quarter of 2011 ended September 30, 2010 highlighted by revenue of $1,510,542, a 112 percent increase from the previous three months.
Verecloud reported an operating loss of $121,216 during the latest quarter, a $606,505 improvement from the previous three months. The company reduced its net loss by 69 percent to $147,851, from $480,777 in the preceding three months.
During the quarter, Verecloud continued to expand its leadership team with the additions of Dr. Hossein Eslambolchi and Phillip Tonge to its board of directors. Dr. Eslambolchi, a venture capital consultant and renowned technology change visionary, will provide invaluable technological and strategic advice on the company’s business and innovation growth. Tonge, a leader in both the energy and telecommunications industries, will provide strategic and business development guidance as the company continues to expand its customer base.
"The results demonstrate the significant progress that Verecloud made in the quarter," said John McCawley, chief executive officer of Verecloud. "I am very pleased with the growing revenue trend and we remain very focused on expanding our customer base and deploying our Nimbus Xchange solution in the coming months."
Financial Highlights
- Revenue of $1,510,542, up 112 percent from the quarter ended June 30, 2010 and down 57 percent compared to the year ago quarter.
- Net loss of $147,851, down from a net loss of $480,777 in the quarter ended June 30, 2010. Net income for the three months ended September 30, 2009 was $908,031.
- Ended the quarter with a cash balance of $742,857 compared to $197,151 in the quarter ended June 30, 2010 and up from $255,634 at September 30, 2009.
- Closed the quarter with working capital of $692,217, up 87 percent from the quarter ended June 30, 2010 and up 184 percent compared to the year ago quarter.
- Became publicly traded in September 2010 on the Over-the-Counter market.
Additional financial information, including historical SEC filings and the current Quarterly Report on Form 10-Q can be found on Verecloud’s website at www.verecloud.com.
About Verecloud
Based in Englewood, Colorado, Verecloud enables communications service providers (CSPs) to capture market share in the expanding and lucrative cloud computing market. Verecloud’s cloud services broker platform, Nimbus Xchange, addresses the CSPs’ need to integrate their cloud services business with existing back-office systems which enable CSPs to drive new revenue opportunities. By collaborating with Verecloud, CSPs are positioned to capture a significant percentage of this exciting market by leveraging their trusted intermediary status as a cloud services broker. Learn more about Verecloud at: http://www.verecloud.com.
Forward-Looking Statement
This release may contain projections and other forward-looking statements that involve risks and uncertainties. Forward-looking statements are projections reflecting management’s judgment and assumptions based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Future performance cannot be assured. Readers are referred to the documents filed by Verecloud with the Securities and Exchange Commission (SEC), specifically the most recent reports which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. Recent documents filed with the SEC can be found in the Investor Relations section of our website (www.verecloud.com). Verecloud believes the forward-looking statements in this release are reasonable; however, you should not place undue reliance on forward-looking statements, which are based on current expectations and speak only as of the date of this release. Verecloud is not obligated to publicly release any revisions to forward-looking statements to reflect events after the date of this release.
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STATEMENT OF OPERATIONS |
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Three Months Ended September 30, |
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2010 |
2009 |
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| Revenue | $ | 1,510,542 | $ | 3,499,022 | ||||
| Cost of goods sold | 677,431 | 1,657,797 | ||||||
| Gross profit | 833,111 | 1,841,225 | ||||||
| Operating expenses | ||||||||
| Employee related (1) | 415,985 | 238,018 | ||||||
| Marketing expense | 250,956 | 261,099 | ||||||
| Legal and accounting | 127,421 | 139,941 | ||||||
| Consulting expense | 65,092 | 25,275 | ||||||
| Rent | 22,435 | 36,026 | ||||||
| Travel and entertainment | 23,396 | 29,213 | ||||||
| Information technology | 18,090 | 41,027 | ||||||
| Depreciation | 10,614 | 11,921 | ||||||
| Other | 20,338 | 262 | ||||||
| Total operating expenses | 954,327 | 782,782 | ||||||
| Operating income (loss) | (121,216 | ) | 1,058,443 | |||||
| Other income (expense) | ||||||||
| Interest income | 133 | 73 | ||||||
| Interest (expense) | (26,768 | ) | (52,047 | ) | ||||
| Total other income (expense) | (26,634 | ) | (51,974 | ) | ||||
| Pretax income (loss) | (147,851 | ) | 1,006,469 | |||||
| Income tax expense (benefit) | - | 98,438 | ||||||
| Net income (loss) | $ | (147,851 | ) | $ | 908,031 | |||
| Basic net income (loss) per common share | $ | (0.00 | ) | $ | 0.02 | |||
| Fully diluted net income (loss) per common share | $ | (0.00 | ) | $ | 0.02 | |||
| Basic weighted average common shares | 70,098,000 | 43,800,000 | ||||||
| Fully diluted weighted average common shares | 87,068,652 | 43,800,000 | ||||||
| (1) Includes stock-based compensation as follows: | ||||||||
| Salary and wages | $ | 51,656 | $ | - | ||||
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BALANCE SHEET |
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| September 30, | June 30, | |||||||
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2010 |
2010 |
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| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | 742,857 | $ | 197,151 | ||||
| Accounts receivable | 591,166 | 632,962 | ||||||
| Other current assets | 109,888 | 34,243 | ||||||
| Total current assets | 1,443,911 | 864,356 | ||||||
| Property and equipment | ||||||||
| Computer related | 87,655 | 87,655 | ||||||
| Equipment and machinery | 37,914 | 36,255 | ||||||
| Other property and equipment | 36,330 | 36,330 | ||||||
| Subtotal | 161,899 | 160,240 | ||||||
| Accumulated depreciation | (109,453 | ) | (98,839 | ) | ||||
| Net property and equipment | 52,445 | 61,401 | ||||||
| Other assets | ||||||||
| Capitalized software, net | 40,101 | - | ||||||
| Total assets | $ | 1,536,458 | $ | 925,757 | ||||
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 417,115 | $ | 174,899 | ||||
| Accrued liabilities | 334,579 | 319,899 | ||||||
| Total current liabilities | 751,694 | 494,798 | ||||||
| Long term debt | 1,314,000 | 864,000 | ||||||
| Deferred taxes payable | 334,579 | 319,899 | ||||||
| Total liabilities | 2,065,694 | 1,358,798 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' (deficit) | ||||||||
| Preferred stock - $0.001 par value, 5,000,000 shares authorized: | - | - | ||||||
| No shares issued or outstanding | ||||||||
| Common stock - $0.001 par value, 200,000,000 shares authorized: | 70,098 | 70,098 | ||||||
| 70,098,000 shares issued and outstanding | ||||||||
| Additional paid-in capital | 849,326 | 797,670 | ||||||
| Accumulated (deficit) | (1,448,661 | ) | (1,300,809 | ) | ||||
| Total stockholders' (deficit) | (529,237 | ) | (433,041 | ) | ||||
| Total liabilities and stockholders' (deficit) | $ | 1,536,458 | $ | 925,757 | ||||
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STATEMENT OF CASH FLOWS |
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| Three Months Ended | ||||||||
| September 30, | ||||||||
| Operating Activities |
2010 |
2009 |
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| Net income (loss) | $ | (147,851 | ) | $ | 908,031 | |||
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Adjustments to reconcile net income to net cash from operations |
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| Depreciation and amortization | 10,614 | 11,921 | ||||||
| Stock for services | - | 98,000 | ||||||
| Stock-based compensation | 51,656 | - | ||||||
| Income tax expense (benefit) | - | 98,438 | ||||||
| Change in assets and liabilities | ||||||||
| Accounts receivable | 41,796 | (769,353 | ) | |||||
| Income taxes receivable | ||||||||
| Other current assets | (75,645 | ) | 3,918 | |||||
| Accounts payable | 242,216 | 166,108 | ||||||
| Other current liabilities | 14,679 | 2,909 | ||||||
| Net cash from operating activities | 137,466 | 519,972 | ||||||
| Investing Activities | ||||||||
| Purchase of computer related | - | (12,727 | ) | |||||
| Purchase of equipment and machinery | (1,659 | ) | (2,520 | ) | ||||
| Purchase of other property and equipment | - | (2,946 | ) | |||||
| Capitalized software | (40,101 | ) | - | |||||
| Net cash (used in) investing activities | (41,760 | ) | (18,193 | ) | ||||
| Financing Activities | ||||||||
| Reduction in note payable | (100,000 | ) | (280,000 | ) | ||||
| Increase in long term debt | 550,000 | - | ||||||
| Members distributions | - | (506,623 | ) | |||||
| Net cash (used in) financing activities | 450,000 | (786,623 | ) | |||||
| Increase (decrease) in cash for period | $ | 545,706 | $ | (284,844 | ) | |||
| Cash at beginning of period | 197,151 | 540,479 | ||||||
| Cash at end of period | $ | 742,857 | $ | 255,635 | ||||
| Schedule of Noncash Investing and Financing Activities | ||||||||
| Share exchange agreement | $ | - | $ | (579,905 | ) | |||
| Deferred taxes payable | $ | - | $ | 214,973 | ||||
| Income taxes payable | $ | - | $ | 364,932 | ||||
| Supplemental disclosure: | ||||||||
| Cash paid for interest during the year | $ | 26,768 | $ | 52,047 | ||||
| Cash paid for income taxes during the year | $ | - | $ | - | ||||
CONTACT:
Verecloud
Investor Relations
Lynn Schlemeyer, 1-877-711-6492
lynn.schlemeyer@verecloud.com
or
Media Relations
VisiTech
Michael Hopkins, 303-752-3552 ext 230
vc@visitechpr.com
KEYWORDS: United States North America Colorado
INDUSTRY KEYWORDS: Technology Networks Telecommunications Mobile/Wireless VoIP
MEDIA:
