American TonerServ Reports Fourth-Quarter, Full-Year Results, Reviews Strategy and Outlook Full-Year 2007 Revenue Increases to $3,630,531 From $456,433 in 2006; Fourth-Quarter Revenue Grows to $
SOURCE:
American TonerServ
2008-04-02 13:23:00
American TonerServ Reports Fourth-Quarter, Full-Year Results, Reviews Strategy and Outlook
Full-Year 2007 Revenue Increases to $3,630,531 From $456,433 in 2006; Fourth-Quarter Revenue Grows to $
SANTA ROSA, CA–( EMWNews – April 2, 2008) – American TonerServ Corp. (
(“ATS”), a strategic consolidator in the more than $6.0 billion highly
fragmented independent segment of the printer supplies and services
industry, today announced financial results for the fourth quarter and year
ended December 31, 2007.
“In 2007, American TonerServ went from planning our future to executing the
steps necessary to achieve our goal of building the company’s annual
revenue run rate to approximately $45 million by the end of 2008,” said Dan
Brinker, chief executive officer.
“As we stated at the beginning of 2007, our strategy is to acquire and grow
strong independent printer supply and service companies in the top 30
metropolitan areas in the Untied States. Building upon foundational work
in 2006, in 2007 we acquired Optima Technologies LLC and Tonertype of
Florida, LLC. The Optima acquisition was completed in April, and the
Tonertype acquisition closed in late December, making 2007 the biggest year
in the Company’s history for acquisitions.”
Mr. Brinker continued, “Looking forward, we have identified several
attractive targets to add to the American TonerServ family of companies.
At the same time, we are achieving improvements in sourcing that
strengthens our ability to provide cost-effective printer supplies, and we
are maximizing operational infrastructure to support our growing business.”
In 2007, the American TonerServ Board of Directors was strengthened by the
addition of two new members. Chuck Mache joined the board in November and
was subsequently named Chairman of the Board in January 2008. Steven
Jensen, who was Chief Executive Officer of Optima Technologies, joined the
Board in August. Additionally, the company established an advisory board
of industry and management experts to provide counsel to the executive
management team.
Recent Highlights
In March, 2008, American TonerServ announced the establishment of NC
TonerServ, a wholly-owned subsidiary located in North Carolina’s Research
Triangle.
Also in March, American TonerServ consolidated its Dallas, Texas,
operations under the leadership of Clay Allbright, who owned and operated
an independent printer supply and service company prior to joining ATS.
Additionally, ATS engaged printer supply and service consultant Rob Cowman,
founder of the Cowman Group, to work with the Corporate Development team in
identifying and evaluating acquisition prospects for ATS.
Mr. Brinker said, “We recognized that the growth we experienced in 2007
represented an opportunity to build best practices internally from the
ground up. In early 2008, we established new accounting and audit
functions within our Finance department. This group has begun to institute
best practices on internal controls. This is one example of how we are
building the team to take ATS to a much larger operating model.”
Fourth-Quarter and Fiscal Year 2007 Financial Results
ATS reported revenue of $1.1 million for the quarter ended December 31,
2007, compared to approximately $0.1 million for the quarter ended December
31, 2006. ATS reported a net loss for the quarter ended December 31, 2007
of $1.75 million, compared to a net loss of $1.1 million for the quarter
ended December 31, 2006, or a net loss of $0.04 per share in the fourth
quarter compared to a net loss of $0.06 per share in the same period of the
previous year.
The Company reported revenue of $3.6 million for the year ended December
31, 2007, compared to $0.5 million for the year ended December 31, 2006.
For the twelve months ended December 31, 2007, ATS reported a net loss of
$4.8 million, compared to a net loss of $1.9 million for the year ended
December 31, 2006.
Based on 29.4 million weighted shares of common stock outstanding during
the year ended December 31, 2007, ATS reported a loss of approximately
$0.16 per share for the year ended December 31, 2007 and a loss of $0.17
per share for the year ended December 31, 2006.
Outlook
“Printing is the largest undocumented cost in business, according to our
research,” said Mr. Brinker. “ATS customers gain print management systems
and service that increase their ability to budget for printing and increase
efficiency by reducing equipment down time. Furthermore, using recycled
components in top-quality printer cartridges compatible with all leading
printer brands reduces cost and reduces waste going to landfills.
“We are actively identifying and evaluating acquisition targets in major
metropolitan areas around the country. Our strategy is to make favorable
offers to owners and in many cases to engage the expertise of those owners
to continue building their operations under the ATS umbrella,” said Mr.
Brinker. “We plan to add five to seven businesses that together we expect
would build the Company’s level of revenue to approximately $45 million on
an annualized basis by the end of 2008. We believe the industry is ready
for a national consolidator capable of providing buying power, operational
infrastructure, inventory management, and best business practices.
American TonerServ is that consolidator.”
AMERICAN TONERSERV CORP. AND SUBSIDIARIES
Consolidated Statements of Operations
December 31, December 31,
2007 2006
----------- ----------
Revenues:
Toner $ 3,203,894 $ 267,784
Service 426,637 188,649
----------- ----------
Total revenues 3,630,531 456,433
----------- ----------
Cost of sales:
Toner 2,116,802 171,229
Service 420,046 90,873
Inventory write-down 68,500 -
----------- ----------
Total cost of sales 2,605,348 262,102
----------- ----------
Gross profit 1,025,183 194,331
Operating Expenses:
Salaries and wages 1,768,024 580,560
Professional fees and services 1,346,706 982,493
Sales and marketing 287,616 87,990
General and administrative 1,334,711 239,145
Amortization of customer lists 338,173 11,503
----------- ----------
Total operating expenses 5,075,230 1,901,691
----------- ----------
Loss from operations (4,050,047) (1,707,360)
Other income (expense):
Fair value of convertible debt 85,417 (154,166)
Termination of management agreement (550,000) -
Interest expense (260,267) (75,162)
Change in fair value of warrant liabilities (71,873) (35,000)
Gain on claims settlements 14,445 37,819
----------- -----------
Net loss $(4,832,325) $(1,933,869)
=========== ===========
Net loss per share:
Basic and diluted $ (0.16) $ (0.17)
=========== ===========
Weighted average number of shares outstanding:
Basic and diluted 29,373,589 11,359,337
=========== ===========
AMERICAN TONERSERV CORP. AND SUBSIDIARIES
Unaudited Statements of Operations
Three Months Ended
December 31, December 31,
2007 2006
------------ -----------
Revenues:
Toner $ 911,458 $ 114,779
Service 143,273 16,268
----------- ----------
Total revenues 1,054,731 131,047
----------- ----------
Cost of sales:
Toner 659,870 69,500
Service 150,872 11,975
----------- ----------
Total cost of sales 810,742 81,475
----------- ----------
Gross profit 243,989 49,572
Operating Expenses:
Salaries and wages 606,375 218,427
Professional fees and services 197,221 666,688
Sales and marketing 75,953 72,115
General and administrative 457,774 90,841
Amortization of customer lists 105,951 -
----------- ----------
Total operating expenses 1,443,274 1,048,071
----------- ----------
Loss from operations (1,199,285) (998,499)
Other income (expense):
Fair value of convertible debt 131,250 (3,994)
Termination of Azaria management agreement (550,000) -
Interest expense (69,218) (21,737)
Change in fair value of warrant liabilities (78,205) (47,827)
Gain on claims settlements 13,144 462
----------- -----------
Net loss $(1,752,314) $(1,071,595)
=========== ===========
Net loss per share:
Basic and diluted $ (0.04) $ (0.06)
=========== ===========
AMERICAN TONERSERV CORP. AND SUBSIDIARIES
Consolidated Balance Sheet
December 31,
2007
------------
ASSETS
Current assets:
Cash and cash equivalents $ 60,196
Accounts receivable, net of doubtful accounts of $35,224 1,326,891
Inventory 715,328
Prepaid expenses and other current assets 33,127
Deferred compensation 471,298
------------
Total current assets 2,606,840
Customer lists, net 4,002,862
Goodwill 1,801,895
Property and equipment, net 394,745
Other assets 29,959
------------
Total Assets $ 8,836,301
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 1,767,997
Shareholder advances 431,095
Notes payable - current portion (net of unamortized
discount of $(223,120) 2,068,033
Notes payable, related parties - current portion 150,000
Convertible notes payable, related parties - current portion 31,250
Convertible notes payable - current portion 187,500
Deferred revenue 92,589
------------
Total current liabilities 4,728,464
------------
Long-term liabilities:
Notes payable (net of unamortized discount of $(343,815) 1,281,400
Convertible notes payable 925,000
Warrant liabilities 119,700
------------
Total long-term liabilities 2,326,100
------------
Total liabilities 7,054,564
------------
Commitments and contingencies
Stockholders' equity:
Common stock; $.001 par value; 450,000,000 shares authorized;
60,390,956 shares issued and outstanding 60,391
Additional paid-in capital 19,300,186
Accumulated deficit (17,578,840)
------------
Total stockholders' equity 1,781,737
------------
Total Liabilities and Stockholders' Equity $ 8,836,301
============
About American TonerServ:
American TonerServ Corp. (“ATS”) is building a nationwide organization to
efficiently serve the printing needs of small-and medium-sized businesses
by consolidating leading independent operators in the $6 billion recycled
printer cartridge and printer services industry, offering top-quality,
environmentally-friendly products and local service teams. Please see
www.AmericanTonerServ.com for more information.
Forward-Looking Statements
Except for historical information contained herein, the matters set forth
above may be forward-looking statements that involve certain risks and
uncertainties that could cause actual results to differ from those in the
forward-looking statements. Words such as “anticipate,” “believe,”
“estimate,” “expect,” “intend” and similar expressions, as they relate to
the Company or its management, identify forward-looking statements. Such
forward-looking statements are based on the current beliefs of management,
as well as assumptions made by and information currently available to
management. Actual results could differ materially from those contemplated
by the forward-looking statements as a result of certain factors such as
the level of business and consumer spending, the amount of sales of the
Company’s products, the competitive environment within the industry, the
ability of the Company to continue to expand its operations, the level of
costs incurred in connection with the Company’s expansion efforts, economic
conditions in the industry and the financial strength of the Company’s
customers and suppliers. The Company does not undertake any obligation to
update such forward-looking statements. Investors are also directed to
consider all other risks and uncertainties.
| Contact:
American TonerServ Corp. Jordan Goldstein |
|
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