Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - SPEEDEMISSIONS INC | d8k.htm |
Exhibit 99.1
Exhibit 99.1 Press release dated as of March 31, 2011
| Press Release | Source: Speedemissions Inc. |
Speedemissions, Inc Reports Fourth Quarter & December 31, 2010 Year End Results
ATLANTA, GA. March 31, 2011/Business Wire/ — Speedemissions, Inc. (OTC Bulletin Board: SPMI - News), a leading vehicle emissions testing and safety inspections company with testing stores in Atlanta, Houston, St. Louis and Salt Lake City today announced its financial results for the fourth quarter and year ended December 31, 2010.
2010 Summary:
| • | Revenue decreased $663,580 or 6.7% to $9,253,098 for the year ended December 31, 2010 compared to revenue of $9,916,678 for year ended December 31, 2009. The decrease in revenue was primarily due to the loss of six months revenue of $433,021 at two Mr. Sticker stores closed in June 2010. Our same store sales decreased 4.1% over the comparable period of 2009. |
| • | Store operating expenses decreased $264,569 or 4.2% to $6,002,009 for the year ended December 31, 2010 compared to store operating expenses of $6,266,578 in the comparable period of 2009. Our same store operating expenses declined $268,780 during 2010. |
| • | General and administrative expenses increased 11.9% to $1,579,566 during the year ended December 31, 2010 compared to $1,411,296 in the same period of the prior year. The increase in our general and administrative expenses was primarily attributable to an increase in CARbonga related expenses and professional fees over the prior year. |
| • | The Company’s net losses for the year ended December 31, 2010 and 2009 included goodwill impairment expenses of $1,902,590 and $2,873,766, respectively. |
| • | Net loss for the year ended December 31, 2010 was $2,182,874 or ($0.19) per basic and diluted share compared to a net loss of $2,787,072 or ($0.53) per basic and diluted share in 2009. Excluding the goodwill impairment expense, the Company lost ($0.02) per diluted share in the year ended December 31, 2010 compared to earning $0.01 per diluted share in the year ended December 31, 2009. |
Richard A. Parlontieri, President and Chief Executive Officer of Speedemissions commented: “In the third Quarter 2010, we introduced the selling of a limited line of automotive products in many of our stores where we’re required to do a vehicle safety inspection. This business segment of selling light bulbs, windshield wipers, along with our “Headlight Restoration” program has provided a positive benefit to our customers. We’re pleased our store employees were able to successfully implement a program that will help us recapture lost revenue, improve our income from continuing operations and reduce our total liabilities in this difficult economic environment. In addition, the latest version of CARbonga (our iPhone App) designed to give a consumer control over both his/her auto safety, as well as being an invaluable tool when buying or selling a used car by showing the buyer the vehicles history on Safety Recalls or Technical Service Bulletins, should contribute to increasing revenue in 2011”.
Revenue in the fourth quarter of 2010 totaled $1,990,436, a decrease of $268,642 or 11.9%, compared with revenue of $2,259,078 in the same period last year. The closure of our two Mr. Sticker stores in Texas in June 2010 resulted in the loss of $207,843 revenue in the fourth quarter of 2010 compared to 2009. On a same-store basis, Speedemissions, Inc.’s fourth quarter sales were down 5.5%.
The Company’s net losses in the fourth quarter ended December 31, 2010 and 2009 included goodwill impairment expenses of $1,902,590 and $2,873,766, respectively. The Company’s net loss in the fourth quarter of 2010 was $2,079,005 or ($0.13) per basic and diluted share compared to a net loss of $2,992,673 or ($0.31) per basic and diluted share in the comparable period of 2009.
About Speedemissions Inc. http://www.speedemissions.com
Speedemissions, Inc., based in Atlanta, Georgia, is a leading vehicle emissions testing and safety inspections company in the United States. We provide services in certain areas where auto testing is mandated by the Environmental Protection Agency (EPA). Since the emissions testing market is highly fragmented, Speedemissions expects to be the first company to create a national brand offering their customers quick and efficient vehicle emissions testing service. The current focus of the company is in the Atlanta, Georgia; Houston, Texas; St. Louis, Missouri and Salt Lake City, Utah markets.
Certain statements contained in this news release regarding matters that are not historical facts may be forward-looking statements. Because such forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed in or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, uncertainties pertaining to continued market acceptance for Speedemissions’ products and services, its ability to succeed in growing revenue, the effect of new competitors in its market, integration of acquired businesses, and other risk factors identified from time to time in its filings with the Securities and Exchange Commission. For Further Information: Contact Michael Shanahan, Chief Financial Officer, 770-306-7667.
Speedemissions, Inc. and Subsidiaries
Consolidated Balance Sheets
as of December 31,
| 2010 | 2009 | |||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash |
$ | 261,600 | $ | 449,203 | ||||
| Note receivable – current portion |
12,000 | — | ||||||
| Certificate and merchandise inventory |
77,401 | 83,455 | ||||||
| Other current assets |
58,819 | 53,335 | ||||||
| Total current assets |
409,820 | 585,993 | ||||||
| Note receivable, net of current portion |
89,643 | — | ||||||
| Property and equipment, net |
728,016 | 953,183 | ||||||
| Goodwill |
2,349,066 | 4,251,657 | ||||||
| Other assets |
105,603 | 104,003 | ||||||
| Total assets |
$ | 3,682,148 | $ | 5,894,836 | ||||
| Liabilities and Shareholders’ (Deficit) Equity |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 182,499 | $ | 177,647 | ||||
| Accrued liabilities |
196,829 | 196,544 | ||||||
| Current portion - capitalized lease obligations |
44,632 | 47,288 | ||||||
| Current portion - equipment financing obligations |
21,778 | 18,865 | ||||||
| Current portion - deferred rent |
35,776 | 30,513 | ||||||
| Total current liabilities |
481,514 | 470,857 | ||||||
| Capitalized lease obligations, net of current portion |
41,339 | 93,604 | ||||||
| Equipment financing obligations, net of current portion |
23,788 | 46,389 | ||||||
| Deferred rent |
159,820 | 205,701 | ||||||
| Note payable |
55,000 | — | ||||||
| Other long term liabilities |
7,350 | 7,350 | ||||||
| Total liabilities |
768,811 | 823,901 | ||||||
| Commitments and contingencies |
||||||||
| Series A convertible, redeemable preferred stock, $.001 par value, 5,000,000 shares authorized, 5,133 shares issued and outstanding; liquidation preference: $5,133,000 |
4,579,346 | 4,579,346 | ||||||
| Shareholders’ (deficit) equity: |
||||||||
| Series B convertible preferred stock, $.001 par value, 3,000,000 shares authorized, 215,981 and 2,279,982 shares issued and outstanding; liquidation preference: $554,642 and $5,854,994 |
216 | 2,280 | ||||||
| Common stock, $.001 par value, 250,000,000 shares authorized, 22,789,288 and 6,685,448 shares issued and outstanding |
22,789 | 6,685 | ||||||
| Additional paid-in capital |
15,806,600 | 15,795,364 | ||||||
| Accumulated deficit |
(17,495,614 | ) | (15,312,740 | ) | ||||
| Total shareholders’ (deficit) equity |
(1,666,009 | ) | 491,589 | |||||
| Total liabilities and shareholders’ (deficit) equity |
$ | 3,682,148 | $ | 5,894,836 | ||||
Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Operations
For the Years Ended December 31,
| 2010 | 2009 | |||||||
| Revenue |
$ | 9,253,098 | $ | 9,916,678 | ||||
| Costs of revenue: |
||||||||
| Cost of emissions certificates |
2,028,949 | 2,156,673 | ||||||
| Store operating expenses |
6,002,009 | 6,266,578 | ||||||
| General and administrative expenses |
1,579,566 | 1,411,296 | ||||||
| (Gain) loss on disposal of non-strategic assets |
10,513 | (39,820 | ) | |||||
| Gain from legal settlement |
(106,881 | ) | — | |||||
| Goodwill impairment expense |
1,902,590 | 2,873,766 | ||||||
| Operating loss |
(2,163,648 | ) | (2,751,815 | ) | ||||
| Interest income (expense) |
||||||||
| Interest income |
2,414 | 111 | ||||||
| Interest expense |
(21,640 | ) | (35,368 | ) | ||||
| Interest, net |
(19,226 | ) | (35,257 | ) | ||||
| Net loss |
$ | (2,182,874 | ) | $ | (2,787,072 | ) | ||
| Basic and diluted net loss per common share |
$ | (0.19 | ) | $ | (0.53 | ) | ||
| Weighted average common shares outstanding, basic and diluted |
11,342,812 | 5,217,990 | ||||||
Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
For the Years Ended December 31,
| 2010 | 2009 | |||||||
| Operating activities: |
||||||||
| Net loss |
$ | (2,182,874 | ) | $ | (2,787,072 | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
||||||||
| Depreciation and amortization |
260,577 | 319,288 | ||||||
| Goodwill impairment expense |
1,902,590 | 2,873,766 | ||||||
| (Gain) loss from disposal of non-strategic assets |
10,513 | (39,820 | ) | |||||
| Share based compensation including director stock awards |
25,276 | 46,731 | ||||||
| Gain from legal settlement |
(106,881 | ) | — | |||||
| Changes in operating assets and liabilities: |
||||||||
| Certificate and merchandise inventory |
6,054 | (14,684 | ) | |||||
| Other current assets |
(5,484 | ) | 15,585 | |||||
| Other assets |
(1,600 | ) | (3,066 | ) | ||||
| Accounts payable and accrued liabilities |
15,673 | (361,492 | ) | |||||
| Other liabilities |
(45,881 | ) | (12,256 | ) | ||||
| Net cash (used in) provided by operating activities |
(122,037 | ) | 36,980 | |||||
| Cash flows from investing activities: |
||||||||
| Proceeds from note receivable |
5,238 | — | ||||||
| Proceeds from asset sales |
20,000 | 46,330 | ||||||
| Purchases of property and equipment |
(71,195 | ) | (89,093 | ) | ||||
| Net cash used in investing activities |
(45,957 | ) | (42,763 | ) | ||||
| Cash flows from financing activities: |
||||||||
| Proceeds from promissory note |
55,000 | — | ||||||
| Payments on financing obligations |
(19,688 | ) | (15,539 | ) | ||||
| Payments on capitalized leases |
(54,921 | ) | (41,967 | ) | ||||
| Net cash used in financing activities |
(19,609 | ) | (57,506 | ) | ||||
| Net decrease in cash |
(187,603 | ) | (63,289 | ) | ||||
| Cash at beginning of period |
449,203 | 512,492 | ||||||
| Cash at end of period |
$ | 261,600 | $ | 449,203 | ||||
| Supplemental Information: |
||||||||
| Cash paid during the period for interest |
$ | 20,459 | $ | 35,368 | ||||
Non-cash transaction:
Conversion of redeemable preferred stock into common shares
Barron Partners, LP converted 2,064,000 shares of Preferred B Stock into 15,603,840 common shares during the year ended December 31, 2010.
Barron Partners, LP converted 201,500 shares of Preferred B Stock into 1,523,340 common shares during the year ended December 31, 2009.