IZEA Worldwide, Inc. - FORM 8-K - EX-99.1 - PRESS RELEASE - March 20, 2015

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EXHIBIT 99.1

IZEA Announces Record Q4 Revenue, up 26% Year over Year
Reports Highest Annual Revenue in Company History of $8.3 Million

Orlando, Florida (March 19, 2015) - IZEA, Inc. (OTCQB: IZEA), operator of the premiere online marketplace that connects brands with influential content creators, today announced record results for its fourth quarter ended December 31, 2014.

Financial Highlights include:

•
Revenue for the quarter increased 26% to a record $2.5 million compared to Q4 2013.
•
Gross profit margin for the quarter was 65.6%, up from 56.5% during the same period in 2013.
•
Bookings for the quarter grew 40% year over year to a record $2.7 million.
•
New opportunity pipeline for the quarter increased 76% year-over-year to $16 million.
•
Revenue for the 2014 fiscal year was $8.3 million, an increase of 26% over 2013.
•
Annual bookings reached $9.0 million, an increase of 24% over 2013.

Fourth Quarter Operational Highlights:

•
Completed user migration from legacy systems to IZEAx.
•
IZEAx aggregate network reach increased 138% to 2.3 billion fans and followers at the end of the quarter, compared with Q3 2014.
•
IZEAx registered users increased 153% to 243,000 compared with Q3 2014.
•
Three new IZEAx partners, including Bent Pixels and Frederator.

“IZEA made significant investments in client services and engineering ahead of revenue last year, and that investment is beginning to be reflected in our organic growth momentum,” said Ted Murphy, IZEA's Chairman and Chief Executive Officer. “I am proud of what our team accomplished in 2014 and have never been more optimistic about our future. The investments we made last year, combined with our acquisition of Ebyline, Inc. in January 2015, have set the stage for a transformational year ahead for the company. We project 177% bookings growth in 2015, with $25 million in bookings driving an estimated $23 million in revenue.”

2014 Annual Results

Revenue for 2014 was $8,322,274 compared to $6,626,943 in 2013, an increase of 26%. Gross profit for the year was $5,476,441, up from $3,928,579 in 2013, an increase of 39%. Operating expenses for the year were $10,122,644, compared to $6,841,635 in 2013, due to investments in sales, marketing and engineering.

Net income for the year was $3,184,064 compared to a net loss of $(3,321,992) during the same period last year, primarily due to a $7,845,214 gain on the change in the fair value of derivatives. Operating EBITDA was $(3,719,556) compared to $(1,682,155) in 2013, primarily due to investments in marketing and new hires.

Basic and diluted income per common share for the year was $.06 and $.05, respectively, compared to basic and diluted loss per common share of $(.27) for 2013.

Investor Conference Call
The Company will host a conference call today at 4:00p.m. ET, during which IZEA management will discuss the financial results and be available to answer any questions from investors.

Conference Date:  03/19/15
Conference Start Time:  4:00 pm Eastern




Dial-In Number : 1-201-689-8471
Electronic replay of the conference call will be available through March 26, 2015 by dialing 1-858-384-5517 and entering PIN number 13602917. IZEA will also post a downloadable file onto the Investor Relations area of http://corp.izea.com.
 
About IZEA
IZEA operates the premiere online marketplace that connects brands with influential content creators. IZEA creators range from leading bloggers and social media personalities to A-List celebrities and professional journalists. Creators are compensated for developing and distributing unique content on behalf of brands including long form text, videos, photos and status updates. Brands receive influential consumer content and engaging, shareable stories that drive awareness. For more information about IZEA, visit http://corp.izea.com.

Financial Methodology & Related Disclosures
"EBITDA" is a non-GAAP financial measure within the meaning of Regulation G promulgated by the Securities and Exchange Commission. EBITDA is commonly defined as "earnings before interest, taxes, depreciation and amortization." We believe that EBITDA provides useful information to investors as it excludes transactions not related to the core cash operating business activities including non-cash transactions.

We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. All companies do not calculate EBITDA in the same manner, and EBITDA as presented by IZEA may not be comparable to EBITDA presented by other companies. IZEA defines EBITDA as earnings or loss before interest, taxes, depreciation and amortization, non-cash stock related compensation, gain or loss on asset disposals or impairment and all other income and expense items such as loss on exchanges and changes in fair value of derivatives, if applicable.

Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Statements in this press release that are forward-looking include the company's estimated levels of revenues, gross profit margin and net operating loss for the 2014 fiscal year. These forward-looking statements are based largely on IZEA's expectations and are subject to a number of risks and uncertainties, certain of which are beyond IZEA's control. Actual results could differ materially from these forward-looking statements as a result of, among other factors, competitive conditions in the social sponsorship segment in which IZEA operates, failure to popularize one or more of the marketplace platforms of IZEA, inability to obtain additional capital, and changing economic conditions that are less favorable than expected. In light of these risks and uncertainties, there can be no assurance that the forward-looking information contained in this respect will in fact occur. Please read the full statement and disclosures here: http://corp.izea.com/safe-harbor-statement.

# # #

IZEA Investor Relations:
Budd Zuckerman
Genesis Select
303.415.0200
bzuckerman@genesisselect.com

IZEA Media Relations:
Brent Diggins
Allison & Partners
(480) 516-2035
brent@allisonpr.com
###




IZEA, Inc.
Consolidated Balance Sheets
 
December 31,
2014
 
December 31,
2013
Assets
 
 
 
Current:
 
 
 
Cash and cash equivalents
$
6,521,930

 
$
530,052

Accounts receivable
2,156,378

 
1,659,802

Prepaid expenses
190,604

 
109,960

Other current assets
61,424

 
83,486

Total current assets
8,930,336

 
2,383,300

 
 
 
 
Property and equipment, net of accumulated depreciation of $239,521 and $205,070
588,919

 
156,482

Software development costs, net of accumulated amortization of $85,331 and $0
483,544

 
362,346

Security deposits
100,641

 
46,574

Total assets
$
10,103,440

 
$
2,948,702

Liabilities and Stockholders’ Equity (Deficit)
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
310,611

 
$
817,057

Accrued expenses
394,617

 
365,454

Unearned revenue
1,767,074

 
1,292,228

Current portion of capital lease obligations
54,376

 
43,852

Total current liabilities
2,526,678

 
2,518,591

 
 
 
 
Capital lease obligations, less current portion
7,291

 
34,013

Deferred rent
106,531

 
14,179

Warrant liability
3,203,465

 
1,832,945

Total liabilities
5,843,965

 
4,399,728

 
 
 
 
Stockholders’ equity (deficit:)
 

 
 

Common stock, $.0001 par value; 200,000,000 shares authorized; 57,697,666 and 22,560,653 issued and outstanding
5,770

 
2,256

Additional paid-in capital
27,195,055

 
24,672,132

Accumulated deficit
(22,941,350
)
 
(26,125,414
)
Total stockholders’ equity (deficit)
4,259,475

 
(1,451,026
)
 
 
 
 
Total liabilities and stockholders’ equity (deficit)
$
10,103,440

 
$
2,948,702
















IZEA, Inc.
Consolidated Statements of Operations
 
 
Three Months Ended
December 31,
 
Twelve Months Ended December 31,
 
2014
 
2013
 
2014
 
2013
 
 
 
 
 
 
 
 
Revenue
$
2,464,328

 
$
1,960,544

 
$
8,322,274

 
$
6,626,943

Cost of sales
847,427

 
852,234

 
2,845,833

 
2,698,364

Gross profit
1,616,901

 
1,108,310

 
5,476,441

 
3,928,579

 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 

 
 

General and administrative
2,472,495

 
1,865,912

 
8,813,291

 
6,460,800

Sales and marketing
323,158

 
108,140

 
1,309,353

 
380,835

Total operating expenses
2,795,653

 
1,974,052

 
10,122,644

 
6,841,635

 
 
 
 
 
 
 
 
Loss from operations
(1,178,752
)
 
(865,742
)
 
(4,646,203
)
 
(2,913,056
)
 
 
 
 
 
 
 
 
Other income (expense):
 
 
 
 
 

 
 

Interest expense
(4,788
)
 
(10,969
)
 
(25,375
)
 
(63,404
)
Loss on exchange of warrants and debt
—

 
—

 
—

 
(94,214
)
Change in fair value of derivatives and notes payable carried at fair value, net
2,219,659

 
307,022

 
7,845,214

 
(251,847
)
Other income (expense), net
2,751

 
299

 
10,428

 
529

Total other income (expense)
2,217,622

 
296,352

 
7,830,267

 
(408,936
)
 
 
 
 
 
 
 
 
Net income (loss)
$
1,038,870

 
$
(569,390
)
 
$
3,184,064

 
$
(3,321,992
)
 
 
 
 
 
 
 
 
Weighted average common shares outstanding – basic
57,497,631

 
22,388,623

 
52,327,088

 
12,400,366

Basic income (loss) per common share
$
0.02

 
$
(0.03
)
 
$
0.06

 
$
(0.27
)
 
 
 
 
 
 
 
 
Weighted average common shares outstanding – diluted
61,179,808

 
22,388,623

 
63,400,080

 
12,400,366

Diluted income (loss) per common share
$
0.02

 
$
(0.03
)
 
$
0.05

 
$
(0.27
)
 













IZEA, Inc.
Consolidated Statements of Cash Flows
 
Twelve Months Ended December 31,
 
2014
 
2013
Cash flows from operating activities:
 
 
 
Net income (loss)
$
3,184,064

 
$
(3,321,992
)
Adjustments to reconcile net income (loss) to net cash used for operating activities:
 

 
 

Depreciation
109,823

 
51,229

Amortization of software development costs and other assets
95,548

 
45,961

Loss (gain) on sale of furniture and equipment
16,192

 
(2,879
)
Bad debt expense
—

 
26,389

Stock-based compensation
538,263

 
725,254

Stock issued or to be issued for payment of services
166,610

 
443,588

Loss on exchange of warrants and debt
—

 
94,214

Change in fair value of derivatives and notes payable carried at fair value, net
(7,845,214
)
 
251,847

Cash provided by (used for):
 

 
 

Accounts receivable
(496,576
)
 
(1,259,373
)
Prepaid expenses and other current assets
(72,299
)
 
(15,226
)
Accounts payable
(506,446
)
 
(346,250
)
Accrued expenses
29,163

 
203,990

Unearned revenue
474,846

 
152,088

Deferred rent
92,352

 
14,179

Net cash used for operating activities
(4,213,674
)
 
(2,936,981
)
 
 
 
 
Cash flows from investing activities:
 
 
 
Purchase of equipment
(517,113
)
 
(17,586
)
Increase in software development costs
(206,529
)
 
(362,346
)
Security deposits
(54,067
)
 
(37,526
)
Net cash used for investing activities
(777,709
)
 
(417,458
)
 
 
 
 
Cash flows from financing activities:
 

 
 

Proceeds from issuance of notes payable, net
—

 
1,439,798

Proceeds from issuance of common stock and warrants, net
10,933,998

 
2,004,111

Proceeds from exercise of stock options & warrants
112,800

 
—

Payments on notes payable and capital leases
(63,537
)
 
(217,364
)
Net cash provided by financing activities
10,983,261

 
3,226,545

 
 
 
 
Net increase (decrease) in cash and cash equivalents
5,991,878

 
(127,894
)
Cash and cash equivalents, beginning of year
530,052

 
657,946

 
 
 
 
Cash and cash equivalents, end of period
$
6,521,930

 
$
530,052

 
 
 
 
Supplemental cash flow information:
 

 
 

Cash paid during period for interest
$
15,158

 
$
13,045

 
 
 
 
Non-cash financing and investing activities:
 

 
 

Fair value of 2013 PPM warrants reclassified from liability to equity
$
3,166,482

 
$
—

Fair value of warrants issued
$
12,382,216

 
$
2,352,108

Conversion of notes payable into common stock
$
—

 
$
1,501,229

Acquisition of assets through capital lease
$
41,339

 
$
73,489






Reconciliation of Net Income (Loss) to Operating EBITDA:
 
 
 
 
Three Months Ended
Twelve Months Ended
 
December 31,
2014
 
December 31,
2013
December 31,
2014
 
December 31,
2013
Net income (loss)
$
1,038,870

 
$
(569,390
)
$
3,184,064

 
$
(3,321,992
)
Non-cash stock-based compensation
149,261

 
366,003

538,263

 
725,254

Non-cash stock issued for payment of services
18,750

 
22,000

166,610

 
438,768

Change in the fair value of derivatives
(2,219,659
)
 
(307,022
)
(7,845,214
)
 
251,847

Loss on exchange of warrants
—

 
—

—

 
94,214

Loss/(Gain) on disposal of equipment
—

 
(2,879
)
16,192

 
(2,879
)
Interest expense
4,788

 
10,969

25,375

 
63,404

Depreciation & amortization
34,659

 
19,352

195,154

 
69,229

Operating EBITDA
$
(973,331
)
 
$
(460,967
)
$
(3,719,556
)
 
$
(1,682,155
)














IZEA Worldwide, Inc. Reports