PAID Inc. Reports Record Revenue and Record Adjusted Income From Operations for the Third Quarter Ended September 2012
FOR: PAID INC
WESTBOROUGH, MA--(Marketwire - November 21, 2012) - PAID Inc. (
"PAID is having its best revenue year ever and we expect progress to continue," said Austin Lewis, PAID Inc. CEO. "The company is focusing on growing our VIP Experiences, streamlining costs, while continuing to provide excellent service and value to our clients and fans. New business prospects and other activities currently in the new business pipeline are making us feel comfortable that 2013 should be another strong year."
"The true operating results have been overshadowed by certain accounting treatments, specifically option compensation and stock price guarantees which are non-cash and non-operating charges," said Christopher Culross, PAID Inc. CFO. We have been very focused on cutting excess overhead and streamlining the operational processes so that we can achieve profitability. The results of our initial efforts which included salary and headcount reductions, reductions in legacy IT costs, and reductions in general administrative costs, produced a profit from operations in the third quarter of 2012 of $318,600 on a proforma basis.
|Three Months Ended|
|September 30, 2012||September 30, 2011|
|Cost of revenues||5,509,100||1,010,500|
|Income (loss) from operations||318,600||(689,500||)|
|Reconciliation of non cash expenses to reported results|
|Stock price guarantee||231,100||-|
|Reported loss from operations||$||(264,800||)||$||(802,500||)|
Operating Cash Flows
"Positive cash flow continues to be a high priority for us," said Lewis. "We have moved our reliance off of issuing stock options for payment of services and compensation, and have moved our focus to reducing costs, and as a result, operating cash flows in the third quarter of 2012 increased $406,400."
|Nine Months Ended September 30, 2012||Six Months Ended June 30, 2012|
|Depreciation and amortization||56,000||33,700|
|Unrealized gain on investment||24,400||51,600|
|Share based compensation||532,500||180,000|
|Amortization of prepaid facility costs||227,800||-|
|Change in fair value of stock price guarantee||919,500||236,200|
|Fair value of stock options awarded|
|in payment of outside services and compensation||2,166,800||2,070,900|
|Deferred revenues, net of prepaid royalties||(100,700||)||(870,500||)|
|Changes in current assets and liabilities||(523,900||)||282,600|
|Net cash provided by (used in) operating activities||$||(283,600||)||$||(690,000||)|
PAID, Inc. will continue to streamline its operations with a focus on core revenue generating activities. PAID, Inc. is a leader in custom developed VIP experience programs. "PAID's new client acquisition strategy is centered on the plan to hone its competitive edge by taking VIP experience programs to the next level with expanded direct-to-consumer reach and engagement via mobile and wireless communications channels, the addition of higher-margin travel package services and VIP programs designed to support celebrity client charitable fundraising and awareness campaigns," said Keith Garde, President of PAID Inc. celebrity services. PAID, Inc. will be reaching beyond its celebrity clients' consumer-level fan bases and increasing the volume of VIP experience package sales by targeting corporate and institutional demand for VIP experience and travel packages.
We continue to work with our legal counsel and believe we are making progress in our efforts to maximize the value of PAID's intellectual property on behalf of shareholders.
About PAID Inc.:
PAID Inc. is a one-stop brand management and marketing resource to music, entertainment and sports personalities and organizations, and offers AuctionInc™ online shipping calculation and shopping cart software employing its patented technology to streamline ecommerce. Known for quality and customer service, PAID offers turnkey online, mobile, social media and traditional marketing campaigns, as well as award-winning video & film production, VIP ticketing, web site design, merchandising, ecommerce and fan community management programs. More details are available at www.paid.com.
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995:
Statements in this news release looking forward in time involve risks and uncertainties, including the risks associated with the effect of changing economic conditions, trends in the markets, variations in the company's cash flow, competition, celebrity programs, business development efforts, technology availability and cost of materials and other risk factors. Factors that could cause actual results to differ materially are discussed in the Company's most recent filings with the Securities and Exchange Commission.