Advanced Communications Announces Post-Acquisition Results and Appointment of New Advertising Agency
BUSINESS WIRE
Posted: 2007-12-11 09:10:28
NEW YORK--(BUSINESS WIRE)----Advanced Communications Technologies, Inc. (OTCBB:ADVC), a vertically integrated public company in the reverse logistics industry, today announced financial results for the quarter ended September 30, 2007, the first fiscal quarter for fiscal year ending June 30, 2008. The Company reports revenue of $9.1 million in the current quarter compared to $2.1 million in the year-ago quarter.
On a GAAP (generally accepted accounting principles) basis, net losses for the quarters ended September 30, 2007 and 2006 amounted to $(460,000) and $(84,000), respectively.
For the quarters ended September 30, 2007 and 2006, non-GAAP adjusted net income (loss) amounted to $259,000 and $(46,000), respectively. For the quarters ended September 30, 2007 and 2006, non-GAAP adjusted EBITDA amounted to $714,000 and $(46,000), respectively.
"We are pleased with the Company's results of operations for this quarter, which includes revenues and expenses of Vance Baldwin, Inc. since August 17, 2007, the date that we acquired this major distributor of consumer electronics and appliance replacement parts," said Wayne Danson, President and Chief Executive Officer of ACT. "The integration of Vance Baldwin's management team and day-to-day operations with those of Advanced Communications Technologies and Cyber-Test is proceeding well in line with our expectations. The acquisition of Vance Baldwin and the equity stake taken in Advanced Communications Technologies by HIG Capital, LLC represent important milestones in our goal of increasing our presence in the reverse logistics industry."
Mr. Danson also announced Advanced Communications Technologies has appointed DaynerHall Inc., an Orlando-based marketing and advertising firm, as its agency of record for all marketing, branding and advertising initiatives set forth by the company.
"We went through a comprehensive process of identifying and interviewing many nationwide agencies to find a firm that was qualified to create market awareness as well as branding and strategic positioning in the marketplace," said Danson. "We are confident that DaynerHall can fulfill our goal of establishing and maintaining a distinct market leadership position through a thoughtful and insightful marketing and branding campaign. As we add future acquisitions it is absolutely necessary to combine the new operating companies into one unified brand and market position." Danson stated that a master brand identity that carries across all business activities and corporate communications will help ensure a clear message to the Company's customers, suppliers, investors and shareholders.
Non-GAAP Measures
Non-GAAP adjusted net income represents our net loss before non-cash stock-based and other compensation expense, amortization of acquisition-related intangible assets, and purchase accounting for inventory and its effect on cost of sales in the period. Non-GAAP adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization of acquisition-related intangible assets, non-cash stock-based and other compensation expense and purchase accounting for inventory and its effect on cost of sales in the period. These financial measures are not measures of financial performance in accordance with generally accepted accounting principles; however, we believe that these measures are relevant for evaluating operating performance and they are consistent with the manner in which we assess our profitability. These non-GAAP financial measures should not be considered as alternatives to reporting net income (loss) in accordance with generally accepted accounting principles.
About Advanced Communications Technologies, Inc.
Advanced Communications is a New York-based company specializing in the technology after-market service and supply chain, known as reverse logistics. Its principal operating unit, Encompass Group Affiliates, owns and acquires businesses that provide computer and electronic repair services, parts distribution and asset management services. Encompass owns Cyber-Test, an electronic equipment depot repair company that provides repair and reverse logistics services to third-party warranty companies that service OEMs, national retailers and national office equipment dealers, and Vance Baldwin, Inc. an OEM Parts Distributor that has been a leader in the industry for over fifty years. Vance Baldwin has operations in southern Florida and suburban Atlanta and distributes parts ranging from consumer electronics, computers, printers and office supplies. In addition, Vance Baldwin provides service aids and industrial products such as cable, tools, test equipment, cleaners and other installation equipment.
Cyber-Test's services include advance exchange, depot repair, call center support, parts and warranty management, repair of laptops, flat panel monitors and televisions, printers, multifunction units, fax machines, GPS navigation units, PDAs, PC projectors and CPUs. For more information, visit Cyber-Test's website at www.equipfix.com.
Vance Baldwin's new distribution facility, located near Atlanta, Georgia, allows for 2 day delivery to the vast majority of the United States with UPS Ground Service. It maintains a call center with highly trained parts consultants to receive customer calls and provide assistance with parts selection and ordering. For more information about Vance Baldwin Electronics, visit www.vancebaldwin.com.
ADVANCED COMMUNICATIONS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)For The Three Months Ended
September 30,
------------------------------
2007 2006
------------------------------NET SALES $ 9,071,801 $ 2,140,837
COST OF SALES 7,012,158 1,374,856
------------------------------
GROSS PROFIT 2,059,643 765,981
------------------------------OPERATING EXPENSES
Depreciation and amortization 107,870 19,536
Selling, general and administrative
expenses (including stock-based
compensation of $370,716 and $0,
respectively) 2,096,396 819,468
------------------------------
TOTAL OPERATING EXPENSES 2,204,266 839,004
------------------------------Loss From Operations (144,623) (73,023)
------------------------------OTHER INCOME (EXPENSE)
Other income 76,132 --
Interest expense, net (391,978) (11,417)
------------------------------
TOTAL OTHER EXPENSE (315,846) (11,417)
------------------------------NET LOSS (460,469) (84,440)
------------------------------Deemed dividend on preferred stock (819,905) --
------------------------------------------------------------
NET LOSS AVAILABLE TO COMMON
STOCKHOLDERS $ (1,280,374)$ (84,440)
------------------------------------------------------------
Net loss per share - basic and diluted $ - $ -
------------------------------Weighted average number of shares
outstanding during the period - basic
and diluted 4,997,711,570 4,449,489,506
------------------------------
A reconciliation between the Company's net loss on a GAAP basis to
non-GAAP adjusted EBITDA is as follows:For the Three
Months Ended
September 30,
2007 2006
----------------------------------------------------------------------
GAAP net loss $(460,000)$(84,000)
----------------------------------------------------------------------
Special items:
----------------------------------------------------------------------
Interest expense 405,000 14,000
----------------------------------------------------------------------
Amortization of acquisition-related intangible
assets 58,000 --
----------------------------------------------------------------------
Depreciation expense 49,000 19,000
----------------------------------------------------------------------
Income taxes 1,000 5,000
----------------------------------------------------------------------
Stock-based and other non-cash compensation
expense 423,000 --
----------------------------------------------------------------------
Effect on cost of sales of inventory purchase
accounting write up 238,000 --
----------------------------------------------------------------------
Non-GAAP adjusted EBITDA $ 714,000 $(46,000)
----------------------------------------------------------------------
A reconciliation between the Company's net loss on a GAAP basis to
non-GAAP adjusted net income (loss) is as follows:For the Three Months
Ended
September 30,
2007 2006
----------------------------------------------------------------------
GAAP net loss $(460,000)$(84,000)
----------------------------------------------------------------------
Special items:
--------------------------------------------------------------------------------------------------------------------------------------------
Amortization of acquisition-related intangible
assets 58,000 --
----------------------------------------------------------------------
Stock-based and other non-cash compensation
expense 423,000 38,000
----------------------------------------------------------------------
Effect on cost of sales of inventory purchase
accounting write up 238,000 --
----------------------------------------------------------------------
Non-GAAP adjusted net income (loss) $ 259,000 $(46,000)
----------------------------------------------------------------------
ADVANCED COMMUNICATIONS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETSSeptember
30, 2007 June 30, 2007
------------- -------------
ASSETS (Unaudited)
Current Assets
Cash and cash equivalents $ 3,375,578 $ 843,721
Restricted cash 752,866 --
Accounts receivable, net of allowances
of $302,585 and $6,919, respectively 6,054,530 429,105
Inventory 2,403,145
Replacement parts and equipment 478,683 371,353
Due from vendors 891,107 --
Prepaid expenses and other current
assets 642,526 84,083
------------- -------------
Total Current Assets 14,598,435 1,728,262
------------- -------------
Property and equipment, net 500,285 261,849
Other Assets
Deferred financing costs, net 891,846 --
Deferred acquisition costs 363,588 885,364
Intangibles assets, net 3,950,000 --
Goodwill 20,654,521 2,624,388
Other assets 37,373 7,960
------------- -------------
Total Other Assets 25,897,328 3,517,712
------------- -------------TOTAL ASSETS $ 40,996,048 $ 5,507,823
============= =============LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Current Liabilities
Accounts payable $ 4,689,133 $ 2,197,344
Accrued expenses 2,135,971 1,375,363
Escrow liability 752,866 --
Notes payable, current portion 507,614 617,068
Capitalized lease obligation, current
portion 42,654 15,341
------------- -------------
Total Current Liabilities 8,128,238 4,205,116
------------- -------------
Long Term Liabilities
Senior Notes, net of unamortized
original issue discount and current
portion 11,997,642 --
Senior Subordinated Notes, net of
unamortized original issue discount 11,514,668 --
Convertible notes payable 1,206,146 --
Note payable, officer 310,000 --
Capitalized lease obligation, less
current portion 63,154
Convertible preferred stock
Series A convertible preferred stock,
$.01 par value -- 3,006,200
Series B convertible preferred stock,
$.01 par value -- 40,000
Series A-1 convertible preferred
stock, $.01 par value -- 340,000
Series A-2 convertible preferred
stock, $.01 par value 4,206,105 --
Series C convertible preferred stock,
$.01 par value 6,300,000 --
Series D convertible preferred stock,
$.01 par value 633,962 --
------------- -------------
Total Long Term Liabilities 36,231,677 3,386,200
------------- -------------
TOTAL LIABILITIES 44,359,915 7,591,316
------------- -------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIENCY
Common stock, no par value, 5,000,000,000
shares authorized, 4,997,711,570 issued
and outstanding 31,092,290 31,092,290
Additional paid-in capital 1,280,374 1,280,374
Accumulated deficit (35,736,531) (34,456,157)
------------- -------------
Total Stockholders' Deficiency (3,363,867) (2,083,493)
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIENCY $ 40,996,048 $ 5,507,823
============= =============
Advanced Communications Technologies, Inc.Wayne Danson, President/CEO, 646-227-1600
© Business Wire 2006
12/11/2007 09:05 ET |
