Speedemissions, Inc. (OTC Bulletin Board: SPMI - News), a leading vehicle emissions testing and safety inspections company with stores in Atlanta, Houston, St. Louis and Salt Lake City today announced its financial results for the second quarter ended June 30, 2011.
SECOND QUARTER 2011:
- Revenue decreased $342,903 or 13.7% to $2,152,831 in the second quarter of 2011 compared to $2,495,734 in the second quarter of 2010. The decrease in revenue was primarily due to the closure of two stores in 2010 and a decrease in same store sales of 6.0%. The decrease in same store sales is mainly attributable to increased competition and discounting at our Georgia, Texas and Utah locations, offset by increases in same store sales at our Missouri locations.
- Store operating expenses decreased $151,515 or 9.9% to $1,383,888 in the second quarter of 2011 compared to $1,535,403 in the second quarter of 2010. The decrease in store operating expenses was primarily due to the closure of two stores in 2010. Same store operating expenses decreased $72,022 in the second quarter of 2011 compared to the second quarter of 2010.
- General and administrative expenses decreased $69,643 or 14.3% in the second quarter of 2011 compared to the second quarter of 2010.
- The Company recognized net loss of $92,468, or $0.00 per basic and diluted share in the second quarter of 2011 compared to net loss of $103,389, or ($0.01) per basic and diluted share in the second quarter of 2010.
YEAR TO DATE 2011:
- Revenue decreased $684,890 or 13.8% to $4,263,957 in the six months ended June 30, 2011 compared to $4,948,847 in the same period of 2010. The decrease in revenue was primarily due to the closure of two stores in 2010 and a decrease in same store sales of 6.7%. The decrease in same store sales is mainly attributable to increased competition and discounting at our Georgia, Texas and Utah locations, offset by increases in same store sales at our Missouri locations.
- Store operating expenses decreased $266,350 or 8.6% to $2,825,775 in the six months ended June 30, 2011 compared to $3,092,125 in the same period of 2010. The decrease in store operating expenses was primarily due to the closure of two stores in 2010. Same store operating expenses decreased $133,277 in the six months ended June 30, 2011 compared to the same period of 2010.
- General and administrative expenses decreased $124,585 or 14.1%, during the six months ended June 30, 2011 compared to the same period of 2010.
- The Company incurred a net loss of $236,419 or ($0.01) per basic and diluted share in the six months ended June 30, 2011 compared to net loss of $154,964 or ($0.02) per basic and diluted share in the same period of 2010.
Richard A. Parlontieri, President and Chief Executive Officer of Speedemissions commented:
"While we're disappointed in the same store sales for the quarter, we are encouraged by the increase we've seen in St. Louis with store over store sales. This is a most promising sign given that three of the stores have been open for 3+ years. As a means to combat the increased competition in both Atlanta and Salt Lake, we've added two part-time Marketing Representatives. Their task is to expand our government, corporate and fleet dealer business. There's already been improvement in the Atlanta market because of these efforts.
"With respect to CARbonga (our iPhone, iPad & iPod Touch app), we recently began implementation of a viral marketing program to increase brand awareness and sales, in addition to potentially attracting Strategic Partners."
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.
Speedemissions, Inc. and Subsidiaries | |||||||||||
Consolidated Balance Sheets | |||||||||||
| June 30, | December 31, | ||||||||||
| 2011 | 2010 | ||||||||||
| (unaudited) | |||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash | $ | 180,129 | $ | 261,600 | |||||||
| Note receivable – current portion | 19,500 | 12,000 | |||||||||
| Certificate and merchandise inventory | 79,278 | 77,401 | |||||||||
| Other current assets | 91,654 | 58,819 | |||||||||
| Total current assets | 370,561 | 409,820 | |||||||||
| Note receivable, net of current portion | 92,653 | 89,643 | |||||||||
| Property and equipment, net | 624,814 | 728,016 | |||||||||
| Goodwill | 2,349,066 | 2,349,066 | |||||||||
| Other assets | 105,403 | 105,603 | |||||||||
| Total assets | $ | 3,542,497 | $ | 3,682,148 | |||||||
| Liabilities and Shareholders’ Equity | |||||||||||
| Current liabilities: | |||||||||||
| Line of credit | $ | 60,262 | $ | - | |||||||
| Accounts payable | 192,757 | 182,499 | |||||||||
| Accrued liabilities | 169,470 | 196,829 | |||||||||
| Current portion of capitalized lease obligations | 47,291 | 44,632 | |||||||||
| Current portion of equipment financing obligations | 23,408 | 21,778 | |||||||||
| Current portion - deferred rent | 35,776 | 35,776 | |||||||||
| Total current liabilities | 528,964 | 481,514 | |||||||||
| Capitalized lease obligations, net of current portion | 17,010 | 41,339 | |||||||||
| Equipment financing obligations, net of current portion | 12,653 | 23,788 | |||||||||
| Deferred rent | 125,760 | 159,820 | |||||||||
| Note payable | 55,000 | 55,000 | |||||||||
| Other long term liabilities | 7,350 | 7,350 | |||||||||
| Total liabilities | 746,737 | 768,811 | |||||||||
| 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: | |||||||||||
| Series B convertible preferred stock, $.001 par value, 3,000,000 shares authorized, 63,981 shares issued and outstanding with a liquidation preference of $164,306 at June 30, 2011 and 215,981 shares issued and outstanding with a liquidation preference of $554,642 at December 31, 2010 | 64 | 216 | |||||||||
| Common stock, $.001 par value, 250,000,000 shares authorized, 33,604,466 and 22,789,288 shares issued and outstanding at June 30, 2011 and December 31, 2010, respectively | 33,534 | 22,789 | |||||||||
| Additional paid-in capital | 15,914,849 | 15,806,600 | |||||||||
| Accumulated deficit | (17,732,033 | ) | (17,495,614 | ) | |||||||
| Total shareholders’ deficit | (1,783,586 | ) | (1,666,009 | ) | |||||||
| Total liabilities and shareholders’ deficit | $ | 3,542,497 | $ | 3,682,148 | |||||||
Speedemissions, Inc. and Subsidiaries | ||||||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||||||
(unaudited) | ||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||||||
| Revenue | $ | 2,152,831 | $ | 2,495,734 | $ | 4,263,957 | $ | 4,948,847 | ||||||||||||
| Costs of operations: | ||||||||||||||||||||
| Cost of emission certificates | 480,427 | 567,255 | 950,495 | 1,108,741 | ||||||||||||||||
| Store operating expenses | 1,383,888 | 1,535,403 | 2,825,775 | 3,092,125 | ||||||||||||||||
| General and administrative expenses | 416,718 | 486,361 | 757,039 | 881,624 | ||||||||||||||||
| (Gain) loss on disposal of assets | (39,622 | ) | 4,724 | (40,622 | ) | 9,713 | ||||||||||||||
| Operating loss | (88,580 | ) | (98,009 | ) | (228,730 | ) | (143,356 | ) | ||||||||||||
| Interest income (expense) | ||||||||||||||||||||
| Interest income | 760 | 13 | 1,519 | 628 | ||||||||||||||||
| Interest expense | (4,648 | ) | (5,393 | ) | (9,208 | ) | (12,236 | ) | ||||||||||||
| Interest expense, net | (3,888 | ) | (5,380 | ) | (7,689 | ) | (11,608 | ) | ||||||||||||
| Net loss | $ | (92,468 | ) | $ | (103,389 | ) | $ | (236,419 | ) | $ | (154,964 | ) | ||||||||
| Basic and diluted net loss per share | $ | 0.00 | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) | |||||||||
| Weighted average common shares outstanding, basic and diluted | 31,692,498 | 8,509,834 | 31,660,755 | 7,736,631 | ||||||||||||||||
Speedemissions, Inc. and Subsidiaries | ||||||||||
Consolidated Statements of Cash Flows | ||||||||||
(unaudited) | ||||||||||
| Six Months Ended June 30, | ||||||||||
| 2011 | 2010 | |||||||||
| Cash flows from operating activities: | ||||||||||
| Net loss | $ | (236,419 | ) | $ | (154,964 | ) | ||||
| Adjustments to reconcile net loss to net cash from operating activities: | ||||||||||
| Depreciation and amortization | 107,830 | 142,666 | ||||||||
| (Gain) loss on disposal of assets | (40,622 | ) | 9,713 | |||||||
| Share-based compensation | 54,842 | 25,014 | ||||||||
| Changes in operating assets and liabilities: | ||||||||||
| Certificate and merchandise inventory | (1,877 | ) | 10,994 | |||||||
| Other current assets | (32,835 | ) | (39,888 | ) | ||||||
| Other assets | 200 | (1,800 | ) | |||||||
| Accounts payable and accrued liabilities | (17,101 | ) | 101,292 | |||||||
| Other liabilities | (35,570 | ) | (20,514 | ) | ||||||
| Net cash (used in) provided by operating activities | (201,552 | ) | 72,513 | |||||||
| Cash flows from investing activities: | ||||||||||
| Proceeds from note receivable | 6,000 | - | ||||||||
| Proceeds from sales of property and equipment | 28,000 | 20,000 | ||||||||
| Purchases of property and equipment | (7,006 | ) | (33,961 | ) | ||||||
| Net cash used in investing activities | 26,994 | (13,961 | ) | |||||||
| Cash flows from financing activities: | ||||||||||
| Net proceeds from warrant exercise | 64,000 | - | ||||||||
| Net proceeds from line of credit | 60,262 | - | ||||||||
| Payments on equipment financing obligations | (9,505 | ) | (9,919 | ) | ||||||
| Payments on capitalized leases | (21,670 | ) | (34,468 | ) | ||||||
| Net cash provided by (used in) financing activities | 93,087 | (44,387 | ) | |||||||
| Net (decrease) increase in cash | (81,471 | ) | 14,165 | |||||||
| Cash at beginning of period | 261,600 | 449,203 | ||||||||
| Cash at end of period | $ | 180,129 | $ | 463,368 | ||||||
| Supplemental Information: | ||||||||||
| Cash paid during the period for interest | $ | 8,953 | $ | 12,236 | ||||||
| Supplemental Disclosure of Non-Cash Activity: | ||||||||||
| Note receivable from disposal of assets | $ | 15,000 | $ | - | ||||||
Michael Shanahan, 770-306-7667
Chief Financial Officer