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ID Watchdog Announces First Quarter 2015 Results
[May 21, 2015]

ID Watchdog Announces First Quarter 2015 Results


DENVER, May 21, 2015 /PRNewswire/ --

  • Employee Benefit Revenue increased 138.4%
  • Total revenues increased 60.6%
  • Gross profit increased 70.2%
  • Adjusted EBITDA of $162,288

ID Watchdog, Inc. (TSX VENTURE: IDW) (PINKSHEETS: IDWAF) ("ID Watchdog" or the "Company"), provider of consumer-facing identity theft protection and resolution services, today announced its results for the first quarter ended March 31, 2015. All amounts are in U.S. dollars.

1st Quarter 2015 Highlights:

  • Revenue: Revenue totaled $1,269,686 for the first quarter of 2015, an increase of $479,059, or 60.6%, from the first quarter of 2014. Revenue from our Employee Benefit Channel increased $512,449, or 138.4%, from $370,305 for the quarter ended March 31, 2014 to $882,754 for the quarter ended March 31, 2015. Total revenue increased by $479,059, or 60.6%, from $790,627 in the first quarter of 2014 to $1,269,686 in the first quarter of 2015.
  • Gross Profit: Gross profit increased by $380,240, or 70.2%, from $541,797 during the first quarter of 2014 to $922,037 during the first quarter of 2015. Gross profit as a percent of revenue for the first quarter of 2014 and 2015 was 68.5% and 72.6%, respectively.
  • Adjusted EBITDA: For the first quarter of 2015, Adjusted EBITDA improved by $103,545 to $162,288, or 12.8% of revenue, as compared with $58,743, or 7.4% of revenue, for the similar period in 2014.
  • Cash Balances: Cash and cash equivalents as of March 31, 2015, totaled $933,054.

ID Watchdog CEO, Michael Greene, stated, "I am thrilled with our first quarter Employee Benefit Channel growth as we added a number of significant brand name employers to our roster of clients, which drove our Employee Benefit Channel revenue growth for the quarter by 138.4% and total revenue growth by 60.6%.  We also delivered nicely improved gross margins and Adjusted EBITDA margins of 72.6% and 12.8%, respectively."  Mr. Greene continued, "In early January we expanded our call center hours to 24 x 7 to further improve our customer experience and we are planning to introduce new product enhancements to our identity theft protection services during 2015."

 





ID Watchdog, Inc.

Unaudited Consolidated Condensed Statements of Operations




Three Months Ended  March 31,




2015


2014

Revenue


$      1,269,686


$         790,627

Cost of revenue


347,649


248,830

Gross profit


922,037


541,797

Operating expense:





     General and administrative expense


331,226


340,857

     Sales and marketing expense


428,523


142,197

     Share-based compensation expense


14,293


59,779

     Depreciation and amortization expense


10,212


18,230



784,254


561,063

Operating income (loss)


137,783


(19,266)

Other income (expense):





     Gain on warrant liability


199,659


199,658


     Interest expense, net


(232,506)


(216,456)




(32,847)


(16,798)

Net income (loss) and comprehensive income (loss) applicable to ordinary shares


$         104,936


$         (36,064)

Basic and diluted net income (loss) per share applicable to ordinary shares


$                   *


$                    *

Weighted average number of shares outstanding - basic and diluted


121,834,997


121,834,997


* Per share income (loss) is less than $0.01 and $(0.01), respectively


      

Reconciliation of Net Income (Loss) to Adjusted EBITDA



Three Months Ended March 31,



2015


2014


Net income (loss)

$         104,936


$      (36,064)

Depreciation and amortization expense

10,212


18,230


Interest expense, net

232,506


216,456


EBITDA

347,654


198,622

Gain on warrant liability

(199,659)


(199,658)


Share-based compensation expense

14,293


59,779


Adjusted EBITDA

$         162,288


$         58,743


       


ID Watchdog, Inc.

Unaudited Consolidated Statements of Financial Position




March 31,
2015



December 31,
2014



ASSETS










Cash and cash equivalents


$

933,054



$

886,476



Accounts receivable, net



285,780




168,602



Prepaid expenses and other



117,769




123,617




Total current assets



1,336,603




1,178,695



Property and equipment, net



74,034




79,879



Customer agreements, net



20,807




22,482





Total Assets


$

1,431,444



$

1,281,056















LIABILITIES










Accounts payable, accrued liabilities and other


$

1,034,854



$

977,657



Current portion of credit facility



121,597




84,422



Deferred revenue



439,430




439,794




Total current liabilities



1,595,881




1,501,873



Credit facility, net



54,786




99,500



Deferred rent



33,970




28,440



Finance lease obligation, net of current portion



10,574




14,876



Series C Preferred mandatorily redeemable preferred shares, net of discount and conversion feature



4,514,691




4,334,395



Warrants liability



199,659




399,318





Total Liabilities



6,409,561




6,378,402





Total Shareholders' Deficit



(4,978,117)




(5,097,346)



TOTAL LIABILITIES AND
SHAREHOLDERS' DEFICIT


$

1,431,444



$

1,281,056



 

About Non-IFRS Financial Measure

To supplement the Company's consolidated financial results presented in accordance with International Financial Reporting Standards ("IFRS"), the Company reports adjusted EBITDA (net income (loss) before deducting net interest expense, income tax expense, depreciation and amortization, share-based compensation, and gain (loss) on warrant liability) and uses this metric to measure the performance of our business.  Adjusted EBITDA is not a performance measure defined under IFRS and is not considered an alternative to income (loss) from operations or net earnings (loss) in the context of measuring the Company's performance.  Adjusted EBITDA does not have a standardized meaning and is therefore not likely to be comparable with similar measures used by other publically traded companies.  Adjusted EBITDA should not be used as an exclusive measure of cash flow since it does not account for the impact of working capital changes, income taxes, interest payments, capital expenditures, debt principal reductions and other sources and uses of cash, and is not meant to be considered in isolation or as a substitute for financial information prepared in accordance with IFRS.

Financial information contained in this press release should be read in conjunction with the consolidated financial statements and notes thereto included in our most recent quarterly reports and our annual report. These documents are available online at www.sedar.com and in the "Company Overview" section of our website at www.IDWatchdog.com.

About ID Watchdog, Inc.

ID Watchdog was founded in 2005 and is headquartered in Denver, Colorado. The Company provides three-tiered comprehensive monitoring, detection and resolution for identity theft. ID Watchdog proactively detects identity theft problems at their source and provides immediate resolution services to ensure complete peace of mind for individuals. All the Company's services have been developed with input from industry experts; national consumer advocacy groups; federal, state, and local law enforcement agencies; consumer protection agencies; and adhere to guidelines published by the Consumer Federation of America. For more information, please visit www.IDWatchdog.com.

Forward-Looking Statement

This news release includes certain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 which address future events and conditions which are subject to various risks and uncertainties. The actual results could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. Although the Company believes that its expectations reflected in these forward-looking statements are reasonable, no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed in the company's filings with Canadian regulators at www.sedar.com. ID Watchdog assumes no obligation to update the forward-looking statements of management beliefs, opinions, projections, or other factors should they change.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Company Contact:
Jay B. Lewis
Chief Financial Officer
ID Watchdog, Inc.
303-339-8099
[email protected] 
www.idwatchdog.com

ID Watchdog, Inc. logo

Logo - http://photos.prnewswire.com/prnh/20130829/NY71341LOGO

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/id-watchdog-announces-first-quarter-2015-results-300087605.html

SOURCE ID Watchdog, Inc.


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