[August 14, 2014] |
|
InsPro Technologies Corporation Announces Second Quarter 2014 Financial Results
RADNOR, Pa. --(Business Wire)--
InsPro Technologies Corporation (OTC Bulletin Board: ITCC), a
leading provider of core policy administration software for Group and
Individual Life, Health, and Annuity products that enables insurance
carriers and third-party administrators to quickly respond to evolving
market needs, improve customer service, and reduce operating costs today
announced its financial results for the quarter ended June 30, 2014.
Second Quarter 2014 Highlights
-
Revenues were $4,267,656 in the second quarter of 2014 as compared to
$4,296,755 in the second quarter of 2013. In the second quarter of
2013 we recognized $1,275,000 of license fees upon the completion of
the implementation of InsPro Enterprise™ for two clients. The decline
in license fees was virtually offset by increased professional
services, ASP/Hosting and maintenance revenues in the second quarter
of 2014 as compared to the same period in 2013.
-
Operating loss from continuing operations was $2,547,644 in the second
quarter of 2014 as compared to a loss of $26,839 in the second quarter
of 2013. The results from operations in the second quarter of 2014
were unfavorably impacted by a one-time, non-cash equity compensation
expense of $1,664,400 while the second quarter of 2013 was favorably
impacted by $1,275,000 of license fees.
-
Net loss was $2,487,141 in the second quarter of 2014 as compared to a
net loss of $37,439 in the second quarter of 2013 due primarily to the
stock-based compensation charge and the reduced license fees.
First Half 2014 Highlights
-
Revenues were $7,844,255 in the first half of 2014 as compared to
$8,889,578 in the first half of 2013. In the first half of 2013, we
recognized $2,475,000 of license fees upon the completion of the
implementation of InsPro Enterprise™ for three clients. The decline in
license fees was partially offset by increased professional services,
ASP/Hosting and maintenance revenues in the first half of 2014 as
compared to the same period in 2013.
-
Operating loss from continuing operations was $3,112,359 in the first
half of 2014 as compared to a loss of $91,630 in the first half of
2013. The results from operations in the first half of 2014 were
unfavorably impacted by a one-time, non-cash equity compensation
expense of $1,664,400, and the first half of 2013 was favorably
impacted by $2,475,000 of license fees.
-
Net loss was $2,988,900 in the first half of 2014 as compared to a net
loss of $275,931 in the first half of 2013. The net loss in the first
half of 2014 included a non-cash gain on the change of the fair value
of warrant liability of $10,120 and one-time stock-based compensation
while the same period in 2013 included a non-cash loss of $382,199 on
the change in the fair value of the warrant liability and license fees
of $2,475,000.
Anthony R. Verdi, Chief Executive Officer, stated, "We generated
significant growth in our professional services and other recurring
revenue streams in the first half of the year, the result of our
expanding portfolio of clients. Even more promising, though, is the
increased strength of our sales pipeline. The considerable investments
we made in the InsPro Enterprise™ technology has both broadened our
addressable market and raised market interest in our system and
services. We remain optimistic about our future opportunities."
About InsPro Enterprise
InsPro Enterprise, a Life and Health insurance policy
administration system, is a single technology solution used to manage
all insurance processing requirements supporting multiple product lines
as well as hybrid products for both group and individual policies on a
single web-based platform. The InsPro Enterprise design provides
carriers the option to deploy the solution as an end-to-end straight
through processing suite or on a modular, componentized basis to address
immediate areas of concern. The InsPro Enterprise suite includes
Product Configuration Workbench, New Business and Underwriting, Billing
and Collections, Policy Administration, Agent Management and
Commissions, Claims, Document Management, Web Portals, and Data
Analytics components.
About InsPro Technologies Corporation
Through its subsidiary, InsPro Technologies, LLC, InsPro Technologies
Corporation offers InsPro Enterprise, an end-to-end, web-based
policy administration system used by insurance carriers and third-party
administrators. By managing the entire product and policy lifecycle on a
single integrated platform, customers are afforded opportunities to
accelerate new product introductions, lower costs, increase customer
satisfaction and improve operational performance. InsPro's solutions are
offered through standard software licensing, as a hosted solution, or
via Software as a Service (SaaS (News - Alert)) delivery.
For additional information on InsPro Technologies, LLC and InsPro
Enterprise please visit www.inspro.com.
Forward-Looking Statements
In addition to historical facts or statements of current condition, this
press release contains forward-looking statements within the meaning of
the "Safe Harbor" provisions of The Private Securities Litigation Reform
Act of 1995, including statements regarding current and future
capabilities and products supported, growth in the number of clients,
quality and growth potential of our technology platform, including
related services, and providing the financial support and other
resources needed to demonstrate the strength of this growing technology
business and to continue to reinvest in the product. Forward-looking
statements provide InsPro Technologies Corporation's current
expectations or forecasts of future events. Moreover, InsPro
Technologies Corporation cautions readers that forward-looking
statements are subject to certain risks and uncertainties, which could
cause actual results to differ materially from the statements made,
including risks described in InsPro Technologies' most recent Quarterly
Reports on Form 10-Q or Annual Reports on Form 10-K filed with the
Securities and Exchange Commission and available on the Securities and
Exchange Commission's website at www.sec.gov.
InsPro Technologies Corporation does not undertake any obligation to
update any forward-looking statement to conform the statement to actual
results or changes in expectations.
|
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INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended June 30,
|
|
For the Six Months Ended June 30
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
4,267,656
|
|
|
$
|
4,296,755
|
|
|
$
|
7,844,255
|
|
|
$
|
8,889,578
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues
|
|
|
3,614,767
|
|
|
|
3,054,759
|
|
|
|
6,567,200
|
|
|
|
6,427,135
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
652,889
|
|
|
|
1,241,996
|
|
|
|
1,277,055
|
|
|
|
2,462,443
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses:
|
|
|
|
|
|
|
|
Compensation, employee benefits and related taxes
|
|
|
2,385,650
|
|
|
|
671,391
|
|
|
|
3,043,145
|
|
|
|
1,323,355
|
|
Advertising and other marketing
|
|
|
91,319
|
|
|
|
93,898
|
|
|
|
143,248
|
|
|
|
150,070
|
|
Depreciation
|
|
|
42,139
|
|
|
|
39,262
|
|
|
|
78,854
|
|
|
|
77,475
|
|
Rent, utilities, telephone and communications
|
|
|
103,427
|
|
|
|
98,969
|
|
|
|
194,089
|
|
|
|
192,390
|
|
Professional fees
|
|
|
366,434
|
|
|
|
174,646
|
|
|
|
537,099
|
|
|
|
441,824
|
|
Other general and administrative
|
|
|
211,564
|
|
|
|
190,669
|
|
|
|
392,979
|
|
|
|
368,959
|
|
|
|
|
|
|
|
|
|
|
Total selling, general and administrative expenses
|
|
|
3,200,533
|
|
|
|
1,268,835
|
|
|
|
4,389,414
|
|
|
|
2,554,073
|
|
|
|
|
|
|
|
|
|
|
Operating loss from continuing operations
|
|
|
(2,547,644
|
)
|
|
|
(26,839
|
)
|
|
|
(3,112,359
|
)
|
|
|
(91,630
|
)
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
Gain (loss) on the change of the fair value of warrant liability
|
|
|
10,120
|
|
|
|
(102,400
|
)
|
|
|
10,120
|
|
|
|
(382,199
|
)
|
Interest expense
|
|
|
(11,234
|
)
|
|
|
(9,206
|
)
|
|
|
(18,678
|
)
|
|
|
(16,861
|
)
|
|
|
|
|
|
|
|
|
|
Total other income (expense)
|
|
|
(1,114
|
)
|
|
|
(111,606
|
)
|
|
|
(8,558
|
)
|
|
|
(399,060
|
)
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(2,548,758
|
)
|
|
|
(138,445
|
)
|
|
|
(3,120,917
|
)
|
|
|
(490,690
|
)
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations
|
|
|
61,617
|
|
|
|
101,006
|
|
|
|
132,017
|
|
|
|
214,759
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(2,487,141
|
)
|
|
$
|
(37,439
|
)
|
|
$
|
(2,988,900
|
)
|
|
$
|
(275,931
|
)
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share - basic and diluted:
|
|
|
|
|
|
|
Loss from operations
|
|
$
|
(0.06
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.02
|
)
|
Gain from discontinued operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
0.01
|
|
Net loss per common share
|
|
$
|
(0.06
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - basic and diluted
|
|
|
41,543,655
|
|
|
|
41,543,655
|
|
|
|
41,543,655
|
|
|
|
41,543,655
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED BALANCE SHEETS
|
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|
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
Cash
|
|
$
|
2,610,907
|
|
|
$
|
2,569,536
|
|
Accounts receivable, net
|
|
|
2,166,227
|
|
|
|
1,660,564
|
|
Prepaid expenses
|
|
|
384,698
|
|
|
|
200,985
|
|
Other current assets
|
|
|
4,399
|
|
|
|
2,564
|
|
Assets of discontinued operations
|
|
|
22,034
|
|
|
|
31,540
|
|
|
|
|
|
|
Total current assets
|
|
|
5,188,265
|
|
|
|
4,465,189
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
1,114,361
|
|
|
|
959,902
|
|
Other assets
|
|
|
60,000
|
|
|
|
60,000
|
|
|
|
|
|
|
Total assets
|
|
$
|
6,362,626
|
|
|
$
|
5,485,091
|
|
|
|
|
|
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LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
Notes payable
|
|
$
|
612,982
|
|
|
$
|
550,761
|
|
Accounts payable
|
|
|
1,374,231
|
|
|
|
1,169,251
|
|
Accrued expenses
|
|
|
706,693
|
|
|
|
456,753
|
|
Current portion of capital lease obligations
|
|
|
186,542
|
|
|
|
57,932
|
|
Due to related parties
|
|
|
10,000
|
|
|
|
10,000
|
|
Deferred revenue
|
|
|
2,323,805
|
|
|
|
1,006,875
|
|
|
|
|
|
|
Total current liabilities
|
|
|
5,214,253
|
|
|
|
3,251,572
|
|
|
|
|
|
|
LONG TERM LIABILITIES:
|
|
|
|
|
Warrant liability
|
|
|
597,079
|
|
|
|
607,199
|
|
Capital lease obligations
|
|
|
229,137
|
|
|
|
23,184
|
|
|
|
|
|
|
Total long term liabilities
|
|
|
826,216
|
|
|
|
630,383
|
|
|
|
|
|
|
Total liabilities
|
|
|
6,040,469
|
|
|
|
3,881,955
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY:
|
|
|
|
|
Preferred stock ($.001 par value; 20,000,000 shares authorized)
|
|
|
|
|
Series A convertible preferred stock; 3,437,500 shares authorized,
1,276,750 shares issued and outstanding (liquidation value
$12,767,500)
|
|
|
2,864,104
|
|
|
|
2,864,104
|
|
Series B convertible preferred stock; 5,000,000 shares authorized,
3,809,378 shares issued and outstanding (liquidation value
$11,428,134)
|
|
|
7,709,919
|
|
|
|
7,709,919
|
|
Common stock ($.001 par value; 300,000,000 shares authorized,
41,543,655 shares issued and outstanding)
|
|
|
41,543
|
|
|
|
41,543
|
|
Additional paid-in capital
|
|
|
45,119,094
|
|
|
|
43,411,172
|
|
Accumulated deficit
|
|
|
(55,412,503
|
)
|
|
|
(52,423,602
|
)
|
|
|
|
|
|
Total shareholders' equity
|
|
|
322,157
|
|
|
|
1,603,136
|
|
|
|
|
|
|
Total liabilities and shareholders' equity
|
|
$
|
6,362,626
|
|
|
$
|
5,485,091
|
|
|
|
|
|
|
|
|
|
INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
For the Six Months Ended June 30,
|
|
|
2014
|
|
2013
|
Cash Flows From Operating Activities:
|
|
|
|
|
Net loss
|
|
$
|
(2,988,900
|
)
|
|
$
|
(275,931
|
)
|
Adjustments to reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
Depreciation
|
|
|
383,686
|
|
|
|
346,814
|
|
Stock-based compensation
|
|
|
1,707,922
|
|
|
|
37,497
|
|
(Gain) loss on change of fair value of warrant liability
|
|
|
(10,120
|
)
|
|
|
382,199
|
|
Changes in assets and liabilities:
|
|
|
|
|
Accounts receivable
|
|
|
(505,663
|
)
|
|
|
83,663
|
|
Prepaid expenses
|
|
|
(76,633
|
)
|
|
|
(103,276
|
)
|
Other current assets
|
|
|
(1,835
|
)
|
|
|
314
|
|
Accounts payable
|
|
|
204,980
|
|
|
|
(542,325
|
)
|
Accrued expenses
|
|
|
249,940
|
|
|
|
(25,155
|
)
|
Deferred revenue
|
|
|
1,316,930
|
|
|
|
(388,174
|
)
|
Assets of discontinued operations
|
|
|
9,506
|
|
|
|
25,374
|
|
|
|
|
|
|
Net cash provided (used) in operating activities
|
|
|
289,813
|
|
|
|
(459,000
|
)
|
|
|
|
|
|
Cash Flows From Investing Activities:
|
|
|
|
|
Purchase of property and equipment
|
|
|
(129,140
|
)
|
|
|
(86,720
|
)
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
(129,140
|
)
|
|
|
(86,720
|
)
|
|
|
|
|
|
Cash Flows From Financing Activities:
|
|
|
|
|
Gross proceeds from sale of preferred stock and warrants
|
|
|
-
|
|
|
|
36,000
|
|
Fees paid in connection with sale of preferred stock and warrants
|
|
|
-
|
|
|
|
(28,800
|
)
|
Payments on notes payable
|
|
|
(44,859
|
)
|
|
|
(43,981
|
)
|
Payments on capital leases
|
|
|
(74,443
|
)
|
|
|
(34,579
|
)
|
|
|
|
|
|
Net cash used in financing activities
|
|
|
(119,302
|
)
|
|
|
(71,360
|
)
|
|
|
|
|
|
Net increase (decrease) in cash
|
|
|
41,371
|
|
|
|
(617,080
|
)
|
|
|
|
|
|
Cash - beginning of the period
|
|
|
2,569,536
|
|
|
|
3,347,689
|
|
|
|
|
|
|
Cash - end of the period
|
|
$
|
2,610,907
|
|
|
$
|
2,730,609
|
|
|
|
|
|
|
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