NEW YORK, May 30, 2017 (GLOBE NEWSWIRE) -- Data Storage Corporation (OTC:DTST) today announced financial results for its Fiscal 2017 first quarter ended March 31, 2017.
Chuck Piluso, Chief Executive Officer of Data Storage Corporation, stated, "We continue to make significant progress towards executing on our strategic business plan, and we are pleased with the developments throughout the first quarter and to date. Our accomplishments include successfully completing the acquisition and assimilation of ABC Services and integrating finance, administration, sales and operations. The team continues to implement marketing strategies to expand our sales efforts with current clients and targeting new customers in specific markets.”
Select Financial Results for the First Fiscal Quarter Ended March 31, 2017:
- Net sales for the three months ended March 31, 2017 increased 136% to $2,323,915, compared to $984,620 for the three months ended March 31, 2016.
- Net profit for the three months ended March 31, 2017 was $368,922, as compared to net loss of $144,813 for the three months ended March 31, 2016.
Mr. Piluso continued, “The acquisition of the assets of ABC Services, Inc. and ABC Services II, Inc. and the remaining 50% of Secure Infrastructure and Services LLC accelerated our strategy into managed services, expanded cyber security solutions and our hybrid cloud solutions with the ability to provide equipment and expanded technical support. We have a seasoned management team that’s highly focused on execution.”
About Data Storage Corporation
Data Storage Corporation focuses on cyber security, cloud and compliance. Solutions include: Infrastructure as a Service, Disaster Recovery as a Service, Cyber Security and Email Compliance and Analytics. Our mission: Protecting our client’s data, ensuring business continuity, assisting in their compliance requirements while providing better control over their digital information.
The Company sells their services through direct sales and distributors. DSC owns intellectual property with our proprietary email compliance and data analytics software, Message Logic. We provide Recovery Cloud solutions and Infrastructure as a Service with our IBM Power Cloud. Our distributors, typically Managed Service Providers, have a lower barrier of entry in providing DSC’s solutions to their client base.
DSC is a 16-year veteran in cloud storage and cloud computing.
Forward-Looking Statements
This release may contain "forward-looking statements" that are within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified by certain words or phrases such as "may", "will", "aim", "will likely result", "believe", "expect", "will continue", "anticipate", "estimate", "intend", "plan", "contemplate", "seek to", "future", "objective", "goal", "project", "should", "will pursue" and similar expressions or variations of such expressions. These forward-looking statements reflect the Company's current expectations about its future plans and performance. These forward-looking statements rely on a number of assumptions and estimates which could be inaccurate and which are subject to risks and uncertainties. Actual results could vary materially from those anticipated or expressed in any forward-looking statement made by the Company. Please refer to the Company's most recent Forms 10-Q and 10-K and subsequent filings with the SEC for a further discussion of these risks and uncertainties. The Company disclaims any obligation or intent to update the forward-looking statements in order to reflect events or circumstances after the date of this release.
FINANCIAL TABLES FOLLOW
Additional information may be found in the Company's Quarterly Report on Form 10-Q that has been filed with the U.S. Securities and Exchange Commission ("SEC"). The Form 10-Q may be accessed at www.sec.gov or at the Company's website in the Investor Relations section.
| DATA STORAGE CORPORATION AND SUBSIDIARY | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| March 31, | December 31, | |||||||
| 2017 | 2016 | |||||||
| (UNAUDITED) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 150,322 | $ | 255,817 | ||||
| Accounts receivable (less allowance for doubtful accounts of $90,000 in 2017 and $90,000 in 2016) | 954,827 | 807,515 | ||||||
| Prepaid expenses and other current assets | 224,747 | 231,432 | ||||||
| Total Current Assets | 1,329,896 | 1,294,764 | ||||||
| Property and Equipment: | ||||||||
| Property and equipment | 5,148,347 | 3,401,251 | ||||||
| Less—Accumulated depreciation | (3,309,746 | ) | (3,222,591 | ) | ||||
| Net Property and Equipment | 1,838,601 | 178,660 | ||||||
| Other Assets: | ||||||||
| Goodwill | 3,985,700 | 3,985,700 | ||||||
| Other assets | 50,903 | 54,504 | ||||||
| Intangible assets, net | 320,750 | 329,242 | ||||||
| Total Other Assets | 4,357,353 | 4,369,446 | ||||||
| Total Assets | 7,525,850 | 5,842,870 | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | 1,246,011 | 1,219,247 | ||||||
| Revolving credit facility | - | 50,412 | ||||||
| Accounts payable from acquisition | - | 374,762 | ||||||
| Dividend payable | 647,346 | 619,138 | ||||||
| Deferred revenue | 761,730 | 919,103 | ||||||
| Leases payable – related party | 614,292 | 254,078 | ||||||
| Note payable – bank | 350,000 | 350,000 | ||||||
| Total Current Liabilities | 3,619,379 | 3,786,740 | ||||||
| Deferred rental obligation | 1,796 | 1,904 | ||||||
| Note Payable – related party | 416.435 | 190,000 | ||||||
| Leases payable long-term – related party | 1,414,024 | 133,825 | ||||||
| Total Long Term Liabilities | 1,832,255 | 325,729 | ||||||
| Total Liabilities | 5,451,634 | 4,112,469 | ||||||
| Stockholders’ Deficit: Preferred Stock, $.001 par value; 10,000,000 shares authorized; 1,401,786 shares issued and outstanding in each period | 1,402 | 1,402 | ||||||
| Common stock, par value $0.001; 250,000,000 shares authorized; 128,039,418 shares Issued and outstanding in each period | 128,039 | 128,039 | ||||||
| Additional paid in capital | 17,197,485 | 17,194,383 | ||||||
| Accumulated deficit | (15,252,710 | ) | (15,593,423 | ) | ||||
| Total Stockholders’ (Deficit) Equity | 2,074,216 | 1,730,401 | ||||||
| Total Liabilities and Stockholders’ (Deficit) | $ | 7,525,850 | $ | 5,842,870 | ||||
| DATA STORAGE CORPORATION AND SUBSIDIARY | ||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
| (Unaudited) | ||||||||
| Three months Ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| Sales | $ | 2,323,915 | $ | 984,620 | ||||
| Cost of sales | 1,324,058 | 616,316 | ||||||
| Gross Profit | 999,857 | 368,304 | ||||||
| Selling, general and administrative | 605,066 | 438,110 | ||||||
| Income (Loss) from Operations | 394,791 | (69,806 | ) | |||||
| Other Income (Expense) | ||||||||
| Interest income | 19 | — | ||||||
| Bad Debt Recovery | 1,542 | 1,508 | ||||||
| Net income (loss) in equity method investment | — | (9,087 | ) | |||||
| Interest expense | (27,430 | ) | (67,428 | ) | ||||
| Total Other Income (Expense) | (25,869 | ) | (75,007 | ) | ||||
| Income (loss) before provision for income taxes | 368,922 | (144,813 | ) | |||||
| Provision for income taxes | — | — | ||||||
| Net Income (loss) | 368,922 | (144,813 | ) | |||||
| Preferred Stock Dividend | (28,208 | ) | (25,534 | ) | ||||
| Net Income (loss) Attributable to Common Shareholders | $ | 340,714 | $ | (170,347 | ) | |||
| Income (loss) per Share – Basic and Diluted | $ | (0.00 | ) | $ | (0.00 | ) | ||
| Weighted Average Number of Shares - Basic and Diluted | 128,039,418 | 36,588,240 | ||||||
| DATA STORAGE CORPORATION AND SUBSIDIARY | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (UNAUDITED) | ||||||||
| Three Months Ended March 31, | ||||||||
| 2017 | 2016 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net Income (loss) | $ | 368,922 | $ | (144,813 | ) | |||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | 95,646 | 71,366 | ||||||
| Net (gain) loss on equity method investment | — | 9,087 | ||||||
| Non-cash interest expense | — | 52,299 | ||||||
| Stock based compensation | 3,102 | 12,140 | ||||||
| Changes in Assets and Liabilities: | ||||||||
| Accounts receivable | (147,312 | ) | 14,621 | |||||
| Other assets | 3,600 | (2,100 | ) | |||||
| Prepaid expenses and other current assets | 6,686 | 5,955 | ||||||
| Accounts payable and accrued expenses | (100,978 | ) | 96,808 | |||||
| Deferred revenue | (157,373 | ) | (43,455 | ) | ||||
| Deferred rent | (108 | ) | 163 | |||||
| Net Cash Provided by Operating Activities | 72,185 | 72,071 | ||||||
| Cash Flows from Financing Activities: | ||||||||
| Repayment of loan obligations | (70,997 | ) | — | |||||
| Repayments of capital lease obligations | (106,683 | ) | (59,176 | ) | ||||
| Net Cash Used in Financing Activities | (177,680 | ) | (59,176 | ) | ||||
| Increase (Decrease) in Cash and Cash Equivalents | (105,495 | ) | 12,895 | |||||
| Cash and Cash Equivalents, Beginning of Period | 255,817 | 67,045 | ||||||
| Cash and Cash Equivalents, End of Period | $ | 150,322 | $ | 79,940 | ||||
| Cash paid for interest | $ | 27,430 | $ | 15,131 | ||||
| Cash paid for income taxes | $ | — | $ | — | ||||
| Non cash investing and financing activities: | ||||||||
| Accrual of preferred stock dividend | $ | 28,208 | $ | 25,234 | ||||
| Assets acquired by capital lease | $ | 1,747,096 | $ | — | ||||