Speedemissions Reports Year End 2007 Results
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ATLANTA, April 3, 2008 -- Speedemissions, Inc. (OTC Bulletin Board: SPMI), a leading vehicle emissions testing and safety inspections company with 49 testing stores in Atlanta, Houston, Salt Lake City and St. Louis today announced its results for the year ended December 31, 2007.
For the year ended December 31, 2007, the Company reported revenue of $9.7 million up from $9.5 million in the prior year. Revenue from same stores sales increased 3%. The Company incurred net loss of $264,232, or ($0.07) per basic and diluted share compared to a net loss of $1.3 million, or ($0.46) per basic and diluted share in the year ended December 31, 2006.
Cost of emissions certificates totaled $2.3 million compared to $2.4 million in 2006. Store operating expenses totaled $5.8 million compared to $5.8 million in 2006. For the year ended December 31, 2007, general and administrative expenses were $1.8 million compared to $1.6 million in 2006. General and administrative expenses increased mainly as a result of Sarbanes-Oxley compliance costs and additional SEC filings.
Richard A. Parlontieri, President/CEO of Speedemissions stated:
"I am pleased to report we have generated our second consecutive year of positive operating cash flows with our cash provided operations growing to $562,000, up from $324,000 in the prior year. We also experienced a 3% increase in same store sales while reducing our same store operating expenses by 4%."
Parlontieri concluded:
"During the fourth quarter of 2007, we began our expansion into the Dallas and St. Louis emissions testing and safety inspection markets. We have added a total 14 new locations in Houston, Dallas and St. Louis since September 30, 2007 and we are excited about the opportunity these markets present for us. The investment in new stores is expected to add additional revenue to the company. However, until the new stores achieve the test volume necessary to cover the initial capital expenditures and expenses of operating these stores, we may operate at a loss and our cash on hand may decrease."
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, Dallas, Houston, Salt Lake City and St. Louis 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
as of December 31,
2007 2006
Assets
Current assets:
Cash $804,662 $320,231
Other current assets 226,051 224,930
Total current assets 1,030,713 545,161
Property and equipment, at cost
less accumulated depreciation
and amortization 1,484,229 1,229,329
Goodwill 7,100,572 7,100,572
Other assets 103,787 59,926
Total assets $9,719,301 $8,934,988
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $495,503 $318,297
Accrued liabilities 522,385 341,621
Debt payable - 111,747
Current portion of capitalized lease
obligations 32,325 12,925
Current portion of equipment financing
obligations 14,207 -
Current portion - deferred rent 13,628 23,956
Total current liabilities 1,078,048 808,546
Capitalized lease obligations 155,961 22,199
Equipment financing obligations 80,792 -
Deferred rent 243,948 235,519
Other long term liabilities 7,350 6,100
Total liabilities 1,566,099 1,072,364
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' equity:
Series B convertible preferred stock,
$.001 par value, 3,000,000 shares
authorized, 2,481,482 shares issued and
outstanding; liquidation
preference: $6,372,446 2,481 2,481
Common stock, $.001 par value,
250,000,000 shares authorized,
5,162,108 and 2,963,528 shares
issued and outstanding in 2007 and 2006,
respectively 5,162 2,964
Additional paid-in capital 15,596,105 15,043,493
Accumulated deficit (12,029,892) (11,765,660)
Total shareholders' equity 3,573,856 3,283,278
Total liabilities and shareholders'
equity $9,719,301 $8,934,988
Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Operations for the Years Ended December 31,
2007 2006
Revenue $9,662,245 $9,480,097
Costs of operations:
Cost of emission certificates 2,314,621 2,401,461
Store operating expenses 5,762,290 5,788,657
General and administrative expenses 1,832,008 1,601,505
(Gain) loss from disposal of
non-strategic assets 11,735 -61,449
Goodwill and related asset impairment expense - 1,071,007
Loss from operations (258,409) (1,321,084)
Other income (expense)
Other income 5,994 -
Interest expense (11,817) (11,122)
Other income (expense), net (5,823) (11,122)
Net loss attributable to common
shareholders ($264,232) ($1,332,206)
Basic and diluted net loss per share ($0.07) ($0.46)
Weighted average common shares
outstanding, basic and diluted 3,583,774 2,880,216
Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Shareholders' Equity (Deficiency)
For the Years Ended December 31, 2007 and 2006
Preferred Stock - Series B Common Stock
Shares Amount Shares Amount
Balance at
January 1, 2006 2,500,000 $2,500 2,683,581 $2,684
Common stock issued
for services - - 68,517 68
Conversion of
Series B
Preferred Stock (18,518) (19) 140,000 140
Compensation due to
stock option grants - - - -
Compensation due to
stock warrants
issued - - - -
Common stock issued
for business
acquisition - - 71,430 72
Net loss - - - -
Balance at
December 31,
2006 2,481,482 2,481 2,963,528 2,964
Compensation due
to stock option
grants - - - -
Common stock issued
for private
placement - - 2,127,150 2,127
Common stock issued
for business
acquisition - - 71,430 71
Net loss - - - -
Balance at
December 31,
2007 2,481,482 $2,481 5,162,108 $5,162
Additional Accumulated
Paid-In-Capital Deficit Total
Balance at
January 1, 2006 $14,658,175 $(10,433,454) $4,229,905
Common stock issued
for services 68,432 - 68,500
Conversion of Series
B Preferred Stock (121) - -
Compensation due to
stock option grants 156,927 - 156,927
Compensation due to stock
warrants issued 60,152 - 60,152
Common stock issued
for business acquisition 99,928 - 100,000
Net loss - (1,332,206) (1,332,206)
Balance at
December 31, 2006 15,043,493 (11,765,660) 3,283,278
Compensation due
to stock option grants 135,738 - 135,738
Common stock issued
for private placement 316,945 - 319,072
Common stock issued
for business acquisition 99,929 - 100,000
Net loss - (264,232) (264,232)
Balance at
December 31, 2007 $15,596,105 $(12,029,892) $3,573,856
Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
For the Years Ended December 31,
2007 2006
Operating activities:
Net loss $(264,232) $(1,332,206)
Adjustments to reconcile
net loss to net cash provided
by operating activities:
Depreciation and amortization 263,603 388,799
Goodwill and related asset
impairment expense - 1,071,007
(Gain) loss from disposal of
non-strategic assets 11,735 (61,449)
Share based compensation expenses 135,738 217,079
Stock issued for services - 68,500
Changes in operating assets
and liabilities, net
of acquisitions:
Other current assets (1,121) (25,084)
Other assets (43,861) (18,725)
Accounts payable and
accrued liabilities 460,753 (122,925)
Other liabilities (649) 138,823
Net cash provided by
operating activities 561,966 323,819
Cash flows from investing activities:
Acquisition of businesses - (100,000)
Proceeds from asset sales 211,094 14,854
Purchases of property and equipment (479,284) (196,343)
Net cash (used in) investing activities (268,190) (281,489)
Cash flows from financing activities:
Proceeds from sale of common stock 319,072 -
Proceeds from bank loan 60,000
Payments on debt (111,747) -
Payments on capitalized leases (16,670) (32,326)
Net cash provided by
financing activities 190,655 27,674
Net increase in cash 484,431 70,004
Cash at beginning of period 320,231 250,227
Cash at end of period $804,662 $320,231
Supplemental Information:
Cash paid during the year for interest $10,732 $5,949
Non-cash Investing and Financing activities:
Equity securities issued in
connection with acquisition of Just, Inc. $100,000 $100,000
Non-cash asset additions for
financed and capital leases $264,831 $44,148