ATLANTA, GA--(Marketwire -05/15/12)- Speedemissions, Inc. (OTC.BB: SPMI), a leading vehicle emissions testing and safety inspections company with testing stores in Atlanta, Houston, St. Louis and Salt Lake City today announced its financial results for the first quarter ended March 31, 2012.
Financial and Operational Highlights:
- Revenue decreased 9.0% to $1,921,005 in the first quarter of 2012 compared to $2,111,126 in the comparable period of 2011. The decrease in revenue over the same period was due to the closure of two underperforming stores and a decrease in same store sales of 6.8%. The decrease in same store sales was mainly attributable to revisions in emission testing laws in both Texas and Utah, resulting in an increase in the number of testing competitors.
- Store operating expenses decreased 9.0% or $129,336 to $1,312,551 in the first quarter of 2012 compared to $1,441,887 in the first quarter of 2011. The decrease in store operating expenses was due to the closure of the two stores, a decrease in same store operating expenses of $83K, and a reduction in personnel. General and administrative expenses decreased 12.1% or $41K mainly due to lower service fees and a reduction in corporate staff.
- The Company incurred a net loss of $116,782, or ($0.00) per basic and diluted share in the first quarter of 2012 compared to a net loss of $143,951, or ($0.01) per basic and diluted share in the first quarter of 2011.
Richard A. Parlontieri, President and Chief Executive Officer of Speedemissions added:
"While the first quarter historically is one of our slowest, this year it was impacted even more by the increased level of competition brought about by law changes in both Houston and Salt Lake City. To mitigate the plethora of new competitors, we launched three initiatives. First, operating expenses at both the corporate and store level have been significantly reduced. Concurrent to that, we expect to close additional underperforming stores. Lastly, we have stepped up efforts in the selling of our limited product line (windshield wipers, light bulbs, etc.). We continue to see strong growth in this area despite a decrease in overall tests. And, to bolster same store sales even more, we expect to add other automotive services sometime this year."
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
March 31, December 31,
2012 2011
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(unaudited)
Assets
Current assets:
Cash $ 122,186 $ 129,095
Notes receivable - current portion 12,000 21,125
Certificate and merchandise inventory 70,816 59,822
Other current assets 72,120 59,320
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Total current assets 277,122 269,362
Notes receivable, net of current portion 77,669 79,914
Property and equipment, net 493,141 539,673
Goodwill 1,240,152 1,240,152
Other assets 104,363 104,363
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Total assets $ 2,192,447 $ 2,233,464
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Liabilities and Shareholders' Deficit
Current liabilities:
Line of credit $ 95,000 $ 90,000
Note payable 55,000 55,000
Accounts payable 339,605 220,625
Accrued liabilities 169,424 200,096
Current portion of capitalized lease
obligations 29,351 40,659
Current portion of equipment financing
obligations 18,826 24,780
Current portion - deferred rent 14,796 14,795
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Total current liabilities 722,002 645,955
Capitalized lease obligations, net of current
portion - 681
Deferred rent 121,789 121,390
Other long term liabilities 7,350 7,350
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Total liabilities 851,141 775,376
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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
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Shareholders' deficit:
Common stock, $.001 par value, 250,000,000
shares authorized, 34,688,166 shares issued
and outstanding at March 31, 2012 and
December 31, 2011 34,618 34,618
Additional paid-in capital 15,918,329 15,918,329
Accumulated deficit (19,190,987) (19,074,205)
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Total shareholders' deficit (3,238,040) (3,121,258)
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Total liabilities and shareholders'
deficit $ 2,192,447 $ 2,233,464
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Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Operations
(unaudited)
Three Months Ended March 31,
----------------------------
2012 2011
------------- -------------
Revenue $ 1,921,005 $ 2,111,126
Costs of operations:
Cost of emission certificates 425,747 470,067
Store operating expenses 1,312,551 1,441,887
General and administrative expenses 299,042 340,323
Gain on sale of non-strategic assets (2,458) (1,000)
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Operating loss (113,877) (140,151)
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Interest income (expense)
Interest income 755 759
Interest expense (3,660) (4,559)
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Interest expense, net (2,905) (3,800)
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Net loss $ (116,782) $ (143,951)
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Basic and diluted net loss per share $ (0.00) $ (0.01)
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Weighted average common shares outstanding,
basic and diluted 34,688,166 23,874,568
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Speedemissions, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(unaudited)
Three Months Ended March 31,
----------------------------
2011 2010
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Cash flows from operating activities:
Net loss $ (116,782) $ (143,951)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 45,890 55,801
Gain on sale of assets (2,458) (1,000)
Changes in operating assets and
liabilities:
Certificate and merchandise inventory (10,993) (6,402)
Other current assets (12,800) (14,871)
Accounts payable and accrued
liabilities 88,307 (41,988)
Other liabilities 400 (15,041)
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Net cash used in operating activities (8,436) (167,452)
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Cash flows from investing activities:
Proceeds from note receivable 11,370 2,225
Proceeds from sales of property and
equipment 3,100 1,000
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Net cash provided by investing activities 14,470 3,245
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Cash flows from financing activities:
Net proceeds from line of credit 5,000 70,357
Payments on equipment financing obligations (5,954) (4,162)
Payments on capitalized leases (11,989) (10,678)
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Net cash provided by (used in) financing
activities (12,943) 55,517
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Net decrease in cash (6,909) (108,690)
Cash at beginning of period 129,095 261,600
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Cash at end of period $ 122,186 $ 152,910
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Supplemental Information:
Cash paid during the period for interest $ 3,195 $ 3,980
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Contact
Larry Cobb
Chief Financial Officer
770-306-7667
