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Zoned Properties Reports Full-Year 2018 Financial Results

SCOTTSDALE, Ariz., March 28, 2019 /PRNewswire/ -- Zoned Properties®, Inc. (ZDPY), a strategic real estate development firm whose primary mission is to provide real estate and sustainability services for the regulated cannabis industry, positioning the company for property acquisitions and revenue growth, today announced its financial results for the year ended December 31, 2018.

Full-Year 2018 and Subsequent Financial Results

  • Revenues were $1.2 million, down 41.5% compared to $2.1 million for the year ended December 31, 2017, reflecting the company's transition to a new business model.
  • Operating expenses, including a one-time non-cash write-off of $1.9 million related to deferred rent receivables in the second quarter of 2018, were $3.2 million compared to $1.4 million for the year ended December 31, 2017.
  • Cash provided by operating activities was $360,000 for the year ended December 31, 2018 compared to $54,000 for the year ended December 31, 2017.
  • As of December 31, 2018, the company had cash of $355,000, compared to $824,000 as of December 31, 2017.
  • Completed a 32.3% common stock redemption as consideration for amending agreements with its primary tenant and client in Arizona, providing an immediate return of value to its shareholders. As a result, Zoned Properties now has 11.9 million common shares issued and outstanding.

"We enter 2019 with a clean capital structure and no toxic debt, a rarity among companies in the regulated cannabis industry, and a stable base of triple-net recurring revenue to cover our fixed costs," commented Bryan McLaren, Chief Executive Officer. "With this solid platform, we are moving quickly to address significant and largely unmet needs in the regulated cannabis industry. Operators are realizing that real estate project complexities are one of the most common issues inhibiting development and expansion, and finding appropriate, zoned properties in which to conduct business is increasingly challenging. Zoned Properties has the expertise to address these challenges with practical, proven solutions."

"During 2019, we anticipate adding meaningful revenue from our advisory services division atop existing lease revenue from the regulated cannabis properties already under ownership," added Mr. McLaren. "Zoned Properties has valuable expertise in navigating development issues related to regulated cannabis properties, and a track record in securing municipal approvals to develop large-scale projects. Our plan is to leverage this value to reward shareholders."

About Zoned Properties, Inc. (ZDPY):

Zoned Properties is a strategic real estate development firm whose primary mission is to provide real estate and sustainability services for clients in the regulated cannabis industry, positioning the company for real estate acquisitions and revenue growth. We intend to pioneer sustainable development for emerging industries, including the regulated cannabis industry. We are an accredited member of the Better Business Bureau, the U.S. Green Building Council, and the Forbes Real Estate Council. We focus on investing capital to acquire and develop commercial properties to be leased on a triple-net basis, and engaging clients that face zoning, permitting, development, and operational challenges. We provide development strategies and advisory services that could potentially have a major impact on cash flow and property value. We do not grow, harvest, sell or distribute cannabis or any substances regulated under United States law such as the Controlled Substance Act of 1970, as amended (the "CSA").

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "believe," "expect," "anticipate," "plan," "potential," "continue" or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company's filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company's control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company's current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Tables Follow


ZONED PROPERTIES, INC. AND SUBSIDIARIES

 CONSOLIDATED BALANCE SHEETS











December 31,






2018


2017









 ASSETS





 Cash



$                   354,867


$                  824,240


 Rental properties, net

7,730,087


7,170,322


 Deferred rent receivable - related parties

-


1,708,734


 Note receivable - related party

-


182,365


 Prepaid expenses and other current assets

116,967


127,902


 Property and equipment, net

28,695


35,768


 Security deposits


600


2,890









 Total Assets


$                8,231,216


$             10,052,221









 LIABILITIES AND STOCKHOLDERS' EQUITY












 LIABILITIES:






 Convertible notes payable - related parties

$                2,020,000


$               2,020,000


 Accounts payable 


117,985


8,896


 Accrued expenses


54,636


48,468


 Accrued expenses - related parties

34,800


33,600


 Deferred revenues


2,750


28,750


 Security deposits payable - related parties

71,800


71,800


 Security deposits payable


6,032


5,864









 Total Liabilities


2,308,003


2,217,378









 Commitments and Contingencies












 STOCKHOLDERS' EQUITY:





Preferred stock, $0.001 par value, 5,000,000 shares authorized; 2,000,000 shares issued and outstanding at December 31, 2018 and 2017 ($1.00 per share liquidation preference)  

2,000


2,000


Common stock: $0.001 par value, 100,000,000 shares authorized; 17,441,552 and 17,345,497 issued and outstanding at December 31, 2018 and 2017, respectively

17,442


17,345


Additional paid-in capital

20,746,200


20,630,649


Accumulated deficit


(14,842,429)


(12,815,151)









 Total Stockholders' Equity


5,923,213


7,834,843









 Total Liabilities and Stockholders' Equity


$              8,231,216


$             10,052,221




ZONED PROPERTIES, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF OPERATIONS





 For the Years Ended




 December 31,




2018


2017







 REVENUES:




 Rental revenues

$                   50,155


$                  80,180

 Rental revenues - related parties

1,186,775


2,033,684








 Total revenues

1,236,930


2,113,864







 OPERATING EXPENSES:




 Compensation and benefits

411,682


569,215

 Professional fees

340,134


232,887

 General and administrative expenses

187,361


165,500

 Depreciation and amortization

276,665


225,220

 Property operating expenses

37,919


112,555

 Real estate taxes

91,113


90,821

 Settlement expense

-


20,500

     Write-off of related party receivable

1,853,539


-








 Total operating expenses

3,198,413


1,416,698







 (LOSS) INCOME FROM OPERATIONS

(1,961,483)


697,166







 OTHER (EXPENSES) INCOME:




    Interest expenses

-


(42,983)

    Interest expenses - related parties

(121,200)


(129,288)

    Other income

50,000


831,753

    Gain on sale of property and equipment

-


12,750

    Interest income

5,405


8,504








 Total other (expenses) income, net

(65,795)


680,736







 (LOSS) INCOME BEFORE INCOME TAXES

(2,027,278)


1,377,902







 PROVISION FOR INCOME TAXES

-


-







 NET (LOSS) INCOME

$             (2,027,278)


$             1,377,902







 NET (LOSS) INCOME PER COMMON SHARE:




 Basic


$                      (0.12)


$                      0.07

 Diluted


$                      (0.12)


$                      0.07







 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:




 Basic


17,427,038


17,309,446

 Diluted


17,427,038


17,482,142










ZONED PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS




 For the Years Ended



December 31,



2018


2017

CASH FLOWS FROM OPERATING ACTIVITIES





Net (loss) income

$ (2,027,278)


$   1,377,902


Adjustments to reconcile net (loss) income to net cash provided by operating activities:





Depreciation and amortization expense

276,665


225,220


Stock-based compensation

84,132


223,375


Stock option expense

31,516


14,806


Stock-based settlement expense

-


10,500


Gain from sale of property and equipment

-


(831,753)


Impairment loss

1,853,539


-


Change in operating assets and liabilities:





Rent receivable

-


-


Deferred rent receivable - related parties

(144,805)


(702,563)


Real estate tax escrow

-


39,487


Note receivable

182,365


(182,365)


Prepaid expenses and other assets

10,935


12,108


Security deposits

2,290


5,268


Accounts payable

109,089


(69,415)


Accrued expenses

6,168


(26,406)


Accrued expenses - related parties

1,200


(51,941)


Deferred revenues

(26,000)


24,000


Security deposits payable - related party

-


1,800


Security deposits payable

168


(16,100)






NET CASH PROVIDED BY OPERATING ACTIVITIES

359,984


53,923






CASH FLOWS FROM INVESTING ACTIVITIES





Acquisition of buildings and improvements

(829,357)


(497,309)


Cash received from sale of property and equipment

-


1,984,188


Acquisition of property and equipment

-


(2,586)






NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES

(829,357)


1,484,293






CASH FLOWS FROM FINANCING ACTIVITIES





Proceeds from convertible debt - related parties

-


2,020,000


Repayment of convertible note - related party

-


(500,000)


Repayment of convertible note

-


(500,000)


Repayment of mortgage payable

-


(2,100,000)






NET CASH USED IN FINANCING ACTIVITIES

-


(1,080,000)






NET (DECREASE) INCREASE IN CASH

(469,373)


458,216






CASH, beginning of year

824,240


366,024






CASH, end of year

$      354,867


$      824,240






SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION





Interest paid

$     120,000


$      225,087






SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:





Common stock issued for buildings and improvements

$                  -


$          7,700


Common stock issued for accrued settlement payable

$                  -


$        21,875

 

Cision

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