InfoLogix Announces Fourth Quarter and Full Year 2006 Financial Results
20 March 2007
InfoLogix, Inc. (OTC Bulletin Board: IFLG), a leading provider of mobile enterprise technology solutions for healthcare and commercial organizations, today announced financial results for the quarter and year ended December 31, 2006. For the fourth quarter of 2006, the Company reported total revenue of $16.4 million and a net loss of $2.5 million, or $0.15 per basic and diluted share. For the full year 2006, the Company reported total revenue of $60.8 million and a net loss of $1.9 million, or $0.14 per basic and diluted share.
(Logo: http://www.newscom.com/cgi-bin/prnh/20060209/PHTH052LOGO )
Key Operational Highlights
* Completed a $17 million equity financing to support investment in
business development efforts, sales force expansion and acquisition
strategy;
* Common stock commenced trading on the OTC Bulletin Board on December 8,
2006;
* Formed a nine-person Board of Directors including prominent leaders in
business, professional sports, and mobile technology led by Chairman
Warren V. "Pete" Musser, renowned investor and CEO of The Musser Group;
* Reached significant milestones with over 1,900 customer solutions, 1,100
of which are specialized hospital solutions installed as of December 31,
2006;
* Signed the largest managed services contract in the Company's history;
* Continued to expand the sales of higher value mobile solutions; and
* Expanded sales, marketing and technical staff and infrastructure in
preparation for planned growth of RFID solutions, mobile managed
services, new product introductions and new value added services and
applications.
David Gulian, President and Chief Executive Officer of InfoLogix, stated, "Our net losses for the fourth quarter and full year 2006 were primarily related to transaction costs associated with our reverse merger in November and incremental investments in building our sales team and marketing resources to accommodate our planned growth. With all merger related transaction expenses behind us and the bulk of our sales and marketing investments completed, we will seek to leverage our scalable infrastructure and leadership in mobile healthcare and commercial solutions to capitalize on substantial opportunities in the high-growth healthcare and enterprise workforce automation sectors."
"Our plan for 2007 involves a combination of driving existing sales opportunities and pursuing select acquisitions," Gulian continued. "We are focusing on our channel-partner strategy, and are continuing our business application development to broaden our offerings to existing customers and accelerate our regional market share growth. We now have capital for select acquisitions of service-oriented companies with complementary business application suites and consultative services."
Full Year 2006 Financial Results
Revenue for the year ended December 31, 2006 increased 9.6% to $60.8 million from $55.5 million for the year ended December 31, 2005. The annual revenue increase was primarily attributed to the expansion of the Company's healthcare business as the result of an increase in the Company's field-sales force.
Gross margin increased to 24.6% for the year ended December 31, 2006 compared with 23.2% for the year ended December 31, 2005. The increase in gross margin reflected the increased sales of more profitable mobile workstation hardware, offset by a decrease in the sale of third-party hardware.
Selling, general and administrative expenses totaled $17.9 million for 2006 compared with $11.7 million for 2005. The increase was primarily related to: increases in salary and commission expense related to an increased field- sales force; professional and advisory fees related to the reverse merger; one-time bonuses made to executives as the result of the reverse merger and financing transaction; and $2.8 million recorded as stock-based compensation expense attributable to options and warrants issued to management, employees and advisors.
At December 31, 2006, InfoLogix had cash and cash equivalents totaling $12.9 million, working capital of $13.5 million, long-term debt of $1.3 million, and stockholders' equity of $15.9 million.
Fourth Quarter 2006 Financial Results
Revenue for the fourth quarter ended December 31, 2006 increased 2.0% to $16.4 million from $16.1 million for the fourth quarter of 2005.
Gross margin increased to 22.8% for the fourth quarter of 2006 compared with 21.2% for the fourth quarter of 2005, primarily from a large order for third-party hardware sold in the fourth quarter 2006 carrying a higher average gross margin.
Selling, general and administrative expenses totaled $7.8 million for the fourth quarter of 2006 compared with $3.1 million for the fourth quarter of 2005. These expenses were $4.7 million, or 152.8%, higher in the comparable periods as the result of: recruiting fees associated with an increase in hiring of sales and operations staff; professional and advisory fees related to the reverse merger; one- time bonuses made to executives as the result of the reverse merger and financing transaction; and $2.8 million recorded as stock based compensation expense attributable to options and warrants issued to management, employees and advisors.
Outlook
InfoLogix intends to focus on, and make investments in, the following stated strategies for growth and expansion in 2007:
* Develop and market new business applications and value-added solutions
to complement the Company's existing suite of mobile connectivity
applications and device and infrastructure solutions;
* Establish additional strategic partnerships to create a deeper offering
of software applications;
* Acquire service-based companies with synergistic technologies, services,
strategies and expertise in the healthcare and commercial markets;
* Broaden its regional presence to additional domestic emerging centers of
healthcare and commercial activity; and
* Further expand its sales force to facilitate planned geographic
extension and projected growth.
Conference Call and Webcast
Management will host a conference call with the investment community today at 5:00 p.m. Eastern time. Interested parties may participate in the teleconference by dialing 800-257-2182 or 303-262-2160 for international callers. When prompted, ask for the "InfoLogix Investor Conference Call." A telephonic replay may be accessed approximately two hours after the call through March 23, 2007, by dialing 800-405-2236 and entering the replay access code 11085598#.
The teleconference will be webcast simultaneously on the InfoLogix website at http://www.infologixsys.com under Investors: Event Calendar. The webcast replay will be archived for 12 months.
About InfoLogix
As a leading provider of mobile enterprise technology solutions, InfoLogix uses the industry's most advanced wireless information technology to increase the efficiency, accuracy, and transparency of complex business and clinical processes. With over seventeen patents, InfoLogix provides strategic consulting, business applications, mobile managed services, end-user platform, connectivity and infrastructure solutions to Fortune 1000 clients including Kraft Foods, Merck and Company, General Electric, News America Corporation, Mercedes Benz, Kaiser Permanente, Adventist Health, Universal Health Services, and Stanford School of Medicine. InfoLogix is a publicly-traded company (OTC Bulletin Board: IFLG). For more information on InfoLogix, please visit: http://www.infologixsys.com.
Safe Harbor Statement
This press release contains forward looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and that represent our expectations or beliefs about future events and financial performance. Forward-looking statements are identifiable by words such as "believe," "anticipate," "expect," "intend," "plan," "will," "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Forward-looking statements are subject to known and unknown risks and uncertainties, including those described in the filings we make with the Securities and Exchange Commission. Actual results could differ materially from those suggested by the forward- looking statements. We do not make any commitment to revise or update any forward-looking statements to reflect new information events or circumstances occurring or existing after the date of any forward-looking statement is made.
INFOLOGIX, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE FOURTH QUARTERS AND YEARS ENDED DECEMBER 31, 2006 AND 2005
Fourth Quarter Full Year
2006 2005 2006 2005
Revenues $16,439,964 $16,121,982 $60,786,377 $55,472,056
Cost of revenues 12,691,288 12,704,258 45,836,514 42,605,150
Gross profit 3,748,676 3,417,724 14,949,863 12,866,906
Selling, general and
administrative
expenses 7,845,052 3,103,657 17,897,567 11,661,138
Operating (loss)
income (4,096,376) 314,067 (2,947,704) 1,205,768
Interest expense 120,302 79,723 608,746 525,205
Income (loss)
before income
tax benefit (4,216,678) 234,344 (3,556,450) 680,563
Income tax
benefit 1,686,964 - 1,686,964 -
Net (loss)
income $(2,529,714) $234,344 $(1,869,486) $680,563
(Loss) earnings
per share:
Basic $(0.15) $0.02 $(0.14) $0.05
Diluted $(0.15) $0.02 $(0.14) $0.05
Weighted average
shares outstanding:
Basic and
diluted 16,479,966 12,500,000 13,503,170 12,500,000
INFOLOGIX, INC.
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2006 AND 2005
ASSETS
2006 2005
Currents assets:
Cash and cash equivalents $12,882,044 $447,901
Accounts and other receivables (net of
allowance for doubtful accounts in the
amount of $120,000 and $100,000 as of
December 31, 2006 and 2005, respectively) 11,797,265 10,223,024
Inventory, net 2,227,201 1,912,018
Prepaid expenses and other current assets 906,793 334,450
Deferred tax assets - short-term 311,478 -
Total current assets 28,124,781 12,917,393
Property and equipment, net 1,440,338 1,338,842
Intangible assets, net 871,976 910,782
Deferred tax assets - long-term 1,375,486 -
Total assets $31,812,581 $15,167,017
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $6,584,489 $7,135,956
Line of credit 5,954,672 4,443,327
Current portion of notes payable - bank 833,333 285,714
Current portion of capital lease obligations 116,973 116,973
Current portion of notes payable - stockholders - 800,000
Sales tax payable 342,064 271,390
Accrued expenses 767,967 649,043
Deferred revenue - 186,397
Total current liabilities 14,599,498 13,888,800
Notes payable - bank, net of current
maturities 1,194,445 285,714
Capital lease obligations, net of
current maturities 130,378 247,351
Total liabilities 15,924,321 14,421,865
Commitments and contingencies
Stockholders' equity:
Preferred stock, par value $.00001;
authorized 10,000,000 shares; - -
none issued or outstanding
Capital stock, par value $.00001;
authorized 100,000,000 shares;
issued and outstanding 23,595,663
shares and 12,500,000 shares
at December 31, 2006 and 2005,
respectively 236 125
Additional paid in capital 17,802,373 49,875
Retained earnings (deficit) (1,914,349) 695,152
Total stockholders' equity 15,888,260 745,152
Total liabilities and
stockholders' equity $31,812,581 $15,167,017
INFOLOGIX, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005
2006 2005
Operating activities:
Net income (loss) $(1,869,486) $680,563
Adjustments to reconcile net income
(loss) to operating cash flow:
Depreciation and amortization 1,319,845 1,044,903
Allowance for doubtful accounts receivable 20,000 -
Inventory obsolescence 123,965 35,000
Share based compensation 2,773,434 -
Deferred income tax benefit (1,686,964) -
Changes in:
Accounts receivable (1,594,241) (2,875,262)
Inventory (439,148) (91,578)
Prepaid expenses (572,343) 280,357
Accounts payable (551,467) 1,580,749
Sales tax payable 70,674 113,975
Accrued expenses 118,924 (294,211)
Deferred revenue (186,397) 146,322
Net cash provided by (used in)
operating activities (2,473,204) 620,818
Investing activities:
Acquisition of property and equipment (959,487) (790,068)
Acquisition of intangible assets (423,048) (498,991)
Net cash used in investing activities (1,382,535) (1,289,059)
Financing activities:
Proceeds from long-term debt 2,500,000 917,892
Repayment of long-term debt (1,160,597) (389,282)
Net borrowings from line of credit 1,511,345 409,888
Repayment of notes payable - stockholders (800,000) -
Common stock issued for cash, net of
offering costs 14,979,149 -
Dividends paid to stockholders (740,015) (170,127)
Net cash provided by financing
activities 16,289,882 768,371
Net change in cash and cash equivalents 12,434,143 100,130
Cash and cash equivalents at
beginning of year 447,901 347,771
Cash and cash equivalents at end of
year $12,882,044 $447,901
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid for interest $664,543 $555,251
SUPPLEMENTAL DISCLOSURE OF NON-CASH
FINANCING ACTIVITIES:
Issuance of warrants in connection with a
private placement $1,234,800
Capital lease obligation incurred for
new equipment $439,000
Source: prnewswire
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