American TonerServ Reports Record Revenue for Third Quarter
Quarterly Revenue Tops $7.7 Million
$21.5 Million Generated at Nine-Month End; Adjusted EBITDA Remains Positive
Conference Call Scheduled for Wednesday, November 11, 2009 at 4:30PM ET
SANTA ROSA, Calif.–(BUSINESS WIRE)– American TonerServ Corp. (OTCBB:ASVP) (“ATS”), a leader in the highly fragmented $6.0 billion printer supplies and services industry, reports sequential revenue growth for the 3rd quarter and nine-months ended September 30, 2009.
Financial highlights for the quarter include:
Financial highlights for the nine-months ended September 30, 2009 include:
Chuck Mache, CEO of American TonerServ, commented: “We are very pleased with the continuing improvements in our financial results. We have set another record for revenue this quarter and achieved positive adjusted EBITDA for the third consecutive quarter. The trajectory suggests that the coming quarter and 2010 will see further strengthening of our position as a leader in the compatible toner cartridge business.”
Mr. Mache continued: “Since the education and medical business segments are strong vertical markets for us, and with the education sector largely closed down and hospitals in the Florida region slower during the third quarter, we have seen reasonable downward seasonality in our business this quarter. However, we are pleased with our 3rd quarter growth over the previous quarter, and since the end of the quarter, we have seen an acceleration in sales, and indeed, we are now selling over 1,000 cartridges a day.”
Mache concluded, “Through the execution of our organic growth strategies, largely sparked by the iPrint division’s strong quarter, we are working toward our goal to establish ATS as the brand of choice in the compatibles market as Hewlett Packard is in the OEM market.”
Conference Call Information:
Management will host a conference call on Wednesday, November 11, 2009, at 4:30 Eastern Standard Time.
The conference call will be available to interested parties by dialing 800-447-0521 from the U.S. or Canada, or 847-413-3238 from international locations, passcode 25804114. This call is also available through a live, listen-only audio Web broadcast via the Internet at www.AmericanTonerServ.com under Investor Relations. Listeners are encouraged to visit the Web site at least 15 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. The call will be archived and accessible on the Web site for one year.
Presentation of Non-GAAP Information
This press release contains non-GAAP financial measures, including EBITDA (earnings before interest, income taxes, depreciation and amortization) and Adjusted EBITDA (earnings before interest, income taxes, depreciation, amortization and other non-cash related expenditures). The Company believes these non-GAAP financial measures are useful to investors in evaluating its results. These measures are not a measurement of financial performance under GAAP and should not be considered as alternatives to net income, income from operations, or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating, investing or financing activities as a measure of liquidity. In addition, because EBITDA and Adjusted EBITDA may not be calculated identically by all companies, this presentation may not be comparable to other similarly titled measures of other companies. For a reconciliation of these non-GAAP financial measures to the most comparable GAAP equivalent, see the Non-GAAP Reconciliation – EBITDA and Adjusted EBITDA, along with related footnotes, below.
About American TonerServ
American TonerServ (OTCBB:ASVP) is a leading marketer of compatible and original-equipment-manufactured toner cartridges. The company is strategically building a nationwide organization to efficiently serve the printing needs of small- and medium-sized businesses by executing on key organic growth initiatives designed to build sales distribution across the country. In the more than $6.0 billion recycled printer cartridge and printer services industry, the company offers top-quality, environmentally friendly products and local service teams to its customers. Please see www.AmericanTonerServ.com for more information.
Forward Looking Information
Except for historical information contained herein, the matters set forth above may be forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ from those in the forward-looking statements. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the current beliefs of management, as well as assumptions made by and information currently available to management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors such as the level of business and consumer spending, the amount of sales of the Company’s products, the competitive environment within the industry, the ability of the Company to continue to expand its operations, the level of costs incurred in connection with the Company’s expansion efforts, economic conditions in the industry and the financial strength of the Company’s customers and suppliers. The Company does not undertake any obligation to update such forward-looking statements. Investors are also directed to consider all other risks and uncertainties.
AMERICAN TONERSERV CORP. AND SUBSIDIARIESRESULTS OF OPERATIONS
Three months endedSeptember 30,
Nine months endedSeptember 30,
Professional fees and services
General and administrative
Amortization of intangible assets
Change in fair value of warrant liability
Gain on claims settlement
Fair value of convertible debt
)
$
)
$
Weighted average number of shares outstanding:
BALANCE SHEET DATA
62,866
4,033
Notes payable – current portion (net of unamortized discount of $116,368 and $194,937 at September 30, 2009 and December 31, 2008)
Convertible notes payable, current portion (net of unamortized discount of $205,315 and $147,566 at September 30, 2009 and December 31, 2008)
Convertible notes payable, related parties – current portion(net of unamortized discount of $0 and $1,466 at September 30, 2009 and December 31, 2008)
Notes payable (net of unamortized discount of $187,796 and $244,016 at September 30, 2009 and December 31, 2008)
Convertible notes payable (net of unamortized discount of $435,785 and $669,042 at September 30, 2009 and December 31, 2008)
BALANCE SHEET DATA (continued)
Preferred stock 6,800,000 and 0 shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively
Common stock 78,455,995 and 77,045,995 shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively
The following is a reconciliation of cash flows provided by operating activities to EBIT, EBITDA, and net loss:
Three Months EndedSeptember 30,
Nine Months EndedSeptember 30,
Cash flows from operating activities
Changes in operating assets and liabilities
Non-cash (expenses) income, including depreciation and amortization
Depreciation and amortization
Depreciation and amortization
The following is a reconciliation of net loss to EBITDA:
Depreciation and amortization
The following is a reconciliation of net EBITDA to Adjusted EBITDA; which excludes all non-cash items; one time expenditures and stock related compensation:
Stock related compensation
Fair value of conversion feature of convertible debt
Fair value of warrant liabilities
Bad debt allowance for new entities