SOURCE: MacroSolve, Inc.

November 01, 2013 07:00 ET

MacroSolve Announces Third Quarter and Year-to-Date 2013 Earnings

Nine Month Net Income Improved 103% Over Prior Period

TULSA, OK--(Marketwired - Nov 1, 2013) - MacroSolve, Inc. (OTCQB: MCVE) ("MacroSolve" or the "Company"), a leading provider of mobile technology intellectual property and app venture mentorship, today announced financial results for its third quarter ended September 30, 2013.

Year-to-date 2013 results included:

  • Net income from continuing operations for the nine months ended September 30, 2013 increased $2,027,000, or 103%, over the same nine month period in 2012; and
  • Operating expenses for the first nine months of 2013 decreased by $2,422,000, an 82% decrease over the same period in 2012.

Net revenues for the third quarter of 2013 decreased $398,000 or 71%, to $161,000 as compared to $559,000 in the third quarter of 2012. Similarly, for the nine month period ended September 30, 2013, revenues decreased $851,000 to $1,130,000 from $1,981,000 for the same period in 2012. A significant source of revenue comes from the Company's enforcement of its '816' patent. As anticipated, the third quarter revenues were impacted by the attention to the Markman Hearing held on September 26, 2013. As previously announced, the Company filed new suits against eleven potential infringers in September 2013.

The net loss for the third quarter of 2013 was $(121,000) or $(0.00) per share, as compared to the third quarter 2012 net loss of $(480,000), or $(0.00) per share, a 75% decrease in net loss of $359,000. The net income for the nine months ended September 30, 2013 of $59,000 or $0.00 per share was $2,027,000 or 103% higher than the $(1,968,000) net loss of $(0.00) per share for the same period in 2012. The improvement was primarily due to the July 2012 sale of Illume Mobile and the elimination of its operating losses as well as corporate restructuring following the sale.

The Company improved its use of cash in operations, with $175,000 cash provided by operating activities in the first nine months of 2013 as compared to ($1,044,000) cash used in operating activities over the same period in 2012. Cash on hand at September 30, 2013 was $758,000, an increase of $443,000 as compared to $315,000 on September 30, 2013.

Operating expenses decreased 78% in the third quarter of 2013 to $169,000 from $757,000 in the same period of 2012. For the nine months ended September 30, 2013, operating expenses decreased $2,422,000, or 82%, from $2,951,000 in 2012 to $529,000 in 2013.

"Although the third quarter results were not as robust as the three previous quarters, we were prepared for the reduction in patent licensing revenues and still returned impressive bottom line results when compared to 2012. By running a lean operation and preserving cash, our balance sheet remains strong with a surplus of working capital," stated Kendall Carpenter, CFO.

For further information, please see MacroSolve's full 3Q13 10-Q filing at www.sec.gov.

About MacroSolve
Founded in 1997, MacroSolve is heralded for its robust IP portfolio, while advancing throughout the mobile apps era by innovating key technologies that have laid the foundation for apps and next-gen developers. Today, MacroSolve is empowering a new era of mobile innovators seeking advisory and patent services and IP strength from a source of experience. For more information, visit www.macrosolve.com.

Safe Harbor Statement
This press release contains projections of future results and other forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Important factors that may cause actual results and outcomes to differ materially from those contained in the projections and forward-looking statements included in this press release are described in our publicly filed reports. Factors that could cause these differences include, but are not limited to, the acceptance of our products, lack of revenue growth, failure to realize profitability, inability to raise capital and market conditions that negatively affect the market price of our common stock. The Company disclaims any responsibility to update any forward-looking statements.

   
   
MACROSOLVE, INC.  
   
BALANCE SHEETS  
   
    Unaudited        
For the Periods Ended:   9/30/2013     12/31/2012  
             
ASSETS                
                 
CURRENT ASSETS:                
  Cash   $ 757,986     $ 659,204  
  Accounts receivable - trade     67,188       74,056  
  Prepaid expenses and other     97,919       519,330  
                   
    Total current assets     923,093       1,252,590  
                 
PROPERTY AND EQUIPMENT, at cost:     4,237       21,651  
  Less - accumulated depreciation and amortization     (1,442 )     (19,462 )
                 
    Net property and equipment     2,795       2,189  
                 
OTHER ASSETS:                
  Investment in DecisionPoint Systems, Inc.     442,281       579,875  
  Investment in MEDL Mobile Holdings, Inc.     46,179       -  
  Investment in Endexx Corporation     10,010       -  
  Other assets     68,251       64,227  
                   
    Total other assets     566,721       644,102  
                 
TOTAL ASSETS   $ 1,492,609     $ 1,898,881  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
                 
CURRENT LIABILITIES:                
  Current maturities of long-term debt   $ 90,000     $ 90,000  
  Accounts payable - trade and accrued liabilities     139,065       84,062  
  Unearned income     -       500,000  
                   
    Total current liabilities     229,065       674,062  
                 
LONG-TERM DEBT, less current maturities                
  Note Payable - Shareholders     579,202       541,752  
  Oklahoma Technology Commercialization Center     57,500       125,000  
  Convertible debentures     150,000       150,000  
    Total long-term debt, less current maturities     786,702       816,752  
                 
COMMITMENTS AND CONTINGENCIES     -       -  
                 
STOCKHOLDERS' EQUITY:                
  Common stock, $.01 par value; authorized 500,000,000 shares; issued and outstanding 188,644,731 and179,831,987 shares, at September 30, 2013 and December 31, 2012, respectively     1,886,447      
 1,798,320
 
  Additional paid-in capital     13,298,362       13,230,111  
  Accumulated other comprehensive income     (316,530 )     (170,125 )
  Accumulated deficit     (14,391,437 )     (14,450,239 )
                   
    Total stockholders' equity     476,842       408,067  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $ 1,492,609     $ 1,898,881  
                 
                 
                 
MACROSOLVE, INC.  
   
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)  
   
For the Periods Ended    For the Three Months Ended     For the Nine Months Ended  
September 30,      9/30/2013     9/30/2012     9/30/2013     9/30/2012  
                         
Net revenues   $ 161,246     $ 558,738     $ 1,129,597     $ 1,980,990  
                                 
Cost of revenues     101,583       261,444       509,699       859,645  
                                 
Gross profit     59,663       297,294       619,898       1,121,345  
                                 
Selling, general and administrative expense     169,386       756,628       528,827       2,951,163  
                                 
(Loss) Income from operations     (109,723 )     (459,334 )     91,071       (1,829,818 )
                                 
OTHER INCOME (EXPENSE):                                
    Interest income     1,637       25       5,857       53  
    Interest expense     (12,820 )     (21,317 )     (38,126 )     (138,186 )
                                     
    Total other expense     (11,183 )     (21,292 )     (32,269 )     (138,133 )
                                 
NET INCOME (LOSS) FROM CONTINUING OPERATIONS     (120,906 )     (480,626 )     58,802       (1,967,951 )
                                 
DISCONTINUED OPERATIONS                                
  Loss from operations of discontinued Illume Mobile operations     -       (197,387 )     -       (197,387 )
                                 
NET INCOME (LOSS)     (120,906 )     (678,013 )     58,802       (2,165,338 )
                                 
OTHER COMPREHENSIVE INCOME, net of tax                                
  Unrealized holding loss arising during the period     (220,008 )     (107,072 )     (146,405 )     (107,072 )
                                 
COMPREHENSIVE (LOSS)   $ (340,914 )   $ (785,085 )   $ (87,603 )     (2,272,410 )
                                 
INCOME (LOSS) ALLOCABLE TO COMMON STOCKHOLDERS:                                
    Net income (loss)   $ (120,906 )   $ (678,013 )   $ 58,802       (2,165,338 )
                                     
    Income (loss) allocable to common stockholders   $ (120,906 )   $ (678,013 )   $ 58,802       (2,165,338 )
                                 
Weighted average number of common shares outstanding     186,551,952       176,710,333       185,026,337       162,690,085  
                                 
Basic and diluted net income (loss) from continuing operations per share   $ (0.00 )   $ (0.00 )   $ 0.00     $ (0.01 )
                                 
Basic and diluted net loss from discontinued operations per share   $ 0.00     $ (0.00 )   $ 0.00     $ (0.00 )
                                 
Basic and diluted net income (loss) per share   $ (0.00 )   $ (0.00 )   $ 0.00     $ (0.01 )
             
             
             
MACROSOLVE, INC.            
             
STATEMENTS OF CASH FLOWS (UNAUDITED)            
             
For the Nine Months Ended September 30,   9/30/2013     9/30/2012  
                 
OPERATING ACTIVITIES:                
  Net income (loss)   $ 58,802     $ (2,165,338 )
  Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                
    Depreciation and amortization     2,536       516,693  
    Loss on disposal of fixed assets     435       4,246  
    Stock based compensation     106,408       303,568  
    Changes in current assets and liabilities:                
      Decrease in accounts receivable - trade     6,868       102,944  
      Decrease in note receivable     -       135,577  
      Decrease in prepaid expenses and other     421,381       235,219  
      Increase (decrease) in accounts payable - trade and accrued liabilities     41,473       (290,394 )
      Increase in accrued debenture interest     13,530       107,641  
      Increase in accrued shareholder loan interest     23,950       -  
      Increase accrued salary - note payable     13,500       -  
      (Decrease) increase in unearned income     (500,000 )     5,571  
                     
    Net cash provided by (used in) operating activities     188,883       (1,044,273 )
                 
INVESTING ACTIVITIES:                
  Cash received from sale of Illume Mobile     -       250,000  
  Investment in Endexx Corporation     (15,000 )     -  
  Purchase of equipment     (1,467 )     (8,580 )
  Software development costs     -       (233,390 )
  Patent costs     (6,134 )     -  
                   
    Net cash (used in) investing activities     (22,601 )     8,030  
                 
FINANCING ACTIVITIES:                
  Net proceeds from debenture financing     -       500,000  
  Reduction of accrued debenture interest     -       (233,782 )
  Common stock issued for accrued debenture interest     -       216,330  
  Proceeds from shareholder loans, including accrued interest     -       790,621  
  Repayment of shareholder loans, including accrued interest     -       (115,247 )
  Proceeds from sale of common stock     -       250,000  
  Shareholder loans converted to debentures     -       (320,000 )
  Repayment of bank line of credit     -       (10,000 )
  Repayments of notes payable     (67,500 )     -  
                   
    Net cash (used in) provided by financing activities     (67,500 )     1,077,922  
                 
NET INCREASE IN CASH     98,782       41,679  
                 
CASH, beginning of period     659,204       273,132  
                 
CASH, end of period   $ 757,986     $ 314,811  
                 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:                
  Cash paid during the Nine Months ended September 30:                
    Interest   $ -     $ 46,631  
    Income taxes   $ -     $ 0  
  Noncash activities for the Nine Months ended September 30:                
    Stock issued for debenture interest   $       $ 216,330  
    Stock issued for MEDL investment   $ 50,000     $ -  
    Stock received from DecisionPoint Systems for sale of Illume Mobile assets, less unrealized market loss of $107,072   $ -     $ 642,928  

Contact Information