Direct Response Financial Services Announces Record Third-Quarter Sales
Tuesday January 17, 12:43 pm ET
-- Q3 Contract Sales Totaled $58,365 --
-- Strong Q4 Anticipated with Contract Sales
of $122,000 Already Booked --
LOS ANGELES, Jan. 17, 2006 (PRIMEZONE) -- Marking the success of its newly launched Direct2Own business, Direct Response Financial Services, Inc. (OTC BB:DRFL.OB - News), a leading provider of stored value and debit card products and services to Hispanics and other consumers underserved by the credit markets, today announced results of its Direct2Own business for the third quarter ended October 31, 2005.
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Direct Response launched the Direct2Own business at the end of September in an effort to extend its reach to the underserved credit market, which includes individuals with no or subpar credit. The success of the Direct2Own launch is reflected in contract sales of computers and other electronic equipment of $58,365 in the first six weeks of operations. The contracts are for a one-year lease of a product in which the consumer makes affordable biweekly payments. At the end of the contract, title to the product is transferred to the consumer. The model is beneficial to both the consumer and Direct Response in that it offers consumers the ability to purchase products that they otherwise might not be able to afford while allowing the company the ability to build a steady stream of cash flow that it will use to finance operations, including its debit card program. For the third quarter, the contracts resulted in $16,432 in cash received from customers, with the balance of $41,932 booked as accounts receivables. Contract sales for the fourth quarter as of January 15, 2006, total $122,000, a significant increase over third-quarter sales.
Gross margins on Direct2Own sales were consistently above 85% and customer defaults were less than 1%. These two factors combined to make the Direct2Own division of the company highly profitable. The company was able to achieve these results while significantly lowering its overall loss per share from $.03 for the nine months ended October 31, 2004, to $.01 for the nine months ended October 31, 2005.
``We are very pleased to report record sales for our third quarter. Since the end of the quarter we have continued to experience consistent, strong sales in the Direct2Own division and look forward to announcing healthier fourth quarter results. Moreover, as the company continues to grow its high profit Direct2Own division, we anticipate achieving positive cash flow in the coming year,'' stated T. Randolph Catanese, CEO and President of Direct Response Financial Services, Inc.
Mr. Catanese continued, ``We have found there is tremendous demand for Direct2Own's offering of computer and electronics sales to persons with no credit or subpar credit. With our recently announced bank line of credit from First Private Bank & Trust, we are geared to significantly ramp up sales in the coming quarters. Growing sales of electronics through Direct2Own not only produces the financial results we are aiming for, it also generates leads and sales for our debit card programs.''
Direct2Own enables individuals with no credit or subpar credit to purchase items such as computers, televisions, cell phones and audio equipment with just a small down payment and affordable monthly payments. The launch of Direct2Own expands Direct Response Financial Services' business into the multi-billion dollar retail electronics market. In addition, Direct2Own functions as a platform to sell debit cards to its target customer group. Through Direct2own, customers can acquire a Direct Card Services DCS Media Card MasterCard which enables them to make timely payments for purchased products. Furthermore, Direct2Own offers a credit building service to customers on a monthly subscription basis.
Direct2Own products are currently marketed through ads on television, Internet, and print media. Orders are taken online and by phone. For more information please visit http://www.Direct2own.com.
The company's full financial results can viewed in its 10Q filing at http://www.sec.gov or http://www.nasdaq.com.
About Direct Response Financial Services, Inc.
Direct Response Financial Services, Inc. provides financial, technology and marketing solutions for serving unbanked and under-banked consumers. The company continues to focus on the issuance of pre-paid cash card products to Hispanics in the United States. Through its proprietary loading network, the DirectLoad Network(tm), the company allows its customers an easy and convenient means to load their pre-paid cash cards and to obtain other financial services. Its consumer electronics retail site, located at http://www.Direct2own.com, offers consumer electronics to the under-banked and unbanked. For more information on the company please visit http://www.drfs.net or visit http://www.directcardservices.net. To learn more about its pre-paid products please visit http://www.dcsmediacard.com. And to learn more about the company's consumer electronics offers. please visit http://www.Direct2own.com.
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