ITEX (OTCBB) ITEX CORPORATION
ITEX Corporation Announces Third Consecutive Quarter of Profitability
MONDAY , DECEMBER 16, 2002 09:06 AM
SACRAMENTO, Calif., Dec 16, 2002 (Canada NewsWire via COMTEX) -- ITEX Corporation, (OTC Bulletin Board: ITEX) a leading business services and trading company, today announced the operating results for its first quarter ending October 31, 2002.
First Quarter Results
For the quarter ending October 31, 2002, the Company generated net income of $122,000 compared to a net loss of $725,000 for the same period last year. This marks the third consecutive quarter the Company has shown profitability. Earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter were $266,000 compared to a loss of $441,000 for the same period last year. Revenue from the trade exchange increased $158,000, or 6.3% from the same period last year.
The significant improvement in the financial performance for the first quarter is primarily the result of the comprehensive corporate restructuring program initiated in November 2001. The Company embarked on a targeted program of cost reduction, trimmed the number of management, indirect, and non-essential support staff in both the corporate and regional offices, and eliminated the Corporate Trade Department. The Company also sold several regional offices to ITEX Independent Licensed Brokers, further reducing expenses, while maintaining a substantial interest in the revenue stream generated from those offices through trade transaction and association fees.
ITEX Corporation First Quarter Operational Highlights:
-- Corporate SG&A expenses decreased $681,000 as compared to the first
quarter fiscal 2002. This decrease of 44.2% includes the reduction in
wages, salaries, and benefits of $540,000 from the first fiscal quarter
2002.
-- The Company completed the applications for franchise registration in 50
States within the U.S.
-- The first U.S. ITEX Franchise was sold and placed in Florida.
-- TEAM (Trade Exchange Account Management program), an industry-leading
proprietary software platform, was launched and implemented.
-- The Company was accepted as a member of the International Franchising
Association (IFA).
-- The Company was the Gold Sponsor of the International Reciprocal Trade
Association (IRTA) International Convention, in St. Petersburg,
Florida.
Lewis "Spike" Humer, ITEX President and Chief Executive Officer stated, "ITEX Corporation is a 'new' corporation -- restructured, refocused, and revitalized. In the last nine-months where we completed the majority of the restructuring, we have shown a profit of $409,000 compared to the loss of $2,512,000 for the nine-months preceding the initiation of the restructuring program. This is a bottom-line improvement of almost three million dollars in an incredibly short period of time."
He continued, "During the first quarter of fiscal year 2003, we continued to invest in our franchise initiatives and our training and support systems. In addition, we launched an industry-leading proprietary software platform for our 20,000-member trade exchange. We implemented numerous customer service and member retention programs, and continued to reduce short-term debt and other cash drains, such as miscellaneous legal fees related to matters of the Company's past. It is our hope and expectation to continue to build upon the performance of our recent quarters. In the second quarter FY2003, we are planning to embark upon an aggressive path of future revenue growth through the placement of new franchises, the enrollment of additional members into the ITEX Trade Exchange, and the increased trading volumes within our extensive business network."
Humer concluded by stating, "The turnaround of the last year was balanced between the need to rebuild our infrastructure and the necessity to immediately stabilize the financial position of the corporation through prudent cost reductions. In the forthcoming quarters, we will be aggressively marketing to add new members, sell and place additional franchises, and increase the ITEX brand awareness. While our growth will be tempered by our projected cash flows, we are working diligently to increase our revenues throughout fiscal year 2003. Overall, the next twenty-four months will be focused on profitable and effective growth in the business services market and the expansion of the ITEX Trade Exchange through organic growth and systematic acquisitions."
ITEX CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
October 31, July 31,
2002 2002
(unaudited)
ASSETS
Current assets 1,477 1,190
Long-term assets 1,410 1,517
Total assets $2,887 $2,707
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities 2,591 2,518
Long-term liabilities 134 149
Stockholders' equity 162 40
Total liabilities and
stockholders' equity $2,887 $2,707
ITEX CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTERS ENDED
OCTOBER 31, 2002 AND 2001
(In thousands, except per share amounts)
Three Months Ended October 31,
2002 2001
(unaudited) (unaudited)
Trade exchange revenue $2,662 $2,504
Costs and expenses:
Costs of trade exchange revenue 1,510 1,353
Selling, general and administrative 859 1,540
Costs of regulatory and litigation matters 27 175
Depreciation and amortization 136 251
2,532 3,319
Income (loss) from operations 130 (815)
Other (expense) income (8) 90
Net income (loss) $122 $(725)
Earnings (loss) per common share
- basic and diluted $.01 $(0.05)
Weighted average common shares
Basic 17,725 15,989
Diluted 18,081 15,989
About ITEX:
Founded in 1982, ITEX Corporation (http://www.itex.com) is a business services and trading company with domestic and international operations. ITEX has established itself as the leader among the roughly 450 trade exchanges in North America by facilitating barter transactions between member businesses of its Retail Trade Exchange. At the retail, corporate and international levels, modern barter business enjoys expanding sophistication, credibility, and acceptance. ITEX helps its member businesses improve sales and liquidity, reduce cash expenses, open new markets and utilize the full business capacity of their enterprises by providing an alternative channel of distribution through a network of five company offices and more than ninety licensees worldwide.
This press release contains certain forward-looking statements and comments within the safe harbor provisions established under The Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the operations of ITEX to be materially different from those expressed or implied in such statements. These factors include, but are not limited to the continuing development of successful marketing strategies for the company's concepts; the effect of international, national, and regional economic conditions; the ability of the company to satisfy its debt obligations; the availability of adequate working capital; competitive barter exchanges; changes in legislation; demographic changes, the ability to attract and retain qualified personnel; changes in business strategy or development plans; business disruptions; and changes in the demand for goods and services offered by members of its trade exchange. These risk factors and others are discussed in the periodic reports and filings of ITEX Corporation with the Securities and Exchange Commission, including but not limited to its Form 10-KSBs and Form 10-QSBs. All statements other than statements of historical fact included in this press release, including without limitations, the company's business strategy, plans and objectives, are forward-looking statements.
VIEW ADDITIONAL COMPANY-SPECIFIC INFORMATION: http://www.newswire.ca/cgi-bin/inquiry.cgi?OKEY=81056
CONTACT: For further information: Lewis "Spike" Humer of ITEX Corporation,
+1-916-679-1122, or spike.humer(at)itex.com
URL: Web site: http://www.itex.com
News release via Canada NewsWire, Toronto 416-863-9350
Copyright (C) 2002 CNW, All rights reserved
Disclaimer
http://www.investorshub.com/boards/read_msg.asp?message_id=135097
News 
Market Data 
Discover 
