Integrated Management Information (IMI Global) Reports Second Quarter and Six-Month Revenue and Net Income*
Integrated Mgmt Inf (QB) (USOTC:WFCF)
Today : Wednesday 1 August 2012
Integrated Management Information, Inc. (d.b.a. IMI Global, Inc.) (OTCQB: WFCF) (OTCBB: WFCF)
Q2 revenue up 24% to a record $1.4 million from $1.1 million
Q2 net income* increases to $304,300 from $276,900
6-month revenue up 25% to a record $2.4 million from $1.9 million
6-month net income* increases to $666,400 from $354,400
Integrated Management Information, Inc. (d.b.a. IMI Global, Inc.) (OTCQB: WFCF) (OTCBB: WFCF), a leading provider of verification and Internet solutions for the agricultural/livestock industry under the Where Food Comes From® brand, today announced record revenue and net income for its second quarter and six-month period ended June 30, 2012.
"We continue to generate positive financial results and maintain a strong balance sheet, and are looking forward to continued success in the second half of the year," said John Saunders, chairman and CEO of IMI Global. "Our consistent growth is a testament to the strength of our broad solutions portfolio and the hard work and commitment of employees and contractors at all levels of our organization. In addition to our solid financial performance, our second quarter was highlighted by the addition of the Company's first regional restaurant chain -- Anderson's Frozen Custard in western New York -- to our Where Food Comes From program. We now have anchor customers in both the restaurant and grocery segments and are focused on adding new, quality customers in both areas. Also of note in the second quarter, we changed our stock symbol to WFCF to better reflect our Where Food Comes From brand strategy and to raise awareness of Company in the investment community."
In February of 2012 IMI Global acquired controlling interest in International Certification Services, Inc. (ICS), a leading provider of organic and sustainable certification services to agricultural operations and the food industry. On an unaudited basis, ICS was profitable on revenue of approximately $1.0 million in 2011. The acquisition strengthened IMI Global's solutions portfolio and is expected to accelerate the Company's revenue growth. The Company will continue to evaluate opportunities to acquire complementary businesses.
Second Quarter Results
Second quarter revenue increased 24% to a record $1,397,200 from revenue of $1,125,500 in the second quarter a year ago. It was the Company's 10th consecutive quarter of year-over-year revenue growth. Revenue from verification services, which includes the Company's industry leading USVerified™ solutions, increased 25% to $1,172,200 from $938,300 in the second quarter last year. Hardware revenue consisting primarily of cattle identification tags increased 8% in the second quarter to $200,300 from $186,000 in the same quarter last year. Other revenue, primarily consisting of fees from the Where Food Comes From labeling program, grew to $24,700 in the second quarter from $1,100 in the same quarter last year.
Gross margin in the second quarter increased to $756,000 from $677,200 in the same quarter last year. As a percent of revenue, second quarter gross margin declined to 54% from 60% year over year.
Selling, general and administrative expense in the second quarter increased 48% year over year to $581,400 from $393,500 due to increased investments in promoting the Where Food Comes From program as well as costs associated with the Company's acquisition of controlling interest in ICS in the first quarter of 2012.
IMI Global recognized a second quarter income tax benefit of $127,400 related to the release of the valuation allowance on its deferred tax assets. Net income attributable to IMI Global in the second quarter was $304,300, or $0.01 per share, versus net income of $276,900, or $0.01 per share, in the same quarter last year.
Six-Month Results
Revenue for the six-month period ended June 30, 2012, increased 25% to a record $2,426,500 from $1,947,300 in the same period last year based on strong market demand for the Company's core verification solutions as well as a growing contribution to revenue from Where Food Comes From and ICS.
Verification revenue grew by 25% to $2,018,100 from $1,620,300 in the same period last year. Hardware revenue grew 11% to $357,200 from $323,000 a year ago. And revenue from Where Food Comes From and other sources increased dramatically to $51,200 from $4,000.
Gross margin through six months grew to 1,326,900, or 55% of revenue, from gross margin of $1,129,300, or 58% of revenue, in the same period of 2011.
Selling, general and administrative expense increased 41% for the year-to-date period to $1,069,500 from $760,500, primarily as a result of increased advertising, marketing and consulting costs associated with promoting Where Food Comes From.
Net income through six months, inclusive of an income tax benefit of $409,500, was $666,400, or $0.03 per share, versus net income of $354,400, or $0.02 per share, in the same period a year ago.
Balance Sheet Highlights
Cash and cash equivalents and short-term investments at June 30, 2012, totaled $1.2 million, down only slightly from $1.3 million at 2011 year-end despite the Company having paid $215,000 in cash associated with the ICS transaction and having paid down $50,000 in long-term debt.
*References to net income in the text of this news release refer to net income attributable to IMI Global stockholders, which includes significant income tax benefits for the 2012 second quarter and six-month period.
About IMI Global
Integrated Management Information, Inc. (d.b.a. IMI Global) is America's leading provider of third-party identification, verification and traceability solutions for the livestock and agricultural industries. The Company supports more than 6,000 ranchers, feed yards, meatpackers, food retailers and restaurants with a wide range of solutions, including its USVerified™ brand -- the industry standard for USDA Process Verified (PVP) programs -- which annually verifies marketing claims for approximately one half of all U.S. beef exports; and Where Food Comes From®, a unique retail and restaurant labeling program that connects consumers directly to the source of the food they purchase. Go to www.IMIGlobal.com and www.wherefoodcomesfrom.com for additional information.
CAUTIONARY STATEMENT
This news release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, based on current expectations, estimates and projections that are subject to risk. Forward-looking statements are inherently uncertain, and actual events could differ materially from the Company's predictions. Important factors that could cause actual events to vary from predictions include those discussed in our SEC filings. Specifically, statements in this news release about revenue and profitability growth, expected acceleration of revenue growth, ICS' revenue and profitability, the Company's ability to achieve continued success, generate positive financial results, maintain a strong balance sheet, and build shareholder value; growth potential; leadership; potential acquisitions; and the demand for, and impact and efficacy of, the Company's and its subsidiaries' products and services on the marketplace are forward-looking statements that are subject to a variety of factors, including availability of capital, personnel and other resources; competition; governmental regulation of the agricultural industry; the market for beef and other commodities; and other factors. Financial results for the second quarter and six-month period are not necessarily indicative of future results. Readers should not place undue reliance on these forward-looking statements. The Company assumes no obligation to update its forward-looking statements to reflect new information or developments. For a more extensive discussion of the Company's business, please refer to the Company's SEC filings at www.sec.gov.
Integrated Management Information, Inc.
Statements of Operations
Three Months Ended Six Months Ended
June 30, June 30,
2012 2011 2012 2011
----------- ----------- ----------- -----------
Revenues
Service revenues $ 1,172,224 $ 938,315 $ 2,018,051 $ 1,620,291
Product sales 200,282 186,024 357,236 322,996
Other revenues 24,676 1,133 51,179 4,004
----------- ----------- ----------- -----------
Total revenues 1,397,182 1,125,472 2,426,466 1,947,291
Costs of revenues
Labor and other costs of
services 488,684 313,691 844,137 590,625
Costs of products 152,545 134,583 255,417 227,396
----------- ----------- ----------- -----------
Total costs of revenue 641,229 448,274 1,099,554 818,021
----------- ----------- ----------- -----------
Gross profit 755,953 677,198 1,326,912 1,129,270
Selling, general and
administrative expenses 581,369 393,475 1,069,506 760,482
----------- ----------- ----------- -----------
Income from operations 174,584 283,723 257,406 368,788
Other expense (income):
Interest expense 5,821 7,244 13,693 15,449
Gain on sale of marketable
securities (2,574) - (2,574) -
Other income, net (691) (465) (3,353) (1,028)
----------- ----------- ----------- -----------
Income before income taxes 172,028 276,944 249,640 354,367
Income tax benefit (127,382) - (409,472) -
----------- ----------- ----------- -----------
Net income 299,410 276,944 659,112 354,367
Net loss attributable to
non-controlling interest 4,842 - 7,273 -
----------- ----------- ----------- -----------
Net income attributable to
Integrated Management
Information, Inc. $ 304,252 $ 276,944 $ 666,385 $ 354,367
=========== =========== =========== ===========
Net income per share:
Basic $ 0.01 $ 0.01 $ 0.03 $ 0.02
=========== =========== =========== ===========
Diluted $ 0.01 $ 0.01 $ 0.03 $ 0.02
=========== =========== =========== ===========
Weighted average common
shares outstanding:
Basic 20,854,725 20,716,923 20,732,182 20,740,515
=========== =========== =========== ===========
Diluted 21,549,014 21,078,226 21,361,420 20,988,471
=========== =========== =========== ===========
Integrated Management Information, Inc.
Balance Sheets
June 30, December 31,
2012 2011
------------- -------------
ASSETS
Current Assets:
Cash and cash equivalents $ 907,399 $ 969,020
Accounts receivable, net 395,062 226,760
Investment in marketable securities 292,368 283,511
Prepaid expenses and other current assets 35,713 36,776
Deferred tax assets 232,350 224,350
------------- -------------
Total current assets 1,862,892 1,740,417
Property and equipment, net 117,193 57,354
Intangible assets, net 715,468 9,205
Long-term deferred tax assets 422,981 -
------------- -------------
Total assets $ 3,118,534 $ 1,806,976
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 170,006 $ 148,384
Accrued expenses and other current
liabilities 35,139 42,960
Customer deposits 40,885 -
Deferred revenue 213,191 -
Short-term debt and current portion of notes
payable 23,058 25,644
Current portion of capital lease obligations 8,424 -
------------- -------------
Total current liabilities 490,703 216,988
Capital lease obligations, net of current
portion 16,987 -
Notes payable and other long-term debt 166,101 176,201
Notes payable, related party 200,000 250,000
Other long-term liabilities 775 -
------------- -------------
Total liabilities $ 874,566 $ 643,189
------------- -------------
Stockholders' equity:
Common stock 21,422 21,049
Additional paid-in capital 3,550,530 3,416,343
Treasury stock (111,284) (109,014)
Accumulated other comprehensive loss (3,099) (6,693)
Accumulated deficit (1,491,513) (2,157,898)
------------- -------------
Total stockholders' equity 1,966,056 1,163,787
Non-controlling interest 277,912 -
------------- -------------
Total equity 2,243,968 1,163,787
------------- -------------
Total liabilities and stockholders' equity $ 3,118,534 $ 1,806,976
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Company Contacts:
John Saunders
Chief Executive Officer
303-895-3002
Jay Pfeiffer
Pfeiffer High Investor Relations, Inc.
303-393-7044
