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8-K - 8-K - Halo Companies, Inc. | halo_8k052010.htm |
Exhibit 99.1
2010
ANNUAL LETTER TO SHAREHOLDERS
2010
Annual Letter to Shareholders
by
Executive Committee of Halo Companies, Inc. (OTCBB: HALN)
May
5, 2010
Dear Fellow Shareholders: | |||
With
the completion and public filing of the 2009 year-end financials, we are
pleased to report Halo Companies, Inc. has achieved key milestones
essential to executing Halo’s aggressive business strategy. However, even
though several of Halo’s verticals do thrive in a down economy, Halo, like
many other companies, encountered its own economic hurdles in achieving
its overall growth plan for 2009.
The
most important achievement of 2009, was taking the company public through
a triangular reverse merger; Halo Companies, Inc. currently trades on the
Over-the-Counter Bulletin Board under the symbol “HALN”. In addition,
though not exactly at the pace we had planned, Halo achieved this feat
while producing an exceptional year in sales strengthening its position as
a leader in the consumer financial services industry.
A
contributing factor to Halo’s success can be attributed to the diligence
with which we’ve continued to build the Halo brand, adding three new
subsidiaries to our suite of consumer financial tools. The new additions
are ones that we believe enhance shareholder value over the long term.
While we did not anticipate these new subsidiaries to hit their stride
until 2010, the companies contributed a great deal to Halo’s marketability
and lead share generation.
The
most significant trend we are seeing is a B2B market for Halo’s bundled
services. Halo Portfolio Advisors, LLC was chartered in 2009 to meet this
demand. Careful research and consideration to the needs of the market have
laid the groundwork for what will become a catalyst to drive Halo
Companies to the next level of growth.
Looking
forward to the coming fiscal year, we see strong demand for our products
and expect to grow revenue and profitability to levels which will
demonstrate that Halo Companies is well positioned to thrive long term in
the consumer financial services industry. But first let’s take a look at
some of Halo’s accomplishments in 2009.
|
Cade
Thompson
Chairman
&
Chief
Executive Officer
Paul
Williams
Vice
Chairman &
Chief
Financial Officer
Tony
Chron
President
& Director
|
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Financial
Accomplishments
Halo had a record year, achieving a total $9.1 million in revenue up 183% over 2008 and up 730% over 2006 total revenue. Although we took a loss overall of $1.8 million in 2009, $1.4 million of that loss is attributed to a one time soft cost (non-cash) expense due to stock option compensation expenses taken in Q3 at the time of the merger. On an adjusted EBITDA basis, after adding back in the paper loss and the non-recurring expenses for the public transaction, Halo’s net loss was only around $56 thousand. |
A Year in
Recognition
Halo
was continually recognized in 2009 for its unprecedented growth and
achievements. Inc. Magazine recognized Halo in their annual Inc. 500/5000
issue ranking the fastest growing private companies in America. Inc.
Magazine ranked Halo Group, Inc. as 23rd in the financial services
industry and 533rd overall out of 5000 named companies.
Halo’s
Vice Chairman & Chief Financial Officer, Paul Williams was honored
this year as the recipient of the CFO of the Year award by Dallas Business
Journal in their annual award issued October 23rd. The honoree was chosen
from 90 nominations received in North Texas. The panel of judges was
comprised of prior winners of the award, Dallas CPA Society and Financial
Executives International.
The
SMU Cox School of Business honored Halo November 4th as the 45th fastest
growing company in the Metroplex at a ceremony held to announce the
recipients of the 2009 Dallas 100. The Dallas 100 is a prestigious list
published annually by the SMU Cox School of Business that recognizes
privately held companies that have experienced significant growth and
success.
Capital
One Bank honored Halo with the Celebration of Enterprise award. The award
is designed to recognize entrepreneurial spirit and reward those who saw
significant economic growth and overcame daunting obstacles to achieve
that growth. Halo was selected as the winner of the $5 - $10 million
category.
Comerica
Bank honored Halo as the “Third Fastest Growing Company in Collin County”
in the Comerica Bank Collin 60, June 2009. The Collin 60 includes some of
the largest cities in North Texas including Frisco, Allen, McKinney,
Plano, Richardson and others. Collin County is the fastest growing county
in Texas, and is recognized as one of the top growth counties in the
nation. With many businesses relocating to the area each month, we were
very honored to win this award amongst such fierce
competition.
|
2
Certifications
and Regulations
Halo
continues to stay ahead of the curve supporting regulation in the industry
and pursuing certifications that set Halo apart from the competition. In
2009, Halo laid the foundation to achieve ISO 9001 :2008 Certification. In
order to obtain certification, Halo spent six months designing and
implementing a quality management system to regulate all operations of the
company, culminating with on-site audits by BSI Group, a provider of
independent third-party certifications of management systems. Halo began
the application in accordance with their initiative to continue to set the
highest standards in the industry and serve more consumers. Several key
states have adopted strong debt settlement laws with increased consumer
protections, such as the Uniform Debt Management Services Act (UDMSA). The
tough statutory compliance and accreditation requirements exclude the
majority of settlement companies from operating in those states. The ISO
9001 :2008 certification, however, meets the accreditation requirements of
the UDMSA. By obtaining the ISO certification, Halo Debt Solutions, LLC
will be able to operate in more states, increasing the number of consumers
eligible for Halo's debt settlement program.
Officers
of Halo support the legislative process by meeting regularly with
legislators and lobbyists in Austin and elsewhere to assist in determining
the regulatory needs of the industry. As a leader in the debt relief
industry, Halo has a responsibility to help craft any legislation that may
transpire, ensuring adequate consumer protections balanced by reasonable
business regulations. Such regulations act to weed-out bad actors in the
industry that do little to uphold a desirable reputation in the market
place.
|
A Public
Event
Providing
an opportunity for investors to participate in an early stage of Halo’s
growth and provide capital to accomplish our aggressive business plan is
central to Halo’s overall growth strategy.
September
30, 2009 Halo Group, Inc. participated in a triangular reverse merger
transaction with GVC Venture Corp. in New York. The transaction resulted
in Halo shareholders with controlling interest in GVC Venture Corp., the
new parent company of Halo and its eleven subsidiaries.
The
first post event initiative was to issue a name and symbol change for the
new parent company. Accordingly, on December 11th, the corporation issued
an 8-K announcing the name change of the parent company from GVC Venture
Corp. to Halo Companies, Inc. Subsequently to that action a new symbol was
assigned to the company and Halo Companies, Inc. is now traded on the Over
the Counter Bulletin Board under the symbol “HALN”.
|
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New
Launches in 2009
In
2009, Halo expanded its family of services to continue to meet a growing
market demand. The first of these new additions is Halo Financial
Services, LLC. As traditional debt relief programs are increasingly
limited in the number of states in which it can operate, Halo developed an
alternative model that will allow Halo to offer debt relief services to
consumers in more states. Halo Financial Services offers financial
education as well as an in-depth analysis that is designed to find the
right debt resolution solution for each consumer. The model requires a
minimal upfront fee and a small monthly service charge. A success fee is
assessed only after the accounts have been settled and
satisfied.
As
Halo’s extensive client base continues to grow, so has its warm market. In
2009, Halo saw a need to provide these consumers with low cost insurance
services. Halo now provides these services through Halo Choice Insurance
Services, LLC. Halo Choice Insurance is currently licensed in Texas and
has access to numerous insurance companies including, but not limited to,
Travelers, State Auto and Hartford. Therefore, Halo is not limited to the
product and service offerings of a single insurance underwriter, allowing
Halo the ability to identify the lowest cost alternative for clients. Halo
Choice Insurance offers Auto, Home, Commercial and various other insurance
products to meet the needs of existing and potential clients. By adding a
broad spectrum of insurance products to its current product offering, Halo
can now position itself before tens of thousands of clients - clients who
are already enrolled in products and services offered by other Halo
subsidiaries - and who would welcome a value-added product offering from
the company they already know and trust.
As
previously mentioned, Halo sees its future growth in expanding to the
business-to-business market. In today’s economy, lenders are experiencing
an overflow of distressed assets. Halo Portfolio Advisors, LLC was
designed to leverage the complete business-to-consumer suite of services
to market turnkey solutions to lenders. Halo’s unique strategy deposits
borrowers into an intelligent, results-driven process that establishes
affordable, long-term mortgages while also achieving an improved return
for lenders and investors, when compared to foreclosure. Halo Portfolio
Advisors’ operational support services allow endless opportunities for
strategic B2B relationships.
|
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Looking
Ahead
Halo
Companies will continue to foster a growth culture with a clear vision for
the future. This future predicts a profitable B2B business, as well as the
emerging profitability from maturing verticals in origination
services.
Along
with these successes the company will continue to work to align our
incentives with those of our shareholders. The company is now keenly
focused on growth, open communication, and leadership by example, as it
works diligently to expand its sales and deliver shareholder
value.
Investing
in our growth is a nominal expense to ensure that Halo is working to
maximize the growth potential of this company. With our past
accomplishments of benchmarking our goals, we have learned that
extraordinary companies have extraordinary goals. The company is presently
strong and the future indicates strong potential.
Additional
growth capital will be sought during 2010 to achieve our long term growth
and expansion goals. The capital will be raised in a series of
transactions, which could include subordinated debt offerings and/or a
private investment in public equity (PIPE).
Halo
has started 2010 on solid footing by achieving many of its past goals. The
executive committee would like to thank you, our shareholders, for your
support and continued confidence in our management team and business
model. We will continue to work to achieve our objectives and position the
company for a strong finish in 2010, as well as a solid future for the
years to come.
|
Warmest Regards, | ||||
Cade Thompson | Paul Williams | Tony Chron | ||
Chairman & | Vice Chairman & | President & | ||
Chief Executive Officer | Chief Financial Officer | Director |
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