Attached files
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| 8-K - FORM 8-K - usell.com, Inc. | v410954_8k.htm |
Exhibit 99.1
uSell.com Announces First Quarter 2015 Results
Year-over-Year Increase of 39% in Orders Completed
Processed $19.5 Million in Gross Merchandise Value Over Last 12 Months
New York, NY – (Accesswire) - May 14, 2015 – uSell.com (USEL), the leading US-based reCommerce marketplace that instantly finds cash offers for used smartphones and electronics, announced today results for the first quarter ended March 31, 2015.
Highlights:
| · | Facilitated over 500,000 transactions to-date |
| · | Increased Orders Completed by 39%, year-over-year, to 46,700 devices while decreasing sales and marketing expenditures by 7% |
| · | Processed $19.5 million in Gross Merchandize Value over last 12 months, since tracking this metric |
| · | Implemented $2.4 million in annualized savings in marketing spend and marketing staff; effects beginning in April |
The cost cutting measures were implemented in response to shifting industry dynamics, wherein carrier trade-in programs have begun to advertise heavily and collect large volumes of used consumer smartphones. In response to this shift, uSell made the strategic decision to pursue a wholesale device acquisition strategy rather than relying solely on direct to consumer marketing.
Nik Raman, Chief Executive Officer, stated, “Given the increasing importance of the carrier trade in programs, uSell has decided to shift the bulk of its investment from consumer marketing to technology. uSell is uniquely positioned to utilize its marketplace technology to enable large wholesalers and processors that purchase from the carriers to sell to our ever growing network of buyers. Growth through such wholesale channels will enable us to expand our marketplace in a far more efficient manner.”
Financial Results:
First Quarter Ended March 31, 2015 Compared to First Quarter Ended March 31, 2014
For the first quarter ended March 31, 2015, revenues were $2.1 million, a 113% increase from $1.0 million for the quarter ended March 31, 2014. Net loss for the quarter ended March 31, 2015 decreased by $1.3 million, from a loss of $2.8 million for the quarter ended March 31, 2014 to a loss of $1.5 million. The resulting EPS is ($0.20), as compared to ($0.55) in the year-ago quarter.
For the quarter ended March 31, 2015, there was $0.4 million of non-cash expenses, resulting from stock-based compensation and depreciation and amortization. For the quarter ended March 31, 2014, there was $2.0 million of non-cash expenses, which mainly resulted from the amortization of the remaining debt discount into interest expense upon the conversion of certain convertible notes in February 2014, the change in the market value of the derivative liability on the convertible notes through the date of conversion, stock-based compensation expense and depreciation and amortization. As of March 31, 2015, the Company had $1.1 million in cash.
About uSell.com, Inc.
uSell.com is a reCommerce marketplace that helps individuals turn unused items into cash. uSell ensures that customers get the highest payouts with the least amount of hassle by facilitating risk-free transactions with professional buyers. For uSell’s buyers, uSell offers a scalable technology, marketing, logistics, and analytics solution that provides a high volume of inventory at a low acquisition cost. Visit www.uSell.com
Contact Information
Hayden IR
hart@haydenir.com
917-658-7878
uSell.com, Inc. and Subsidiaries
Consolidated Balance Sheets
| March 31, | December 31, | |||||||
| 2015 | 2014 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 1,129,830 | $ | 2,414,757 | ||||
| Accounts receivable, net | 142,662 | 141,327 | ||||||
| Inventory | 158,200 | - | ||||||
| Prepaid expenses and other current assets | 81,451 | 99,529 | ||||||
| Total Current Assets | 1,512,143 | 2,655,613 | ||||||
| Property and equipment, net | 5,535 | 6,928 | ||||||
| Intangible assets, net | 861,193 | 852,093 | ||||||
| Other assets | 25,875 | 25,875 | ||||||
| Total Assets | $ | 2,404,746 | $ | 3,540,509 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 258,525 | $ | 539,566 | ||||
| Accrued expenses | 520,845 | 168,093 | ||||||
| Deferred revenue | 289,818 | 263,739 | ||||||
| Total Liabilities | 1,069,188 | 971,398 | ||||||
| Stockholders' Equity: | ||||||||
| Convertible Series A preferred stock; $0.0001 par value; 325,000 shares authorized; 100,000 shares issued and outstanding. Liquidation preference $300,000 | 10 | 10 | ||||||
| Convertible Series B preferred stock; $0.0001 value per share; 4,000,000 shares authorized; 951,250 shares issued and outstanding. Liquidation preference $951,250 | 95 | 95 | ||||||
| Convertible Series C preferred stock; $0.0001 value per share; 146,667 shares authorized; 146,667 shares issued and outstanding. | 15 | 15 | ||||||
| Convertible Series E preferred stock; $0.0001 value per share; 103,232 shares authorized; 103,232 shares issued and outstanding | 10 | 10 | ||||||
| Common stock; $0.0001 par value; 43,333,333 shares authorized; 7,572,703 shares issued and 7,539,373 and 7,533,817 shares outstanding, respectively | 754 | 753 | ||||||
| Additional paid in capital | 54,847,216 | 54,610,843 | ||||||
| Accumulated deficit | (53,512,542 | ) | (52,042,615 | ) | ||||
| Total Stockholders' Equity | 1,335,558 | 2,569,111 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 2,404,746 | $ | 3,540,509 | ||||
uSell.com, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
| Three Months Ended March 31, | ||||||||
| 2015 | 2014 | |||||||
| Revenue | $ | 2,142,983 | $ | 1,005,999 | ||||
| Costs and Expenses | ||||||||
| Cost of revenue | 1,442,519 | 143,126 | ||||||
| Sales and marketing expenses | 1,006,023 | 1,085,439 | ||||||
| General and administrative expenses | 1,164,083 | 1,060,717 | ||||||
| Total operating expenses | 3,612,625 | 2,289,282 | ||||||
| Loss from Operations | (1,469,642 | ) | (1,283,283 | ) | ||||
| Other (Expense) Income: | ||||||||
| Interest income | 532 | 274 | ||||||
| Interest expense | (817 | ) | (891,279 | ) | ||||
| Gain on settlements of accounts payable | - | 9,038 | ||||||
| Change in fair value of derivative liability - convertible notes payable | - | (681,122 | ) | |||||
| Total Other (Expense) Income, Net | (285 | ) | (1,563,089 | ) | ||||
| Net Loss | $ | (1,469,927 | ) | $ | (2,846,372 | ) | ||
| Basic and Diluted Loss per Common Share: | ||||||||
| Net loss per common share - basic and diluted | $ | (0.20 | ) | $ | (0.55 | ) | ||
| Weighted average number of common shares outstanding during the period - basic and diluted | 7,533,817 | 5,219,842 | ||||||
uSell.com, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
| Three Months Ended March 31, | ||||||||
| 2015 | 2014 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (1,469,927 | ) | $ | (2,846,372 | ) | ||
| Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities: | ||||||||
| Depreciation and amortization | 163,035 | 122,554 | ||||||
| Provision for bad debt | - | 8,835 | ||||||
| Stock based compensation expense | 246,541 | 316,947 | ||||||
| Amortization of debt issue costs into interest expense | - | 8,645 | ||||||
| Amortization of debt discount into interest expense | - | 873,872 | ||||||
| Gain on settlement of accounts payable | - | (9,038 | ) | |||||
| Change in fair value of derivative liability - convertible notes payable | - | 681,122 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (1,335 | ) | 67,330 | |||||
| Other receivables | - | 20,422 | ||||||
| Inventory | (158,200 | ) | - | |||||
| Prepaid and other current assets | 7,911 | (33,552 | ) | |||||
| Accounts payable | (281,041 | ) | (5,189 | ) | ||||
| Accrued expenses | 352,752 | 40,516 | ||||||
| Deferred revenues | 26,079 | 5,041 | ||||||
| Net Cash and Cash Equivalents Used In Operating Activities | (1,114,185 | ) | (748,867 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Website development costs | (170,742 | ) | (143,018 | ) | ||||
| Net Cash and Cash Equivalents Used In Investing Activities | (170,742 | ) | (143,018 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from sale of common stock | - | 1,774,999 | ||||||
| Proceeds from sale of convertible Series A preferred stock | - | 300,000 | ||||||
| Cash paid for direct offering costs | - | (90,766 | ) | |||||
| Net Cash and Cash Equivalents Provided By Financing Activities | - | 1,984,233 | ||||||
| Net (Decrease) Increase in Cash and Cash Equivalents | (1,284,927 | ) | 1,092,348 | |||||
| Cash and Cash Equivalents - Beginning of Period | 2,414,757 | 489,166 | ||||||
| Cash and Cash Equivalents - End of Period | $ | 1,129,830 | $ | 1,581,514 | ||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | ||||||||
| Cash Paid During the Period for: | ||||||||
| Interest | $ | - | $ | - | ||||
| Taxes | $ | - | $ | - | ||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Derivative liability reclassified to Additional Paid in Capital upon conversion of Convertible Notes Payable | $ | - | $ | 1,682,507 | ||||
| Conversion of Convertible Notes Payable and accrued interest to common stock | $ | - | $ | 841,294 | ||||
| Conversion of Convertible Notes Payable and accrued interest to Series E preferred stock | $ | - | $ | 309,698 | ||||
| Common stock issued for services | $ | - | $ | 21,195 | ||||
| Issuance of Series C preferred stock in exchange for warrants | $ | - | $ | 15 | ||||
| Conversion of Series B preferred stock into common stock | $ | - | $ | 3 | ||||