ID Watchdog Announces Results for Second Quarter 2015

DENVER, Aug. 17, 2015 /CNW/ --

  • Employee Benefit revenues increased 144.7%
  • Total revenues increased 53.9%
  • Gross profit increased 64.2%

ID Watchdog, Inc. (TSX VENTURE: IDW) (PINKSHEETS: IDWAF) ("ID Watchdog" or the "Company"), provider of consumer-facing identity theft protection and resolution services, today announced its results for the 2nd quarter ended June 30, 2015. All amounts are in U.S. dollars.

2nd Quarter 2015 Highlights:

  • Revenue: Revenue totaled $1,296,265 for the second quarter of 2015, an increase of $453,945, or 53.9%, from the second quarter of 2014.  Revenue from our Employee Benefit Channel increased $542,525, or 144.7%, from $374,994 for the three months ended June 30, 2014 to $917,519 for the three months ended June 30, 2015. 
  • Gross Profit: Gross profit increased by $378,222, or 64.2%, from $588,758 during the second quarter of 2014 to $966,980 during the second quarter of 2015.  The gross margin rates for the second quarter of 2015 and 2014 were 74.6% and 69.9%, respectively.
  • Adjusted EBITDA:  For the second quarter of 2015, adjusted EBITDA improved by $44,054 to $159,141 as compared with $115,087 for the similar period in 2014.
  • Cash Balances: Cash and cash equivalents as of June 30, 2015, totaled $849,742, a decrease of $36,734 from our cash balances at December 31, 2014.

ID Watchdog CEO, Michael Greene, stated, "We are pleased to report strong top line growth for the second quarter in our Employee Benefit channel as well as for total revenue. We continue to achieve great success in building out our network of employee benefit brokers. Our pipeline of total employees who may open enroll for our services in the first quarter of 2016 is significantly stronger than it was last year at this time and it continues to build as the year progresses, which is creating a solid foundation for strong revenue growth in 2016."

Mr. Jay Lewis, ID Watchdog's CFO, commented, "As we look forward to the second half of 2015, we anticipate that Employee Benefit revenue growth will range between 120%-125% for both the third and fourth quarters of 2015 over the similar quarters in 2014, and that total revenue growth will range between 48%-52% and 40%-44% for the third and fourth quarters of 2015, over the similar quarters in 2014, respectively." 

ID Watchdog, Inc.

Unaudited Consolidated Condensed Statements of Operations




Three Months Ended

June 30,


Six Months Ended

June 30,



2015


2014


2015


2014

Revenue


$    1,296,265


$    842,320


$   2,565,951


$   1,632,947

Cost of revenue


329,285


253,562


676,934


502,392

Gross profit


966,980


588,758


1,889,017


1,130,555

Operating expense:









     General and administrative expense


377,673


300,236


708,899


641,093

     Sales and marketing expense


430,166


173,435


858,689


315,632

     Share-based compensation expense


11,066


35,159


25,359


94,938

     Depreciation and amortization expense


10,956


15,136


21,168


33,366



829,861


523,966


1,614,115


1,085,029

Operating income


137,119


64,792


274,902


45,526

Other income (expense):









     Gain (loss) on warrant liability



(159,727)


199,659


39,931

     Interest expense, net


(300,368)


(213,278)


(532,874)


(429,734)



(300,368)


(373,005)

(333,215)


(389,803)

Net loss and comprehensive loss applicable to ordinary shares

$     (163,249)


$  (308,213)

$      (58,313)


$    (344,277)

Basic and diluted net loss per share applicable to ordinary shares

$           (0.00)


$         (0.00)

$          (0.00)


$          (0.00)

Weighted average number of shares outstanding - basic and diluted

121,834,997


121,834,997

121,834,997


121,834,997

 

 

Reconciliation of Net Loss to Adjusted EBITDA






Three Months Ended June 30,


Six Months Ended June 30,


2015


2014


2015


2014

Net loss

$   (163,249)


$   (308,213)

$       (58,313)


$    (344,277)

Depreciation and amortization expense

10,956


15,136


21,168


33,366

Interest expense, net

300,368


213,278


532,874


429,734

EBITDA

148,075


(79,799)

495,729


118,823

Loss (gain) on warrant liability


159,727


(199,659)


(39,931)

Share-based compensation expense

11,066


35,159


25,359


94,938

Adjusted EBITDA

$     159,141


$     115,087


$        321,429


$      173,830

 

 


ID Watchdog, Inc.

Unaudited Consolidated Statements of Financial Position







June 30,
2015



December 31,
2014

ASSETS








Cash and cash equivalents


$

849,742



$

886,476

Accounts receivable, net



264,639




168,602

Prepaid expenses and other



105,330




123,617


Total current assets



1,219,711




1,178,695

Property and equipment, net



80,081




79,879

Customer agreements, net



19,131




22,482



Total Assets


$

1,318,923



$

1,281,056











LIABILITIES








Accounts payable, accrued liabilities and other

$

1,040,417



$

977,657

Current portion of credit facility






84,422

Deferred revenue



460,045




439,794


Total current liabilities



1,500,462




1,501,873

Credit facility, net






99,500

Deferred rent



31,600




28,440

Finance lease obligations, net of current portion


6,136




14,876

Series C Preferred mandatorily redeemable preferred shares, net of discount and conversion feature


4,639,067




4,334,395

Warrants liability


199,659




399,318



Total Liabilities


6,376,924




6,378,402



Total Shareholders' Deficit


(5,058,001)




(5,097,346)

TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT

$

1,318,923



$

1,281,056











About Non-IFRS Financial Measure

To supplement the Company's consolidated financial results presented in accordance with International Financial Reporting Standards ("IFRS"), the Company reports "Adjusted EBITDA" (net income (loss) before deducting net interest expense, income tax expense, depreciation and amortization, share-based compensation, and gain (loss) on warrant liability) and uses this metric to measure the performance of our business.  Adjusted EBITDA is not a performance measure defined under IFRS and is not considered an alternative to income from operations or net earnings (loss) in the context of measuring the Company's performance.  Adjusted EBITDA does not have a standardized meaning and is therefore not likely to be comparable with similar measures used by other publicly traded companies.  Adjusted EBITDA should not be used as an exclusive measure of cash flow since it does not account for the impact of working capital changes, income taxes, interest payments, capital expenditures, debt principal reductions and other sources and uses of cash, and is not meant to be considered in isolation or as a substitute for financial information prepared in accordance with IFRS.

Financial information contained in this press release should be read in conjunction with the unaudited consolidated interim condensed financial statements and notes thereto included in our most recent quarterly reports and our annual report. These documents are available online at www.sedar.com and in the "Company Overview" section of our website at www.IDWatchdog.com.

About ID Watchdog, Inc.

ID Watchdog was founded in 2005 and is headquartered in Denver, Colorado. The Company provides three-tiered comprehensive monitoring, detection and resolution for identity theft. ID Watchdog proactively detects identity theft problems at their source and provides immediate resolution services to ensure complete peace of mind for individuals. All the Company's services have been developed with input from industry experts; national consumer advocacy groups; federal, state, and local law enforcement agencies; consumer protection agencies; and adhere to guidelines published by the Consumer Federation of America. For more information, please visit www.IDWatchdog.com.

Forward-Looking Statement

This news release includes certain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 which address future events and conditions which are subject to various risks and uncertainties. The actual results could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. Although the Company believes that its expectations reflected in these forward-looking statements are reasonable, no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed in the company's filings with Canadian regulators at www.sedar.com. ID Watchdog assumes no obligation to update the forward-looking statements of management beliefs, opinions, projections, or other factors should they change.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Company Contact:
Jay B. Lewis
Chief Financial Officer
ID Watchdog, Inc.
303-339-8099
InvestorRelations@idwatchdog.com
www.idwatchdog.com

Logo - http://photos.prnewswire.com/prnh/20130829/NY71341LOGO

SOURCE ID Watchdog, Inc.


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890