8-K
Research Solutions, Inc. (RSSS)
`
UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORTPursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report:
(Date of earliest event reported)
February 10, 2022
Research Solutions, Inc.
(Exact name of registrant as specified in its charter)
Nevada
(State or other Jurisdiction of Incorporation)
| 1-39256 | 11-3797644 |
|---|---|
| (Commission File Number) | (IRS Employer Identification No.) |
N/A
(Address of Principal Executive Offices and zip code)
(310) 477-0354
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each Class | Trading Symbol(s) | Name of each Exchange on which registered |
|---|---|---|
| Common stock, $0.001 par value | RSSS | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
| Item 2.02. | Results of Operations and Financial Condition. |
|---|
On February 10, 2022, the Registrant announced its financial results for the second quarter ended December 31, 2021. A copy of the press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Item 2.02 and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits | |
|---|---|---|
| (d) | Exhibits | |
| --- | --- | --- |
| Exhibit<br><br> Number | Description | |
| 99.1 | Press Release issued February 10, 2022 entitled “Research Solutions Reports Fiscal Second Quarter<br>2022 Results”. | |
| 104 | Cover Page Interactive Data File (embedded as Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| RESEARCH SOLUTIONS, INC. | ||
|---|---|---|
| Date:<br> February 10, 2022 | By: | /s/<br> William Nurthen |
| William<br> Nurthen | ||
| Chief Financial Officer |
Exhibit 99.1
****
Research Solutions Reports Fiscal Second Quarter2022 Results
Reports Record 56 Net New Platform Deploymentsand 36 Percent Increase in ARR to $6.8 Million
HENDERSON, Nev., February 10, 2022 — Research Solutions, Inc. (NASDAQ: RSSS), a pioneer in providing cloud-based workflow solutions for R&D driven organizations, reported financial results for its fiscal second quarter ended December 31, 2021.
Fiscal Second Quarter 2022 Summary
| · | Total revenue of $7.9 million, a 5.7% increase from prior-year quarter |
|---|---|
| · | Platform revenue up 31% to $1.6 million. Annual Recurring Revenue (“ARR”)<br>up 36% to $6.8 million |
| --- | --- |
| · | Gross profit up 19% from prior-year quarter. Total gross margin improved<br>390 basis points to 36.0% |
| --- | --- |
| · | Loss of $0.02 per share, compared to a loss of $0.01 per share in the prior-year<br>quarter |
| --- | --- |
| · | Platform incremental ARR generated in the quarter was a record high of $0.6M.<br>The Company has now generated $1.8M of incremental platform ARR in the past twelve months. |
| --- | --- |
| · | 56 net new platform deployments in the quarter compared to 29 in the prior-year |
| --- | --- |
“In the second quarter we saw a record number of new customers adopt the platform, and existing customers continue to increase the number of features they subscribe to as they expand the licensed number of users,” said Roy W. Olivier, President and CEO of Research Solutions. “The increase in ARR during the quarter reflects continued operational efficiencies, more accountability from our sales teams, and a deeper focus on innovative new product upgrades. We believe we are well-positioned for growth in the second half of fiscal 2022.”
Fiscal Second Quarter 2022 Results
Total revenue was $7.9 million, a 5.7% increase from $7.4 million in the year-ago quarter as both platform and transaction revenue increased from the prior period.
Platform subscription revenue increased 31% to $1.6 million compared to approximately $1.2 million in the year-ago quarter. The increase was primarily due to an increase in the total number of paid Platform deployments, including 56 net deployments added in the quarter, as well as upsells to existing customers. The quarter ended with annual recurring revenue of $6.8 million, up 9% sequentially and 36% year-over-year (see the company’s definition of annual recurring revenue below).
Transaction revenue was $6.3 million, compared to $6.2 million the second quarter of fiscal 2021. Transaction revenue has historically declined due to the savings experienced by customers as they transition to the recurring revenue platform business, however, this was the first quarter in the last six to experience transaction revenue growth over the prior period. Transaction customer count for the quarter was 1,179, compared to 1,109 customers in the prior-year quarter (see the company's definition of active customer accounts and transactions below).
Total gross margin improved 390 basis points from the prior-year quarter to 36.0%. The increase was primarily driven by a continued revenue mix shift to the higher-margin Platform business as well as reduced copyright costs in the quarter.
Total operating expenses were $3.3 million, compared to $2.7 million in the second quarter of 2021. The increase was primarily due to higher technology and product development and general and administrative costs.
Net loss in the second quarter was ($482,000), or ($0.02) per share, compared to net loss of ($261,000), or ($0.01) per share, in the prior-year quarter. Adjusted EBITDA was ($165,000), compared to $161,000 in the year-ago quarter (see definition and further discussion about the presentation of Adjusted EBITDA, a non-GAAP term, below).
Conference Call
Research Solutions President and CEO Roy W. Olivier and CFO Bill Nurthen will host the conference call, followed by a question and answer period.
Date: Thursday, February 10, 2022
Time: 5:00 p.m. ET (2:00 p.m. PT)
Toll-free dial-in number: 1-855-327-6837
International dial-in number: 1-631-891-4304
Conference ID: 10017815
The conference call will be broadcast live and available for replay until March 10, 2022 by dialing 1-844-512-2921 and using the replay ID 10017815, and via the investor relations section of the company's website at http://researchsolutions.investorroom.com/.
Fiscal Second Quarter Financial and Operational Summary Tablesvs. Prior-Year Quarter
| Quarter<br> Ended December 31, | Six<br> Months Ended December 31, | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | Change | %<br> Change | 2021 | 2020 | Change | %<br> Change | |||||||||||||||||
| Revenue: | ||||||||||||||||||||||||
| Platforms | $ | 1,604,829 | $ | 1,220,535 | $ | 384,294 | 31.5 | % | $ | 3,114,703 | $ | 2,362,223 | $ | 752,480 | 31.9 | % | ||||||||
| Transactions | $ | 6,267,458 | $ | 6,229,200 | 38,258 | 0.6 | % | $ | 12,500,088 | $ | 12,835,937 | (335,849 | ) | -2.6 | % | |||||||||
| Total Revenue | 7,872,287 | 7,449,735 | 422,552 | 5.7 | % | 15,614,791 | 15,198,160 | 416,631 | 2.7 | % | ||||||||||||||
| Gross Profit: | ||||||||||||||||||||||||
| Platforms | 1,373,161 | 1,003,532 | 369,629 | 36.8 | % | 2,637,379 | 1,941,268 | 696,111 | 35.9 | % | ||||||||||||||
| Transactions | 1,464,499 | 1,388,050 | 76,449 | 5.5 | % | 2,860,656 | 2,899,890 | (39,234 | ) | -1.4 | % | |||||||||||||
| Total Gross Profit | 2,837,660 | 2,391,582 | 446,078 | 18.7 | % | 5,498,035 | 4,841,158 | 656,877 | 13.6 | % | ||||||||||||||
| Gross profit as a % of revenue: | ||||||||||||||||||||||||
| Platforms | 85.6 | % | 82.2 | % | 3.3 | % | 84.7 | % | 82.2 | % | 2.5 | % | ||||||||||||
| Transactions | 23.4 | % | 22.3 | % | 1.1 | % | 22.9 | % | 22.6 | % | 0.3 | % | ||||||||||||
| Total Gross Profit | 36.0 | % | 32.1 | % | 3.9 | % | 35.2 | % | 31.9 | % | 3.4 | % | ||||||||||||
| Operating Expenses: | ||||||||||||||||||||||||
| Sales and marketing | 518,357 | 487,571 | 30,786 | 6.3 | % | 1,041,308 | 985,945 | 55,363 | 5.6 | % | ||||||||||||||
| Technology and product development | 868,236 | 624,747 | 243,489 | 39.0 | % | 1,689,696 | 1,247,708 | 441,988 | 35.4 | % | ||||||||||||||
| General and administrative | 1,616,135 | 1,118,750 | 497,385 | 44.5 | % | 3,113,358 | 2,279,812 | 833,546 | 36.6 | % | ||||||||||||||
| Depreciation and amortization | 4,260 | 3,039 | 1,221 | 40.2 | % | 7,156 | 6,762 | 394 | 5.8 | % | ||||||||||||||
| Stock-based compensation | 300,539 | 435,949 | (135,410 | ) | -31.1 | % | 471,649 | 606,739 | (135,090 | ) | -22.3 | % | ||||||||||||
| Foreign currency<br> translation loss | 11,982 | (17,469 | ) | 29,451 | NM | 23,225 | (41,718 | ) | 64,943 | NM | ||||||||||||||
| Total Operating Expenses | 3,319,509 | 2,652,587 | 666,922 | 25.1 | % | 6,346,392 | 5,085,248 | 1,261,144 | 24.8 | % | ||||||||||||||
| Income (loss) from operations | (481,849 | ) | (261,005 | ) | (220,844 | ) | NM | (848,357 | ) | (244,090 | ) | (604,268 | ) | NM | ||||||||||
| Other Income (Expenses): | ||||||||||||||||||||||||
| Other income (expense) | 264 | 399 | (135 | ) | 540 | 634 | (94 | ) | -14.8 | % | ||||||||||||||
| Provision for income taxes | - | - | - | 0.0 | % | (5,770 | ) | (2,505 | ) | (3,265 | ) | NM | ||||||||||||
| Gain on sale<br> of disc'd operations | - | - | - | - | - | - | ||||||||||||||||||
| Total Other Income (Expenses): | 264 | 399 | (135 | ) | -33.8 | % | (5,230 | ) | (1,871 | ) | (3,359 | ) | NM | |||||||||||
| Net income (loss) | $ | (481,585 | ) | $ | (260,606 | ) | (220,979 | ) | NM | $ | (853,587 | ) | $ | (245,961 | ) | (607,627 | ) | NM | ||||||
| NM | NM | |||||||||||||||||||||||
| Adjusted EBITDA | $ | (165,068 | ) | $ | 160,514 | $ | (325,582 | ) | NM | $ | (346,327 | ) | $ | 327,693 | $ | (674,021 | ) | NM | ||||||
| Quarter<br> Ended December 31, | Six<br> Months Ended December 31, | |||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||
| 2021 | 2020 | Change | %<br> Change | 2021 | 2020 | Change | %<br> Change | |||||||||||||||||
| Platforms: | ||||||||||||||||||||||||
| ARR (Annual recurring revenue): | ||||||||||||||||||||||||
| Beginning of Period | $ | 6,282,927 | $ | 4,741,183 | $ | 1,541,744 | 32.5 | % | $ | 5,880,179 | $ | 4,446,088 | $ | 1,434,091 | 32.3 | % | ||||||||
| Incremental<br> ARR | 565,687 | 279,870 | 285,817 | 102.1 | % | 968,434 | 574,965 | 393,469 | 68.4 | % | ||||||||||||||
| End of Period | $ | 6,848,613 | $ | 5,021,053 | $ | 1,827,560 | 36.4 | % | $ | 6,848,613 | $ | 5,021,053 | $ | 1,827,560 | 36.4 | % | ||||||||
| Deployments: | ||||||||||||||||||||||||
| Beginning of Period | 590 | 432 | 158 | 36.6 | % | 553 | 401 | 152 | 37.9 | % | ||||||||||||||
| Incremental<br> Deployments | 56 | 29 | 27 | 93.1 | % | 93 | 60 | 33 | 55.0 | % | ||||||||||||||
| End of Period | 646 | 461 | 185 | 40.1 | % | 646 | 461 | 185 | 40.1 | % | ||||||||||||||
| ASP (Average sales price): | ||||||||||||||||||||||||
| Beginning of Period | $ | 10,649 | $ | 10,975 | $ | (326 | ) | -3.0 | % | $ | 10,633 | $ | 11,088 | $ | (454 | ) | -4.1 | % | ||||||
| End of Period | $ | 10,602 | $ | 10,892 | $ | (290 | ) | -2.7 | % | $ | 10,602 | $ | 10,892 | $ | (290 | ) | -2.7 | % | ||||||
| Transaction Customers: | ||||||||||||||||||||||||
| Corporate customers | 867 | 809 | 58 | 7.2 | % | 860 | 807 | 53 | 6.6 | % | ||||||||||||||
| Academic customers | 312 | 300 | 12 | 4.0 | % | 306 | 293 | 14 | 4.6 | % | ||||||||||||||
| Total customers | 1,179 | 1,109 | 70 | 6.3 | % | 1,166 | 1,100 | 67 | 6.0 | % |
Active Customer Accounts, Transactions and Annual Recurring Revenue
The company defines active customer accounts as the sum of the total quantity of customers per month for each month in the period divided by the respective number of months in the period. The quantity of customers per month is defined as customers with at least one transaction during the month.
A transaction is an order for a unit of copyrighted content fulfilled or managed in the Platform.
The company defines annual recurring revenue (“ARR”) as the value of contracted Platform subscription recurring revenue normalized to a one-year period.
Use of Non-GAAP Measure – Adjusted EBITDA
Research Solutions’ management evaluates and makes operating decisions using various financial metrics. In addition to the company’s GAAP results, management also considers the non-GAAP measure of Adjusted EBITDA. Management believes that this non-GAAP measure provides useful information about the company’s operating results.
The tables below provide a reconciliation of this non-GAAP financial measure with the most directly comparable GAAP financial measure. Adjusted EBITDA is defined as net income (loss), plus interest expense, other income (expense), foreign currency transaction loss, provision for income taxes, depreciation and amortization, stock-based compensation, gain on sale of discontinued operations, and other potential adjustments that may arise. Set forth below is a reconciliation of Adjusted EBITDA to net income (loss):
| Quarter Ended December<br> 31, | Six Months Ended December<br> 31, | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | Change | %<br> Change | 2021 | 2020 | Change | %<br> Change | |||||||||||||||||
| Net Income (loss) | $ | (481,585 | ) | $ | (260,606 | ) | $ | (220,979 | ) | NM | $ | (853,587 | ) | $ | (245,961 | ) | $ | (607,627 | ) | NM | ||||
| Add (deduct): | - | |||||||||||||||||||||||
| Other income (expense) | (264 | ) | (399 | ) | 135 | -33.8 | % | (540 | ) | (634 | ) | 94 | -14.8 | % | ||||||||||
| Foreign currency translation loss | 11,982 | (17,469 | ) | 29,451 | NM | 23,225 | (41,718 | ) | 64,943 | NM | ||||||||||||||
| Provision for income taxes | - | - | - | 5,770 | 2,505 | 3,265 | 130.3 | % | ||||||||||||||||
| Depreciation and amortization | 4,260 | 3,039 | 1,221 | 40.2 | % | 7,156 | 6,762 | 394 | 5.8 | % | ||||||||||||||
| Stock-based compensation | 300,539 | 435,949 | (135,410 | ) | -31.1 | % | 471,649 | 606,739 | (135,090 | ) | -22.3 | % | ||||||||||||
| Gain on sale<br> of disc. ops. | - | - | - | - | - | - | ||||||||||||||||||
| Adjusted EBITDA | $ | (165,068 | ) | $ | 160,514 | $ | (325,582 | ) | NM | $ | (346,327 | ) | $ | 327,693 | $ | (674,021 | ) | NM |
About Research Solutions
Research Solutions, Inc. (NASDAQ: RSSS) provides cloud-based technologies to streamline the process of obtaining, managing, and creating intellectual property. Founded in 2006 as Reprints Desk, the company was a pioneer in developing solutions to serve researchers. Today, more than 70 percent of the top pharmaceutical companies, prestigious universities, and emerging businesses rely on Article Galaxy, the company's SaaS research platform, to streamline access to the latest scientific research and data with 24/7 customer support. For more information and details, please visit www.researchsolutions.comand www.reprintsdesk.com
Important Cautions Regarding Forward-Looking Statements
Certain statements in this press release may contain "forward-looking statements" regarding future events and our future results. All statements other than statements of historical facts are statements that could be deemed to be forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the markets in which we operate and the beliefs and assumptions of our management. Words such as "expects," "anticipates," "targets," "goals," "projects", "intends," "plans," "believes," "seeks," "estimates," "endeavors," "strives," "may," or variations of such words, and similar expressions are intended to identify such forward-looking statements. Readers are cautioned that these forward-looking statements are subject to a number of risks, uncertainties and assumptions that are difficult to predict, estimate or verify. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. Such risks and uncertainties include those factors described in the Company's most recent annual report on Form 10-K, as such may be amended or supplemented by subsequent quarterly reports on Form 10-Q, or other reports filed with the Securities and Exchange Commission. Examples of forward-looking statements in this release include statements regarding additional customers, potential acquisitions and the Company’s prospects for growth. Readers are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements. For more information, please refer to the Company's filings with the Securities and Exchange Commission.
Research Solutions, Inc. and Subsidiaries
Consolidated Balance Sheets
| June 30, | |||||
| 2021 | |||||
| Assets | |||||
| Current assets: | |||||
| Cash and cash equivalents | 10,679,714 | $ | 11,004,337 | ||
| Accounts receivable, net of allowance of 75,655 and 51,495, respectively | 4,618,340 | 4,717,453 | |||
| Prepaid expenses and other current assets | 325,861 | 270,252 | |||
| Prepaid royalties | 655,146 | 904,921 | |||
| Total current assets | 16,279,061 | 16,896,963 | |||
| Other assets: | |||||
| Property and equipment, net of accumulated depreciation of 829,554 and 824,123, respectively | 40,918 | 20,755 | |||
| Deposits and other assets | 880 | 906 | |||
| Total assets | 16,320,859 | $ | 16,918,624 | ||
| Liabilities and Stockholders’ Equity | |||||
| Current liabilities: | |||||
| Accounts payable and accrued expenses | 6,514,905 | $ | 6,687,188 | ||
| Deferred revenue | 4,741,238 | 4,804,351 | |||
| Total current liabilities | 11,256,143 | 11,491,539 | |||
| Commitments and contingencies | |||||
| Stockholders’ equity: | |||||
| Preferred stock; 0.001 par value; 20,000,000 shares authorized; no shares issued and outstanding | — | — | |||
| Common stock; 0.001 par value; 100,000,000 shares authorized; 26,817,056 and 26,498,215 shares issued and outstanding, respectively | 26,817 | 26,498 | |||
| Additional paid-in capital | 27,475,741 | 26,982,052 | |||
| Accumulated deficit | (22,315,475 | ) | (21,461,888 | ) | |
| Accumulated other comprehensive loss | (122,367 | ) | (119,577 | ) | |
| Total stockholders’ equity | 5,064,716 | 5,427,085 | |||
| Total liabilities and stockholders’ equity | 16,320,859 | $ | 16,918,624 |
All values are in US Dollars.
Research Solutions, Inc. and Subsidiaries
Consolidated Statements of Operations and OtherComprehensive Loss
(Unaudited)
| Three Months Ended | Six Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| December 31, | December 31, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Revenue: | ||||||||||||
| Platforms | $ | 1,604,829 | $ | 1,220,535 | $ | 3,114,703 | $ | 2,362,223 | ||||
| Transactions | 6,267,458 | 6,229,200 | 12,500,088 | 12,835,937 | ||||||||
| Total revenue | 7,872,287 | 7,449,735 | 15,614,791 | 15,198,160 | ||||||||
| Cost of revenue: | ||||||||||||
| Platforms | 231,668 | 217,003 | 477,324 | 420,955 | ||||||||
| Transactions | 4,802,959 | 4,841,150 | 9,639,432 | 9,936,047 | ||||||||
| Total cost of revenue | 5,034,627 | 5,058,153 | 10,116,756 | 10,357,002 | ||||||||
| Gross profit | 2,837,660 | 2,391,582 | 5,498,035 | 4,841,158 | ||||||||
| Operating expenses: | ||||||||||||
| Selling, general and administrative | 3,315,249 | 2,649,548 | 6,339,236 | 5,078,486 | ||||||||
| Depreciation and amortization | 4,260 | 3,039 | 7,156 | 6,762 | ||||||||
| Total operating expenses | 3,319,509 | 2,652,587 | 6,346,392 | 5,085,248 | ||||||||
| Loss from operations | (481,849 | ) | (261,005 | ) | (848,357 | ) | (244,090 | ) | ||||
| Other income | 264 | 399 | 540 | 634 | ||||||||
| Loss from operations before provision for income taxes | (481,585 | ) | (260,606 | ) | (847,817 | ) | (243,456 | ) | ||||
| Provision for income taxes | — | — | (5,770 | ) | (2,505 | ) | ||||||
| Net loss | (481,585 | ) | (260,606 | ) | (853,587 | ) | (245,961 | ) | ||||
| Other comprehensive income (loss): | ||||||||||||
| Foreign currency translation | 185 | 5,516 | (2,790 | ) | 6,681 | |||||||
| Comprehensive loss | $ | (481,400 | ) | $ | (255,090 | ) | $ | (856,377 | ) | $ | (239,280 | ) |
| Loss per common share: | ||||||||||||
| Net loss per share, basic and diluted | $ | (0.02 | ) | $ | (0.01 | ) | $ | (0.03 | ) | $ | (0.01 | ) |
| Weighted average common shares outstanding, basic and diluted | 26,351,947 | 25,988,117 | 26,314,532 | 25,943,509 |
Research Solutions, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
| Six Months Ended | ||||||
|---|---|---|---|---|---|---|
| December 31, | ||||||
| 2021 | 2020 | |||||
| Cash flow from operating activities: | ||||||
| Net loss | $ | (853,587 | ) | $ | (245,961 | ) |
| Adjustment to reconcile net loss to net cash provided by (used in) operating activities: | ||||||
| Depreciation and amortization | 7,156 | 6,762 | ||||
| Amortization of lease right | — | 61,886 | ||||
| Fair value of vested stock options | 127,668 | 419,785 | ||||
| Fair value of vested restricted common stock | 343,981 | 186,954 | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable | 99,113 | 221,657 | ||||
| Prepaid expenses and other current assets | (55,609 | ) | (55,533 | ) | ||
| Prepaid royalties | 249,775 | 46,503 | ||||
| Accounts payable and accrued expenses | (172,283 | ) | (550,693 | ) | ||
| Deferred revenue | (63,113 | ) | 861,000 | |||
| Lease liability | — | (67,882 | ) | |||
| Net cash provided by (used in) operating activities | (316,899 | ) | 884,478 | |||
| Cash flow from investing activities: | ||||||
| Purchase of property and equipment | (26,991 | ) | (6,134 | ) | ||
| Net cash used in investing activities | (26,991 | ) | (6,134 | ) | ||
| Cash flow from financing activities: | ||||||
| Proceeds from the exercise of stock options | 30,671 | 14,100 | ||||
| Proceeds from the exercise of warrants | 59,500 | 81,251 | ||||
| Common stock repurchase | (67,812 | ) | (127,274 | ) | ||
| Net cash provided by (used in) financing activities | 22,359 | (31,923 | ) | |||
| Effect of exchange rate changes | (3,092 | ) | 5,527 | |||
| Net increase (decrease) in cash and cash equivalents | (324,623 | ) | 851,948 | |||
| Cash and cash equivalents, beginning of period | 11,004,337 | 9,311,556 | ||||
| Cash and cash equivalents, end of period | $ | 10,679,714 | $ | 10,163,504 | ||
| Supplemental disclosures of cash flow information: | ||||||
| Cash paid for income taxes | $ | 5,770 | $ | 2,505 |
Contact
Steven Hooser or John Beisler
Three Part Advisors
(214) 872-2710
shooser@threepa.com; jbeisler@threepa.com