BELLEVUE, Wash., Dec. 10 /PRNewswire-FirstCall/ -- ITEX Corporation (OTC Bulletin Board: ITEX), The Membership Trading Community(SM), a leading marketplace for cashless business transactions in North America, today filed its Form 10-Q with the Securities and Exchange Commission and announced results for its fiscal 2010 first quarter ended October 31, 2009.
"Income from operations increased more than 15 times over what we reported for the corresponding period last year; when we were investing in our strategic initiatives. We achieved growth in a number of areas during a very difficult economic time while many other businesses recognized declines," said Steven White, Chairman and CEO. "We realized a small increase in revenues for the quarter with expenses and earnings in line with what we anticipated, resulting in an increase in net income. Our cash from operations remained strong."
Mr. White continued, "As I conveyed in my annual letter to shareholders last week, our financial condition has never been stronger. We attribute our financial success in part to our disciplined, conservative and astute management of our finances; our ability to run the company with a lean, smart and dedicated staff; our hard-working broker network and their employees; and our understanding that in order to make forward leaps, we need to follow our entrepreneurial drive with fearless pursuit of opportunity. The upside for growth in our trading community is enormous and largely untapped, while our downside is limited due to the strength of our balance sheet, cash flow and proven revenue streams."
First Quarter 2010 Highlights -- Income from operations of $340,000 compared to $22,000 in the same period last year; -- Revenue of $3,924,000 compared to $3,899,000 in the same period last year; -- Net income of $277,000 compared to $45,000 in the same period last year; -- Cash at end of period was $3,098,000 compared to $2,557,000 on July 31, 2009; -- Stockholder equity of $14,271,000 compared to $13,981,000 in the same period last year; -- Sold our San Francisco, CA corporate owned office to an existing franchisee. Subsequent Event -- In November, we entered into an agreement with U.S. Bank to increase the maximum loan amount under our revolving credit facility from $1.5 million to $2.5 million, to lower the interest rate to 2 1/4% (adjustable), and to extend the maturity date to November 30, 2010. ITEX Corporation's report on Form 10-Q can be found at http://www.sec.gov/. About ITEX
ITEX, The Membership Trading Community(SM), is a thriving network of participating member businesses. Members increase sales through an exclusive distribution channel managed by franchisees, licensees and corporate-owned locations, by utilizing ITEX dollars to exchange goods and services. ITEX is powered by ITEX Payment Systems, the leading payment technology platform for processing cashless business transactions. ITEX is headquartered in Bellevue, WA. For more information, please visit ITEX's website at http://www.itex.com/. We routinely post important information on the investor relations portion of our website.
ITEX CORPORATION CONSOLIDATED BALANCE SHEETS (In thousands, except per share amounts) October 31, July 31, 2009 2009 (unaudited) ----------- -------- ASSETS Current assets: Cash and cash equivalents $3,098 $2,557 Accounts receivable, net of allowance of $340 and $351 765 895 Prepaid expenses 113 82 Loans and advances 50 57 Prepaid advertising credits 157 157 Deferred tax asset 739 739 Notes receivable -corporate office sales 225 242 Other current assets 13 19 --- --- Total current assets 5,160 4,748 Property and equipment, net of accumulated depreciation of $320 and $280 212 247 Intangible assets, net of amortization of $1,832 and $1,703 1,366 1,572 Deferred tax asset, net of current portion 5,641 5,798 Notes receivable -corporate office sales, net of current portion 768 624 Other long-term assets 366 354 Goodwill 3,282 3,318 ----- ----- Total assets $16,795 $16,661 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $53 $98 Commissions payable to brokers 318 691 Accrued commissions to brokers 973 828 Accrued expenses 656 521 Deferred revenue 150 144 Advance payments 132 138 --- --- Total current liabilities 2,282 2,420 Long-term liabilities: Other long-term liabilities 242 260 --- --- Total Liabilities 2,524 2,680 ----- ----- Commitments and contingencies Stockholders' equity: Common stock, $.01 par value; 50,000 shares authorized; 181 179 18,051 and 17,856 shares issued and outstanding, respectively Additional paid-in capital 28,973 28,962 Accumulated deficit (14,883) (15,160) ------- ------- Total stockholders' equity 14,271 13,981 ------ ------ Total liabilities and stockholders' equity $16,795 $16,661 ======= ======= ITEX CORPORATION CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) Three Months ended October 31 2009 2008 ---- ---- (unaudited) (unaudited) ----------- ----------- Revenue Marketplace revenue and other revenue $3,924 $3,899 Cost And expenses: Costs of marketplace revenue 2,549 2,522 Corporate salaries, wages and employee benefits 411 510 Selling, general and administrative 454 660 Depreciation and amortization 170 185 --- --- 3,584 3,877 ----- ----- Income from operations 340 22 Interest, net 11 (2) Other 99 - --- --- 110 (2) --- --- Income before income taxes 450 20 Provision for income taxes 173 (25) --- --- Net income $277 $45 ==== === Net income per common share Basic $0.02 $- Diluted $0.02 $- Average common and equivalent shares Basic 17,856 17,720 Diluted 17,905 17,816
This press release contains forward-looking statements that involve risks and uncertainties concerning our expected performance (as described without limitation in the quotations from current management in this release) and comments within the safe harbor provisions established under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of our future performance. We believe that these potential risks and uncertainties include, without limitation: the continuing development of successful marketing strategies for our concepts; our ability to increase revenues and sustain profitability; the availability of adequate working capital; our dependence both on key personnel and our franchise network; and the effect of changes in the overall economy and in technology. Statements in this release should be evaluated in light of these factors. These risk factors and other important factors that could affect our business and financial results are discussed in our periodic reports and filings with the Securities and Exchange Commission, including our Forms 10-K and Forms 10-Q, which are available at http://www.sec.gov/. All information set forth in this release is as of December 10, 2009, and ITEX undertakes no duty to update this information.
For more information, please visit http://www.itex.com/
ITEX Corporation
CONTACT: Alan Zimmelman of ITEX Corporation, +1-425-463-4017,
alan@itex.com
Web Site: http://www.itex.com/
