InsPro Technologies Corporation Announces Fourth Quarter and 2012 Full Year Financial Results
InsPro Technologies Corporation Announces Fourth Quarter and 2012 Full Year Financial Results
RADNOR, Pa.--(BUSINESS WIRE)-- InsPro Technologies Corporation (OTC Bulletin Board: ITCC), a leading provider of Life and Health core policy administration software that enables insurance carriers and third-party administrators to quickly respond to evolving market needs, improve customer service and reduce operating costs today announced its financial results for the quarter and year ended December 31, 2012.
Fourth Quarter 2012 Highlights
Revenues from continuing operations decreased 3% to $3,311,087 in the fourth quarter of 2012, compared to $3,421,793 in the fourth quarter of 2011 primarily due to $1,600,000 license fee revenue recognized in 2011 pertaining to the completion of a large implementation of InsPro Enterprise™, which was offset in 2012 by increased professional services fees and higher ASP/Hosting and maintenance revenue.
Loss from continuing operations was $1,196,557 in the fourth quarter of 2012, compared to a gain of $394,396 in the fourth quarter of 2011. The results from continuing operations in 2011 were favorably impacted by the $1,600,000 of license fee revenue.
Net loss was $1,018,366 in the fourth quarter of 2012, compared to net income of $1,958,597 in the fourth quarter of 2011. The 2012 net loss included a non cash gain on the change of the fair value of warrant liability of $74,999 while the 2011 net income included a non cash gain of $1,426,443 on the change in the fair value of the warrant liability and the $1,600,000 of license fee revenue.
2012 Full Year Highlights
Revenues from continuing operations increased 34% to $12,146,237 in 2012, compared to $9,057,816 in 2011. Increased professional services fees, ASP/Hosting revenue and maintenance revenue in 2012 as compared to 2011 more than offset lower license fee revenue in 2012.
Loss from continuing operations increased to $3,896,053 in 2012 compared to a loss of $2,670,538 in 2011. The results from continuing operations in 2011 were favorably impacted by $1,935,000 of license fee revenue.
Net loss was $7,883,145 in 2012 compared to net income of $489,049 in 2011. 2012's net loss included a non cash loss on the change of the fair value of warrant liability of $4,422,079 compared to non cash gain of $2,356,114 on the change of the fair value of warrant liability and $1,935,000 of license fee revenue in 2011.
Anthony R. Verdi, Chief Executive Officer, stated, "2012 was another year of milestones including the initiation of four new implementations of InsPro Enterprise™, achieving significant revenue growth, continuing to innovate the scope and scale of our technology and culminated in a rank in the top third of technology companies on Deloitte's "Fast 500" list. 2013 promises to be equally active beginning with the upcoming release of annuity product support as part of InsPro Enterprise."
About InsPro Enterprise
InsPro Enterprise, a Life and Health insurance policy administration system, is a web-based technology solution used to manage all insurance processing requirements, supporting Individual and Group Life, Health, Annuity and Hybrid products on a single platform. The InsPro Enterprise system is highly configurable by the business user, and provides carriers and third-party administrators with the option to deploy the solution as an end-to-end straight through processing suite or on a modular componentized basis to address immediate areas of concern. The InsPro Enterprise suite includes Product Configuration Workbench, New Business and Underwriting, Billing and Collections, Policy Administration, Agent Management and Commissions, Claims, Document Management, Web Portals, and Data Analytics.
About InsPro Technologies Corporation
Through its subsidiary, InsPro Technologies, LLC, InsPro Technologies Corporation offers InsPro Enterprise, an innovative, end-to-end policy administration system used by insurance carriers and third-party administrators. InsPro Enterprise contains preconfigured, product-specific templates supported by simple, intuitive Wizards that easily and efficiently meet client needs. By managing the entire product and policy lifecycle on a single integrated platform, clients can accelerate new product introductions, lower costs, increase customer satisfaction and improve operational performance. InsPro's solutions are offered through standard software licensing, as a hosted solution, or via Software as a Service (SaaS) delivery.
For additional information on InsPro Technologies, LLC and InsPro Enterprise please visit www.inspro.com.
Forward-Looking Statements
In addition to historical facts or statements of current condition, this press release contains forward-looking statements within the meaning of the "Safe Harbor" provisions of The Private Securities Litigation Reform Act of 1995, including statements regarding current and future capabilities and products supported, quality and growth potential of our technology platform, including related services, and providing the financial support and other resources needed to demonstrate the strength of this growing technology business and to continue to reinvest in the product. Forward-looking statements provide InsPro Technologies Corporation current expectations or forecasts of future events. Moreover, InsPro Technologies Corporation cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially from the statements made, including risks described in InsPro Technologies' most recent Quarterly Reports on Form 10-Q or Annual Reports on Form 10-K filed with the Securities and Exchange Commission and available on the Securities and Exchange Commission's website at www.sec.gov. InsPro Technologies Corporation does not undertake any obligation to update any forward-looking statement to conform the statement to actual results or changes in expectations
INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES | ||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
For the Three Months Ended December 31, | For the Year Ended December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Revenues | $ | 3,311,087 | $ | 3,421,793 | $ | 12,146,237 | $ | 9,057,816 | ||||||||
Cost of revenues | 3,145,598 | 1,913,542 | 10,990,246 | 6,948,872 | ||||||||||||
Gross profit | 165,489 | 1,508,251 | 1,155,991 | 2,108,944 | ||||||||||||
Selling, general and administrative expenses: | ||||||||||||||||
Salaries, employee benefits and related taxes | 586,642 | 562,321 | 2,322,425 | 2,615,602 | ||||||||||||
Advertising and other marketing | 72,546 | 43,887 | 217,665 | 125,130 | ||||||||||||
Depreciation and amortization | 175,243 | 165,733 | 892,315 | 687,042 | ||||||||||||
Rent, utilities, telephone and communications | 91,939 | 85,973 | 373,292 | 368,336 | ||||||||||||
Professional fees | 271,870 | 131,150 | 657,277 | 439,006 | ||||||||||||
Other general and administrative | 163,806 | 124,791 | 589,070 | 544,366 | ||||||||||||
1,362,046 | 1,113,855 | 5,052,044 | 4,779,482 | |||||||||||||
Gain (loss) from operations | (1,196,557 | ) | 394,396 | (3,896,053 | ) | (2,670,538 | ) | |||||||||
Gain from discontinued operations | 111,469 | 165,955 | 520,563 | 803,989 | ||||||||||||
Other income (expense): | ||||||||||||||||
Gain on the change of the fair value of warrant liability | 74,999 | 1,426,443 | (4,433,079 | ) | 2,356,114 | |||||||||||
Interest income | - | 3,561 | 4,008 | 23,044 | ||||||||||||
Interest expense | (8,277 | ) | (4,758 | ) | (78,584 | ) | (23,560 | ) | ||||||||
Total other income (expense) | 66,722 | 1,425,246 | (4,507,655 | ) | 2,355,598 | |||||||||||
Net income (loss) | $ | (1,018,366 | ) | $ | 1,985,597 | $ | (7,883,145 | ) | $ | 489,049 | ||||||
Net income (loss) per common share - basic and diluted: | ||||||||||||||||
Gain (loss) from operations | $ | (0.02 | ) | $ | 0.05 | $ | (0.20 | ) | $ | (0.01 | ) | |||||
Gain from discontinued operations | 0.00 | 0.00 | 0.01 | 0.02 | ||||||||||||
Net income (loss) per common share | $ | (0.02 | ) | $ | 0.05 | $ | (0.19 | ) | $ | 0.01 | ||||||
Weighted average common shares outstanding - basic and diluted | 41,543,655 | 41,543,655 | 41,543,655 | 41,543,655 | ||||||||||||
INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
December 31, 2012 | December 31, 2011 | |||||||
ASSETS | ||||||||
CURRENT ASSETS: | ||||||||
Cash | $ | 3,347,689 | $ | 3,702,053 | ||||
Accounts receivable, net | 1,706,414 | 1,506,234 | ||||||
Prepaid expenses | 236,719 | 116,649 | ||||||
Other current assets | 1,723 | 2,905 | ||||||
Assets of discontinued operations | 63,519 | 104,002 | ||||||
Total current assets | 5,356,064 | 5,431,843 | ||||||
Property and equipment, net | 1,422,043 | 496,692 | ||||||
Intangibles, net | - | 260,050 | ||||||
Other assets | 70,000 | 80,608 | ||||||
Total assets | $ | 6,848,107 | $ | 6,269,193 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
CURRENT LIABILITIES: | ||||||||
Note payable | $ | 551,985 | $ | 8,586 | ||||
Accounts payable | 1,561,403 | 644,563 | ||||||
Accrued expenses | 523,324 | 521,383 | ||||||
Current portion of capital lease obligations | 61,849 | 109,872 | ||||||
Deferred revenue | 1,680,833 | 622,500 | ||||||
Total current liabilities | 4,379,394 | 1,906,904 | ||||||
LONG TERM LIABILITIES: | ||||||||
Warrant liability | 225,000 | 1,674,226 | ||||||
Capital lease obligations | 83,510 | 113,943 | ||||||
Total long term liabilities | 308,510 | 1,788,169 | ||||||
Total liabilities | 4,687,904 | 3,695,073 | ||||||
SHAREHOLDERS' EQUITY: | ||||||||
Preferred stock ($.001 par value; 20,000,000 shares authorized) | ||||||||
Series A convertible preferred stock; 3,437,500 shares authorized, 1,276,750 | ||||||||
shares issued and outstanding (liquidation value $12,767,500) | 2,864,104 | 2,864,104 | ||||||
Series B convertible preferred stock; 5,000,000 shares authorized, 3,297,378 | ||||||||
and 2,797,379 shares issued and outstanding (liquidation value $9,892,134 | ||||||||
and $8,392,137) | 6,617,812 | 5,427,604 | ||||||
Common stock ($.001 par value; 300,000,000 shares authorized, 41,543,655 | ||||||||
shares issued and outstanding) | 41,543 | 41,543 | ||||||
Additional paid-in capital | 43,317,338 | 37,038,318 | ||||||
Accumulated deficit | (50,680,594 | ) | (42,797,449 | ) | ||||
Total shareholders' equity | 2,160,203 | 2,574,120 | ||||||
Total liabilities and shareholders' equity | $ | 6,848,107 | $ | 6,269,193 | ||||
INSPRO TECHNOLOGIES CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
For the Year Ended December 31, | ||||||||
2012 | 2011 | |||||||
Cash Flows From Operating Activities: | ||||||||
Net income (loss) | $ | (7,883,145 | ) | $ | 489,049 | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Depreciation and amortization | 892,315 | 687,042 | ||||||
Stock-based compensation | 96,717 | 274,303 | ||||||
Loss (Gain) on change of fair value of warrant liability | 4,433,079 | (2,356,114 | ) | |||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | (200,180 | ) | (796,731 | ) | ||||
Prepaid expenses | (120,070 | ) | 41,596 | |||||
Other current assets | 1,182 | 5,306 | ||||||
Other assets | 10,608 | 11,950 | ||||||
Accounts payable | 916,840 | (274,409 | ) | |||||
Accrued expenses | 1,941 | 174,575 | ||||||
Deferred revenue | 1,058,333 | 245,000 | ||||||
Assets of discontinued operations | 40,483 | (40,701 | ) | |||||
Net cash used in operating activities | (751,897 | ) | (1,539,134 | ) | ||||
Cash Flows From Investing Activities: | ||||||||
Purchase of property and equipment | (1,530,175 | ) | (223,382 | ) | ||||
Net cash used in investing activities | (1,530,175 | ) | (223,382 | ) | ||||
Cash Flows From Financing Activities: | ||||||||
Gross proceeds from sale of preferred stock and warrants | 1,499,997 | - | ||||||
Fees paid in connection with sale of preferred stock and warrants | (9,790 | ) | - | |||||
Gross proceeds from notes and loans payable | 643,206 | 37,540 | ||||||
Payments on notes payable | (99,807 | ) | (46,265 | ) | ||||
Fees paid in connection with secured note from related party | - | (8,370 | ) | |||||
Gross proceeds from capital leases | - | 58,791 | ||||||
Payments on capit | ||||||||
