Intellinetics, Inc. Reports Second Quarter and Six-Month Financial Results

Revenue and Channel Growth Accelerating

COLUMBUS, Ohio--(BUSINESS WIRE)-- Intellinetics, Inc. (OTCQB: INLX), an Enterprise Content Management (ECM) software company focused on cloud-based document solutions for the Small to Medium Business (SMB) market, announced financial results for the second quarter and six months ended June 30, 2016.

Second Quarter Highlights

  1. 8.4% increase in Revenue
  2. 91% increase in Software as a service revenues
  3. Expanded internal sales team
  4. Expanded sales channel

Second Quarter Results

Revenues for the three months ended June 30, 2016 were $636,749 as compared with $587,170 for the same period in 2015. The increase is primarily attributed to revenues from the sale of software as a service, software maintenance services, and third-party services.

Intellinetics reported a net loss of $401,964 and $642,742 for the three months ended June 30, 2016 and 2015, respectively, representing a decrease in net loss of $240,778, or 37%. Net loss per share for the three months ended June 30, 2016 and 2015 was ($0.02) and ($0.09), respectively.

Six-Month Results

Revenues for the six months ended June 30, 2016 were $1,240,140 as compared with $1,170,945 for the same period in 2015. Intellinetics reported a net loss of $937,730 and $851,599, respectively, for the six months ended June 30, 2016 and 2015, respectively, an increase of $86,161. Net loss per share for the six months ended June 30, 2016 and 2015 was ($0.06) and ($0.12), respectively, a decrease of 50%.

Matthew L. Chretien, President and CEO of Intellinetics, noted that, “Q2 results, including markedly improved top and bottom line numbers, do not yet reflect the progress we have made and the foundation that was laid during the quarter to position the Company for accelerated growth during the balance of the year and beyond. We have doubled the internal sales team to six during this quarter.

“Because of the increase of our sales staff, and particularly because of the growth of our sales channel partners, we recently established IntelliCloud™ University ( This automated system provides sales training and marketing services to help increase partner sales competency and revenue production. These investments are key objectives in our strategy, which have already resulted in a 91% increase in recurring, cloud-based revenue this period, and are critical steps to build shareholder value and financial strength as we grow,” concluded Chretien.

IntelliCloud™ – Powered by the Intel® NUC

The Intellinetics IntelliCloud Program provides turnkey document workflow solutions for SMBs through a growing network of channel partners who already serve them. Our channel partners simply attach IntelliCloud to the software, hardware, and/or services they already sell to existing customers and deliver more value to the customer and create new/recurring revenue streams for themselves…and us, all without the sales or technical complexity of other less effective options in the market.

About Intellinetics, Inc.

Intellinetics, Inc. is a Columbus, Ohio-based ECM software company. Intellinetics partnered with Intel to create the IntelliCloud Channel Program that makes it easy to add turnkey document workflow solutions to the copiers, productivity software and services they already provide. IntelliCloud provides dealers a “deploy once, use many” innovation where one IntelliCloud customer sale/activation creates endless possibilities to add other software applications that deliver more value and increase revenue. For additional information, please visit:

Cautionary Statement

Statements in this press release which are not purely historical, including statements regarding Intellinetics’ intentions, beliefs, expectations, representations, projections, plans or strategies regarding future events, operations and financial results, are forward-looking statements. Forward-looking statements include statements regarding accelerated growth, increased partner sales competency and revenue production and building shareholder value and financial strength, new products and solutions and statements of assumptions underlying the foregoing. The forward-looking statements are not guarantees of future performance or events and are subject to a number of risks and uncertainties and other factors that are difficult to predict and could cause actual results to differ materially from those expressed, projected or implied by such forward-looking statements including, but not limited to, the risks associated with the effect of changing economic conditions, trends in the products markets, customer and channel acceptance of new solutions, variations and limitations in the company’s cash flow and the inadequacy of capital resources to fund operations for the next 9 to 12 months, market acceptance risks, technical development risks, and other risks, uncertainties and other factors identified from time to time in its reports filed with or furnished to the Securities and Exchange Commission, including the company's most recent Annual Report on Form 10-K, as well as subsequently filed reports on Form 10-Q and Form 8-K. Accordingly, there is no assurance that the results expressed, projected or implied by any forward-looking statements will be achieved, and the company cautions investors not to place undue reliance on the forward-looking statements contained in this press release. The forward-looking statements in this press release speak only as of the date hereof and are based on the current plans, goals, objectives, strategies, intentions, expectations and assumptions of, and the information currently available to, management. Intellinetics disclaims any obligation and does not undertake to update or revise any forward-looking statements in this press release. Expanded and historical information is made available to the public by Intellinetics and its Affiliates on its website or at or at

Condensed Consolidated Statements of Operations
  For the Three Months Ended June 30,   For the Six Months Ended June 30,
  2016       2015       2016       2015  
Sale of software $ 101,694 $ 147,723 $ 192,568 $ 337,760
Software as a service 116,343 60,966 226,499 117,505
Software maintenance services 245,317 231,939 491,913 460,610
Professional services 85,609 92,782 183,785 175,020
Third Party services 87,786 53,760 145,375 80,050
Total revenues   636,749     587,170       1,240,140     1,170,945  
Cost of revenues:
Sale of software 18,051 19,704 37,569 67,226
Software as a service 37,054 11,764 61,642 22,674
Software maintenance services 37,988 31,451 84,546 62,459
Professional services 30,612 23,593 61,967 44,111
Third Party services   55,373     35,933       82,814     39,512  
Total cost of revenues   179,078     122,445       328,538     235,982  
Gross profit   457,671     464,725       911,602     934,963  
Operating expenses:
General and administrative 528,163 791,404 1,177,292 1,157,245
Sales and marketing 304,593 217,679 503,536 431,655
Depreciation   2,767     2,673       5,723     6,051  
Total operating expenses   835,523     1,011,756       1,686,551     1,594,951  
Loss from operations (377,852 ) (547,031 ) (774,949 ) (659,988 )
Other income (expense)
Interest expense, net   (24,112 )   (95,711 )     (162,781 )   (191,611 )
Total other income (expense) (24,112 ) (95,711 ) (162,781 ) (191,611 )
Net loss $ (401,964 ) $ (642,742 )   $ (937,730 ) $ (851,599 )
Basic and diluted net loss per share: $ (0.02 ) $ (0.09 ) $ (0.06 ) $ (0.12 )

Weighted average number of common shares outstanding - basic and diluted

  16,794,992     7,123,024     16,529,023     7,123,024  
Condensed Consolidated Balance Sheets
June 30, December 31,
  2016     2015  
Current assets:
Cash $ 401,842 $ 1,117,118
Accounts receivable, net 281,353 217,028
Prepaid expenses and other current assets   169,885     46,521  
Total current assets 853,080 1,380,667
Property and equipment, net 19,891 22,603
Other assets   10,285     10,285  
Total assets $ 883,256   $ 1,413,555  
Current liabilities:
Accounts payable and accrued expenses $ 694,812 $ 826,864
Deferred revenues 479,587 638,193
Deferred compensation 215,012 215,012
Notes payable - current 323,934 401,573
Notes payable - related party - current   36,449     92,805  
Total current liabilities 1,749,794 2,174,447
Long-term liabilities:
Notes payable - net of current portion 606,260 782,206
Notes payable - related party 108,706 127,409
Deferred interest expense 152,018 136,078
Other long-term liabilities - related parties   -     12,852  
Total long-term liabilities   866,984     1,058,545  
Total liabilities 2,616,778 3,232,992
Stockholders' deficit:

Common stock, $0.001 par value, 50,000,000 shares authorized; 16,794,992 and 14,908,439 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively

26,795 21,909
Additional paid-in capital 12,555,852 11,537,093
Accumulated deficit   (14,316,169 )   (13,378,439 )
Total stockholders' deficit   (1,733,522 )   (1,819,437 )
Total liabilities and stockholders' deficit $ 883,256   $ 1,413,555  

Bibicoff + MacInnis, Inc.
Terri MacInnis, VP of Investor Relations

Source: Intellinetics, Inc.