News

GlobalWise Investments Reports

Second Quarter and Six-Month Results

 

COLUMBUS, OH – (August 14, 2014) – GlobalWise Investments, Inc. (OTCQB: INLX) and its wholly owned subsidiary Intellinetics, Inc., a leading-edge technology company focused on the design, implementation and management of cloud-based Enterprise Content Management (“ECM”) systems in both the public and private sectors, announced financial results for the second quarter and six-month periods ended June 30, 2014.

 

Second Quarter Results

Total revenues for the three months ended June 30, 2014 were $326,352, as compared with $471,174 for the same period in 2013, a decrease of $144,822, or 31%, primarily attributable to decreases in revenues from the sale of software.

 

Overall gross margins were 79% and 61% for the three months ended June 30, 2014 and 2013, respectively, an increase of 18%.

 

Total operating expenses were $574,939 for the three months ended June 30, 2014, as compared with $766,481 for the three months ended June 30, 2013, representing a decrease of $191,542 or 25%. The decrease in operating expenses is primarily due to a reduction in sales and marketing expense.

 

GlobalWise reported a net loss of $372,714 and $518,897 for the three months ended June 30, 2014 and 2013, respectively, representing a decrease in net loss of $146,183, or 28%.

 

Six-Month Results

For the six months ended June 30, 2014, the Company’s total revenues were $625,535, as compared with $826,046 for the same period in 2013, a decrease of $200,511 or 24%, primarily attributable to decreases in revenues from the sale of software and professional services. Overall gross margins were 79% and 56% for the six months ended June 30, 2014 and 2013, respectively, an increase of 23%.

 

Total operating expenses for the six months ended June 30, 2014 and 2013 were $1,166,512 and $1,567,755, respectively, a decrease of $401,243 or 26%. The decrease in operating expenses is primarily due to a reduction in sales and marketing expense and a decrease in administrative expenses from the reduction in personnel.

 

For the six months ended June 30, 2014 and 2013, the Company reported a net loss of $776,536 and $1,190,694, respectively, representing a decrease of $414,158 or 35%.

 

Positioning Company for Long-Term Growth and Profitability

Matthew L. Chretien, President and CEO of GlobalWise, stated, “In Q2 of 2014, Intellinetics continued to implement MarketCommand™, which we refer to as IntelliCloud™, our reseller program for print/imaging and IT solutions providers. We have presently have five partners who are actively selling IntelliCloud based solutions.

 

“Our strategic shift in focus from premise-based, one-time sales to the new low-cost, cloud-based IntelliCloud model does bring a contraction of short-term revenue. In our model, sustained revenue growth is coupled with the increase in active IntelliCloud users, which will generate growing recurring revenue. The overall increase in operating margins reflect this migration to higher margin IntelliCloud based revenue impact,” Chretien concluded.

 

The following video link below captures the simplicity of IntelliCloud in action. Its power is in the simplicity of messaging and its delivery as a feature of the multi-function devices most businesses already own.

 

IntelliCloud™ Overview Video: http://www.intellinetics.com/video

  

 
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About GlobalWise Investments, Inc.

GlobalWise Investments, Inc., via its wholly owned subsidiary Intellinetics, Inc., is a Columbus, Ohio-based Enterprise Content Management (ECM) pioneer with industry-leading software that delivers cloud ECM based solutions on-demand. The Company’s flagship platform, Intellivue™, represents a new industry benchmark and game-changing solution by enabling clients to access and manage the content of every scanned document, file, spreadsheet, email, photo, audio file or video tape — virtually anything that can be digitized — in their enterprise from any PC, laptop, tablet or smartphone from anywhere in the world. For additional information, please visit: www.Intellinetics.com

 

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 the future are forward-looking statements. The forward-looking statements involve risks and uncertainties including, but not limited to, the risks associated with the effect of changing economic conditions, trends in the products markets, variations in the company's cash flow or adequacy of capital resources, market acceptance risks, technical development risks, and other risk factors. The company cautions investors not to place undue reliance on the forward-looking statements contained in this press release. 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 www.intellinetics.com or at www.sec.gov .

 

Contact:

Matthew Chretien, Pres. & CEO

GlobalWise Investments, Inc.

614-388-8909 matt@intellinetics.com

 

 
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GLOBALWISE INVESTMENTS, INC. and SUBSIDIARY

Condensed Consolidated Balance Sheets

               

 

ASSETS
  Unaudited     
  June 30,   December 31, 
   2014   2013 
Current assets:          
Cash  $381,092   $260,560 
Accounts receivable, net   229,603    144,071 
Prepaid expenses and other current assets   46,621    39,242 
Total current assets   657,316    443,873 
Property and equipment, net   43,005    53,226 
Other assets   24,767    28,925 
Total assets  $725,088   $526,024 
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:          
Accounts payable and accrued expenses  $677,673   $502,646 
Deferred revenues   614,990    482,428 
Deferred compensation   215,012    - 
Notes payable - current   846,000    711,266 
Notes payable - related party - current   215,415    - 
Total current liabilities   2,569,090    1,696,340 
Long-term liabilities:          
Deferred compensation   -    215,012 
Notes payable - net of current portion   1,611,435    1,114,394 
Notes payable - related party   40,000    222,915 
Deferred interest expense   78,869    83,942 
Other long-term liabilities - related parties   43,423    34,614 
Total long-term liabilities   1,773,727    1,670,877 
Total liabilities   4,342,817    3,367,217 
Stockholders'  deficit:          
Common stock, $0.001 par value, 50,000,000 shares authorized;          
 47,362,047 shares issued and outstanding at June 30, 2014 and December 31, 2013   54,363    54,363 
Additional paid-in capital   4,912,814    4,912,814 
Accumulated deficit   (8,584,906)   (7,808,370)
Total stockholders' deficit   (3,617,729)   (2,841,193)
Total liabilities and stockholders' deficit  $725,088   $526,024 

  

 
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GLOBALWISE INVESTMENTS, INC. and SUBSIDIARY

Condensed Consolidated Statements of Operations

(Unaudited)

               

 

   For the Three Months Ended June 30,   For the Six Months Ended June 30, 
   2014   2013   2014   2013 
       (As Restated)       (As Restated) 
Revenues:                    
Sale of software  $4,496   $160,352   $12,496   $169,012 
Software as a service   41,028    34,320    80,470    69,111 
Software maintenance services   212,000    213,542    422,522    437,006 
Professional services   47,350    45,771    76,774    118,543 
Third Party services   21,478    17,189    33,273    32,374 
                     
Total revenues   326,352    471,174    625,535    826,046 
                     
Cost of revenues:                    
Sale of software   1,260    123,748    7,704    245,054 
Software as a service   6,941    6,893    13,870    13,803 
Software maintenance services   31,076    32,374    62,823    60,324 
Professional services   10,627    4,685    20,338    6,003 
Third Party services   18,631    14,663    27,228    36,665 
                     
Total cost of revenues   68,535    182,363    131,963    361,849 
                     
Gross profit   257,817    288,811    493,572    464,197 
                     
Operating expenses:                    
General and administrative   443,077    507,469    911,547    1,075,617 
Sales and marketing   125,052    252,240    241,225    480,022 
Depreciation   6,810    6,772    13,740    12,116 
                     
Total operating expenses   574,939    766,481    1,166,512    1,567,755 
                     
Loss from operations   (317,122)   (477,670)   (672,940)   (1,103,558)
                     
Other income (expense)                    
Derivative gain   -    -    -    15,470 
Interest expense, net   (55,592)   (41,227)   (103,596)   (102,606)
                     
Total other income (expense)   (55,592)   (41,227)   (103,596)   (87,136)
                     
Net loss  $(372,714)  $(518,897)  $(776,536)  $(1,190,694)
                     
Basic and diluted net loss per share:  $(0.01)  $(0.01)  $(0.02)  $(0.03)
                     
                     
Weighted average number of common shares  outstanding - basic and diluted   47,362,047    47,362,047    47,362,047    43,182,708