Concierge Technologies Reports Fiscal First Quarter Financial Results

Balance Sheet Remains Strong, with Essentially No Debt

SAN CLEMENTE, CA / ACCESSWIRE / November 14, 2019 / Concierge Technologies, Inc. (OTCQB: CNCG), a diversified global holding firm, today announced financial results for the first fiscal quarter ended September 30, 2019.

The company reported revenues of $6.0 million for the three months ended September 30, 2019, compared with $7.2 million for the prior year. Net income for the most recent three-month period amounted to $54,892, equal to $0.00 per share, versus $285,954, or $0.01 per share, for the comparable prior year period.

Results for the fiscal 2020 first quarter, as anticipated, were impacted primarily by lower assets under management (AUM) at the company’s Wainwright Holdings funds management subsidiary. Wainwright, which operates under the name, USCF Investments, currently manages 13 commodity-oriented exchange-traded funds (ETFs) that are listed on the New York Stock Exchange.

The company’s Other business segment, which comprised approximately 50 percent of total revenues in the most recent first quarter vs 41 percent of revenues in last year’s first quarter, achieved improved revenues and income for the fiscal 2020 period. The Other segment is comprised of Gourmet Foods, Brigadier Security Systems and Original Sprout.

Concierge’s balance sheet further strengthened at the end of the first fiscal quarter. Cash and cash equivalents totaled $6.9 million, compared with $6.5 million at June 30, 2019. Total stockholders’ equity increased to $17.3 million at September 30, 2019 from $17.2 million at the end of fiscal 2019. The company has essentially no debt.

“USCF, our commodities-focused fund management subsidiary, experienced a decline in AUM throughout the past year, as did the entire commodities sector,” said David Neibert, chief operations officer of Concierge Technologies. “Nevertheless, USCF continues to be profitable at current AUM levels and is expected to benefit when the cyclical trend for commodities shifts upward.”

The table below summarizes the performance of the Financial Services business unit as compared to Other for the three-month periods ended September 30, 2019 and 2018.

($’s in thousands)
  Financial Services For the Three Months Ended September 30,     Other Operating Units For the Three Months Ended September 30,     Concierge Corporate For the Three Months Ended September 30,     Consolidated For the Three Months Ended September 30,  
 
  2019     2018     Change     2019     2018     Change     2019     2018     Change     2019     2018     Change  
 
              $     %                 $     %                 $     %                 $     %  
Revenue
  $ 3,041     $ 4,223     $ (1,182 )     (28 %)   $ 2,987     $ 2,954     $ 33       1 %                           $ 6,028     $ 7,177     $ (1,149 )        
% of total revenue
    50 %     59 %             (9 %)     50 %     41 %             9 %                                                        
Cost of revenue
                                  $ 1,769     $ 1,838     $ (69 )     (4 %)                           $ 1,769     $ 1,838     $ (69 )        
Gross profit
  $ 3,041     $ 4,223     $ (1,182 )     (28 %)   $ 1,218     $ 1,116     $ 102       9 %                           $ 4,259     $ 5,339     $ (1,080 )        
Operating expenses
    2,843       3,633     $ (790 )     (22 %)     866       802       64       8 %   $ 489     $ 335     $ 154       46 %     4,198       4,770       (572 )        
% of total operating expenses
    68 %     76 %             (8 %)     20 %     17 %             3 %     12 %     7 %             5 %                                
Income (loss) from operations
  $ 198     $ 590     $ (392 )     (66 %)   $ 352     $ 314     $ 38       12 %   $ (489 %)     (335 )   $ (154 )     (46 %)   $ 61     $ 569     $ (508 )        
Other (expense) / income
    15       (175 )     190       109 %     6     $ 2     $ 4       238 %     2       (6 )   $ 8       133 %     23       (179 )     202          
Income (loss) before income taxes
  $ 213     $ 415     $ (202 )     (49 %)   $ 358     $ 316     $ 42       13 %   $ (487 )   $ (341 )   $ (146 )     (43 %)   $ 84     $ 390     $ (306 )        

“The management teams at our Other operating units continue to make good progress. They are building their respective businesses, with strategies in place for adding new, larger distribution channels to enhance growth,” Neibert said.

“As a global holding company, our corporate goal remains to build a profitable, diverse organization, through organic growth, acquisitions and new ventures,” added Nicholas Gerber, chairman and chief executive officer. “We are laser-focused on creating and sustaining tangible long-term value for all of our stakeholders, while at the same time not being reliant on any one business sector for that sustainability.”

Business Units

Gourmet Foods, https://gourmetfoodsltd.co.nz/, acquired in August 2015, is a commercial-scale bakery that produces and distributes iconic meat pies and pastries throughout New Zealand under the brand names Pat’s Pantry and Ponsonby Pies.

Brigadier Security Systems, www.brigadiersecurity.com, acquired in June 2016 and headquartered in Saskatoon, Canada, provides comprehensive security solutions to homes and businesses, government offices, schools and other public buildings throughout the province.

The company’s USCF Investments operation, www.uscfinvestments.com, acquired as part of the Wainwright Holdings transaction in December 2016 and based in Walnut Creek, Calif., serves as manager, operator or investment adviser to 13 exchange traded products, structured as limited partnerships or investment trusts that issue shares trading on the NYSE Arca.

Acquired by Concierge at the end of 2017, California-based Original Sprout, www.originalsprout.com, produces and distributes a full line of vegan, safe, non-toxic hair and skin care products, including a “reef safe” sun screen, in the U.S. and its territories, the U.K., E.U., Turkey, Middle East, Africa, Taiwan, Singapore, Hong Kong, Malaysia, New Zealand, Australia and Canada.

About Concierge Technologies, Inc.

Concierge Technologies, originally founded in 1996, was repositioned as a global holding firm in 2015, and currently has operating subsidiaries in financial services, food manufacturing, security systems and beauty products. Offices and manufacturing operations are in the U.S., New Zealand and Canada. For more information, visit www.conciergetechnology.net.

Forward-Looking Statements

This press release may contain “forward-looking statements” that include information relating to Concierge Technologies’ future events and future financial and operating performance. Such forward-looking statements, including, but not limited to, adding new distribution channels and an expectation for the USCF operating subsidiary to benefit when the cyclical trend for commodities shifts upward, should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements.

For a more detailed description of the risk factors and uncertainties affecting Concierge Technologies or its subsidiary companies, and more detailed information about the individual operating entities, please refer to the Company’s Securities and Exchange Commission filings, which are available on the Company’s website, (http://www.conciergetechnology.net), or at www.sec.gov.

Financial Tables Follow

CONCIERGE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

 
  September 30, 2019     June 30,
2019
 
 
        (AUDITED)  
ASSETS
           
 
           
CURRENT ASSETS
           
Cash and cash equivalents
  6,904,137     6,481,815  
Accounts receivable, net
    875,672       939,649  
Accounts receivable – related parties
    988,769       1,037,146  
Inventories
    1,049,184       1,008,662  
Prepaid income tax and tax receivable
    1,232,219       1,754,369  
Investments
    3,775,158       3,756,596  
Other current assets
    265,796       546,105  
Total current assets
    15,090,935       15,524,342  
 
               
Restricted cash
    12,543       13,436  
Property and equipment, net
    1,299,866       757,014  
Operating lease right-of-use asset
    1,005,006        
Goodwill
    915,790       915,790  
Intangible assets, net
    2,575,156       2,659,723  
Deferred tax assets, net
    859,696       859,696  
Other assets, long – term
    523,607       523,607  
Total assets
  22,282,599     21,253,608  
 
               
 LIABILITIES AND STOCKHOLDERS’ EQUITY    
 
               
CURRENT LIABILITIES
               
Accounts payable and accrued expenses
  2,533,875     2,867,081  
Expense waivers – related parties
    213,095       325,821  
Current portion operating lease liabilities
    361,996        
Notes payable – related parties
    3,500       3,500  
Loans – property and equipment, current portion
    13,153       26,241  
Total current liabilities
    3,125,619       3,222,643  
 
               
LONG TERM LIABILITIES
               
Notes payable – related parties
    600,000       600,000  
Loans – property and equipment, net of current portion
    380,200       61,057  
Long-term operating lease liabilities
    680,490        
Deferred tax liabilities
    176,578       176,578  
Total long-term liabilities
    1,837,268       837,635  
Total liabilities
    4,962,887       4,060,278  
 
               
STOCKHOLDERS’ EQUITY
               
Preferred stock, $0.001 par value; 50,000,000 authorized
               
Series B: 53,032 issued and outstanding at September 30, 2019 and at June 30, 2019
    53       53  
Common stock, $0.001 par value; 900,000,000 shares authorized; 37,412,519 shares issued and outstanding at September 30, 2019 and 37,237,519 at June 30, 2019
    37,412       37,237  
Additional paid-in capital
    9,216,204       9,178,838  
Accumulated other comprehensive (loss)
    (141,710 )     (175,659 )
Retained earnings
    8,207,753       8,152,861  
Total stockholders’ equity
    17,319,712       17,193,330  
Total liabilities and stockholders’ equity
  22,282,599     21,253,608  

CONCIERGE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

 
  Three Months Ended     Three Months Ended  
 
  September 30, 2019     September 30, 2018  
 
           
Net revenue
           
Fund management – related party
  3,040,569     4,222,984  
Food products
    1,250,331       1,192,996  
Security systems
    773,277       858,651  
Beauty products and other
    963,673       902,328  
Net revenue
    6,027,850       7,176,959  
 
               
Cost of revenue
    1,769,393       1,838,384  
 
               
Gross profit
    4,258,457       5,338,575  
 
               
 
               
Operating expense
               
General and administrative expense
    1,117,149       1,072,932  
Fund operations
    809,836       1,265,655  
Marketing and advertising
    577,876       871,781  
Depreciation and amortization
    149,663       174,505  
Salaries and compensation
    1,543,022       1,384,982  
Total operating expenses
    4,197,546       4,769,855  
 
               
Income from operations
    60,911       568,720  
 
               
 
               
Other (expense) income:
               
Other (expense) income
    8,436       (174,661 )
Interest and dividend income
    25,847       3,779  
Interest expense
    (11,005 )     (8,136 )
Total other (expense) income, net
    23,278       (179,018 )
 
               
Income before income taxes
    84,189       389,702  
 
               
Provision of income taxes
    29,297       103,748  
 
               
Net income
  54,892     285,954  
 
               
Weighted average shares of common stock
               
Basic
    37,325,019       29,559,139  
Diluted
    38,385,659       38,298,159  
 
               
Net income per common share
               
Basic
  0.00     0.01  
Diluted
  0.00     0.01  

CONCIERGE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)

 
  Three Months Ended     Three Months Ended  
 
  September 30, 2019     September 30, 2018  
 
           
Net income
  54,892     285,954  
 
               
Other comprehensive income (loss):
               
Foreign currency translation gain (loss)
    33,949       (11,583 )
Comprehensive income
  88,841     274,371  

Investors and media,
for more information, contact:

Roger S. Pondel
PondelWilkinson Inc.
310-279-5980
rpondel@pondel.com

SOURCE: Concierge Technologies, Inc.

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