IMS Quarterly Report Reveals Cash
Flow, Operating Profits Increase
International Monetary Systems (OTCBB:INLM), a worldwide leader in
business-to-business barter services, filed its first-quarter report
on Form 10-Q. The three-month period ending March 31, 2009, showed
much improvement in the firm�s financial performance.
During the past nine months, IMS made a great effort to achieve
profitability by reducing payroll and other elements of overhead. As
a result, net income from operations totaled $56,314 for the first
quarter of 2009, and net cash provided by operating activities was
$557,464, a substantial increase over all previous quarters.
Operating profits (EBITDA) totaled $469,261, an improvement over
IMS reports that primarily due to the global recession, first
quarter revenue of $3,351,224 declined 4.8% from the $3,518,839
generated in the first quarter of 2008, despite an increase in trade
transactions of 2.1%, from $24,847,894 in the first quarter of 2008
to $25,369,715 in the first quarter of 2009. (U.S. gross domestic
product declined 7.1% in 2008.) As in the general economy IMS
members are experiencing declines in their businesses, with
resulting reductions in discretionary and luxury spending.
Total expenses decreased from $3,828,108 in the first quarter of
2008 to $3,294,910 for the same period in 2009, a reduction in
expenses of 13.9% This substantial decrease was achieved through
payroll cuts and other overhead reductions. Over the past twelve
months, IMS has trimmed its work force by 40 people, without
substantial revenue reduction.
The resulting net profit from operations was $56,314 for the first
three months of 2009, compared to a loss of $309,269 for the same
period last year. After deducting non-cash expenses such as
depreciation, amortization, bad-debt expense and stock issued for
services rendered, the loss before income taxes was just $1,369,
compared to a loss of $371,407 for the same period of 2008.
After deducting current and deferred income taxes, the net loss in
the first three months of 2009 was $54,369, compared to $230,907
last year, which was net of a deferred tax benefit. The deferred tax
represents the adjustment to the deferred tax liability, which
arises primarily from the differences in basis of acquired
membership lists for financial reporting versus tax reporting.
Liquidity, Sources of Capital and Lines of Credit
For this year�s quarter, net cash provided by operating activities
totaled $557,464, compared to $43,457 for the first quarter of 2008.
A portion of this substantial increase was the result of one-time
occurrences. Management, however, expects improvements in cash flow
throughout the year, as effects of cost reductions are fully
realized. Furthermore, third and fourth quarter revenues are
typically significantly higher than the first quarter.
Operating profit or EBITDA (earnings before interest, taxes,
depreciation and amortization) this quarter totaled $469,261, an
increase of 406% from the $92,674 reported for the first quarter of
On March 31, 2009, current assets were $2,151,542, and total assets
were $15,978,055. Current liabilities were $2,994,553 and total
liabilities were $8,004,458, resulting in total shareholder equity
At the end of the first quarter of 2009, the company�s unrestricted
cash balance was $519,648 compared to $279,227 on December 31, 2008.
CEO Don Mardak, commented, �We are very pleased with International
Monetary Systems� first-quarter results. The numbers demonstrate the
progress that we have made in our quest for profitability. We
believe that our lower overhead and ongoing strong sales should
enable us to continue showing similar improvements in the months
ahead, in spite of the current economic environment.�
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