SAN JUAN CAPISTRANO, Calif., April 26, 2007 (PRIME NEWSWIRE) -- American Mold Guard, Inc. (Nasdaq:AMGI), an industry leader in the field of antimicrobial surface treatment services, today announced financial results for its first quarter ended March 31, 2007.
First Quarter Results
The company reported first quarter 2007 revenue of $2.1 million, an increase of 15 percent from the fourth quarter of 2006 and a decrease of 24 percent from $2.76 million for the first quarter of 2006. Revenue in the first quarter of 2007 increased from the prior quarter as the company increased its focus on national multi-family new construction projects. Revenue decreased from the first quarter of 2006 as builders in California reduced their new housing starts in an effort to decrease new home inventory and the Gulf Region restoration business slowed. Gross margin for the first quarter of 2007 improved seven points to 49.1 percent or $1.03 million, as compared to 42.2 percent or $1.16 million for the first quarter of 2006. The first quarter 2007 gross margin was also 4.3 points higher than the fourth quarter of 2006. The gross margin percentage increase was realized through improved crew productivity, optimized material usage, reduced material cost and reduced equipment rental costs.
The company reported a net loss for the first quarter of 2007 of $1.25 million, or $.27 per share, as compared to a net loss of $1.13 million, or $1.20 per share, for the first quarter of 2006. Lower first quarter 2007 revenue was offset by higher gross margin percentages and the company recorded interest income as compared to interest expense that was incurred in 2006. The first quarter net loss declined as compared to a net loss of $1.52 million, or $0.33 per share in the fourth quarter of 2006. Higher revenue, increased gross margin and lower selling, general and administrative expenses contributed to the lower net loss as compared to the fourth quarter of 2006. The per share net loss information reflects the effect of the one-for-.340124209 reverse stock split, effective April 7, 2006.
"Despite the continued housing market contraction, the company recorded first quarter revenue growth of 15 percent as compared to the fourth quarter of 2006. Our sales focus on national multi-family construction as well as the investment that we made in the Midwest region last year is beginning to pay-off," said Tom Blakeley, Chief Executive Officer. "We are encouraged by the level of national multi-family project orders we secured in the quarter, which position the company nicely for continued growth" added Mr. Blakeley. "Once again, the company was able to deliver record gross margins while reducing selling, general and administrative costs, thereby reducing the loss per share by $0.06 as compared to last quarter. We also are encouraged by the progress we are making in our Infection Control business. We are hopeful that the study to evaluate the effectiveness of our infection control antimicrobial treatment for use in hospitals with Dr. Harris and Dr. Perencevich, will validate the value of our services in the fight against hospital-acquired infections," concluded Mr. Blakeley.
Conference Call and Webcast
American Mold Guard will discuss its first quarter 2007 results, on a conference call today beginning at 1:30 p.m. Pacific Daylight Time. You can listen to the call by Domestic Dial at 866-825-3354 or by International Dial at 617-213-8063 using the participant passcode 80013773.
You can also access the conference call via a live webcast at http://phx.corporate-ir.net/playerlink.zhtml?c=196351&s=wm&e=1533888. Prior to the call, the company intends to post on its website a copy of the company's current report on Form 8-K dated April 26, 2007 disclosing the matters addressed in this press release, including the company's operating results for the quarter ended March 31, 2007. The company's web site can be accessed at www.americanmoldguard.com under "Investor Relations / Press Releases."
About American Mold Guard and AMG Scientific, LLC
American Mold Guard, Inc. (Nasdaq:AMGI), founded in 2002, is the industry leader in the field of antimicrobial surface treatment services. Its services are primarily focused on the residential real estate construction industry in California, Texas, Louisiana, Mississippi and Florida with active expansion throughout the United States. Its customers include many of the largest national and regional home builders. Visit: www.americanmoldguard.com. Established in October 2006, AMG Scientific LLC is a wholly owned subsidiary of American Mold Guard, Inc., that is focused on assisting hospitals, large organizations, institutions, military and government facility managers in combating the problem of infectious diseases on interior surfaces. Visit: www.amgscientific.com.
The American Mold Guard Inc. logo is available at http://www.primezone.com/newsroom/prs/?pkgid=2964
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding, among other things, statements relating to goals, plans and projections regarding the company's financial position, results of operations, market position, product and service development and market strategy. These statements may be identified by the fact that they use words or phrases such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "predicts," "projects," "targets," "will likely result," "will continue," "may," "could" and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could delay, divert or change any of them, and could cause actual outcomes and results to differ materially from current expectations. These factors include, among other things, competitive product and service development, future broad market acceptance of mold and hospital acquired infection prevention services, difficulties in raising additional capital in the future, difficulties and delays in establishing the "Mold Guard" brand, the impact of the absence of significant proprietary technology underlying the company's services, a continued and long-term dependence on a limited number of customers, changes to the inventory levels of the company's raw materials suppliers, the impact of a continued absence of exclusive or long-term commitments from the company's customers, changes in the anticipated size or trends of the markets in which the company competes, judicial decisions and governmental laws and regulations, and changes in general economic conditions in the markets in which the company may compete. For further details and a discussion of these and other risks and uncertainties, see the company's periodic reports including current reports on Form 8-K, quarterly reports on Form 10-Q and the annual report on Form 10-KSB, furnished to and filed with the Securities and Exchange Commission. The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
AMERICAN MOLD GUARD, INC.
CONDENSED CONSOLIDATED (UNAUDITED) STATEMENTS OF OPERATIONS
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Three Months Ended
March 31, 2006 March 31, 2007
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Revenue $ 2,761,654 $ 2,102,318
Cost of revenue
Direct costs 1,563,955 995,345
Depreciation
expense 33,558 76,267
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Total cost of revenue 1,597,513 1,071,612
Gross margin 1,164,141 1,030,706
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Selling, general and
administrative expenses 1,564,305 2,326,374
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Loss from operations (400,164) (1,295,668)
Interest income/(expense) (728,697) 49,998
------------- -------------
Loss before income tax
provision (1,128,861) (1,245,670)
Provision for income taxes 3,868 981
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Net loss (1,132,729) (1,246,651)
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Dividends on cumulative
preferred stock 292,443 -
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Net Loss applicable to
common stockholders (1,425,172) (1,246,651)
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Basic and diluted net
loss per share $ (1.20) $ (0.27)
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Dividends accumulated for
the year on
cumulative preferred stock $ (0.31) $ -
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Net loss attributable to
common stock per share $ (1.51) $ (0.27)
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Weighted average number of
common shares outstanding-
basic and diluted 942,301 4,621,464
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AMERICAN MOLD GUARD, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
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December 31, 2006 March 31, 2007
(Unaudited)
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ASSETS
Current Assets:
Cash & cash
equivalents $ 4,554,890 $ 2,748,136
Accounts receivable,
less allowance for
doubtful accounts 1,222,339 1,745,470
Inventories 125,347 118,299
Prepaid expenses and
deposits 409,027 310,563
Other current assets 27,399 6,924
------------- -------------
Total Current Assets 6,339,002 4,929,392
Restricted cash 752,653 761,014
Property and equipment,
net 875,319 807,594
Intangible assets, net 2,368 2,199
------------- -------------
Total Assets $ 7,969,342 $ 6,500,199
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LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIENCY)
Current Liabilities
Accounts payable and
accrued liabilities $ 1,150,286 $ 1,176,673
Lease line of credit,
current portion 146,326 150,316
Accrued payroll and
related expenses 661,346 408,652
Short term notes
payable 1,581 1,581
------------- -------------
Total Current Liabilities 1,959,539 1,737,222
------------- -------------
Long-Term Liabilities
Lease line of credit,
net of current portion 460,767 422,054
------------- --------------
Total Liabilities $ 2,420,306 $ 2,159,276
------------- -------------
Stockholders' Equity
(Deficiency)
Common stock 16,606,734 16,612,507
Additional paid-in
capital 6,920,413 6,953,179
Accumulated deficiency (17,978,111) (19,224,763)
------------- -------------
Total Stockholders' Equity
(Deficiency) 5,549,036 4,340,923
------------- -------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
(DEFICIENCY) $ 7,969,342 $ 6,500,199
============= =============
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