TAMPA, FL -- (MARKET WIRE) -- May 15, 2007 -- FTS Group, Inc. (
OTCBB:
FLIP), an acquisition and
development Company operating in the wireless, technology and Internet
space, today announced record operating results for its 2007 first quarter.
The Company reported today that its wholly owned retail wireless subsidiary
FTS Wireless generated top line revenue growth of more then 40%
year-over-year and turned profitable. The Company will file its form 10QSB
with the Securities and Exchange Commission within the next 5 days. The
filing will be accessible at
www.SEC.gov.
FTS Group Chairman and Chief Executive Officer Scott Gallagher stated, "I'm
pleased to report to the stockholders that FTS has delivered a record
operating quarter. We experienced top-line sales growth of more than 40%
year over year at FTS Wireless, See World delivered another strong quarter
of operating results and we paid down nearly $300,000 in outstanding debt.
Due to higher legal and accounting fees experienced during the quarter we
posted a consolidated loss from operations of ($46,595). Based on our
current year to date results we now expect FTS Wireless to post 2007 sales
in the range of $2.8 to $3.2 Million versus 2006 sales of $1.84 Million.
Almost more important than the tremendous top line growth at FTS Wireless,
the Company generated the first operating profit in its four-year history.
FTS Wireless now expects to generate an operating profit for the full
fiscal year for the first time in its history." Gallagher continued, "Since
joining the Company just over a year ago our Chief Operating Officer Dave
Rasmussen has led a significant turnaround at FTS Wireless, with his
leadership and the momentum he's created I feel confident FTS Wireless will
continue to execute our aggressive expansion plans and achieve our goals
for '07."
FTS COO and CEO of See World Satellites David Rasmussen stated, "I am
pleased to see continued profitability with See World. Our employees
continue to work hard and deliver positive results. We continue to deliver
very positive operational results for Dish Network by exceeding their
expectation for meeting the key metrics they have established for us and
providing outstanding service to the customers of Central Pennsylvania. We
continue to work with Dish to increase our overall footprint within markets
that Dish is looking to improve overall performance in and look forward to
the challenges that lie ahead in those areas."
Mr. Rasmussen commented regarding FTS Wireless as follows, "I would like to
thank the employees of FTS Wireless for their dedication and determination
to make FTS Wireless a respected facet of the Tampa Bay community. The
employees have been very instrumental in FTS' success. Now, with the first
part of our growth strategy in place, we have begun to clearly see the
results of that strategy. I am very pleased with the positive results we
have seen from the first quarter which proves we have developed our staff
and given them the tools necessary to continue our success and begin to
realize the bigger picture of growth and continued positive results. I feel
very confident we can achieve our ultimate goal of providing increased
shareholder value through continued positive results and growth of FTS
Wireless. The next 12 - 15 months will be a very exciting time for the
employees of FTS Wireless and all of the shareholders of FTS."
RESULTS OF OPERATIONS
FTS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2007 AND 2006
2007 2006
------------ ------------
(restated)
REVENUES
Service Revenue-See World Satellites, Inc. $ 1,098,458 $ 1,138,036
Product Retail Sales-FTS Wireless, Inc. 702,962 495,578
------------ ------------
1,801,420 1,633,614
------------ ------------
COST OF GOODS SOLD
Service-See World Satellites, Inc. 176,708 209,208
Product-FTS Wireless, Inc. 550,623 374,274
------------ ------------
727,331 583,482
------------ ------------
GROSS PROFIT
Service-See World Satellites, Inc. 921,750 928,282
Product-FTS Wireless, Inc. 152,339 121,304
------------ ------------
1,074,089 1,050,132
------------ ------------
GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative
expenses 1,120,684 1,008,186
------------ ------------
1,120,684 1,008,186
------------ ------------
INCOME (LOSS) FROM OPERATIONS (46,595) 41,946
------------ ------------
OTHER INCOME (EXPENSE)
Change in fair value of Derivative
Liabilities 60,254 (7,478,664)
Unrealized loss on investments - -
Interest (130,524) (39,029)
------------ ------------
(70,270) (7,517,747)
------------ ------------
NET INCOME (LOSS) $ (116,865) $ (7,475,747)
============ ============
PER SHARE INFORMATION
BASIC SHARES OUTSTANDING 154,784,894 107,195,939
NET LOSS PER COMMON SHARE
BASIC (0.00) (0.07)
SEGMENT RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2007
FTS FTS See
Group Wireless World
Inc. Inc. Satellites Total
----------- ----------- ----------- -----------
Revenues
External $ - $ 702,962 $ 1,098,458 $ 1,801,420
Internal 375,000 - - 375,000
----------- ----------- ----------- -----------
Segment Revenues 375,000 702,962 1,098,458 2,176,420
Cost of Goods Sold - 550,623 176,708 727,331
----------- ----------- ----------- -----------
Gross Profit 375,000 152,339 921,750 1,449,089
----------- ----------- ----------- -----------
Selling, General, &
Administrative
External 268,490 114,686 711,215 1,094,391
Internal - 75,000 300,000 375,000
----------- ----------- ----------- -----------
Segment Selling,
General &
Administrative 268,490 189,686 1,011,215 1,469,391
----------- ----------- ----------- -----------
Subtotal 106,510 (37,347) (89,465) (20,302)
----------- ----------- ----------- -----------
Change in fair value of
derivative liabilities 60,254 - - 60,254
Depreciation (6,923) (10,137) (9,233) (26,293)
Amortization (29,573) - - (29,573)
Interest (100,443) - (508) (100,951)
----------- ----------- ----------- -----------
Net Income (Loss) 29,825 (47,484) (99,206) (116,865)
Intersegment
Adjustments (375,000) 75,000 300,000 -
----------- ----------- ----------- -----------
$ (345,175) $ 27,516 $ 200,794 $ (116,865)
=========== =========== =========== ===========
FTS GROUP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
MARCH 31, 2007 AND DECEMBER 31, 2006
Assets 2007 2006
----------- -----------
Current assets:
Cash and cash equivalents $ 57,617 $ 115,056
Restricted cash - -
Accounts receivable 18,374 130,025
Inventories, net 328,729 373,734
Prepaid expenses and current assets 296,474 247,686
----------- -----------
Total current assets 701,194 866,501
Property and equipment, net of accumulated
depreciation 277,351 303,641
Unamortized discount on convertible debt 342,036 232,925
Unamortized debt issuance costs - 29,573
Investments 114,734 92,505
Goodwill 5,177,696 5,177,696
Deposits 16,482 16,482
----------- -----------
Total assets $ 6,629,493 $ 6,719,323
=========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 576,456 $ 548,707
Current portion of notes payable to related
parties, net of discount 1,886,796 1,820,215
Convertible debentures-current portion 1,165,474 1,238,321
Current installments of long-term
debt-equipment loans - 4,824
----------- -----------
Total current liabilities $ 3,628,726 $ 3,612,067
Fair value of derivative liabilities 392,785 453,039
Convertible debentures - -
Long-term debt to related parties, less current
installments 750,000 1,000,000
----------- -----------
Total liabilities $ 4,771,511 $ 5,065,106
----------- -----------
Stockholders' equity:
10% Convertible Preferred Stock, Series A,
$0.01 par value: 150,000 shares authorized;
0 shares issued and outstanding - -
Preferred Stock, $0.01 par value, 4,850,000
undesignated shares authorized, none issued - -
Convertible Preferred Stock, Series B, $0.01
par value: 1,000,000 Shares authorized,
issued and outstanding at March 31, 2007 10,000 10,000
Common stock, $.001 par value. Authorized
855,000,000 shares: 154,784,894 shares issued
and outstanding at March 31, 2007,
137,650,469 shares issued and outstanding
at December 31, 2006. 154,785 137,650
Additional paid-in capital 12,532,621 12,231,626
Accumulated deficit (10,821,091) (10,704,226)
----------- -----------
Total stockholders' equity 1,876,315 1,675,050
----------- -----------
Commitments and contingent liabilities (18,333) (20,833)
----------- -----------
Total liabilities and stockholders'
equity $ 6,629,493 $ 6,719,323
=========== ===========
About FTS Group, Inc.
FTS Group, Inc. (
OTCBB:
FLIP) is a publicly traded acquisition and
development Company operating in the Wireless, Technology and Internet
space through its wholly owned subsidiaries FTS Wireless, Inc. and See
World Satellites, Inc. The Company operates through retail locations in
Florida and Pennsylvania and globally over the Internet through its web
sites
www.FTSGroup.com,
www.CellChannel.com,
www.SeeWorld.biz and
www.FTSWireless.com. For additional information about FTS Group, Inc. or
any of its wholly owned subsidiaries please review the Company's quarterly,
annual and other filings with the Securities and Exchange Commission at
http://www.SEC.gov or contact the Company at the e-mail or phone number
below.
Forward-Looking Statements
Included in this release are certain "forward-looking'' statements,
involving risks and uncertainties, which are covered by the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995,
including statements regarding the Company's financial performance. Such
statements are based on management's current expectations and are subject
to certain factors, risks and uncertainties that may cause actual results,
events and performance to differ materially from those referred to or
implied by such statements. In addition, actual future results may differ
materially from those anticipated, depending on a variety of factors, sales
and earnings growth, ability to attract and retain key personnel, and
general economic conditions affecting consumer spending, including
uncertainties relating to global political conditions, such as terrorism.
Information with respect to important factors that should be considered is
contained in the Company's Annual Report on Form 10-K and 10-K/A as filed
with the Securities and Exchange Commission. Readers are cautioned not to
place reliance on these forward-looking statements, which speak only as of
the date hereof.
Contact Information: Contact:
www.FTSGroup.com
Scott Gallagher
CEO
Voice: (215) 688-2355
e-mail: Email Contact