-- The Company closed the quarter with working capital of $3.2 million,
including $2.6 million in cash and cash equivalents, no long-term debt and
shareholders' equity of $3.5 million.
-- Michael Wofford joined the executive management team as chief
financial officer. Wofford is a CPA with 22 years of experience in finance
and business management, including assignments with UDP, Sprint PCS, and SW
Bell Mobile Systems.
-- The Company strengthened its board of directors with the addition of
Ernest W. Bromley, chairman of Bromley Communications, a leading provider
of marketing communications services to major U.S. brands seeking to gain
market share in the Hispanic community; and Richard S. Neely, chief
financial officer of Charter Holdings, a Dallas-based diversified real
estate and equity investment company that is a major shareholder in ADS
Media group.
"During the second quarter we continued to focus on strengthening our sales
and marketing capabilities and building our pipeline of new customers,"
said Dub Doyal, president and CEO. "While our growth rate has been slower
than anticipated, we remain confident in our long-term prospects. We have
a strong core group of customers and we believe demand for our
direct-to-door marketing services, which is supported by state-of-the-art
tracking and verification services, will increase over time."
About ADS Media Group, Inc.
ADS Media Group, Inc. provides direct-to-door advertising and marketing
services to companies, institutions and government agencies through its
wholly owned subsidiary Alternative Delivery Solutions, Inc., under the
trade name ADS Direct Media. The Company has a growing list of local,
regional and national clients, including many Fortune 500 companies. ADS
Direct Media has established a highly efficient delivery system capable of
distributing advertising materials and samples direct to the front door of
homes and small businesses. Using sophisticated mapping software, ADS
Direct Media can target specific audiences, geo-demographically, down to
census block groups. This high degree of targeting is complemented by ADS
Direct Media's ability to provide customers with state-of-the-art delivery
tracking and verification services. ADS Media Group, Inc., is
headquartered in San Antonio, Texas. For more information, visit
www.adsmediagroup.com.
CAUTIONARY STATEMENT
This news release contains "forward-looking statements" within the meaning
of the U.S. Private Securities Litigation Reform Act of 1995, based on
current expectations, estimates and projections that are subject to risk.
Forward-looking statements are inherently uncertain, and actual events
could differ materially from the Company's predictions. Important factors
that could cause actual events to vary from predictions include those
discussed in the Company's SEC filings. Specifically, statements in this
news release about growth, profitability, market leadership, efficacy of
products and services, effectiveness of the Company's national sales force
and La Canasta program, ability to win and support new customers and
improve operations, and raising shareholder value are forward-looking
statements that are subject to risks including availability of capital and
personnel, customer preferences and advertising plans, and other factors.
Readers should not place undue reliance on these forward-looking
statements. The Company assumes no obligation to update its
forward-looking statements to reflect new information or developments. For
a more extensive discussion of the Company's business, please refer to the
Company's SEC filings at www.sec.gov.
Consolidated Statements of Operations
(Unaudited) Three months ended Six months ended
June 30, June 30,
2007 2006 2007 2006
---- ---- ---- ----
Revenues $1,017,265 $1,264,562 $1,948,728 $1,945,218
Cost of goods sold 595,094 759,119 1,190,302 1,158,986
---------- ---------- ---------- ----------
Gross profit 422,171 505,443 758,426 786,232
Selling, administrative
and other operating
expense 778,566 754,883 1,666,633 1,161,299
---------- ---------- ---------- ----------
Loss from operations (356,395) (249,440) (908,207) (375,067)
Other income (expense)
Interest expense (189) (4,839) (909) (11,258)
Interest and other income 30,189 - 68,443 -
---------- ---------- ---------- ----------
Total other income (expense) 30,000 (4,839) 67,534 (11,258)
---------- ---------- ---------- ----------
Income (loss) before income
taxes and extraordinary
item (326,395) (254,279) (840,673) (386,325)
Income taxes - - - -
---------- ---------- ---------- ----------
Income (loss) before
extraordinary item (326,395) (254,279) (840,673) (386,325)
Extraordinary item:
Gain on extinguishment
of liabilities - 454,740 - 454,740
---------- ---------- ---------- ----------
Net income (loss) $ (326,395) $ 200,461 $ (840,673) $ 68,415
========== ========== ========== ==========
Net income (loss) per
share, basic $ (0.03) $ 0.04 $ (0.08) $ 0.02
========== ========== ========== ==========
Net income (loss) per
share, diluted $ (0.03) $ 0.04 $ (0.08) $ 0.02
========== ========== ========== ==========
Weighted average basic
shares outstanding 10,880,867 4,332,004 10,880,867 4,077,000
Weighted average diluted
shares outstanding 10,880,867 4,332,004 10,880,867 4,077,000
Consolidated Balance Sheets (Unaudited) June 30, December 31,
2007 2006
---- ----
ASSETS
Current Assets: ----------- -----------
Cash and cash equivalents $ 2,638,635 $ 3,354,597
Accounts receivable, net 731,397 1,259,850
Prepaid expenses 124,713 128,967
Other current assets 8,943 6,743
----------- -----------
Total current assets 3,503,688 4,750,157
Property and equipment
Furniture and fixtures 39,232 36,870
Computer equipment and software 83,133 74,875
Less: accumulated depreciation (84,810) (75,678)
----------- -----------
Total property and equipment, net 37,555 36,067
Goodwill 250,000 250,000
Other assets 6,922 6,922
----------- -----------
Total assets $ 3,798,165 $ 5,043,146
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 99,189 257,717
Customer advance payments 67,650 89,804
Accrued salaries and wages 86,681 110,643
Accrued liabilities 76,132 267,887
Other current liabilities 2,030 8,430
Obligations under capital leases 2,543 3,165
----------- -----------
Total current liabilities 334,225 737,646
Obligations under capital leases, long term - 887
----------- -----------
Total liabilities 334,225 738,533
----------- -----------
Shareholders' equity (deficit):
Preferred stock 3 3
Common stock 10,881 10,881
Additional paid-in capital 6,735,101 6,735,101
Accumulated deficit (3,282,045) (2,441,372)
----------- -----------
Total shareholders' equity (deficit) 3,463,940 4,304,613
----------- -----------
Total liabilities and shareholders' equity
(deficit) $ 3,798,165 $ 5,043,146
=========== ===========
Contact Information: Company Contact: Jim Schell Vice President and Secretary 210-655-6613 Investor Relations Contact: Jay Pfeiffer Pfeiffer High Investor Relations, Inc. 303-393-7044