Creative Realities Q2 Results
Adrian J Cotterill, Editor-in-Chief
Creative Realities, Inc. (OTCQB: CREX), a provider of digital signage and shopper marketing solutions announced its financial results for the three months ended June 30, 2016.
Revenues increased to $3.03 million or 12% for the three-month period ended June 30, 2016 compared to the same period in 2015. This represents an increase of 24% compared to the three-month period ended March 31, 2016.
Gross profit increased to $1.7 million or 157% for the three-month period ended June 30, 2016 compared to the same period in 2015. This represents an increase of 50% compared to the three-month period ended March 31, 2016.
Gross margin improved to 57% of revenue.
General and administrative expenses decreased to $1.47 million or 19% year-on-year, and decreased 14% sequentially.
Non-operating gains resulted in a cumulative gain of $1.16 million.
Approaching operating break-even and cumulative non-operating gains resulted in net income attributable to shareholders of $.42 million for the three months ended June 30, 2016.
Rick Mills, Chief Executive Officer, told us “We continue to make tremendous strides in expanding relationships with existing clients, acquiring new clients, operating efficiencies, and strengthening our balance sheet. This business transformation is ongoing and producing meaningful results. We also continue to engage in ongoing discussions with potential acquisition candidates that we believe can be effectively consolidated onto our public company platform, and contribute to our top and bottom lines. Our industry remains highly fragmented. We are uniquely positioned to be a consolidator to achieve greater scale, diversification and profitability.”
On August 17, 2016, Creative Realities entered into a $3.0 million term loan with Slipstream Communications LLC, their largest institutional shareholder and an affiliate of Pegasus Capital Advisors, L.P.
The loan has an initial maturity of one year, carries an 8.0% interest rate and is secured by Creative Realities’ assets. The lender may make additional advances of up to an another $1.0 million, based on future operating performance. In consideration for entering into the loan agreement, Creative Realities also issued 5,882,352 warrants to purchase shares of common stock. Proceeds from the loan will be used to: satisfy obligations under their current financing agreement, improve working capital, and targeted growth initiatives as they continue to expand the business.
August 23rd, 2016 at 21:45 @948
Looks like Slipstream is looking for any way to end their ownership with CR. By issuing them loans with high interests rates and asking them to buy back shares, Creative Realities better have VERY profitable projects in the works. Otherwise they will find themselves in a situation where their assets are in jeopardy and engorged stakeholders at their doors.
With Gyro selling off recently, i can’t imagine Slipstream wants to keep their investment with Pegasus. CR is the last loose end.