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OmniComm Systems, Inc. Reports Financial Results for the Year Ended December 31, 2017

April 03, 2018

CONTACT :

Kuno van der Post
OmniComm Systems, Inc.
+1.954.473.1254
kvanderpost@omnicomm.com

Record Revenue and Operating Income

Fort Lauderdale, FL, - OmniComm Systems, Inc. (OmniComm) (OTCQX: OMCM), a global leading provider of clinical data management technology, today announced record financial results for the year ended December 31, 2017.

“I am very pleased with our 2017 results,” said Stephen Johnson, chief executive officer and president of OmniComm. “It was a year of record revenue and major milestones. We experienced significant growth, especially in Europe and Asia, reached the 6,000 clinical trial mark, announced the release of two new products, IRTMaster™ and AutoEncoder, and acquired a market-leading business intelligence platform, Acuity® for data analytics. We also had continued success with our two core products, TrialMaster® and TrialOne®.  The expansion of our product offering, coupled with our emergence internationally, well positions us for another strong year in 2018.”

For the year ended December 31, 2017, OmniComm reported record revenue of $27.0 million, a 6% increase over the prior year’s revenue of $25.4 million. Gross margin improved by 8% to $21.7 million. Operating expenses increased by 14% or $2.3 million to $18.2 million, which resulted in operating income of $3.5 million. EBITDA, a non-GAAP financial measure OmniComm uses as an additional financial measure, was $3.9 million.

OmniComm provides EBITDA, a non-GAAP financial measure as additional information to its financial results.  Non-GAAP EBITDA excludes the impact of depreciation and amortization expenses that are included in operating income. Non-GAAP EBITDA is not an alternative or substitute for the financial measure prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) of operating income. The non-GAAP EBITDA financial measure presented may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define this non-GAAP financial measure in the same way. OmniComm’s management uses non-GAAP EBITDA as a measure of operational efficiency and as a goal for incentive compensation. Management believes non-GAAP EBITDA is a useful measure investors may use as an additional factor in their analysis of OmniComm’s performance. Please review the below reconciliation of the non-GAAP financial measure EBITDA to the GAAP financial measure operating income, as well as OmniComm’s financial statements as filed with the Securities and Exchange Commission.

 

OMNICOMM SYSTEMS, INC. AND SUBSIDIARIES
Reconciliation of GAAP operating income to non-GAAP EBITDA
           
      For the year ended
      December 31,
      2017   2016
           
Operating income/(loss) (GAAP)        $3,534,150             $4,165,231
Depreciation expense           336,102                302,893
Amortization expense            22,048                 37,331
EBITDA (non-GAAP)        $3,892,300             $4,505,455
           

Forward-Looking Statements

Statements contained in this press release that are not historical facts are "forward-looking statements." These statements can often be identified by the use of forward-looking terminology such as "estimate," "project," "believe," "expect," "may," "will," "should," "intends," or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. We wish to caution the reader that these forward-looking statements regarding matters that are not historical facts are only predictions and are based on information available at the time and/or management's good faith belief with respect to future events. No assurance can be given that plans for the future will be consummated or that the future results indicated, whether expressed or implied, will be achieved. While sometimes presented with numerical specificity, these plans and projections and other forward-looking statements are based upon a variety of assumptions, which we consider reasonable, but which nevertheless may not be realized. Because of the number and range of the assumptions underlying our projections and forward-looking statements, many of which are subject to significant uncertainties and contingencies that are beyond our reasonable control, some of the assumptions inevitably will not materialize, and unanticipated events and circumstances may occur subsequent to the date of this press release. Therefore, our actual experience and results achieved during the period covered by any particular projections or forward-looking statements may differ substantially from those projected. Consequently, the inclusion of projections and other forward-looking statements should not be regarded as a representation by us or any other person that these plans will be consummated or that estimates and projections will be realized, and actual results may vary materially. There can be no assurance that any of these expectations will be realized or that any of the forward-looking statements contained herein will prove to be accurate. Forward-looking statements speak only as of the date the statement was made. OmniComm does not undertake any obligation to update or revise any forward-looking statement made by it or on its behalf, whether as a result of new information, future events or otherwise.

OMNICOMM SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
           
      For the year ended
      December 31,
      2017   2016
Revenues    $   26,067,933    $      24,394,010
Reimbursable revenues         911,725             1,025,500
Total revenues        26,979,658            25,419,510
           
Cost of goods sold        4,394,918             3,913,407
Reimbursable expenses-cost of goods sold          885,972             1,461,425
Total cost of goods sold        5,280,890             5,374,832
Gross margin          21,698,768            20,044,678
           
Operating expenses      
Salaries, benefits and related taxes       13,200,837             11,383,727
Rent and occupancy expenses        1,125,147              1,071,363
Consulting services          321,472                185,340
Legal and professional fees          533,221                364,859
Travel              986,092                774,379
Telephone and internet          152,926                164,014
Selling, general and administrative        1,356,427              1,462,774
Bad debt expense          130,346                132,767
Depreciation expense          336,102                302,893
Amortization expense           22,048                 37,331
Total operating expenses       18,164,618             15,879,447
Operating income/(loss)        3,534,150              4,165,231
           
Other income/(expense)      
Interest expense, related parties         (947,688)              (918,189)
Interest expense         (419,432)              (421,713)
Interest income                593                     2
Change in derivative liabilities          795,779            (2,657,910)
Transaction gain/(loss)             5,010               (64,472)
Income/(loss) before income taxes        2,968,412               102,949
Income tax (expense)           (1,194)                 (1,069)
Net income/(loss) attributable to common stockholders  $     2,967,218    $          101,880
           
Net income/(loss) per share      
       Basic    $             0.02    $                0.00
       Diluted    $             0.02    $                0.00
Weighted average number of shares outstanding      
       Basic       147,865,246         145,868,227
       Diluted       148,177,984         146,162,427
           
  
OMNICOMM SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
             
        December 31, 2017   December 31, 2016
             
ASSETS
CURRENT ASSETS        
  Cash   $1,176,551   $1,439,332
  Accounts receivable, net of allowance for doubtful accounts of $149,980 and $179,813, respectively                           7,492,597                         5,455,210
  Prepaid expenses                                  297,131                            195,915
  Prepaid stock compensation, current portion   -0-                            148,422
  Other current assets                               11,463                               35,055
    Total current assets                          8,977,742                         7,273,934
  Property and equipment, net                             552,538                            637,552
  Other assets        
  Intangible assets, net                               97,925                            108,880
  Prepaid stock compensation   -0-                              58,663
  Other assets                               46,714                               51,321
TOTAL ASSETS   $ 9,674,919    $ 8,130,350
             
LIABILITIES AND SHAREHOLDERS' (DEFICIT)
             
CURRENT LIABILITIES        
  Accounts payable and accrued expenses    $ 2,586,045    $ 2,123,073
  Deferred revenue, current portion                           7,564,587                         7,250,061
  Convertible notes payable, current portion                               50,000                              50,000
  Patent settlement liability, current portion                             112,500                            862,500
  Conversion feature liability, related parties                          1,604,723                         1,740,278
  Conversion feature liability                               81,224                            585,452
  Warrant liability, related parties                          2,196,570                         2,519,614
  Warrant liability                          1,244,229                         1,479,748
    Total current liabilities   15,439,878                       16,610,726
             
LONG TERM LIABILITIES        
  Line of credit, long term                          2,650,000                         2,700,000
  Notes payable, related parties, long term, net of current portion, net of discount of $117,365 and $237,664, respectively                             282,635                            212,336
  Notes payable, long term, net of current portion, net of discount of $279,402 and $455,285, respectively                             423,098                            337,215
  Deferred revenue, long term, net of current portion                          1,952,366                         2,289,169
  Convertible notes payable, related parties, long term, net of current portion                          5,770,000                         5,825,000
  Convertible notes payable, long term, net of current portion                              350,000                         1,175,000
  Patent settlement liability, long term, net of current portion     -0-                            108,702
             
TOTAL LIABILITIES                        26,867,977                       29,258,148
             
SHAREHOLDERS' (DEFICIT)        
  Preferred stock, $0.001 par value, 10,000,000 shares authorized, 3,772,500 shares undesignated        
  Series A convertible preferred stock, 5,000,000 shares authorized, -0- and -0- issued and outstanding, respectively at $0.001        
     par value; liquidation preference $-0- and $-0-, respectively   -0-   -0-
  Series B convertible preferred stock, 230,000 shares authorized, -0- and -0-  issued and outstanding, respectively at $0.001 par value;        
    liquidation preference $-0- and $-0-, respectively   -0-   -0-
  Series C convertible preferred stock, 747,500 shares authorized, -0- and -0-  issued and outstanding, respectively at $0.001 par value;        
    liquidation preference $-0- and $-0-, respectively   -0-   -0-
  Series D preferred stock, 250,000 shares authorized, 250,000 and 250,000 issued and outstanding, respectively at $0.001 par value                                    250                                   250
  Common stock, 500,000,000 shares authorized, 148,542,805 and 147,786,917 issued and outstanding, respectively, at $0.001 par value                             148,544                            147,788
  Additional paid in capital - preferred                             999,750                            999,750
  Additional paid in capital - common                        54,379,454                       53,425,956
  Accumulated other comprehensive (loss)                             (397,237)                           (410,505)
  Accumulated (deficit)                       (72,323,819)                      (75,291,037)
TOTAL SHAREHOLDERS' (DEFICIT)                       (17,193,058)                      (21,127,798)
             
TOTAL LIABILITIES AND SHAREHOLDERS' (DEFICIT)    $ 9,674,919    $ 8,130,350
             

 

  OMNICOMM SYSTEMS, INC. AND SUBSIDIARIES
  CONSOLIDATED STATEMENTS OF CASH FLOWS
   
          For the year ended
          December 31,
          2017   2016
  CASH FLOWS FROM OPERATING ACTIVITIES        
  Net income/(loss) $     2,967,218       101,880
  Adjustment to reconcile net income/(loss) to net cash provided by/(used in) operating activities        
    Change in derivative liabilities        (795,779)        2,657,910
    Interest expense from derivative instruments         296,182          158,068
    Employee stock compensation         568,522          222,304
    Provision for doubtful accounts         130,346          132,767
     Depreciation and amortization         358,150          340,224
    Changes in operating assets and liabilities        
      Accounts receivable       (2,167,733)        (1,495,505)
      Prepaid expenses         (101,216)           (25,742)
      Other current assets            23,592           (20,704)
      Other assets             4,607            (4,756)
      Accounts payable and accrued expenses           462,972           615,803
      Patent settlement liability          (858,702)          (455,871)
      Deferred revenue           (22,277)           291,453
  Net cash provided by/(used in) operating activities           865,882         2,517,831
               
  CASH FLOWS FROM INVESTING ACTIVITIES        
    Purchase of property and equipment        (242,384)        (260,378)
  Net cash (used in) investing activities        (242,384)        (260,378)
               
  CASH FLOWS FROM FINANCING ACTIVITIES        
    Repayments of notes payable        (915,000)         (200,000)
    Repayments of notes payable, related parties        (105,000)          (45,000)
    Proceeds/(repayments) from revolving line of credit         (50,000)       (1,500,000)
    Proceeds from exercise of stock options          35,250          129,500
    Proceeds from exercise of warrants         155,000          -0-
  Net cash provided by/(used in) financing activities        (879,750)       (1,615,500)
               
  Effect of exchange rate changes on fixed and intangible assets          (19,797)             6,310
  Effect of exchange rate changes on cash and cash equivalents           13,268           (44,150)
  Net increase/(decrease) in cash and cash equivalents         (262,781)           604,113
  Cash and cash equivalents at beginning of period        1,439,332           835,219
               
  Cash and cash equivalents at end of period $      1,176,551 $       1,439,332
               

About OmniComm Systems, Inc.
OmniComm Systems, Inc. is a leading strategic software solutions provider to the life sciences industry. OmniComm is dedicated to helping the world’s pharmaceutical, biotechnology, contract research organizations, diagnostic and device firms, and academic medical centers maximize the value of their clinical research investments. Through the use of innovative and progressive technologies, these organizations drive efficiency in clinical development, better manage their risks, ensure regulatory compliance and manage their clinical operations performance. With an extensive global experience from more than 6,000 clinical trials, OmniComm provides comprehensive solutions for clinical research. For more information, visit: www.omnicomm.com

 

Trademarks
OmniComm, TrialMaster, TrialOne, IRTMaster and Promasys are registered trademarks of OmniComm Systems, Inc. Other names may be trademarks of their respective owners.

 

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