ATLANTA, GA — (Marketwire) — 08/15/12 — (OTCBB: SPMI), a leading vehicle emissions testing and safety inspections company with stores in Atlanta, Houston, St. Louis and Salt Lake City today announced its financial results for the second quarter ended June 30, 2012.
Revenue decreased (7.7%) or $166K to $1,986,863 in the second quarter of 2012 versus $2,152,831 in the second quarter of 2011. The decrease in revenue was due to a drop in same store sales of 6.3% or $133K and the closing of an underperforming store in Q2, 2011. The decline in same store sales is mainly attributable to increased competition at our Texas and Utah locations.
Same store operating expenses decreased by $66K or (4.9%).
General and administrative expenses decreased $84K, or (20.1%) compared to the prior year Q2.
Both the reduction in store operating expense and the decrease in G & A are a direct result of the cost-cutting measures implemented during the middle of the first quarter of 2012.
The Company incurred a net loss of $76,000, or ($0.0022) per diluted share in the second quarter of 2012 compared to net loss of $92,000 or ($0.0029) per diluted share in the second quarter of 2011. A large majority of the operating loss is due to one-time legal fees.
Revenue decreased $356K or (8.4%) to $3,907,869 in the first half of 2012 compared to $4,263,957 in the first half of 2011. During the same period of 2011, we closed two underperforming Houston stores which accounted for $83K of the revenue decrease.
The decrease in revenue was primarily due to a decrease in same store sales of 6.5%. The decrease in same store sales is mainly attributable to increased competition and pricing discounts.
Same store operating expenses decreased by (5.3%) or $146K in the first half of 2012 compared to the first half of 2011.
General and administrative expenses were decreased significantly by (16.5%) or $125K mainly due to corporate staff reductions, rents reduced, service contracts renegotiate and a reduction in professional fees.
A net loss of $913,000 was recorded in the first half of 2012 compared to net loss of $236,000 share in the first half of 2011.
Rich Parlontieri, President and Chief Executive Officer of Speedemissions, commented, “While we continue to be affected by the increased competition and pricing adjustments, we have taken several positive steps to grow and diversify our business. The selling of light bulbs, windshield wipers, etc. in 24 of our stores has had a positive effect on our top line. In addition, our CARbonga-SRI (safety & recall) iPhone app® continues to attract more customers as the average consumer sees this app as a great –Life Style– benefit when buying a used car. We see the recent announcement about franchising the Speedemissions as another step in getting the company back to profitability. These measures, coupled with the securing of a $2.0 million revolving line of credit from TCA Global Credit Master Fund LP, should assist us in achieving our long-term growth strategies.”
About Speedemissions Inc. ;
Speedemissions, Inc., based in Atlanta, Georgia, is a leading vehicle emissions testing and safety inspections company in the United States. We provide services in certain areas where auto testing is mandated by the Environmental Protection Agency (EPA). Since the emissions testing market is highly fragmented, Speedemissions expects to be the first company to create a national brand offering their customers quick and efficient vehicle emissions testing service. The current focus of the company is in the Atlanta, Georgia; Houston, Texas; St. Louis, Missouri and Salt Lake City, Utah markets.
Certain statements contained in this news release regarding matters that are not historical facts may be forward-looking statements. Because such forward-looking statements include risks and uncertainties, actual results may differ materially from those expressed in or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, uncertainties pertaining to continued market acceptance for Speedemissions– products and services, its ability to succeed in growing revenue, the effect of new competitors in its market, integration of acquired businesses, and other risk factors identified from time to time in its filings with the Securities and Exchange Commission.
Contact
Danny Daughtery
Controller
770-306-7667