Safety Quick Lighting & Fans Corp. Reports First Quarter Financial Results
ALPHARETTA, Ga., May 15, 2015 /PRNewswire/ -- Safety Quick Lighting & Fans Corp. ("SQL" or the "Company"), a manufacturer and distributor of ceiling fans and light fixtures incorporating its patented power plug technology, today announced financial results for its first quarter ended March 31, 2015. The Company reported revenue of $1,419,000 and a net loss from operations of $(1,068,000) and a net loss of $(1,543,000) or $(0.05) per basic share. The first quarter of 2015 marks the first quarter in which the Company began generating sales under the new business model. For the comparable period in 2014, the Company incurred an operating loss of $(378,000) and a net loss of $(652,000) or $(0.02) per basic share. The prior year activities were associated with qualifying manufacturers for production of their products as well as costs incurred registering the Company's shares.
General and administrative (G&A) costs increased from $378,000 in the first quarter 2014 to $1,247,000 in the first quarter of 2015, an increase of $869,000, primarily due to the inclusion of $602,000 of amortization costs of its GE trademark license and $128,000 in sales commission and an increase of $156,000 in costs associated with its public company status.
Interest expense increased to $749,000 in the first quarter 2015 from $364,000 in the comparable period in 2014, primarily due to a $310,000 increase in amortization of debt discount and a $68,000 increase in accrued interest on notes. The increase in accrued interest reflects the additional cost associated with $2,270,000 of Secured Convertible Promissory Notes sold by the Company in May and June 2014.
As of March 31, 2015, the Company had Cash & Cash Equivalents and Accounts Receivable of approximately $1,604,000. This compares to $1,242,000 on December 31, 2014. Accounts Payable and Accrued Expenses increased to approximately $1,737,000 during the first quarter of 2015 from $1,042,000 at year-end 2014. The $695,000 increase was primarily due to purchases associated with product sales of $796,000, sales commission of $128,000 and accrued interest of $117,000, partially offset by a decrease of $298,000 in professional fees associated with the Company's outstanding promissory note and a decrease of $48,000 in accrued operating expenses.
As of March 31, 2015 the Company had 37,351,243 shares outstanding, an increase of 1,601,243 shares which were paid to certain holders of the Company's secured convertible promissory notes (the "Noteholders") in lieu of cash for interest due on November 26, 2014 (compounded through February 24, 2015) and penalties incurred by the Company for the late filing and effectiveness of its registration statement pursuant to the Noteholders' registration rights.
"After joining SQL in November 2014 as its CEO, I spent the next few months laying the groundwork for an infrastructure that would support the level of growth we believe our technology and products will attract. With the successful completion of several shipments to customers in North America, we are confident that our manufacturing and logistics capabilities can support significantly larger volume," commented John Campi, SQL's president and CEO.
Mr. Campi continued, "Our initial focus has been to gain acceptance as an approved vendor to several large retail organizations. This is an important first step in building business relationships, and one that should lead us to achieving our revenue growth and profit objectives once we have demonstrated our value added proposition. As we continue our sales and marketing effort on existing SQL products with the support of our business partners, we are also working towards developing other applications using our unique, patented technology. While the worldwide market for ceiling/wall lights and ceiling fans is very large, we believe other practical applications for our proprietary plug technology will expand our opportunities, as well as promote a safe and fast installation of electrical fixtures."
For more detailed information, please refer to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 filed with the U.S. Securities and Exchange Commission on May 14, 2015.
About Safety Quick Lighting & Fans Corp.
Safety Quick Light ("SQL") is a patented, disruptive technology that is transforming the lighting and ceiling fan industry. SQL's technology replaces the mounting bar unit built in existing electrical mounting boxes, converting it into a weight bearing plug that has no exposed wires. Using SQL's power plug, anyone can safely install ceiling and wall lights and ceiling fans in minutes. SQL's technology is UL and cUL Certified. Installing a ceiling light fixture is as simple as pushing the fixture in place and pressing a button.
SQL's technology is comprised of two parts: a female receptacle that is secured to existing electrical boxes, into which electrical and ground wires are simply inserted and locked into holes on the device, and a male plug that is preinstalled on the lighting or fan fixture. Once the female piece is attached to the electrical box, any lighting or fan fixture into which the male plug is incorporated can be installed in literally seconds. SQL's technology will be pre-installed in all types of lighting fixtures, including holiday themed lighting, and ceiling fans, for both indoor and outdoor use. For more information and to view a product video visit www.safetyquicklight.com.
Forward-Looking Statements: This press release includes forward-looking statements as determined by the U.S. Securities and Exchange Commission (the "SEC"). All statements, other than statements of historical facts, included in this press release that address activities, events, or developments that SQL believes or anticipates will or may occur in the future are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of SQL to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These include, but are not limited to, risks and uncertainties associated with the impact of economic, competitive and other factors affecting SQL and its operations, markets, product, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors over which SQL has little or no control and are too numerous to list. SQL does not intend (and is not obligated) to update publicly any forward-looking statements. The contents of this press release should be considered in conjunction with the warnings and cautionary statements contained in SQL recent filings with the SEC.
| Safety Quick Lighting & Fans Corp. and Subsidiary |
|||
| Consolidated Statement of Operations |
|||
| Three months ended |
|||
| March 31, 2015 |
March 31, 2014 |
||
| Sales |
$ 1,419,217 |
$ - |
|
| Cost of sales |
(1,239,728) |
- |
|
| Gross profit |
179,488 |
- |
|
| General and administrative expenses |
1,247,373 |
377,726 |
|
| Loss from operations |
(1,067,885) |
(377,726) |
|
| Other income (expense) |
|||
| Interest expense |
(748,522) |
(364,205) |
|
| Change in fair value of embedded derivative liabilities |
272,992 |
89,779 |
|
| Total other expense - net |
(475,530) |
(274,426) |
|
| Net loss including non-controlling interest |
(1,543,415) |
(652,152) |
|
| Less: net loss attributable to non-controlling interest |
(2) |
- |
|
| Net loss attributable to Safety Quick Lighting & Fans Corp. |
$ (1,543,413) |
$ (652,152) |
|
| Net loss per share - basic and diluted |
$ (0.05) |
$ (0.02) |
|
| Weighted average number of common shares outstanding during the year – basic and diluted |
33,887,925 |
32,597,543 |
|
| Safety Quick Lighting & Fans Corp. and Subsidiary |
|||
| Consolidated Balance Sheet |
|||
| (Unaudited) |
|||
| March 31, 2015 |
December 31, 2014 |
||
| ASSETS |
|||
| Current assets: |
|||
| Cash |
$ 184,694 |
$ 1,241,487 |
|
| Accounts receivable |
1,419,217 |
- |
|
| Prepaid expenses |
15,912 |
29,641 |
|
| Total current assets |
1,619,822 |
1,271,128 |
|
| Furniture and Equipment - net |
128,695 |
132,609 |
|
| Other assets: |
|||
| Patent - net |
51,360 |
46,419 |
|
| Debt issue costs - net |
123,334 |
161,946 |
|
| GE trademark license - net |
8,963,211 |
9,565,217 |
|
| Other assets |
65,714 |
65,714 |
|
| Total other assets |
9,203,619 |
9,839,296 |
|
| Total assets |
$ 10,952,138 |
$ 11,243,034 |
|
| LIABILITIES AND STOCKHOLDERS (DEFICIT) |
|||
| Current liabilities: |
|||
| Accounts payable & accrued expenses |
$ 1,736,685 |
$ 1,041,741 |
|
| Convertible debt - net of $713,319 net of debt discount |
1,480,814 |
1,223,982 |
|
| Convertible debt - related parties - net of $17,305 debt discount |
32,695 |
26,999 |
|
| Notes payable |
104,157 |
98,086 |
|
| Derivative liabilities |
4,378,770 |
4,651,762 |
|
| Other current liabilities |
73,288 |
78,622 |
|
| Total current liabilities |
7,806,409 |
7,121,192 |
|
| Convertible debt - net of $1,308,213 debt discount |
961,887 |
688,013 |
|
| Notes payable |
275,256 |
307,009 |
|
| GE royalty obligation |
11,924,870 |
12,000,000 |
|
| Total long term liabilities |
13,162,014 |
12,995,022 |
|
| Total liabilities |
20,968,423 |
20,116,214 |
|
| Stockholders' deficit: |
|||
| Preferred stock: $0 par value, 20,000,000 shares authorized; |
|||
| 0 shares issued and outstanding |
- |
- |
|
| Common stock: $0 par value, 500,000,000 shares authorized; |
|||
| 37,351,243 and 35,750,000 shares issued and outstanding |
|||
| at March 31, 2015 and December 31, 2014, respectively |
127,400 |
127,400 |
|
| Additional paid-in capital |
6,759,438 |
6,359,127 |
|
| Accumulated deficit |
(16,867,679) |
(15,324,264) |
|
| Total Stockholders' deficit |
(9,980,842) |
(8,837,737) |
|
| Noncontrolling interest |
(35,444) |
(35,442) |
|
| Total Deficit |
(10,016,286) |
(8,873,179) |
|
| Total liabilities and stockholders' deficit |
$ 10,952,138 |
$ 11,243,034 |
|
SOURCE Safety Quick Lighting & Fans Corp.
Related Links
http://www.safetyquicklight.com
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