- Company posts sequential increases in revenue and NDVCW -
- Repurchased $1.6 million in common stock for the quarter
and $26.3 million from the plan’s inception to date-
-Company provides fiscal 2009 guidance-
OREM, Utah, September 4, 2008 - iMergent, Inc., (AMEX: IIG) a leading provider of eCommerce software for small businesses and entrepreneurs, reported financial results for its fiscal fourth quarter and fiscal year ended June 30, 2008.
Don Danks, chief executive officer of iMergent, stated, “Fourth quarter results are in line with our expectations and improved sequentially. Compared to the third quarter, fourth quarter revenue grew 6% and Net Dollar Volume of Contracts Written increased 7%. In addition, close rates grew from 29% in the third quarter to 31% in the fourth quarter and average selling price rose from $5,000 in the third quarter to $5,500 in the fourth quarter. Our StoresOnline™ Express rollout continues to perform well and complements StoresOnline Pro. We are encouraged by the positive impact of our adjusted business model.”
“During the past six months, we have worked diligently to refine our new business model and resolve outstanding legal concerns. We have entered agreements in six states including Florida. We continue to work on resolving the remaining legal issues. As a consequence of settlements we have entered or expect to enter with these states, we have recognized $1.1 million of legal expenses and settlement fees. Also, revenue was negatively impacted by $724,000 for historical and estimated refunds to customers associated with all resolved and outstanding legal matters during the fourth quarter of fiscal 2008. We do not expect this level of legal and settlement expenses to continue in fiscal 2009.”
Fiscal Fourth Quarter: 2008 Compared to 2007
During the three months ended June 30, 2008, the company held 222 workshops, including 65 internationally, compared to 333 workshops, including 70 internationally, in the same quarter of last year.
• Revenues for the fourth quarter of fiscal 2008 were $29.1 million net of customer refunds of $724,000 associated with legal settlements, compared to $44.3 million net of customer refunds of $270,000 associated with legal settlements for the fourth quarter of fiscal 2007, reflecting the lower number of workshops.
• Net Dollar Volume of Contracts Written was $28.4 million for the fourth quarter of fiscal 2008, compared to $46.2 million for the fourth quarter last year.
• Total operating expenses were $29.6 million for the fourth quarter of fiscal 2008 including $1.1 million in legal expenses, compared to $38.2 million for the fourth quarter last year, including $332,000 in legal expenses.
• Other income was $2.2 million for the fourth quarter of fiscal 2008, which included $2.0 million in interest income, compared to $2.5 million of other income for the fourth quarter last year, which included $2.2 million in interest income.
• For the fourth quarter of fiscal 2008, net income was $554,000, or $0.05 per diluted common share. This compares to net income of $5.3 million, or $0.41 per diluted common share in the same quarter last year.
• Cash provided by operating activities was $3.4 million for the fourth quarter of fiscal 2008, compared to $8.5 million for the same period in 2007.
Full Year Ended June 30: 2008 Compared to 2007
During the year ended June 30, 2008, the company held 1,028 workshops, including 184 internationally, compared to 1,193 workshops, including 264 internationally, during the year ended June 30, 2007. Revenues for the year ended June 30, 2008 were $128.0 million net of customer refunds associated with legal settlements totaling $1.0 million, compared to $151.6 million for the year ended June 30, 2007, reflecting the lower number of workshops. Net Dollar Volume of Contracts Written was $128.8 million for fiscal year 2008, compared to $165.3 million for the previous year. For the year ended June 30, 2008, legal expenses were $2.7 million and net income was $3.1 million, or $0.26 per diluted common share. For the year ended June 30, 2007, legal expenses were $1.8 million and net income was $24.0 million, or $1.87 per diluted common share.
As of June 30, 2008, cash and cash equivalents were $26.2 million, net trade receivables were $38.6 million, working capital was $20.6 million, and working capital excluding deferred revenue was $53.4 million.
“We continue to be committed to increasing value for our stockholders. During the quarter and year ended June 30, 2008, we repurchased 128,837 and 948,297 shares of our common stock for $1.6 million and $12.6 million, respectively. Since the repurchase program’s commencement in August 2006, over 1,603,000 shares were purchased for $26.3 million. In addition, during the year we paid $5.1 million in dividends,” Danks added.
Outlook“Looking ahead, we enter fiscal 2009 with increased clarity of our business practices and a stronger business model with leaner and more effective sales teams and improved marketing. Our marketing programs begin months in advance of our previews and workshops, and to date in the first quarter of fiscal 2009, preview demand increased due to our marketing and advertising efforts. We are adjusting our infrastructure to more effectively accommodate more potential customers, and we anticipate adding a sales team in the third fiscal quarter. We expect the impact of these initiatives to grow revenue in the second half of the year. Also we believe we will begin to once again reap the benefits of our operating leverage and increase our profitability in fiscal 2009,” concluded Danks.
The company reduced workshop teams by 33% and introduced its new business model in late December 2007. As such, during the first half of fiscal 2009 the company will have two-thirds of the workshops teams compared to the same period last year, and management expects revenue and Net Dollar Volume of Contracts Written in the first half of fiscal 2009 to decrease 15% to 20% compared to the same period of fiscal 2008. However, during the second half of fiscal 2009, the company believes it will have a comparable business model to the second half of fiscal 2008, and management expects revenue and Net Dollar Volume of Contracts Written for the second half of fiscal 2009 will grow up to 10% compared to the same period of fiscal 2008.
Conference Call
The company is hosting a conference call today at 1:30 p.m. PT (4:30 p.m. ET). The conference call will be broadcast live over the Internet at www.imergentinc.com. If you do not have Internet access, the telephone dial-in number is 800-639-0297 for domestic participants and 706-634-7417 for international participants. Please dial in five to ten minutes prior to the beginning of the call at 1:30 p.m. PT (4:30 p.m. ET). A telephone replay will be available three hours after the call through September 8, 2008 by dialing 800-642-1687 for domestic callers or 706-645-9291 for international callers and entering access code 60268194.
Safe Harbor Statement
The statements made in this press release regarding iMergent's (1) fourth quarter results being in line with expectations and improving sequentially, (2) close rates growing in the fourth quarter and average selling price rising in the fourth quarter, (3) StoresOnline™ Express rollout continuing to perform well and complementing StoresOnline Pro, (4) expectation of continuing to have positive impact of Express and Pro on the business model, (5) continuing to work diligently to refine its new business model and resolving legal concerns, (6) successfully resolving remaining legal issues, (7) accruing $1.1 million of legal expenses and settlement fees for settlements we have or expect to enter, (8) revenue being negatively impacted by $724,000 for historical and estimated refunds to customers, and the expectation that this level of legal related expenses will not continue in fiscal 2009, (9) continuing to be committed to increasing value for stockholders, (10) entering fiscal 2009 with increased clarity of business practices and a stronger business model with leaner and more effective sales teams and improved marketing, (11) preview demand increasing due to marketing and advertising efforts, (12) adjusting its infrastructure to more effectively accommodate more people, (13) anticipation of adding a sales team in the fiscal third quarter, (14) having the impact of its initiatives grow revenue in the second half of fiscal 2009, (15) reaping the benefits of operating leverage and increasing profitability in fiscal 2009, (16) expectation that revenue in the first half of fiscal 2009 will be lower compared to the same period of fiscal 2008, (17) expectation that revenue for the second half of fiscal 2009 will be higher compared to the same period of fiscal 2008, (18) expectation that full year fiscal 2009 revenue and Net Dollar Volume of Contracts Written to decrease between 10% and 15% from the full year fiscal 2008 results of $128.0 million and $128.8 million, respectively and other statements that are not historical in nature constitute forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.
Such statements are based on the current expectations and beliefs of the management of iMergent and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such risks and uncertainties include, without limitation, the Company's ability to execute on its plans and expectations; the Company properly estimating customer returns and cash collections on financed contracts; the Company's ability to continue to evaluate and find ancillary products; the Company's ability to offer best solutions to its customers; the Company's ability to maintain a very solid customer base; the Company's ability to have profitable long-term relationships with its customers; that the market for the Company's products will continue to grow; whether regulatory authorities will bring future actions against the Company; the success of StoresOnline Express ™; the ability to upgrade customers from Express, the viability of the StoresOnline Express model; the ability to increase the number of workshops; the ability to properly market the products; the ability to expand operating margins; the fluctuations in the Company's operating results because of negative publicity, seasonality, competition, economic conditions and other factors; the adverse impact of international or domestic regulatory developments affecting the internet or the Company's business; the effect of competitive and economic factors and the Company's reaction to them; possible disruption in commercial activities caused by terrorist activity and armed conflicts; changes in logistics and security arrangements; reduced purchases relative to security expectations; possible disruption in commercial activity as a result of natural disasters or major health concerns including epidemics; continued competitive pressures in the marketplace; the ability of the Company to successfully evolve its products; costs of and developments in the Company's pending litigation and investigations; the Company's ability to generate revenue and profits from current strategic partnerships; the Company's ability to generate positive cash flows from operating activities; the ability to sell receivables; the continued ability of the Company to repurchase its common shares and what effect those transactions may have on cash and liquidity; the Company's ability to expand current markets and develop new markets and establish profitable strategic partnerships; the Company's ability to continue to finance extended payment term arrangement customer contracts; whether there is continual demand for the Company's products and services in its target market of small businesses and entrepreneurs for assistance in establishing websites; that the Company can successfully adjust its product financing policy, and that such adjustments to the policy will not negatively impact business or revenues; that the Company is able to leverage its business; that the Company does improve margins and can continue to improve margins; that new products and initiatives in the pipeline will be implemented; that new products and initiatives, if implemented, will improve the customer base and margins of the Company; that the Company can broaden its training and education programs as well as offer new products and solutions; that if the Company is able to broaden its training and education programs as well as offer new products and solutions that such actions will have a positive impact on the Company, its customers, its customer relationships, its margins or revenues; and, that the growth strategy undertaken by the Company will be successful. For a more detailed discussion of risk factors that may affect iMergent's operations, please refer to the Company's Form 10-K for the year ended June 30, 2008. These forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update such forward-looking statements, except as required by law.
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and small businesses enabling them to market and sell their business products or ideas via the Internet. Headquartered in Orem, Utah, the company sells its proprietary StoresOnline software and training services, which help users build successful Internet strategies to market products, accept online orders, analyze marketing performance, and manage pricing and customers. In addition to software, iMergent offers website development, web hosting and marketing products. iMergent typically reaches its target audience through a concentrated direct marketing effort to fill Preview Sessions, in which a StoresOnline expert reviews the product opportunities and costs as well as offers StoresOnline Express for sale. These sessions lead to a follow-up Workshop Conference, where product and technology experts train potential users on the software and sells upgrades to StoresOnline Pro and StoresOnline Platinum. iMergent, Inc. and StoresOnline are trademarks of iMergent, Inc.
Friday, September 5, 2008
Thursday, September 4, 2008
iMergent, Inc. Announces Quarterly Dividend
OREM, Utah, September 3, 2008 - iMergent, Inc., (AMEX: IIG), announced its board of directors has declared a quarterly dividend of $0.11 per share on the company’s common stock. The dividend is payable on September 29, 2008 to stockholders of record at the close of business on September 19, 2008.
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and small businesses enabling them to market and sell their business products or ideas via the Internet. Headquartered in Orem, Utah, the company sells its proprietary StoresOnline software and training services which help users build successful Internet strategies to market products, accept online orders, analyze marketing performance, and manage pricing and customers. In addition to software, iMergent offers site development, web hosting and marketing products. iMergent typically reaches its target audience through a concentrated direct marketing effort to fill Preview Sessions, in which a StoresOnline expert reviews the product opportunities and costs. These sessions lead to a follow-up Workshop Conference, where product and technology experts train potential users on the software and encourage them to make purchases. iMergent, Inc. and StoresOnline are trademarks of iMergent, Inc.
Company Contact:
Robert Lewis, CFO
iMergent, Inc.
801.431.4695
investor_relations@imergentinc.com
Investor Relations Contact:
Becky Herrick
Lippert/Heilshorn & Associates
415.433.3777
bherrick@lhai.com
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and small businesses enabling them to market and sell their business products or ideas via the Internet. Headquartered in Orem, Utah, the company sells its proprietary StoresOnline software and training services which help users build successful Internet strategies to market products, accept online orders, analyze marketing performance, and manage pricing and customers. In addition to software, iMergent offers site development, web hosting and marketing products. iMergent typically reaches its target audience through a concentrated direct marketing effort to fill Preview Sessions, in which a StoresOnline expert reviews the product opportunities and costs. These sessions lead to a follow-up Workshop Conference, where product and technology experts train potential users on the software and encourage them to make purchases. iMergent, Inc. and StoresOnline are trademarks of iMergent, Inc.
Company Contact:
Robert Lewis, CFO
iMergent, Inc.
801.431.4695
investor_relations@imergentinc.com
Investor Relations Contact:
Becky Herrick
Lippert/Heilshorn & Associates
415.433.3777
bherrick@lhai.com
Tuesday, September 2, 2008
iMergent Reaches Settlement Agreement with the State of Florida
- Agreement does not impair the company’s ability to conduct business in Florida -
OREM, Utah, September 2, 2008 - iMergent, Inc. (AMEX: IIG), a leading provider of eCommerce software for small businesses and entrepreneurs, entered into a settlement agreement with the State of Florida Office of the Attorney General on Friday, August 29, 2008.
The Attorney General of Florida originally filed an action in 2007 and then amended and re-filed the action in 2008, claiming the company sold a business opportunity and otherwise made sales in violation of certain consumer protection statutes.
As a result of the agreement, the company agreed to pay fees totaling $125,000 and agreed that it will refund any customers in the State of Florida who may file claims within 30 days of entry of the judgment. The company also agreed to refund claimants who have previously filed a claim to either the company or the State. iMergent also agreed to refund up to $250,000 in claims made over the next 18 moths from purchasers who can demonstrate with supporting documentation that there has been a misrepresentation made to them and that the customer could not make the product work. In addition, iMergent agreed to certain actions intended to clarify its business practices. There is no finding iMergent is a seller of a business opportunity.
Jeff Korn, iMergent general counsel, said, “The Attorney General of the State of Florida has completed a very long and thorough review of the company’s business practices. The Attorney General made some suggestions including increasing the refund period for seniors to 15 days, which we have already incorporated world wide. We are always willing to work to take any action that makes our sales model more transparent. We have reserved for the refunds expected and do not expect refunds after the thirty days to have a significant impact as we do not believe there have been any misrepresentations made to customers. ”
Don Danks, CEO, stated, “After a two year review, we are pleased to have a resolution to this matter that clarifies the company’s business practices and does not limit our ability to conduct business in Florida. The changes to StoresOnline™ Express have been instrumental in clarifying our business practices and greatly assisted in resolving this matter.”
Before the stock market opened today, the company filed an SEC Form 8-K.
Safe Harbor
Statements made in this press release regarding (1) iMergent transacting business in the State of Florida (2) the settlement resolving outstanding matters with the State of Florida, (3) the settlement not affecting continued operations in the State of Florida, (4) iMergent addressing issues to clarify its business practices, (5) iMergent having reserved for the refunds expected and the expectation that refunds after the thirty days will not have a significant impact, (7) the belief there have not been misrepresentations made to customers (6) iMergent being willing to take any reasonable action that assists in making sales practices transparent to regulators customers, (7) that the StoresOnline™ Express model has been instrumental in clarifying iMergent business practices and greatly assisted in resolving this matter are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. For a more detailed discussion of risk factors that affect iMergent's operations, please refer to the company's Form 10-K for the year ended June 30, 2007, and Forms 10-Q for the periods ended September 30, 2007, December 31, 2007, and March 31, 2008.
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and small businesses enabling them to market and sell their business products or ideas via the Internet. Headquartered in Orem, Utah, the company sells its proprietary StoresOnline software and training services which help users build successful Internet strategies to market products, accept online orders, analyze marketing performance, and manage pricing and customers. In addition to software, iMergent offers site development, web hosting and marketing products. iMergent typically reaches its target audience through a concentrated direct marketing effort to fill Preview Sessions, in which a StoresOnline expert reviews the product opportunities and costs. These sessions lead to a follow-up Workshop Conference, where product and technology experts train potential users on the software and encourage them to make purchases. iMergent, Inc. and StoresOnline are trademarks of iMergent, Inc.
Company Contact:
Jeffrey Korn,
General Counsel/Corp. Secretary
iMergent, Inc.
801.431.4695
investor_relations@imergentinc.com
Investor Relations Contact:
Becky Herrick
Lippert/Heilshorn & Associates
415.433.3777
bherrick@lhai.com
OREM, Utah, September 2, 2008 - iMergent, Inc. (AMEX: IIG), a leading provider of eCommerce software for small businesses and entrepreneurs, entered into a settlement agreement with the State of Florida Office of the Attorney General on Friday, August 29, 2008.
The Attorney General of Florida originally filed an action in 2007 and then amended and re-filed the action in 2008, claiming the company sold a business opportunity and otherwise made sales in violation of certain consumer protection statutes.
As a result of the agreement, the company agreed to pay fees totaling $125,000 and agreed that it will refund any customers in the State of Florida who may file claims within 30 days of entry of the judgment. The company also agreed to refund claimants who have previously filed a claim to either the company or the State. iMergent also agreed to refund up to $250,000 in claims made over the next 18 moths from purchasers who can demonstrate with supporting documentation that there has been a misrepresentation made to them and that the customer could not make the product work. In addition, iMergent agreed to certain actions intended to clarify its business practices. There is no finding iMergent is a seller of a business opportunity.
Jeff Korn, iMergent general counsel, said, “The Attorney General of the State of Florida has completed a very long and thorough review of the company’s business practices. The Attorney General made some suggestions including increasing the refund period for seniors to 15 days, which we have already incorporated world wide. We are always willing to work to take any action that makes our sales model more transparent. We have reserved for the refunds expected and do not expect refunds after the thirty days to have a significant impact as we do not believe there have been any misrepresentations made to customers. ”
Don Danks, CEO, stated, “After a two year review, we are pleased to have a resolution to this matter that clarifies the company’s business practices and does not limit our ability to conduct business in Florida. The changes to StoresOnline™ Express have been instrumental in clarifying our business practices and greatly assisted in resolving this matter.”
Before the stock market opened today, the company filed an SEC Form 8-K.
Safe Harbor
Statements made in this press release regarding (1) iMergent transacting business in the State of Florida (2) the settlement resolving outstanding matters with the State of Florida, (3) the settlement not affecting continued operations in the State of Florida, (4) iMergent addressing issues to clarify its business practices, (5) iMergent having reserved for the refunds expected and the expectation that refunds after the thirty days will not have a significant impact, (7) the belief there have not been misrepresentations made to customers (6) iMergent being willing to take any reasonable action that assists in making sales practices transparent to regulators customers, (7) that the StoresOnline™ Express model has been instrumental in clarifying iMergent business practices and greatly assisted in resolving this matter are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. For a more detailed discussion of risk factors that affect iMergent's operations, please refer to the company's Form 10-K for the year ended June 30, 2007, and Forms 10-Q for the periods ended September 30, 2007, December 31, 2007, and March 31, 2008.
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and small businesses enabling them to market and sell their business products or ideas via the Internet. Headquartered in Orem, Utah, the company sells its proprietary StoresOnline software and training services which help users build successful Internet strategies to market products, accept online orders, analyze marketing performance, and manage pricing and customers. In addition to software, iMergent offers site development, web hosting and marketing products. iMergent typically reaches its target audience through a concentrated direct marketing effort to fill Preview Sessions, in which a StoresOnline expert reviews the product opportunities and costs. These sessions lead to a follow-up Workshop Conference, where product and technology experts train potential users on the software and encourage them to make purchases. iMergent, Inc. and StoresOnline are trademarks of iMergent, Inc.
Company Contact:
Jeffrey Korn,
General Counsel/Corp. Secretary
iMergent, Inc.
801.431.4695
investor_relations@imergentinc.com
Investor Relations Contact:
Becky Herrick
Lippert/Heilshorn & Associates
415.433.3777
bherrick@lhai.com
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