Delaware
|
|
1-10185
|
|
26-1331503
|
(State or other jurisdiction
|
|
(Commission
|
|
(I.R.S. Employer
|
of incorporation)
|
|
File Number)
|
|
Identification No.)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which
registered
|
Common Stock, par value $0.001
|
ISDR
|
NYSE American
|
Exhibit
No.
|
|
Description
|
|
|
|
|
Press Release
issued by the Company on October 31, 2019.
|
|
Issuer
Direct Corporation
|
|
|||
|
|
|
|
|
|
Date: October 31,
2019
|
By:
|
/s/ Brian
R. Balbirnie
|
|
|
|
|
|
Brian R.
Balbirnie
|
|
|
|
|
|
Chief Executive
Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit
No.
|
|
Description
|
|
|
|
|
Press Release
issued by the Company on October 31, 2019.
|
|
Three Months
ended September 30,
|
|
|
2019
|
2018
|
|
Amount
|
Amount
|
|
|
|
Net
income:
|
$200
|
$86
|
Adjustments:
|
|
|
Depreciation and
amortization
|
430
|
354
|
Interest expense
(income)
|
(79)
|
1
|
Income tax
expense
|
59
|
32
|
EBITDA:
|
$610
|
$473
|
|
Nine Months
ended September 30,
|
|
|
2019
|
2018
|
|
Amount
|
Amount
|
|
|
|
Net
income:
|
$617
|
$772
|
Adjustments:
|
|
|
Depreciation and
amortization
|
1,261
|
1,034
|
Interest expense
(income)
|
(265)
|
11
|
Income tax
expense
|
105
|
246
|
EBITDA:
|
$1,718
|
$2,063
|
|
Three Months
ended September 30,
|
|||
|
2019
|
2018
|
||
|
Amount
|
Per diluted
share
|
Amount
|
Per diluted
share
|
|
|
|
|
|
Net
income:
|
$200
|
$0.05
|
$86
|
$0.02
|
Adjustments:
|
|
|
|
|
Amortization of
intangible assets (1)
|
192
|
0.05
|
140
|
0.04
|
Stock-based
compensation (2)
|
128
|
0.03
|
203
|
0.06
|
Integration and
acquisition costs (3)
|
—
|
—
|
7
|
—
|
Tax impact of
adjustments (4)
|
(67)
|
(0.02)
|
(73)
|
(0.02)
|
Impact of discrete
items impacting income tax expense (5)
|
(15)
|
—
|
48
|
0.01
|
Non-GAAP net
income:
|
$438
|
$0.11
|
$411
|
$0.11
|
|
Nine Months
ended September 30,
|
|||
|
2019
|
2018
|
||
|
Amount
|
Per diluted
share
|
Amount
|
Per diluted
share
|
|
|
|
|
|
Net
income:
|
$617
|
$0.16
|
$772
|
$0.24
|
Adjustments:
|
|
|
|
|
Amortization of
intangible assets (1)
|
574
|
0.15
|
390
|
0.12
|
Stock-based
compensation (2)
|
396
|
0.10
|
489
|
0.15
|
Integration and
acquisition costs (3)
|
112
|
0.03
|
48
|
0.01
|
Tax impact of
adjustments (4)
|
(227)
|
(0.06)
|
(195)
|
(0.06)
|
Impact of discrete
items impacting income tax expense (5)
|
(39)
|
(0.01)
|
27
|
0.01
|
Non-GAAP net
income:
|
$1,433
|
$0.37
|
$1,531
|
$0.47
|
|
September 30,
|
December 31,
|
|
2019
|
2018
|
ASSETS
|
(unaudited)
|
|
Current
assets:
|
|
|
Cash
and cash equivalents
|
$15,807
|
$17,222
|
Accounts
receivable (net of allowance for doubtful accounts of $671 and
$534, respectively)
|
2,054
|
1,593
|
Income
tax receivable
|
88
|
90
|
Other
current assets
|
222
|
89
|
Total
current assets
|
18,171
|
18,994
|
Capitalized
software (net of accumulated amortization of $1,926 and $1,310,
respectively)
|
1,361
|
1,957
|
Fixed
assets (net of accumulated depreciation of $500 and $452,
respectively)
|
329
|
132
|
Other
long-term assets
|
193
|
35
|
Goodwill
|
6,051
|
5,032
|
Intangible
assets (net of accumulated amortization of $4,793 and $4,219,
respectively)
|
3,984
|
2,802
|
Total assets
|
$30,089
|
$28,952
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$397
|
$371
|
Accrued
expenses
|
648
|
577
|
Current
portion of note payable
|
320
|
320
|
Income
taxes payable
|
27
|
83
|
Deferred
revenue
|
1,566
|
1,249
|
Total
current liabilities
|
2,958
|
2,600
|
Note
payable – long-term (net of discount of $26 and $45,
respectively)
|
294
|
276
|
Deferred
income tax liability
|
367
|
413
|
Other
long-term liabilities
|
51
|
—
|
Total liabilities
|
3,670
|
3,289
|
Commitments
and contingencies
|
|
|
Stockholders'
equity:
|
|
|
Preferred
stock, $0.001 par value, 1,000,000 shares authorized, no shares
issued and outstanding as of September 30, 2019 and December 31,
2018, respectively.
|
—
|
—
|
Common
stock $0.001 par value, 20,000,000 shares authorized, 3,837,588 and
3,829,572 shares issued and outstanding as of September 30, 2019
and December 31, 2018, respectively.
|
4
|
4
|
Additional
paid-in capital
|
22,684
|
22,525
|
Other
accumulated comprehensive loss
|
(37)
|
(17)
|
Retained
earnings
|
3,768
|
3,151
|
Total stockholders' equity
|
26,419
|
25,663
|
Total liabilities and stockholders’ equity
|
$30,089
|
$28,952
|
|
For the
Three
Months
Ended
|
For the
Nine
Months
Ended
|
||
|
September
30,
|
September
30,
|
September
30,
|
September
30,
|
|
2019
|
2018
|
2019
|
2018
|
Revenues
|
$4,019
|
$3,255
|
$12,336
|
$10,584
|
Cost of
revenues
|
1,222
|
981
|
3,774
|
3,032
|
Gross
profit
|
2,797
|
2,274
|
8,562
|
7,552
|
Operating costs and
expenses:
|
|
|
|
|
General and
administrative
|
1,229
|
944
|
3,912
|
2,896
|
Sales and marketing
expenses
|
871
|
723
|
2,566
|
2,272
|
Product
development
|
288
|
333
|
968
|
916
|
Depreciation and
amortization
|
229
|
155
|
659
|
439
|
Total operating
costs and expenses
|
2,617
|
2,155
|
8,105
|
6,523
|
Operating
income
|
180
|
119
|
457
|
1,029
|
Interest income
(expense), net
|
79
|
(1)
|
265
|
(11)
|
Net income before
income taxes
|
259
|
118
|
722
|
1,018
|
Income tax
expense
|
59
|
32
|
105
|
246
|
Net
income
|
$200
|
$86
|
$617
|
$772
|
Income per share
– basic
|
$0.05
|
$0.02
|
$0.16
|
$0.24
|
Income per share
– fully diluted
|
$0.05
|
$0.02
|
$0.16
|
$0.23
|
Weighted average
number of common shares outstanding – basic
|
3,853
|
3,552
|
3,853
|
3,223
|
Weighted average
number of common shares outstanding – fully
diluted
|
3,868
|
3,604
|
3,874
|
3,289
|
|
For the
Three
Months
Ended
|
For the
Nine
Months
Ended
|
||
|
September 30,
|
September 30,
|
September 30,
|
September 30,
|
|
2019
|
2018
|
2019
|
2018
|
Net
income
|
$200
|
$86
|
$617
|
$772
|
Foreign
currency translation adjustment
|
(7)
|
(10)
|
(20)
|
(43)
|
Comprehensive
income
|
$193
|
$76
|
$597
|
$729
|
|
Common
Stock
|
Additional
Paid-in
|
Other
Accumulated Comprehensive
Income
|
Retained
|
Total
Stockholders’
|
|
|
Shares
|
Amount
|
Capital
|
(Loss)
|
Earnings
|
Equity
|
Balance at
December 31, 2017
|
3,014,494
|
$3
|
$10,400
|
$34
|
$2,774
|
$13,211
|
Stock-based compensation
expense
|
—
|
—
|
142
|
—
|
—
|
142
|
Exercise of stock awards, net of
tax
|
47,626
|
—
|
161
|
—
|
—
|
161
|
Foreign currency
translation
|
—
|
—
|
—
|
43
|
—
|
43
|
Dividends
|
—
|
—
|
—
|
—
|
(152)
|
(152)
|
Net income
|
—
|
—
|
—
|
—
|
320
|
320
|
Balance at March
31, 2018
|
3,062,120
|
$3
|
$10,703
|
$77
|
$2,942
|
$13,725
|
Stock-based compensation
expense
|
—
|
—
|
144
|
—
|
—
|
144
|
Exercise of stock awards, net of
tax
|
41,250
|
—
|
549
|
—
|
—
|
549
|
Foreign currency
translation
|
—
|
—
|
—
|
(76)
|
—
|
(76)
|
Dividends
|
—
|
—
|
—
|
—
|
(153)
|
(153)
|
Net income
|
—
|
—
|
—
|
—
|
366
|
366
|
Balance at June
30, 2018
|
3,103,370
|
$3
|
$11,396
|
$1
|
$3,155
|
$14,555
|
Stock-based compensation
expense
|
—
|
—
|
204
|
—
|
—
|
204
|
Shares issued upon acquisition of
FSCwire
|
3,402
|
—
|
62
|
—
|
—
|
62
|
Secondary stock
offering
|
927,418
|
1
|
13,322
|
—
|
—
|
13,323
|
Exercise of stock awards, net of
tax
|
10,500
|
—
|
39
|
—
|
—
|
39
|
Foreign currency
translation
|
—
|
—
|
—
|
(10)
|
—
|
(10)
|
Dividends
|
—
|
—
|
—
|
—
|
(155)
|
(155)
|
Net income
|
—
|
—
|
—
|
—
|
86
|
86
|
Balance at
September 30, 2018
|
4,044,690
|
$4
|
$25,023
|
$(9)
|
$3,086
|
$28,104
|
Balance at
December 31, 2018
|
3,829,572
|
$4
|
$22,525
|
$(17)
|
$3,151
|
$25,663
|
Stock-based compensation
expense
|
—
|
—
|
137
|
—
|
—
|
137
|
Exercise of stock awards, net of
tax
|
24,996
|
—
|
—
|
—
|
—
|
—
|
Foreign currency
translation
|
—
|
—
|
—
|
(3)
|
—
|
(3)
|
Net income
|
—
|
—
|
—
|
—
|
205
|
205
|
Balance at March
31, 2019
|
3,854,568
|
$4
|
$22,662
|
$(20)
|
$3,356
|
$26,002
|
Stock-based compensation
expense
|
—
|
—
|
131
|
—
|
—
|
131
|
Exercise of stock awards, net of
tax
|
8,000
|
—
|
—
|
—
|
—
|
—
|
Foreign currency
translation
|
—
|
—
|
—
|
(10)
|
—
|
(10)
|
Net income
|
—
|
—
|
—
|
—
|
212
|
212
|
Balance at June
30, 2019
|
3,862,568
|
$4
|
$22,793
|
$(30)
|
$3,568
|
$26,335
|
Stock-based compensation
expense
|
—
|
—
|
127
|
—
|
—
|
127
|
Exercise of stock awards, net of
tax
|
—
|
—
|
—
|
—
|
—
|
—
|
Stock repurchase and
retirement
|
(24,980)
|
—
|
(236)
|
—
|
—
|
(236)
|
Foreign currency
translation
|
—
|
—
|
—
|
(7)
|
—
|
(7)
|
Net income
|
—
|
—
|
—
|
—
|
200
|
200
|
Balance at
September 30, 2019
|
3,837,588
|
$4
|
$22,684
|
$(37)
|
$3,768
|
$26,419
|
|
For the Nine Months Ended
|
|
|
September 30,
|
September 30,
|
|
2019
|
2018
|
Cash flows from operating activities:
|
|
|
Net
income
|
$617
|
$772
|
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
|
|
Depreciation
and amortization
|
1,261
|
1,034
|
Bad
debt expense
|
700
|
150
|
Deferred
income taxes
|
(46)
|
(15)
|
Non-cash
interest expense (See Note 3)
|
19
|
19
|
Stock-based
compensation expense
|
396
|
489
|
Changes
in operating assets and liabilities:
|
|
|
Decrease
(increase) in accounts receivable
|
(1,166)
|
(479)
|
Decrease
(increase) in other assets
|
(117)
|
229
|
Increase
(decrease) in accounts payable
|
26
|
(197)
|
Increase
(decrease) in accrued expenses and other liabilities
|
(56)
|
(281)
|
Increase
(decrease) in deferred revenue
|
321
|
432
|
Net
cash provided by operating activities
|
1,955
|
2,153
|
|
|
|
Cash flows from investing activities:
|
|
|
Purchase
of VisualWebcaster Platform
|
(2,788)
|
—
|
Purchase
of Filing Services Canada, Inc, net of cash received
|
—
|
(1,123)
|
Capitalized
software
|
(20)
|
(21)
|
Purchase
of fixed assets
|
(302)
|
(48)
|
Net
cash used in investing activities
|
(3,110)
|
(1,192)
|
|
|
|
Cash flows from financing activities:
|
|
|
Payment
for stock repurchase and retirement
|
(236)
|
—
|
Proceeds
from secondary stock offering
|
—
|
13,323
|
Proceeds
from exercise of stock options, net of income taxes
|
—
|
747
|
Payment
of dividends
|
—
|
(460)
|
Net
cash provided by (used in) financing activities
|
(236)
|
13,610
|
|
|
|
Net
change in cash
|
(1,391)
|
14,571
|
Cash
– beginning
|
17,222
|
4,917
|
Currency
translation adjustment
|
(24)
|
(44)
|
Cash
– ending
|
$15,807
|
$19,444
|
|
|
|
Supplemental disclosures:
|
|
|
Cash
paid for income taxes
|
$218
|
$46
|
Non-cash
activities:
|
|
|
Right-of-use
assets obtained in exchange for lease liabilities
|
$260
|
$—
|