Zoned Properties, Inc. (OTCQX:ZDPY), a strategic real estate development firm whose primary mission is to identify, develop and lease sophisticated, safe and sustainable properties in emerging industries, including the licensed medical marijuana industry, today announced its financial results for the three and nine-month periods ended September 30, 2018.
Third Quarter 2018 Financial Results
— Revenues were $263,000, compared to $535,000 for the third quarter of 2017.
— Operating expenses were $270,000, down 17.2% compared to $326,000 for the third quarter of 2017.
— Net income was $13,000, or $0.00 per basic and diluted share, compared to $182,000, or $0.01 per basic and diluted share, for the third quarter of 2017.
— Cash provided by operating activities was $282,000 for the first nine months of 2018 compared to cash used by operating activities of $110,000 for the first nine months of 2017.
— As of September 30, 2018, the Company had cash of $685,000, compared to $824,000 as of December 31, 2017.
“Zoned Properties continues to increase its operating efficiencies and has been expanding its strategic advisory practice,” commented Bryan McLaren, Chief Executive Officer. “The company is well positioned to use its foundational portfolio of property assets as a platform for business expansion and diversification of services. Our expanded team is in the process of bidding to provide professional services to municipal governing bodies for the implementation of regulatory policies in new markets.”
“The end of 2018 and 2019 will be heavily focused on growth of a diversified revenue stream,” added Mr. McLaren. “We intend to accomplish this by prospecting new advisory services across the country for private and municipal clients. We believe that strategic real estate advisory services are likely to emerge as the growth engine for Zoned Properties and are moving to take advantage of new opportunities to create sustainable shareholder value.”
About Zoned Properties, Inc. (ZDPY):
Zoned Properties is a strategic real estate development firm whose primary mission is to identify, develop, and lease sophisticated, safe, and sustainable properties in emerging industries, including the licensed medical marijuana industry. Zoned Properties is an accredited member of the Better Business Bureau, the Forbes Real Estate Council, and the U.S. Green Building Council. The Company focuses on the strategic development of commercial properties that face unique zoning challenges; identifying solutions that could potentially have a major impact on cash flow and property value. Zoned Properties targets commercial properties that can be acquired and re-zoned or permitted for specific purposes. Zoned Properties does not grow, harvest, sell or distribute cannabis or any substances regulated under United States law such as the Controlled Substances Act.
Use of Non-GAAP Financial Information
The Company measures its performance primarily through growth in revenue and operating profit. In addition to the consolidated financial statements presented in accordance with GAAP, management uses certain non-GAAP measures to measure its operating performance, including operating expenses, exclusive of a one-time non-cash write-off related to deferred rent receivables. A definition of the components of operating expenses, exclusive of a one-time non-cash write-off related to deferred rent receivables, and a reconciliation to the most directly comparable GAAP financial measure has been provided.
During the third quarter of 2018, the Company incurred a one-time non-cash write-off of $1.9 million related to deferred rent receivables. Operating expenses, exclusive of this one-time non-cash write-off related to deferred rent receivables, is presented to enhance an understanding of the operating results and is not intended to represent operating expenses or results of operations. The use of operating expenses, exclusive of the one-time non-cash write-off related to deferred rent receivables, provides a clearer understanding of normal, recurring operating results of the Company.
This non-GAAP measure is not in accordance with, and should not be used as an alternative to, measures prepared in accordance with GAAP. In addition, non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP. Non-GAAP measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as “believe,” “expect,” “anticipate,” “plan,” “potential,” “continue” or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company’s filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company’s control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company’s current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
ZONED PROPERTIES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS As of As of September 30, December 31, 2018 2017 (Unaudited) (Audited)ASSETS Cash $ 685,045 $ 824,240 Rental properties, net 7,395,808 7,170,322 Deferred rent receivable - related parties - 1,708,734 Note receivable - related party 46,447 182,365 Prepaid expenses and other current assets 130,749 127,902 Property and equipment, net 30,463 35,768 Security deposits 600 2,890Total Assets $ 8,289,112 $ 10,052,221LIABILITIES AND STOCKHOLDERS' EQUITYLIABILITIES: Convertible notes payable - related parties $ 2,020,000 $ 2,020,000 Accounts payable - 8,896 Accrued expenses 93,857 48,468 Accrued expenses - related parties 34,500 33,600 Deferred revenues 3,000 28,750 Security deposits payable - related parties 71,800 71,800 Security deposits payable 6,032 5,864Total Liabilities 2,229,189 2,217,378Commitments and ContingenciesSTOCKHOLDERS' EQUITY: Preferred stock, $0.001 par value, 5,000,000 shares authorized; 2,000,000 shares issued and outstanding at September 30, 2018 and December 31, 2017 ($1.00 per share liquidation preference) 2,000 2,000 Common stock: $0.001 par value, 100,000,000 shares authorized; 17,441,552 and 17,345,497 issued and outstanding at September 30, 2018 and December 31, 2017, respectively 17,442 17,345 Additional paid-in capital 20,738,321 20,630,649 Accumulated deficit (14,697,840) (12,815,151)Total Stockholders' Equity 6,059,923 7,834,843Total Liabilities and Stockholders' Equity $ 8,289,112 $ 10,052,221
ZONED PROPERTIES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited) For the Three Months Ended For the Nine Months Ended September 30, September 30, 2018 2017 2018 2017REVENUES:Rental revenues $ 12,876 $ 13,291 $ 37,279 $ 67,993Rental revenues - related parties 249,638 522,103 937,137 1,512,609 Total revenues 262,514 535,394 974,416 1,580,602OPERATING EXPENSES:Compensation and benefits 63,766 107,173 318,748 445,401Professional fees 63,052 45,381 220,551 166,002General and administrative expenses 46,046 44,118 123,572 130,699Depreciation and amortization 74,198 59,580 201,102 167,765Property operating expenses 971 28,163 37,270 90,522Real estate taxes 22,038 21,206 66,332 66,488Settlement expense - 20,500 - 20,500Impairment loss - - 1,853,539 - Total operating expenses 270,071 326,121 2,821,114 1,087,377(LOSS) INCOME FROM OPERATIONS (7,557) 209,273 (1,846,698) 493,225OTHER (EXPENSES) INCOME:Interest expenses - - - (42,983)Interest expenses - related parties (30,300) (30,300) (90,900) (98,988)Other income 50,000 50,000 -Gain on sale of property and equipment - - - 831,753Interest income 1,229 2,836 4,909 5,622 Total other (expenses) income, net 20,929 (27,464) (35,991) 695,404(LOSS) INCOME BEFORE INCOME TAXES 13,372 181,809 (1,882,689) 1,188,629PROVISION FOR INCOME TAXES - - - -NET (LOSS) INCOME $ 13,372 $ 181,809 $(1,882,689) $1,188,629NET (LOSS) INCOME PER COMMON SHARE:Basic $ 0.00 $ 0.01 $ (0.11) $ 0.06Diluted $ 0.00 $ 0.01 $ (0.11) $ 0.06WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:Basic 17,436,253 17,318,128 17,422,147 17,299,805Diluted 17,436,253 17,930,461 17,422,147 18,142,071
ZONED PROPERTIES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited) For the Nine Months Ended September 30, 2018 2017CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ (1,882,689) $ 1,188,629 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization expense 201,102 167,765 Stock-based compensation 84,132 204,000 Stock option expense 23,637 3,962 Stock-based settlement expense 10,500 Gain from sale of property and equipment - (831,753) Impairment loss 1,853,539 - Change in operating assets and liabilities: Rent receivable (72,335) Deferred rent receivable - related parties (144,805) (537,756) Real estate tax escrow - 39,487 Note receivable 135,918 (179,483) Prepaid expenses and other assets (2,847) 6,100 Security deposits 2,290 5,268 Accounts payable (8,896) (67,659) Accrued expenses 45,389 18,427 Accrued expenses - related parties 900 (52,241) Deferred revenues (25,750) (750) Deferred revenues - 1,841 Security deposits payable - related party - 1,800 Security deposits payable 168 (16,100)NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 282,088 (110,298)CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of buildings and improvements (421,283) (365,863) Cash received from sale of property and equipment - 1,984,188 Acquisition of property and equipment - (2,586)NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES (421,283) 1,615,739CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from convertible debt - related parties - 2,020,000 Repayment of convertible note - related party - (500,000) Repayment of convertible note - (500,000) Repayment of mortgage payable - (2,100,000)NET CASH USED IN FINANCING ACTIVITIES - (1,080,000)NET (DECREASE) INCREASE IN CASH (139,195) 425,441CASH, beginning of period 824,240 366,024CASH, end of period $ 685,045 $ 791,465SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Interest paid $ 90,000 $ 192,087SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Common stock issued for accrued settlement payable $ - $ 21,875
View original content:http://www.prnewswire.com/news-releases/zoned-properties-reports-third-quarter-2018-financial-results-300748815.html
SOURCE Zoned Properties, Inc.