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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.

Tables Follow

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

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SOURCE Zoned Properties, Inc.

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