AP NEWS
Press release content from ACCESSWIRE. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from ACCESSWIRE
Press release content from ACCESSWIRE. The AP news staff was not involved in its creation.

Galaxy Next Generation Reports First Quarter Fiscal Year 2020 Results

November 19, 2019 GMT
TOCCOA, GA / ACCESSWIRE / November 19, 2019 / Galaxy Next Generation, Inc. (OTCQB:GAXY), a provider of interactive learning technology solutions, today announced the Company's operating and financial results for the fiscal first quarter ended ...
TOCCOA, GA / ACCESSWIRE / November 19, 2019 / Galaxy Next Generation, Inc. (OTCQB:GAXY), a provider of interactive learning technology solutions, today announced the Company's operating and financial results for the fiscal first quarter ended ...

TOCCOA, GA / ACCESSWIRE / November 19, 2019 / Galaxy Next Generation, Inc. (OTCQB: GAXY ), a provider of interactive learning technology solutions, today announced the Company’s operating and financial results for the fiscal first quarter ended September 30, 2019.

Key Financial Highlights for Q1 FY 2020

  • Revenue of $0.6 million, representing growth of 25% in technology interactive panels and related products
  • Gross Margin of 21%
  • Adjusted EBITDA loss of $0.7 million, after deducting non-cash stock-based compensation

Key Business Highlights for Q1 FY 2020

  • Closed acquisition of Interlock Concepts
  • Executed agreements with various new resellers, expanding geographically and vertically, including AIOS Group
  • Completed successful install with the International School of Louisiana
  • Awarded contract from Thompson School District in Loveland, Colorado

Management Commentary

“We are off to a teriffic start in our fiscal year 2020 as we closed our acquisition of Interlock Concepts and grew our core technology interactive panels and related prodicts business by 25%,” commented, Gary LeCroy, Galaxy’s Chief Executive Officer. “We are very excited with several new products launched and our suite of innovative audio products in order to offer a more robust and complete total classroom solution. Our Interlock Concepts audio include notification and building communication platform, amplifier, lanyard microphone, handheld microphone and speakers, call buttons, microphones and alert buttons, IP notification devices (clock and speakers), notification software and soundbar, in-ceiling and wall speakers.”

LeCroy concluded, “We are confident that Interlock Concepts will enable us to accelerate our revenue growth. Our sales pipeline of opportunities we have identified and are competing for is as robust as ever. We believe this is just the beginning of a major technology turnover cycle in the K-12 education market and we look forward to being a major participant in it.”

Financial Results for the Three Months Ended September 30, 2019:

Revenue for the three months ended September 30, 2019 was $0.6 million, a decrease of $0.1 million or 13%, as compared to $0.7 million for the three months ended September 30, 2018. Of note, revenue associated with technology interactive panels and related products for the three months ended September 30, 2019 was $0.6 million, an increase of $0.1 million or 25%, as compared to $0.5 million for the three months ended September 30, 2019. Revenue primarily declined due to the sale of the FLCE business, which was offset by increases in the customer base and additional revenues received through Interlock Concepts and Ehlert Solutions Group, which were acquired in September 2019. Additionally, deferred revenue increased to $0.7 million, as compared to $0.2 million for the three months ended September 30, 2018.

Gross profit for the three months ended September 30, 2019 was $0.1 million, a decrease of $0.1 million or 45%, as compared to $0.2 million for the three months ended September 30, 2018. The resulting gross margin was 21.0% for the three months ended September 30, 2019, compared to 33.4% for the three months ended September 30, 2018.

General and administrative expenses for the three months ended September 30, 2019 were $2.1 million, an increase of $1.3 million or 146%, compared to $0.9 million for the three months ended September 30, 2018. The increase primarily related to Company growth and the addition of Interlock Concepts and Ehlert Solutions Group, which were acquired in September 2019. Of note, $1.3 million of general and administration expenses representing consulting fees and employee compensation was non-cash stock-based compensation, as compared to $0 for the three months ended September 30, 2018.

Other expenses for the three months ended September 30, 2019 were $24,707, an increase of $16,337, compared to $8.369 for the three months ended September 30, 2018. For the three months ended September 30, 2019, this was comprised of $3,049 other income and $802,968 positive change in fair value of derivative liability, offset by $228,933 interest accretion and $601,790 interest expense. For the three months ended September 30, 2018, this was comprised of $40,444 other income, offset by $48,813 interest expense.

Operating loss for the three months ended September 30, 2019 was $2.0 million, an increase of $1.4 million, or 220%, compared to $0.6 million for the three months ended September 30, 2018. Operating loss for the three months ended September 30, 2019 included $1.3 million of non-cash stock-based compensation compared to $0 non-cash stock-based compensation, for the three months ended September 30, 2018.

Net loss for the three months ended September 30, 2019 was $2.0 million, an increase of $1.4 million, or 219%, compared to $0.6 million for the three months ended September 30, 2018. The resulting loss per share for the three months ended September 30, 2019 was ($0.14) per diluted share, compared to ($0.07) per diluted share for the three months ended September 30, 2018.

Adjusted EBITDA loss, after deducting non-cash operating expenses, for the three months ended September 30, 2019 was $0.7 million, compared to $0.6 million for the three months ended September 30, 2018.

Use of Non-GAAP Financial Measures

To supplement Galaxy’s financial statements presented on a GAAP basis, Galaxy provides Adjusted EBITDA as a supplemental measure of its performance.

To provide investors with additional insight and allow for a more comprehensive understanding of the information used by management in its financial and decision-making surrounding pro forma operations, we supplement our consolidated financial statements presented on a basis consistent with U.S. generally accepted accounting principles, or GAAP, Adjusted EBITDA as a non-GAAP financial measures of earnings. Adjusted EBITDA represents EBITDA plus stock-based compensation and change in fair value of derivative liabilities. Our management uses Adjusted EBITDA, as financial measures to evaluate the profitability and efficiency of our business model. We use these non-GAAP financial measures to access the strength of the underlying operations of our business. These adjustments, and the non-GAAP financial measures that are derived from them, provide supplemental information to analyze our operations between periods and over time. We find this especially useful when reviewing pro forma results of operations, which include large non-cash amortizations of intangible assets from acquisitions and stock-based compensation. Investors should consider our non-GAAP financial measures in addition to, and not as a substitute for, financial measures prepared in accordance with GAAP.

About Galaxy Next Generation, Inc.

Galaxy Next Generation (OTCQB:GAXY) is a provider of interactive learning technology solutions that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxy’s products include Galaxy’s own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. Galaxy’s distribution channel consists of 22+ resellers across the U.S. who primarily sell the Company’s products within the commercial and educational market. Galaxy does not control where resellers focus their resell efforts, although generally, the K-12 education market is the largest customer base for Galaxy products - comprising nearly 90% of Galaxy’s sales.

For additional information, please visit our website at: www.galaxynext.us

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are based on the current plans and expectations of management and are subject to a number of uncertainties and risks that could significantly affect the company’s current plans and expectations, as well as future results of operations and financial condition. A more extensive listing of risks and factors that may affect the company’s business prospects and cause actual results to differ materially from those described in the forward-looking statements can be found in the reports and other documents filed by the company with the Securities and Exchange Commission. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Investors Contact:

p888-859-1274

SOURCE: Galaxy Next Generation, Inc.

View source version on accesswire.com: