Data443 Risk Mitigation Reports Operating Results for the Third Quarter 2019
-- Recognized revenue increased 75% over prior quarter, eclipses $1.1 million year to date -- Net billings of $1,129,000 for the three months, a 117% increase over last quarter and over $2 million year to date -- Strong pipeline of deals to close or anticipated to close in Q4 2019
RALEIGH, N.C., Nov. 14, 2019 (GLOBE NEWSWIRE) -- Data443 Risk Mitigation, Inc. (OTCPK: LDSRD), a leading data security and privacy software company, today reported operating results for the three and nine months ended September 30, 2019, including net revenue of $628,000 for the quarter, and strong billings growth quarter over quarter. Net billings represent actual sales which include revenues to be deferred over the term of the contract periods.
Jason Remillard, CEO of Data443, commented, “We delivered strong third quarter and nine-month results and continue to make solid progress toward achieving our long-term goals in delivering a complete data privacy, security and governance ecosystem that is unique and unrivaled in the marketplace. I’m very pleased with the seamless integration of DataExpress™ into the Company, along with achieving a significant customer renewal, and more to come! There’s no question that the last several months have been challenging in terms of our recent corporate actions, but I’m very proud of our team for keeping focused on the tasks at hand.”
“As we look towards the end of 2019, we expect to end the year at a very active pace, both commercially, as well as at the corporate level. As of today, we are less than two months away from the California Consumer Privacy Act (CCPA) taking effect, the first significant data consent and privacy legislation in the United States, perhaps the most comprehensive regulations since GDPR. Many companies don’t understand that preparations need to be made now, before the regulation (and enforcement) goes into effect on January 1, 2020. This poses an incredible opportunity to drive home the importance of mitigating these compliance risks, positioning our sales staff to deliver more education and demos, with the goal of increasing our already growing customer base.”
“Similarly, we will soon announce the effectiveness of our new trading symbol, ‘ATDS,’ which stands for what we do and what we are; ’All Things Data Security’. That dovetails nicely with our formal corporate name change to ’Data443 Risk Mitigation, Inc.’ As previously communicated, we also intend to submit our application to OTC Markets to list our stock to the OTCQB, or the ’Over the Counter Quality Board’. This elevated market tier will provide a more appropriate venue for the trading of our stock and reflects our continued commitment to be a fully SEC-reporting company within improved capital markets, that only helps advance our growing operating business. Additional updates that we anticipate will be meaningful to shareholders that will be announced before the end of the year as we continue to execute our aggressive business plan”
“In conclusion, I want to thank our loyal employees, customers and shareholders for their continued support. As we continue to build an unmatched portfolio of products and services, capturing additional spend from existing clients and growing our new prospect base for our services, we will continue to proceed in closing acquisitions that are accretive and fit within our unique framework and match our financial goals,” concluded Mr. Remillard.
Business Highlights for the Third Quarter of 2019:
-- Announced expansion of multiplatform data privacy and security archiving & eDiscovery solution to enable in CCPA, GDPR, eDiscovery, archiving and data retention requirements -- Completed the acquisition of DataExpress™, one of the world’s leading vendors for secure sensitive data transfer for the hybrid cloud -- Announced another major client win - a leading global payments technology company that operates in over 200 countries and territories worldwide, within DataExpress™ NonStop (DXNS) Secure Managed File Transfer Service -- Completed a series of significant corporate milestones, including formal name change to “Data443 Risk Mitigation, Inc.,” trading symbol change to “ATDS,” and reverse stock split
Third Quarter 2019 Financial Results
Total revenues were $628,000 during the three months ended September 30, 2019, compared to zero revenue for the three months ended September 30, 2018. We had net billings for the three months ended September 30, 2019 of $1,129,000, compared to zero in the prior year period.
Deferred revenues were $927,000 as of September 30, 2019, an increase of $898,000 from $29,000 as of December 31, 2018.
General and administrative expenses for the three months ended September 30, 2019 were $1,374,000, as compared to $514,000 for the three months ended September 30, 2018, which is an increase of $860,000, or 167%, which primarily consisted of management and integration costs and other expenses related to SEC reporting.
The net loss for the three months ended September 30, 2019 was $3,196,000 as compared to a net gain of $2,618,000 for the three months ended September 30, 2018. The net loss for the three months ended September 30, 2019 was mainly derived from a loss on change in fair value of derivative liability of $1,967,000 associated with convertible notes payable and an operating loss of $827,000 due in part by increased general and administrative costs, and sales and marketing expenses incurred.
First Nine Months 2019 Financial Results
Total revenues were $1,130,000 during the nine months ended September 30, 2019, compared to zero revenue for the nine months ended September 30, 2018. We had net billings for the nine months ended September 30, 2019 of $2,066,000, compared to zero in the prior year period.
General and administrative expenses for the nine months ended September 30, 2019 were $3,276,000, compared to $1,714,000 for the nine months ended September 30, 2018, an increase of $1,562,000, or 91%. The expenses for the nine months ended September 30, 2019 which primarily consisted of management and integration costs and other expenses related to SEC reporting.
The net gain for the nine months ended September 30, 2019 was $4,027,000 as compared to a loss of $5,035,000 for the nine months ended September 30, 2018. The net gain for the nine months ended September 30, 2019 was mainly derived from a gain on change in fair value of derivative liability of $7,267,000, offset in part by an operating loss of $2,623,000 by increased general and administrative costs, and sales and marketing expenses incurred.
As of September 30, 2019, we had cash in the amount of $60,000 and other current assets in the amount of $843,000, compared to cash in the amount of $18,000, and other current assets in the amount of $3,000 as of September 30, 2018.
About Data443 Risk Mitigation, Inc.
Data443 Risk Mitigation, Inc. (OTCPK: LDSRD), enables secure data – across local devices, network, cloud, and databases – at rest and in flight. Its suite of products and services is highlighted by: (i) ArcMail, which is a leading provider of simple, secure and cost-effective email and enterprise archiving and management solutions; (ii) ARALOC™, which is a market leading secure, cloud-based platform for the management, protection and distribution of digital content to the desktop and mobile devices, which protects an organization’s confidential content and intellectual property assets from leakage — malicious or accidental — without impacting collaboration between all stakeholders; (iii) ClassiDocs™, the Company’s award-winning data classification and governance technology, which supports CCPA, LGPD and GDPR compliance; (iv) ClassiDocs for Blockchain, which provides an active implementation for the Ripple XRP that protects blockchain transactions from inadvertent disclosure and data leaks; (v) Data443 Privacy Manager™, which is integrated with ClassiDocs to do the delivery portions of GDPR and CCPA as well as process Data Privacy Access Requests – removal request – with inventory by ClassiDocs; enables the full lifecycle of Data Privacy Access Requests, Remediation, Monitoring and Reporting; (vi) Data443 Protect™, which provides nearly instant Cloud-deployed Data Loss Prevention capabilities with false positive rates unmatched enabled by ClassiDocs™ ; (vii) Data443 Virtual Data Protection Officer program that offers a turnkey and outsourced DPO capability for smaller organizations; (viii) DATAEXPRESS™, the leading Data transport, transformation and delivery product trusted by leading financial organizations worldwide and, (ix) the WordPress GDPR Framework with over 30,000 active users enables organizations of all sizes to comply with the GDPR and other privacy frameworks. For more information, please visit http://www.data443.com.
Forward-Looking Statements The statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursuant,” “target,” “continue,” and similar expressions are intended to identify such forward-looking statements. The statements in this press release that are not historical statements, including statements regarding Data443’s plans, objectives, future opportunities for Data443’s services, future financial performance and operating results and any other statements regarding Data443’s future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts, are forward-looking statements within the meaning of the federal securities laws. These statements are not guarantees of future performance and are subject to numerous risks, uncertainties, and assumptions, many of which are beyond Data443’s control, and which could cause actual results to differ materially from the results expressed or implied by the statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict, and include, without limitation, results of litigation, settlements and investigations; actions by third parties, including governmental agencies; volatility in customer spending; global economic conditions; ability to hire and retain personnel; loss of, or reduction in business with, key customers; difficulty with growth and integration of acquisitions; product liability; cybersecurity risk; and, anti-takeover measures in our charter documents. These and other important risk factors are described more fully in our reports and other documents filed with the Securities and Exchange Commission (“the SEC”), including under “Part I, Item 1A. Risk Factors”, in our Registration Statement on Form 10 filed with the SEC on January 11, 2019 and amended on April 24, 2019. Any forward-looking statement is made only as of the date of which such statement is made. Except as otherwise required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.
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