Steve Nur - Chief Financial Officer00:11:27
Steve thank you Brian and good morning everyone. Happy Veterans Day to all of our former members of the Armed Forces. We are extremely grateful for your service and all you've done for our country. As Brian mentioned Q3 another quarter of generating increased EBITDA and non GAAP net income while increasing revenue and lowering operating expenses. I will now discuss some of the details which led to these results. Total rental revenue for the third quarter of 2025 was $5.7 million, an increase of $84,000 or 1.5%, compared to $5.6 million for the same period of 24. For the first nine months of 2025. Total revenue was 16.8 million, a $411,000 or 2% decrease from from $17.2 million for the same of the prior year. The increase in revenue for the quarter was due to an increase in our core press release revenue of 7% due to an increase in volume. For the nine months ended September 30, 2025, press release revenue increased 1%. However, this was more than offset by declines in revenue from our PRO webcasting and IR website solutions. We anticipate increases in core press release revenue will lead to higher revenue growth rates in the quarters ahead. Gross margin percentages have remained relatively flat for both the three and nine months ended September 30, 2025 as compared to the prior year at 75% and 76% respectively. Although we have experienced increased distribution costs as we continue to expand our distribution footprint, we have been able to offset this with efficiencies in our operations teams in order to build scale. Gross margin increased $40,000 or 1% and decreased $233,000 or 2% for the three and nine months ended September 30, 2025 respectively, as compared to the same periods of the prior year. Moving to Operating Loss we posted an operating loss from continuing operations of $184,000 for the third quarter of 2025 and $1.1 million for the first nine months of 2025 compared to operating losses of 604,000 during the same period of 2024. The decrease in operating loss is a result of lower operating expenses which decreased $380,000 or 8% and $1.1 million or 7% for the three and nine months ended September 30, 2025 respectively, as we remain committed to developing efficiencies and optimizing our teams. General and Administrative expenses decreased $409,000 or 22% for the third quarter of 2025 compared to the third quarter of 2024 due to a reduction in bad debt expense, employee related expenses, as well as savings from indirect costs associated with the compliance business. For the first nine months of 2025, general and administrative expenses decreased $185,000 or 3% compared to the first nine months of 2024. This is due to the same reasons I just noted, however, was partially offset by a onetime benefit recorded in the first half of 2024 of approximately $340,000 due to the reversal of stock compensation related to the resignation of an executive officer. We will continue to seek opportunities to reduce G and A expenses and are currently negotiating a sublease on our corporate offices which we anticipate could save us over $300,000 a year. Sales and marketing expenses increased $34,000, or 2%, and decreased $924,000, or 16%, for the three and nine months ended September 30, 2025 as compared to the same periods of 2024. The decrease for the nine month period is due to lower headcount throughout the first six months of the year. However, as of the third quarter the team has been built back to where it was a year ago. Product development expenses have remained consistent for the three and nine months ended September 30, 2025 as compared to the same periods of the prior year. Decreases in costs related to consultants were partially offset by declines in capitalized software. Brian will talk further about some product enhancements coming this quarter and the early part of next year, and as such we will expect to begin to capitalize more product development expenses related to such enhancements on a GAAP basis. We reported a loss from continuing operations of $45,000, or $0.01 per diluted share, during the third quarter of 2025 compared to a net loss of $870,000, or $0.23 per diluted share, during the third Quarter of 2024. For the first nine months of 2025, net loss from continuing operations was $1,000,000, or $0.27 per diluted share, compared to a net loss of $2.3 million, or $0.61 per diluted share, in the first nine months of 2024. There's no activity for discontinued operations during the third quarter of 2025 Compared to net income of $404,000, or $0.11 per diluted share, during the third year of 2024. For the first nine Months of 2025, net income from discontinued operations was almost $6 million, or $1.53 per diluted share, compared to $1.7 million, or $0.45 per diluted share, for the same period of 2024. The increase is primarily a result of the gain on the sale of the compliance business. Looking to some Non GAAP metrics, third quarter of 2025, EBITDA was $537,000, or 9% of revenue, compared to a loss of $212,000, or 4% of revenue, for the third quarter of 2024. For the first nine months of 2025, EBITDA was 1 million dollars, or 6% of revenue, compared to $70,000 for the first nine months of 2024, adjusted EBITDA increased to $933,000, or 16% of revenue for the third quarter of 2025 compared to $546,000, or 10% of revenue for the third quarter Of 2024. For the first nine months Of 2025, adjusted EBITDA more than doubled to $2.3 million, or 14% of revenue, compared to $961,000, or 6% of revenue for the first nine months of 2024. Non GAAP net income for the third quarter of 2025 increased $573,000 to $760,000, or $0.20 per diluted share, compared to $187,000, or $0.05 per diluted share in the third quarter of 2024. The first nine months of 2025, non GAAP net income increased to $1.5 million, or $0.39 per diluted share compared to a non GAAP loss of $78,000, or $0.02 per diluted share during the first nine months of 2024. We ended the quarter with $3.3 million of cash on hand. However, this was negatively impacted by cash outflow from operating activities of $582,000 during the third quarter of 2025. This was primarily due to the payment of over $1.1 million in taxes, primarily related to the gain on the sale of the compliance business. Cash generated by operating activities was $1.5 million during the third quarter of 2024 where this includes cash generated from the compliance business. For the first nine months of 2025, cash flow generated by operating activities was $300,000 compared to $2.3 million during the first nine months of 2024. Again, the year to date amount for 2025 includes over $1.5 million paid in taxes primarily related to the sale of the compliance business. Adjusted free cash flow was negative $418,000 for the third quarter of 2025 compared to $1.4 million for the third quarter of 2024. For the first nine months of 2025amounted to $799,000 compared to $1.9 million for the first nine months of 2024. I will now turn it back over to Brian who will provide some updates on the business, customers, subscriptions and volumes along with everything else we have planned for the remainder of the year. Brian thank you Steve.
