WORCESTER, Mass., May 21, 2003 (PRIMEZONE) -- Sales OnLine Direct (OTCBB:PAID) today announced financial results for its first quarter ended March 31, 2003. The Company's first quarter 2003 revenues represent an increase of approximately 28 percent in first quarter 2002.
The primary reason for the increase in revenues was an increase in sales of Company-owned product, such as sports memorabilia, movie posters and other collectibles, and revenues for Ask the Appraiser(TM) online appraisal service, offset by a decrease of $6,300 in advertising and web hosting fees.
Gross profit from Company owned product sales for the three months ended March 31, 2003 was $204,600, which represents an increase of 28 percent, from the comparable quarter in 2002, in which gross profit from Company owned product sales was $161,200. Gross margin percentages held steady for the company quarter over quarter resulting in the same increase in gross margins as gross revenues.
"Our gross revenues and gross profits continue to grow, despite the weak economy," Greg Rotman, Sales OnLine Direct CEO, noted. "Our collectibles area delivered strong results again this quarter due to our aggressive strategy of increasing the quality and quantity of our offerings, while taking advantage of the automation provided by our AI Commerce Suite to reduce operations costs involved with the processing and fulfillment of the collectibles auctions."
Although the Company realized a first quarter 2003 loss of approximately $861,800, or $.01 per share the quarter's performance compares favorably to the loss of $1,045,000 for the first quarter 2002. The Company's net losses to cash used in operating activities for the three months ended March 31, 2003 was $83,000. The other $778,000 was comprised mainly of non-cash compensation, Changes in current assets and liabilities and Depreciation and amortization as shown in the table below.
Operating Cash Flows
A summarized reconciliation of the Company's net losses to cash used in operating activities for the three months ended March 31, 2003 compared to March 31, 2002, is as follows:
2003 2002
Net loss amortization 440,900 404,100
Amortization of beneficial conversion $(861,800) $(1,045,100)
Depreciation and
Discount and debt discount 52,700 93,400
Common stock issued in payment
Services 184,100 427,300
Common stock issued in
payment of interest -- 59,800
Changes in current assets
and liabilities 100,200 (71,500)
Net cash used in operating activities $ (83,900) $ (132,000)
Web Site Development & Hosting -- Since mid-2002, Sales Online Direct announced several contracts to develop and host celebrity web sites. The majority of payment for these sites is in merchandise autographed by the sports celebrities, which Rotman Auction then sells via its collectibles auctions on eBay or at live events. Sales OnLine Direct frequently holds this merchandise in inventory until a specific sport season begins in order to draw the highest bids and maximum revenue from the merchandise. These sales are included in revenues for the collectible arm of the Company.
"While Sales OnLine Direct has accomplished much during the past year, we still have many milestones ahead of us," stated Greg Rotman, Sales OnLine Direct CEO. "We must move the company toward profitability by growing our new and existing revenue channels."
aiShip & aiSeller
The aiShip & aiSeller product did not have a significant impact on revenues during the first quarter. The product took longer to complete than the Company originally anticipated due in part to new features that had to be added to handle a variety of new auction formats on eBay Inc. (Nasdaq:EBAY). In addition the Company has completed the PayPal integration and the new "aiInjector". The Company has started billing clients and has over 300 registered users for the aiShip & aiSeller products. Signups continue to grow daily and we are ecstatic with the reaction from buyers & sellers.
In addition the Company is proceeding with its patent application and is now in it's 17th month. Typically Process Patents take 18-22 months. The marketing of aiSeller & aiShip will begin during the end of May. The Company will also be releasing a series of informative marketing pieces on the "ai" product line to various media agencies and on our www.paid.com website.
About Sales OnLine Direct and Rotman Auction
Sales OnLine Direct, http://www.paid.com, maintains and develops portals and web sites for various companies and industries. The Company has focused its efforts on the antique and collectible industry, offering the "Ask the Appraiser" online appraisal service, marketing and publishing the "Maloney's Antiques and Collectibles Resource Directory" and developing web sites that enhance the user's experience. Through web hosting and managed services, Sales OnLine Direct has provided e-business solutions to many different companies including their own Rotman Auction division. This division sells tens of thousands of items per year through auction, direct sales, and special events and is a certified eBay Platinum Power Seller. The Company has developed the "AI Suite" http://www.auctioninc.com/ of software to increase revenues and reduce overhead for sellers on eBay, and offers these essential e-tools to other companies.
Through recent initiatives, Sales OnLine Direct is establishing itself as one of the most important collectibles portals, and online auction services and technology providers to the collectibles industry. The Company's common stock is traded on the Nasdaq OTC Bulletin Board under the symbol "PAID."
Link to, Rotman Auction on eBay: http://members.ebay.com/aboutme/rotman-auction/
Link to, "Ask the Appraiser": http://www.collectingchannel.com/cMart/cesATEIndex.asp
Link to, "ai" "Auction Inc:" http://www.auctioninc.com
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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 that are based upon current expectations or beliefs, as well as a number of assumptions about future events, including matters related to the Company's operations. Although the Company believes that the expectations reflected in the forward-looking statements and the assumptions upon which they are based are reasonable, it can give no assurance that such expectations and assumptions will prove to have been correct. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties, including without limitation, successful implementation of the Company's business strategy and competition, any of which may cause actual results to differ materially from those described in the statements. In addition, other factors that could cause actual results to differ materially are discussed in the Company's most recent filings, including Form 10-KSB and 8K with the Securities and Exchange Commission.