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Data Storage Corporation Announces Results for the Fiscal First Quarter Ended March 31, 2017 “Post-Acquisition of ABC Services”

NEW YORK, May 30, 2017 (GLOBE NEWSWIRE) -- Data Storage Corporation (OTC:DTST) today announced financial results for its Fiscal 2017 first quarter ended March 31, 2017.

Chuck Piluso, Chief Executive Officer of Data Storage Corporation, stated, "We continue to make significant progress towards executing on our strategic business plan, and we are pleased with the developments throughout the first quarter and to date. Our accomplishments include successfully completing the acquisition and assimilation of ABC Services and integrating finance, administration, sales and operations. The team continues to implement marketing strategies to expand our sales efforts with current clients and targeting new customers in specific markets.”

Select Financial Results for the First Fiscal Quarter Ended March 31, 2017:

  • Net sales for the three months ended March 31, 2017 increased 136% to $2,323,915, compared to $984,620 for the three months ended March 31, 2016.
  • Net profit for the three months ended March 31, 2017 was $368,922, as compared to net loss of $144,813 for the three months ended March 31, 2016.

Mr. Piluso continued, “The acquisition of the assets of ABC Services, Inc. and ABC Services II, Inc. and the remaining 50% of Secure Infrastructure and Services LLC accelerated our strategy into managed services, expanded cyber security solutions and our hybrid cloud solutions with the ability to provide equipment and expanded technical support. We have a seasoned management team that’s highly focused on execution.”

About Data Storage Corporation

Data Storage Corporation focuses on cyber security, cloud and compliance. Solutions include: Infrastructure as a Service, Disaster Recovery as a Service, Cyber Security and Email Compliance and Analytics. Our mission: Protecting our client’s data, ensuring business continuity, assisting in their compliance requirements while providing better control over their digital information.

The Company sells their services through direct sales and distributors. DSC owns intellectual property with our proprietary email compliance and data analytics software, Message Logic. We provide Recovery Cloud solutions and Infrastructure as a Service with our IBM Power Cloud. Our distributors, typically Managed Service Providers, have a lower barrier of entry in providing DSC’s solutions to their client base.

DSC is a 16-year veteran in cloud storage and cloud computing.

www.Data.StorageCorp.com

Forward-Looking Statements

This release may contain "forward-looking statements" that are within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are identified by certain words or phrases such as "may", "will", "aim", "will likely result", "believe", "expect", "will continue", "anticipate", "estimate", "intend", "plan", "contemplate", "seek to", "future", "objective", "goal", "project", "should", "will pursue" and similar expressions or variations of such expressions. These forward-looking statements reflect the Company's current expectations about its future plans and performance. These forward-looking statements rely on a number of assumptions and estimates which could be inaccurate and which are subject to risks and uncertainties. Actual results could vary materially from those anticipated or expressed in any forward-looking statement made by the Company. Please refer to the Company's most recent Forms 10-Q and 10-K and subsequent filings with the SEC for a further discussion of these risks and uncertainties. The Company disclaims any obligation or intent to update the forward-looking statements in order to reflect events or circumstances after the date of this release.

FINANCIAL TABLES FOLLOW

Additional information may be found in the Company's Quarterly Report on Form 10-Q that has been filed with the U.S. Securities and Exchange Commission ("SEC"). The Form 10-Q may be accessed at www.sec.gov or at the Company's website in the Investor Relations section.


DATA STORAGE CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2017 2016
(UNAUDITED)
ASSETS
Current Assets:
Cash and cash equivalents $150,322 $255,817
Accounts receivable (less allowance for doubtful accounts of $90,000 in 2017 and $90,000 in 2016) 954,827 807,515
Prepaid expenses and other current assets 224,747 231,432
Total Current Assets 1,329,896 1,294,764
Property and Equipment:
Property and equipment 5,148,347 3,401,251
Less—Accumulated depreciation (3,309,746) (3,222,591)
Net Property and Equipment 1,838,601 178,660
Other Assets:
Goodwill 3,985,700 3,985,700
Other assets 50,903 54,504
Intangible assets, net 320,750 329,242
Total Other Assets 4,357,353 4,369,446
Total Assets 7,525,850 5,842,870
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accounts payable and accrued expenses 1,246,011 1,219,247
Revolving credit facility - 50,412
Accounts payable from acquisition - 374,762
Dividend payable 647,346 619,138
Deferred revenue 761,730 919,103
Leases payable – related party 614,292 254,078
Note payable – bank 350,000 350,000
Total Current Liabilities 3,619,379 3,786,740
Deferred rental obligation 1,796 1,904
Note Payable – related party 416.435 190,000
Leases payable long-term – related party 1,414,024 133,825
Total Long Term Liabilities 1,832,255 325,729
Total Liabilities 5,451,634 4,112,469
Stockholders’ Deficit: Preferred Stock, $.001 par value; 10,000,000 shares authorized; 1,401,786 shares issued and outstanding in each period 1,402 1,402
Common stock, par value $0.001; 250,000,000 shares authorized; 128,039,418 shares Issued and outstanding in each period 128,039 128,039
Additional paid in capital 17,197,485 17,194,383
Accumulated deficit (15,252,710) (15,593,423)
Total Stockholders’ (Deficit) Equity 2,074,216 1,730,401
Total Liabilities and Stockholders’ (Deficit) $7,525,850 $5,842,870


DATA STORAGE CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months Ended
March 31,
2017 2016
Sales $2,323,915 $984,620
Cost of sales 1,324,058 616,316
Gross Profit 999,857 368,304
Selling, general and administrative 605,066 438,110
Income (Loss) from Operations 394,791 (69,806)
Other Income (Expense)
Interest income 19
Bad Debt Recovery 1,542 1,508
Net income (loss) in equity method investment (9,087)
Interest expense (27,430) (67,428)
Total Other Income (Expense) (25,869) (75,007)
Income (loss) before provision for income taxes 368,922 (144,813)
Provision for income taxes
Net Income (loss) 368,922 (144,813)
Preferred Stock Dividend (28,208) (25,534)
Net Income (loss) Attributable to Common Shareholders $340,714 $(170,347)
Income (loss) per Share – Basic and Diluted $(0.00) $(0.00)
Weighted Average Number of Shares - Basic and Diluted 128,039,418 36,588,240


DATA STORAGE CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended
March 31,
2017 2016
Cash Flows from Operating Activities:
Net Income (loss) $368,922 $(144,813)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization 95,646 71,366
Net (gain) loss on equity method investment 9,087
Non-cash interest expense 52,299
Stock based compensation 3,102 12,140
Changes in Assets and Liabilities:
Accounts receivable (147,312) 14,621
Other assets 3,600 (2,100)
Prepaid expenses and other current assets 6,686 5,955
Accounts payable and accrued expenses (100,978) 96,808
Deferred revenue (157,373) (43,455)
Deferred rent (108) 163
Net Cash Provided by Operating Activities 72,185 72,071
Cash Flows from Financing Activities:
Repayment of loan obligations (70,997)
Repayments of capital lease obligations (106,683) (59,176)
Net Cash Used in Financing Activities (177,680) (59,176)
Increase (Decrease) in Cash and Cash Equivalents (105,495) 12,895
Cash and Cash Equivalents, Beginning of Period 255,817 67,045
Cash and Cash Equivalents, End of Period $150,322 $79,940
Cash paid for interest $27,430 $15,131
Cash paid for income taxes $ $
Non cash investing and financing activities:
Accrual of preferred stock dividend $28,208 $25,234
Assets acquired by capital lease $1,747,096 $


Investor Relations Contact: Andrew Barwicki Phone: 516-662-9461

Source:Data Storage Corp.