Strategic Environmental & Energy Resources, Inc 8-K

 

Exhibit 99.1

 

 

FOR IMMEDIATE RELEASE NEWS
   
   
May 15, 2014 OTC: SENR
   

 Strategic Environmental & Energy Resources, Inc. Reports 2014 First Quarter Financial Results

GOLDEN, Colo. – Strategic Environmental & Energy Resources, Inc. (SEER) (OTC: SENR), a provider of next-generation clean technologies, renewable fuel and waste management innovations, today announced results for its first quarter ended March 31, 2014.

First quarter revenue increased 8% to $2.8 million from revenue of $2.6 million in the first quarter last year. Services revenue grew 36% year over year to $2.3 million from $1.7 million, more than offsetting a decrease in product revenue from $0.9 million to $0.5 million for the comparative first quarters.

Services revenue includes industrial and rail car cleaning services performed by the Company’s REGS and Tactical Cleaning subsidiaries, both of which carried growth momentum from 2013 into the first quarter of 2014. Product revenue, which is comprised of air quality, fugitive emissions and renewable fuel solutions provided by the Company’s MV Technologies subsidiary, declined primarily due to timing issues involving project revenue recognition. MV is, however, expected to show solid growth in 2014 over 2013. Paragon Waste Solutions continues to win new business and is expected to begin contributing more significantly to revenue as its CoronaLux™ systems are placed into service later this year.

SEER continued to implement its aggressive growth initiatives during the first quarter and, as a result, total operating expenses increased to $3.9 million from $2.8 million year over year. Of the $1.1 million increase, $700,000 was attributable to non-cash stock-based compensation expense. The remaining increase was primarily due to increased staffing at the executive level to support current and future growth and also to costs associated with the commercial implementation of Paragon’s waste destruction technology.

As a result of increased expenses, 64% of which were non-cash, SEER reported a net loss attributable to SEER common stockholders of $1.0 million, or $0.02 per share, versus a net loss of $0.2 million, or less than $0.01 per share, in the first quarter last year. Modified EBITDA for the first quarter was a loss of $305,100.

“We are pleased the Company has continued its growth momentum into the first quarter,” said J. John Combs III, chairman and CEO. “Despite exceptionally cold weather that reduced activity at several operating locations, our environmental and industrial services businesses performed very well, growing revenue by 36%. This growth more than offset lower product revenue from our MV Technologies division. We saw this coming since MV uses a project revenue recognition model based on percent of completion accounting and revenue can vary on a quarter-to-quarter basis independent of new orders and cash received. In the first quarter, we attended several industry conferences and saw increased interest in MV’s products for odor control, fugitive emissions management and renewable fuels so we are confident this level of activity, combined with MV’s existing project pipeline, will position the business for solid full-year revenue growth in 2014.

 
 

 “We are also pleased that SEER’s Paragon Waste Solutions business continued to secure prepaid customer commitments for its CoronaLux™ waste destruction systems,” Combs added. “In the first quarter, approximately $436,000 of cash from these customers was received but deferred and will be amortized under our accounting practices. SEER invested approximately $0.7 million in the manufacture of CoronaLux™ systems during the first quarter and now has a total of five units either deployed or in transit for installation in the medical waste and oil and gas refining markets. As of March 31, 2014, Paragon secured customer commitments totaling approximately $1.0 million in up-front license fees and in the third quarter of 2014 expects to begin receiving on-going revenue-split royalties or monthly licensing payments from units already placed. Accordingly, we expect Paragon to contribute to revenue and overall profitability in 2014 and beyond.”

About Strategic Environmental & Energy Resources, Inc.

Strategic Environmental & Energy Resources, Inc. (SEER) identifies, secures, and commercializes patented and proprietary environmental clean technologies in several multibillion dollar sectors (including oil & gas, renewable fuels, and all types of waste management, both solid and gaseous) for the purpose of either destroying/minimizing hazardous waste streams more safely and at lower cost than any competitive alternative, and/or processing the waste for use as a renewable fuel for the benefit of the customers and the environment. SEER has three wholly-owned operating subsidiaries: REGS, LLC; Tactical Cleaning Company, LLC; MV Technologies, LLC; and two majority-owned subsidiaries: Paragon Waste Solutions, LLC; and ReaCH4biogas (“Reach”).

For more information about the Company visit: www.seer-corp.com

Safe Harbor Statement

This press release contains "forward-looking statements" within the meaning of various provisions of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, commonly identified by such terms as "believes," "looking ahead," "anticipates," "estimates," and other terms with similar meaning.  Specifically, statements about demand for, and effectiveness of, the Company's products and services, and expectations for revenue growth and profitability are forward looking statements.  Although the company believes that the assumptions upon which its forward-looking statements are based are reasonable, it can give no assurance that these assumptions will prove to be correct. Such forward-looking statements should not be construed as fact. Statements in this press release regarding the impact and ability of the Company’s products to handle the future needs of customers, the potential for additional orders for the Company’s products, and expectations for growth and profitability are forward-looking statements. The information contained in such statements is beyond the ability of the Company to control, and in many cases the Company cannot predict what factors would cause results to differ materially from those indicated in such statements. All forward-looking statements in the press release are expressly qualified by these cautionary statements and by reference to the underlying assumptions.

Contacts:

J. John Combs III
Chief Executive Officer
720-460-3522

Jay Pfeiffer
Pfeiffer High Investor Relations, Inc.
jay@pfeifferhigh.com
303-393-7044

 
 

 

 

Strategic Environmental & Energy Resources, Inc.      
Consolidated Statements of Operations      
  Three Months Ended
  March 31,
   2014   2013
Revenue:          
Products  $520,100   $901,600 
Services   2,262,900    1,667,300 
Total revenue  $2,783,000   $2,568,900 
Operating Expenses:          
Products costs   380,200    583,600 
Services costs   1,581,400    1,190,600 
Selling, general and administrative expenses   1,908,700    1,000,700 
Total operating expenses   3,870,300    2,774,900 
Loss from operations   (1,087,300)   (206,000)
Other income (expense):          
Interest income   —     2,000 
Interest expense   (23,600)   (34,500)
Penalties and late fees   (1,100)   (1,400)
Gain on debt settlements   24,400    —  
Other   (15,700)   —  
Total non-operating expense, net   (16,000)   (33,900)
Net loss  $(1,103,300)  $(239,900)
Less: Net loss attributable to non-controlling          
Interest   (68,100)   (68,400)
Net loss attributable to SEER          
common stockholders  $(1,035,200)  $(171,500)
Net loss per share, basic and diluted  $(0.03)  $* 
Weighted average shares outstanding          
- basic and diluted   49,348,566    41,281,000 
           
* Less than $(0.01) per share          

 

 
 

 

Strategic Environmental & Energy Resources, Inc.      
Consolidated Balance Sheets      
  March 31,  December 31,
ASSETS  2014  2013
  Unaudited   
Current assets:          
Cash  $2,166,100   $2,419,100 
Cash – restricted   250,000    250,000 
Accounts receivable, net   1,447,600    1,170,000 
Cost and estimated earnings in   102,000    78,500 
excess billings on uncompleted contracts          
Inventory   22,400    22,400 
Prepaid expenses and other assets   171,000    253,000 
Total current assets   4,159,100    4,193,000 
Property and equipment, net   2,476,000    1,762,900 
Intangible assets, net   364,100    379,500 
Other assets   36,800    36,800 
Total assets  $7,036,000   $6,372,200 
LIABILITIES AND SHAREHOLDERS’ DEFICIT          
Current liabilities:          
Accounts payable  $1,286,800   $1,506,800 
Accrued liabilities   954,300    924,200 
Billings in excess of costs and estimated earnings          
on uncompleted contracts   178,200    170,300 
Current portion of payroll taxes payable   264,900    250,600 
Customer deposits   —     118,000 
Deferred revenue   435,600    —  
Current portion of notes payable and capital lease obligations   405,300    504,700 
Notes payable – related parties, including accrued interest   138,800    136,900 
Total current liabilities   3,663,900    3,611,500 
Payroll taxes payable, net of current portion   727,600    720,800 
Notes payable and capital lease obligations, net of current portion   26,300    48,100 
Total liabilities   4,417,800    4,380,400 
Stockholders’ equity:          
Common stock   50,600    47,900 
Common stock subscribed   50,000    50,000 
Additional paid-in capital   16,324,700    14,597,700 
Stock subscription receivable   (50,000)   (50,000)
Accumulated deficit   (13,250,400)   (12,215,200)
Non-controlling interest   (506,700)   (438,600)
Total stockholders’ equity   2,618,200    1,991,800 
Total liabilities and stockholders’ equity  $7,036,000   $6,372,200