EFACTOR GROUP CORP 
By SAN FRANCISCO, Nov. 14, 2013 /PRNewswire/ -- (OTCBB:STDR or STDRD, soon to be EFCT) EFactor Group Corp. ("EFactor Corp." or "the Company"), owner of the EFactor.com, niche social network for entrepreneurs, content aggregator and provider of resources to entrepreneurs worldwide, today announced financial results for the three and nine months ended September 30, 2013.
Third Quarter 2013 Highlights
-- Revenues increased 48% to $207,022
-- Gross margin increased from 26.2% in Q3 2012 to 70.5% in Q3 2013
-- G&A expenses dropped 56% to $690,682
-- Reduced operating loss by approximately $1.0 million compared to Q3
2012 and approximately $600,000 year-over-year
-- Completes reverse split of Standard Drilling Shares and receives
approval for name change to EFactor Group Corp.
-- Held 8 live Entrepreneur and 9 Webinar events during the quarter
including a "Pitch Event" with Kevin Harrington in NYC
"This quarter was focused on a number of significant public market milestones," began Marion Freijsen, EFactor COO. "We were successful in the combination of efforts to reverse split the Standard Drilling shares, change our name to EFactor Group Corp., obtain our trading ticker, EFCT, and launch the investor relations section of our Website, efactorgroup.com. At the same time, we continued to host a variety of events for our focused niche of entrepreneurs requiring distinct services and products to help build and run their businesses and revamped our flagship Website, EFactor.com. Connections to relevant business partners and education on everything around running a successful company remains the #1 focus of our Company. As such critical connections occur, our members are asking us to bundle additional services and products for them. Adding onto our success with the acquisitions of EQmentor and MCC, we have added many services providers into our resources for our members and we are continually evaluating other companies and services to add into our portfolio of entrepreneur-focused 'Alliance Partners'. We are equally excited about the adverting opportunities on EFactor.com and the value such advertisers, like Harvard Business School, recognize in our membership."
EFactor generates revenue from four primary sources: (1) member fees; (2) sponsorships; (3) advisory services; and (4) public relations services. Management has invested in technology and personnel to grow revenues and cash flows from each business source.
Revenue for the three months ended September 30, 2013 was $207,022, an increase of 48% compared to $139,819 in the corresponding period a year ago. Advisory services and public relations accounted for $175,225 of total revenues in the third quarter of 2013 compared to $492 in the third quarter of 2012.
Cost of goods fell 41% to $61,141 in the third quarter of 2013. Gross profit and gross margin were $145,881 and 70.5% compared to $36,698 and 26.2% in the third quarter of 2012, respectively. The reason for the substantial improvement in gross profit and gross profit margin was the utilization of more of the Company's internal resources for these sundry platforms, which is more cost efficient than going to the outside.
Operating expenses for the three months ended September 30, 2013 fell 55% to $819,004. General and administrative expenses were $690,682 compared to $1,568,262 in the third quarter of 2012, a reduction of 56%. The primary reason for the year-over-year decline in general and administrative expenses was a reduction in non-cash stock-based compensation expenses. EFactor had an operating loss of $611,982 compared to a loss of $1,677,178 in the same period a year ago.
Net loss attributable to common shareholders was $1,784,773, up slightly from $1,754,733 in the third quarter of 2012. The Company recorded a $1,026,859 non-cash loss on extinguishment of debt in the third quarter of 2013. The net loss per share was $0.74 in the third quarter of 2013, an improvement from $2.30 per share in the prior year period.
Cash outflows from operations for the nine months ended September 30, 2013 was $1,177,391 compared to $1,244,179 in the first nine months of 2012. On June 7, 2013, the Company obtained a line of credit from an accredited investor that allows EFactor to borrow up to $750,000 over a 24-month period from the date of the agreement. The Company had $275,000 available under this line of credit at September 30, 2013.
The Company invested $313,820 on capital expenditures in 2013 compared to $237,609 in the same period a year ago. Total assets and shareholders' equity were $4,791,689 and $6,569 at September 30, 2013.
About EFactor Group Corp.
EFactor Group Corp. has at its core EFactor.com, a niche social network for entrepreneurs. EFactor.com provides its members with the people, tools, marketing and expertise to succeed and make real, trustworthy and lasting connections. At the core of the network lies a strong algorithm that allows members to not only connect with a lot of people, but with the right people. In addition, EFactor provides knowledge, facilitates preparing for funding and resources to reduce business costs, delivered through a mix of online social networking and offline domestic and international events.
EFactor.com has over one million members in 222 territories across 240 industries. It is incorporated in Nevada and headquartered in San Francisco. For more information, visit http://www.efactor.com
EFactor Group Corp. also has various subsidiary service organizations including a UK communications and public relations agency and a company that delivers matching software for mentors to find the best mentees.
The EFactor Value
EFactor is a social network designed to support you as your business grows, along every step of your journey. We'll be there to congratulate you every time you win and will coach and inspire you whenever you feel frustrated by setbacks. You can count on us to connect you with the right people for you and your company and offer you the resources and talent that will help you succeed. We are highly motivated everyday people who genuinely care about our team and customers. We cheer each other on and have each other's back. We get to see our ideas come to life every single day. We're entrepreneurs, contributing our expertise to the community.
Forward-Looking Statements
Any statements in this release that are not historical facts are forward-looking statements. Actual results may differ materially from those projected or implied in any forward-looking statements. Such statements involve risks and uncertainties, including but not limited to those discussed from time to time in our Securities and Exchange Commission filings. We undertake no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made except as required by law.
Company:
Marion Freijsen - Co-Founder/COO
EFactor Corp.
Main: +1 650 380 8280
Email: marion@EFactor.com
EFactor email: http://www.EFactor.com/marion
Investor Relations Contact:
John Mattio, Sr. Vice-President
MZ North America
Main: (212)301-7130
Direct: (212) 301-7131
Email: john.mattio@mzgroup.us
EFACTOR GROUP CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30, December 31,
ASSETS 2013 2012
---- ----
CURRENT ASSETS:
Cash $69,048 $46,870
Accounts receivable, net of
allowance for doubtful
accounts of $2,097 and
$2,097 as of September 30,
2013 and December 31, 2012
respectively 157,784 20,982
Other
current
assets 466,833 14,469
Total current assets 693,665 82,321
Property, website and
equipment, net of
accumulated depreciation
of $1,038,262 and $827,619
as of September 30, 2013
and December 31, 2012
respectively
458,530 341,674
Goodwill 3,639,494 2,131,516
TOTAL ASSETS $4,791,689 $2,555,511
========== ==========
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts
payable $947,123 $641,534
Accounts payable -related
party 259,200 38,548
Accrued
expenses 957,501 213,220
Operating line of credit 1,110,005 625,604
Deferred
revenue 158,629 227,044
Current portion of other
long-term obligation 39,668 -
Current portion of notes
payable -third parties,
net of discount of $17,022
and $-0-as of September
30, 2013 and December 31,
2012, respectively 217,135 101,932
Convertible notes payable -
third parties, net of
discount of $152,095 and
$88,809 as of September
30, 2013 and December 31,
2012, respectively 669,172 276,809
Notes payable -related
parties, net of discount
of $6,135 and $62,101 as
of September 30, 2013 and
December 31, 2012,
respectively 284,427 163,675
Total current
liabilities 4,642,860 2,288,366
Other long-term
obligation, net of current
portion 127,390 -
Non-current portion of
notes payable - third
parties 14,870 18,544
Total non-current
liabilities 142,260 18,544
TOTAL LIABILITIES 4,785,120 2,306,910
--------- ---------
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par
value, 20,000,000 shares
authorized, 5,000,000 and
-0-issued and outstanding
as of September 30, 2013
and December 31, 2012,
respectively
5,000 5,000
Common stock, $0.001 par
value, 175,000,000 shares
authorized, 2,406,290 and
1,053,751 issued and
outstanding at September
30, 2013 and December 31,
2012, respectively
2,406 1,054
Accumulated other
comprehensive loss (1,928) -
Additional paid-in capital 15,562,727 11,979,427
Accumulated
deficit (15,561,636) (11,736,880)
Total stockholders'
equity 6,569 248,601
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $4,791,689 $2,555,511
EFACTOR GROUP CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
For the three months
ended September 30,
2013 2012
---- ----
Net revenues $207,022 $139,819
Operating expenses
Cost of
revenue 61,141 103,121
Sales and
marketing 39,702 53,662
General and
administrative 690,682 1,568,262
Depreciation
and
amortization 27,479 91,952
Gain on
forgiveness
of
liabilities - -
Total operating
expenses 819,004 1,816,997
Loss from operations (611,982) (1,677,178)
Other income (expense):
Interest
expense (145,932) (86,413)
Loss on
extinguishment
of debt (1,026,859) -
Other income - 8,858
Total
other
income
(expense),
net (1,172,791) (77,555)
--------- -------
Net loss $(1,784,773) $(1,754,733)
========= =========
Basic and diluted net loss per common share $(0.74) $(2.30)
Weighted average common shares outstanding -
basic and diluted 2,396,185 761,933
========= =======
Comprehensive loss
Net loss $(1,784,773) $(1,754,733)
Foreign currency translation adjustment (11,059) -
------- ---
Comprehensive loss $(1,795,832) $(1,754,733)
EFACTOR GROUP CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
For the nine months
ended September 30,
2013 2012
---- ----
Net revenues $623,959 $234,495
Operating expenses
Cost of
revenue 119,497 112,516
Sales and
marketing 208,210 115,400
General and
administrative 2,515,082 2,709,483
Depreciation
and
amortization 208,567 277,255
Gain on
forgiveness
of
liabilities (84,829) -
Total operating
expenses 2,966,527 3,214,654
Loss from operations (2,342,568) (2,980,159)
Other income (expense):
Interest
expense, net (455,329) (199,478)
Loss on
extinguishment
of debt (1,026,859) -
Other income - 8,858
Total
other
income
(expense),
net (1,482,188) (190,620)
--------- --------
Net loss $(3,824,756) $(3,170,779)
========= ==========
Basic and diluted net loss per common share $(1.74) $(4.46)
Weighted average common shares outstanding -
basic and diluted 2,192,198 710,667
========= =======
Comprehensive loss
Net loss $(3,824,756) $$(3,170,779)
Foreign currency translation adjustment (1,928) -
------ ---
Comprehensive loss $(3,826,684) $(3,170,779)
EFACTOR GROUP CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the nine months
ended September 30,
2013 2012
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(3,824,756) $(3,170,779)
Adjustments to reconcile
net loss to net cash
used in operating
activities:
Depreciation and
amortization 208,567 277,255
Stock option expense 41,165 280,554
Amortization of debt
discount and deferred
financing fees 332,182 172,629
Loss on extinguishment of
debt 1,026,859 -
Stock compensation expense 329,632 1,124,042
Gain on forgiveness of
liabilities (84,829) -
Changes in operating
assets and liabilities:
Accounts
receivables (87,602) 5,016
Other
current
assets (4,067) (10,295)
Accounts
payable 325,927 159,179
Accounts
payable -
related
party 242,165 5,337
Accrued
expenses 385,781 (65,962)
Deferred
revenue (68,415) (21,155)
Net cash used in operating activities $(1,177,391) $(1,244,179)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash acquired in reverse
merger with Standard
Drilling 851 -
Cash acquired in
acquisition of MCC 23,593 -
Cash paid for acquisition
of property, website and
equipment (313,820) (237,609)
Net cash used in
investing activities $(289,376) $(237,609)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable 138,488 745,337
Proceeds from convertible
notes payable 661,585 -
Proceeds from notes payable
- related party 42,110 800
Proceeds from line of
credit, net 484,401 -
Proceeds from issuance of
shares 167,002 802,890
Repayment of notes payable
- related party (837) -
Repayment of notes payable (1,876) (3,159)
Net cash provided by
financing activities $1,490,873 $1,545,868
NET EFFECT OF EXCHANGE RATES ON CASH (1,928) -
NET INCREASE IN CASH 22,178 64,080
CASH, BEGINNING BALANCE 46,870 11,259
CASH, ENDING BALANCE $69,048 $75,339
======= =======
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest $49,770 $1,748
Cash paid for income taxes $ - $ -
Non-cash Financing Activities:
Debt discount $326,908 $146,540
Acquisition of MCC $1,333,335 -
Shares issued as
deferred financing fees $475,000 -
Related party payables
converted into debt $21,513 $ -
Shares issued for
conversion of debt $214,000 $534,960
SOURCE EFactor Group Corp.
