SILVERSUN TECHNOLOGIES, INC. This quarterly report on Form 10-Q and other reports filed by
Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, the Company cannot guarantee future
results, levels of activity, performance, or achievements. Except as required by
applicable law, including the securities laws of
Our unaudited condensed consolidated financial statements are prepared in
accordance with accounting principles generally accepted in
Overview
The Company is engaged in providing transformational business management applications and technologies and professional consulting services to small and medium size companies, primarily in the manufacturing, distribution and service industries.
We are executing a multi-pronged business strategy centered on recurring revenue, customer retention and on rapidly increasing the size of our installed customer base. The growth of our customer base is accomplished via our traditional marketing programs and acquisitions. After a customer is secured, our strategy is to up-sell and cross-sell, providing the customer with advanced technologies and third-party add-ons that help them digitally transform their business. These add-on products could include application hosting, cybersecurity, warehouse management, human capital management, payment automation, sales tax compliance or any number of other products or services that we represent. Many of these incremental products and services are billed on a subscription basis, often paying monthly for the service, which increases our monthly recurring revenue ("MRR"). This strategy increases the average revenue per customer, which facilitates our continued growth, and reduces our cost of customer acquisition, which enhances our profitability profile.
Our core strength is rooted in our ability to discover and identify the driving forces of change that are affecting - or will affect - businesses in a wide range of industries. We invest valuable time and resources to fully understand how technology is transforming the business management landscape and what current or emerging innovations are deserving of a clients' attention. By leveraging this knowledge and foresight, our growing list of clients are empowered with the means to more effectively manage their businesses; to capitalize on real-time insight drawn from their data resources; and to materially profit from enhanced operational functionality, process flexibility and expedited process execution.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued).
We are a business application, technology and consulting company providing
strategies and solutions to meet our clients' information, technology and
business management needs. Our services and technologies enable customers to
manage, protect and monetize their enterprise assets whether on-premise or in
the cloud. As a value-added reseller of business application software, we offer
solutions for accounting and business management, financial reporting,
Enterprise Resource Planning ("ERP"),
Our core business is divided into the following practice areas:
ERP (Enterprise Resource Management) and
We are a value-added reseller for a number of industry-leading ERP applications.
We are a Sage Software Authorized Business Partner and Sage Certified Gold
Development Partner. We believe we are among the largest Sage partners in
Value-Added Services for ERP
We go beyond simply reselling software packages; we have a consulting and professional services organization that manages the process as we move from the sales stage into implementation, go live, and production. We work inside our customers' organizations to ensure all software and IT solutions are enhancing their business needs. A significant portion of our services revenue comes from continuing to work with existing customers as their business needs change, upgrading from one version of software to another, or providing additional software solutions to help them manage their business and grow their revenue. We have a dedicated help desk team that fields hundreds of calls every week. Our custom programming department builds specialized software packages as well as "off the shelf" enhancements and time and billing software.
We provide comprehensive IT managed services, Infrastructure-as-a-Service,
cybersecurity, business continuity, disaster recovery, data back-up, network
maintenance and service upgrades designed to eliminate the IT concerns of our
customers. We are a Microsoft Solutions Provider. Our staff includes engineers
who maintain certifications from Microsoft and
Cybersecurity
We provide enterprise level security services to the mid-market. Our cybersecurity-as-a-service offering includes a security operations center, incident response, cybersecurity assessments, and hacking simulations. The service is particularly well-suited for customers in compliance-driven and regulated industries, including financial services, pension administration, insurance, and the land and title sector.
Application Hosting
Application hosting is a type of SaaS (Software-as-a-Service) hosting solution that allows applications to be available from a remote cloud infrastructure and to be accessed by users through the internet.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued).
Investing in the acquisition of other companies and proprietary business
management solutions has been an important growth strategy for our Company,
allowing us to rapidly expand into new geographic markets and create new and
exciting profit centers. To date, we have completed a series of strategic
ventures that have served to fundamentally strengthen our Company's operating
platform and materially expand our footprint to nearly every
Additionally, it is our intention to continue to increase our business by seeking additional opportunities through potential acquisitions, revenue sharing arrangements, partnerships or investments. Such acquisitions, revenue sharing arrangements, partnerships or investments may consume cash reserves or require additional cash or equity. Our working capital and additional funding requirements will depend upon numerous factors, including: (i) strategic acquisitions or investments; (ii) an increase to current company personnel; (iii) the level of resources that we devote to sales and marketing capabilities; (iv) technological advances; and (v) the activities of competitors.
During the first quarter of 2023, the Company continued to expand its customer base and growth trend which we believe will provide a basis for future growth.
Results of Operations for the Three Months Ended
Our strategy is to grow our business through organic growth of our software
applications, technology solutions and managed services, as well as expansion
through acquisitions. We have established a national presence via our internal
marketing, sales programs, and acquisitions and now have ERP customers
throughout most of
The Company continues to monitor the Covid-19 situation as it pertains to the disruption of our business, and that of some of our customers, and growth in future quarters and will take steps, if necessary, to establish mitigation strategies to try and minimize risk of any potential downturn for shareholders as well the health, safety and wellbeing of its employees and customers. The Company's strategies are focused on assisting our customers in their digital transformation in this new environment. We believe the new "work from home environment" (workforce of the future), coupled with the continued rise of E-Commerce and security and compliance could help drive our future revenues.
For the three months ended
On
The proposed business combination is expected to close in the first half of
2023, subject to the receipt of any applicable regulatory approvals, the
approval of
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued).
Revenues
For the three months ended
Software revenues increased
Service revenue increased
Gross profit
Gross profit for the three months ended
The gross profit attributed to software revenues increased
The gross profit attributed to services increased
Operating expenses
Selling and marketing expenses increased
General and administrative expenses decreased
Share-based compensation decreased
Depreciation and amortization expense decreased
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued).
Income (loss) income from operations
As a result of the above, for the three months ended
Liquidity and Capital Resources
The uncertainty on the economy continues to create uncertainty for the Company in the coming months and quarters. While our Company has not been significantly impacted because of this uncertainty nor from the impact of Covid-19, the potential negative impact on our business, in the future, is impossible to determine at this point, although it is likely that we could suffer negative consequences as many companies go out of business or decrease their technology spending. As such, we need to rely on our own limited resources to weather any economic downturn. Management will continue to monitor developments, explore various cost-cutting measures, and explore other sources of funding, but there is no guarantee we will be successful in doing so.
The Company currently has no line of credit or other credit facility with any lender.
We continue to review and look for additional operating income opportunities through potential acquisitions or investments. Such acquisitions or investments may consume cash reserves or require additional cash or equity. Our working capital and additional funding requirements will depend upon numerous factors, including: (i) strategic acquisitions or investments; (ii) an increase to current company personnel; (iii) the level of resources that we devote to sales and marketing capabilities; (iv) technological advances; and (v) the activities of competitors.
In addition to developing new products, obtaining new customers and increasing sales to existing customers, management plans to increase its business and profitability by entering into collaboration agreements, buying assets, and acquiring companies in the business software and information technology consulting and other markets with solid revenue streams and established customer bases that generate positive cash flow.
AtMarch 31, 2023 , future payments of long-term and related party debt are as follows: Remainder of 2023$ 494,190 2024 360,091 2025 258,736 2026 52,188 Total$ 1,165,205
The Company's working capital was
During the three months ended
Cash used in operating activities:
Operating activities for the three months ended
Cash used in investing activities:
Investing activities for the three months ended
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (Continued).
Liquidity and Capital Resources (Continued)
Cash used in financing activities:
Financing activities for the three months ended
The Company believes that as a result of the growth in business, and the funds on hand, it has adequate liquidity to fund its operating plans for at least the next twelve months, provided, however, that the Company cannot currently quantify the uncertainty related to the recent pandemic and its effects on the business in the coming quarters.
For the three months ended
Off Balance Sheet Arrangements
During the three months ended
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