Exhibit 10.5.1
April 30, 2003 Peter Nasca (pnasca@epixtar.com)
305-503-8600
EPIXTAR CORP REPORTS RECORD FIRST QUARTER RESULTS
Revenues Increase More Than 600 Percent
Miami - April 30, 2003 - EPIXTAR Corp. (OTCBB:EPXR) today reported
record operating results for the first quarter ended March 31, 2003.
Revenues for the quarter were $12.4 million with a net income of $1.9
million, or $.185 per share after tax. This compares with revenue of $2.0
million and a loss of $1.0 million, or ($.10) per share, in the first quarter of
2002 as restated.
"Epixtar's revenue growth in 2002 to $26 million compared with $1.2
million in 2001 and its turn to profitability of $1.5 million in the fourth
quarter from previous losses demonstrates the viability of our business model
and platform for offshore-based, process outsourcing," said William Rhodes,
president and director. "This growth is further reinforced by the first quarter
results of 2003."
"We attribute our positive first quarter to the maturation of our
customer base that resulted in reduced customer churn. In addition, we also
expanded the utilization of offshore customer contact centers. The successful
implementation of both of these initiatives materially reduced our sales costs.
The consolidation of our marketing efforts also increased our efficiency," added
Rhodes.
Epixtar, which initially used its platform to market its own ISP and
websites to small businesses from a much lower cost offshore facilities, has
successfully extended the model and will soon announce an initiative to begin
marketing products for others.
( More)
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ABOUT EPIXTAR
Epixtar Corp. located in Miami, Florida develops communications-related service
bundles designed chiefly for the small-to-medium sized business market. Because
this market tends to be skeptical of technology-based services such as
value-added Internet services, Epixtar employs telemarketing to fuel a
compelling approach to customer acquisition. This approach leverages proven,
highly efficient sales techniques that account for over $239 billion or 44% of
all direct B2B sales.
In four years, Epixtar has launched five brands -retaining over 230,000
subscribers - with plans to launch several additional brands by the end of
second quarter of 2003. Epixtar has realized these dramatic successes through
effective partnership - creating strong value chains to satisfy market demand.
We focus primarily on those activities required to develop, launch, and support
products sold by our vendor contact centers, remaining focused on our core
competencies. To that end, Epixtar concentrates on two primary lines of
business: Value-added ISP services and Telecommunications services.
(Tables Attached)
SAFE HARBOR STATEMENT
This release contains statements about expected future events and financial
results that are forward looking. These statements are based on our estimates
and assumptions and are subject to risks and uncertainties. Actual results could
be affected by a downturn in the economy, new competitive products, slower rate
of growth in member base, higher than anticipated cancellations, unforeseen
expenses, or technical failure related to self generating web site development
or inability to scale server capacity to meet demand. Forward-looking statements
include the information concerning our possible or assumed future results of
operations. Forward-looking statements also include those preceded or followed
by the words: "anticipates," "believes," "estimates," "hopes" or similar
expressions. For those statements, we claim the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995.
EPIXTAR CORP. AND SUBSIDIARIES
FORMERLY GLOBAL ASSET HOLDINGS, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31 December 31
2003 2002
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Current Assets:
Cash and cash equivalents $ 242,209 $ 722,674
Accounts receivable - net 4,326,210 3,802,326
Prepaid expenses and advances 11,596 59,940
Debt restructuring costs - current portion 500,000 500,000
Deferred billing costs 277,309 154,246
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Total current assets 5,357,324 5,239,186
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Property and equipment, net of accumulated depreciation of
$141,374 and $105,375 448,356 406,971
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Other Assets:
Debt-restructuring costs - non current portion 333,333 458,333
Goodwill (net of amortization) 16,801,359 16,801,359
Deposits 135,101 76,716
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Total other assets 17,269,793 17,336,408
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Total assets $ 23,075,473 $ 22,982,565
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Notes payable $ 404,466 $ 404,466
Accounts payable 3,229,738 3,211,934
Accounts payable - subject to compromise 385,401 385,401
Accrued expenses and taxes 834,552 1,398,664
Deferred revenue 1,227,528 2,897,693
Capitalized lease obligations - current portion 74,027 79,320
Corporate Income Tax Payable 389,672
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Total current liabilities 6,545,384 8,377,478
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Long-Term Liabilities:
Note payable 2,474,000 2,474,000
Capitalized lease obligations - non-current portion 71,575 88,451
Loan payable -- 0
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Total long-term liabilities 2,545,575 2,562,451
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Total liabilities 9,090,959 10,939,929
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Commitments and Contingencies
Stockholders' Equity:
Preferred stock, $.001 par value per share, 10,000,000
shares authorized and -0- issued and outstanding -- --
Common stock, $.001 par value per share, 50,000,000
shares authorized and 10,503,000 shares issued
and outstanding in 2003 and 2002, respectively 10,503 10,503
Additional paid in capital in excess of par value 31,757,997 31,757,997
Accumulated deficit (17,783,986) (19,725,864)
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Total stockholders' equity 13,984,514 12,042,636
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Total liabilities and stockholders' equity $ 23,075,471 $ 22,982,565
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2003 2002
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(RESTATED)
Revenues $ 12,366,775 $ 2,066,131
Cost of sales 5,983,628 1,607,815
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Gross profit (loss) 6,383,147 458,316
Expenses:
Selling, general and administrative 3,849,705 1,363,820
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Income(Loss) from operations 2,533,442 (905.504)
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Interest expense 165,893 71,560
Depreciation 35,999 13,724
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201,892 85,284
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Income(Loss) from continuing operations 2,331,550 (990,788)
Loss from discontinued operation 0 (16,406)
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Net Income(loss) before taxes $ 2,331,550 $ (1,007,194)
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Less: Provision for Corporate Income Taxes 389,672 0
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Net Income(Loss) 1,941,878 (1,007,194)
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Net Income(loss) per share (basic and diluted), based
upon 10,503,000 and 10,503,000 weighted average
shares outstanding for March 31, 2002 and 2001,
respectively $ .185 $ (.10)
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