Exhibit 99.1
Contact: Roy Israel
(516) 829-4343
clickNsettle.com Reports Fourth Quarter and Year End Results
and Continues to Explore Strategic Alternatives
GREAT NECK, N.Y., September 28, 2004/Business Wire/ -- clickNsettle.com, Inc.
(OTCBB: CLIK), a global provider of innovative dispute resolution solutions,
today announced its revenues and results for the fourth quarter and fiscal year
ended June 30, 2004. Revenues for the fourth quarter of fiscal 2004 decreased
18.1% to $1,034,650 from $1,263,987 for the fourth quarter of fiscal 2003. Net
income (loss) was ($160,245) for the fourth quarter of fiscal year 2004 or
($0.02) net loss per common share as compared to net income of $57,218 for the
prior year quarterly period or $0.01 net income per common share. Operating
income (loss) was ($163,146) for the quarter ended June 30, 2004 as compared to
operating income of $44,300 for the prior year quarter ended June 30, 2003.
Operating loss and net loss in the fourth fiscal quarter of 2004 included the
recognition of a loss on impairment of furniture and equipment in the amount of
$85,721. There was no similar item in the prior year period.
Revenues for the year ended June 30, 2004 declined by 7.8% to $3,759,372 from
$4,078,119 for the year ended June 30, 2003. Net loss increased to ($722,704)
for fiscal year 2004 from ($479,511) for fiscal year 2003. Net loss per common
share was ($0.09) per share for the current year versus ($0.06) per share for
fiscal year 2003. Further, operating loss was ($779,684) for the year ended June
30, 2004 as compared to ($503,737) for the prior year ended June 30, 2003.
Roy Israel, President & CEO of clickNsettle.com stated, "We believe our revenue
has been adversely affected by the consolidation and turmoil in the insurance
industry, which represents a major portion of our clientele. Additionally,
insurance companies in general and some, in particular, have changed their
claims-settling philosophies. Currently, we perceive that many of the larger
insurance companies are taking a harder line with the plaintiff bar. This
results in a slow down in the number of cases being submitted to our forum, a
trend that continues into fiscal year 2005. In a broader sense, we believe that
lawsuits continue to be commenced and that our services should prove to be vital
to insurers in their ability to address a growing caseload with reduced costs,
but the timing of such may be delayed."
In July 2004, the Board of Directors of the Company decided to explore strategic
alternatives for the Company in an effort to protect shareholder value. During
July and August 2004, the Board of Directors reviewed potential alternatives,
including merger candidates, as well as the purchase or privatization of the
existing business. Currently, the Board is negotiating the terms of an asset
purchase agreement with the present Chief Executive Officer of the Company, Roy
Israel, whereby he or companies owned by him, would assume the assets and
liabilities of the ADR business of the Company and its
future commitments. The Company would retain a minimum of $200,000 in cash in
order to effect a merger or a similar transaction with the intent to acquire a
different operating business, as well as to cover costs directly associated with
the asset purchase including, but not limited to, legal costs, accounting fees,
the cost of obtaining a fairness opinion and proxy solicitation.
The completion of the transaction is subject to the execution of a definitive
asset purchase agreement, the receipt of an opinion from an unrelated third
party approved by the Board of Directors stating that the transaction is fair,
from a financial point of view, to the unaffiliated shareholders of the Company
and shareholder approval. There can be no assurances that the transaction will
occur.
As a result of continued losses, the use of significant cash in operations and
the uncertainty as to the ability to obtain approval for the asset purchase
agreement and to thereafter effect a merger or a similar transaction with the
intent to acquire a different operating business, the Company's independent
auditors have included a going concern paragraph in their report on the June 30,
2004 consolidated financial statements which have been prepared assuming the
Company will continue as a going concern.
Mr. Israel further stated, "While we remain optimistic about the need for the
Company's services, we believe that the unavoidability of the escalating costs
associated with being a publicly traded company shortens the timeframe that the
company needs in order to realize revenues from its sales and marketing
initiatives. Therefore, in looking at alternatives that would be in the best
interest of the shareholders, the Board of Directors is strongly considering a
merger strategy for the public vehicle."
About clickNsettle.com
Headquartered in Great Neck, New York, clickNsettle.com, Inc. provides
innovative and highly effective dispute resolution services and solutions to
entities that seek alternatives to the traditional and often time-consuming and
expensive legal process. clickNsettle.com, the parent company of National
Arbitration and Mediation (NAM), offers a comprehensive selection of some of the
finest lawyers globally, with more than 1,800 top-tier former judges and
attorneys worldwide. Additionally, the company has a number of inventions
designed to enhance transparency and ensure the integrity of ADR (alternative
dispute resolution) initiatives. Although the dispute resolution industry is
still relatively young, clickNsettle.com has been recognized nationally as a
leader in the field and the NAM brand name is well established within the legal
and business communities.
The statements contained in the release contain forward-looking statements
relating to such matters as anticipated financial performance, business
prospects, and similar matters. The Private Securities Litigation Reform Act of
1995 provides a safe harbor for forward-looking statements. In order to comply
with the terms of the safe harbor, the Company notes that a variety of factors
could cause the Company's actual results to differ materially from the
anticipated results or other expenditures expressed in the
Company's forward-looking statements. These factors include changes in the
insurance and legal industries; the Company's inability to retain current or new
hearing officers; changes in the public court system; and the degree and timing
of the market's acceptance of its arbitration and mediation programs and
electronic oversight applications.
Table to follow
clickNsettle.com, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three months ended June 30, Year ended June 30,
2004 2003 2004 2003
----------- ---------- ----------- -----------
Net revenues $ 1,034,650 $1,263,987 $ 3,759,372 $ 4,078,119
----------- ---------- ----------- -----------
Operating costs and expenses
Cost of services 236,731 353,164 860,325 1,006,562
Sales and marketing expenses 306,291 295,412 1,278,207 1,137,489
General and administrative expenses 569,053 571,111 2,314,803 2,437,805
Loss on impairment of furniture and equipment 85,721 85,721 --
----------- ---------- ----------- -----------
1,197,796 1,219,687 4,539,056 4,581,856
----------- ---------- ----------- -----------
(Loss) income from operations (163,146) 44,300 (779,684) (503,737)
Other income
Investment income 2,242 9,390 54,298 13,448
Other income 659 3,528 2,682 10,778
----------- ---------- ----------- -----------
2,901 12,918 56,980 24,226
----------- ---------- ----------- -----------
(Loss) income before income taxes (160,245) 57,218 (722,704) (479,511)
Income taxes -- -- -- --
----------- ---------- ----------- -----------
NET (LOSS) INCOME $ (160,245) $ 57,218 $ (722,704) $ (479,511)
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Net (loss) income per common share - basic and diluted $ (0.02) $ 0.01 $ (0.09) $ (0.06)
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Weighted-average shares outstanding - basic and diluted 8,449,056 8,449,056 8,449,056 8,449,056
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