Zoned Properties Reports Full-Year 2018 Financial Results

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March 28, 2019 4:05 PM EDT

SCOTTSDALE, Ariz., March 28, 2019 /PRNewswire/ -- Zoned Properties®, Inc. (OTCQX: ZDPY), a strategic real estate development firm whose primary mission is to provide real estate and sustainability services for the regulated cannabis industry, positioning the company for property acquisitions and revenue growth, today announced its financial results for the year ended December 31, 2018.

Full-Year 2018 and Subsequent Financial Results

  • Revenues were $1.2 million, down 41.5% compared to $2.1 million for the year ended December 31, 2017, reflecting the company's transition to a new business model.
  • Operating expenses, including a one-time non-cash write-off of $1.9 million related to deferred rent receivables in the second quarter of 2018, were $3.2 million compared to $1.4 million for the year ended December 31, 2017.
  • Cash provided by operating activities was $360,000 for the year ended December 31, 2018 compared to $54,000 for the year ended December 31, 2017.
  • As of December 31, 2018, the company had cash of $355,000, compared to $824,000 as of December 31, 2017.
  • Completed a 32.3% common stock redemption as consideration for amending agreements with its primary tenant and client in Arizona, providing an immediate return of value to its shareholders. As a result, Zoned Properties now has 11.9 million common shares issued and outstanding.

"We enter 2019 with a clean capital structure and no toxic debt, a rarity among companies in the regulated cannabis industry, and a stable base of triple-net recurring revenue to cover our fixed costs," commented Bryan McLaren, Chief Executive Officer. "With this solid platform, we are moving quickly to address significant and largely unmet needs in the regulated cannabis industry. Operators are realizing that real estate project complexities are one of the most common issues inhibiting development and expansion, and finding appropriate, zoned properties in which to conduct business is increasingly challenging. Zoned Properties has the expertise to address these challenges with practical, proven solutions."

"During 2019, we anticipate adding meaningful revenue from our advisory services division atop existing lease revenue from the regulated cannabis properties already under ownership," added Mr. McLaren. "Zoned Properties has valuable expertise in navigating development issues related to regulated cannabis properties, and a track record in securing municipal approvals to develop large-scale projects. Our plan is to leverage this value to reward shareholders."

About Zoned Properties, Inc. (OTCQX: ZDPY):

Zoned Properties is a strategic real estate development firm whose primary mission is to provide real estate and sustainability services for clients in the regulated cannabis industry, positioning the company for real estate acquisitions and revenue growth. We intend to pioneer sustainable development for emerging industries, including the regulated cannabis industry. We are an accredited member of the Better Business Bureau, the U.S. Green Building Council, and the Forbes Real Estate Council. We focus on investing capital to acquire and develop commercial properties to be leased on a triple-net basis, and engaging clients that face zoning, permitting, development, and operational challenges. We provide development strategies and advisory services that could potentially have a major impact on cash flow and property value. We do not grow, harvest, sell or distribute cannabis or any substances regulated under United States law such as the Controlled Substance Act of 1970, as amended (the "CSA").

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "believe," "expect," "anticipate," "plan," "potential," "continue" or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company's filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company's control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company's current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Tables Follow

ZONED PROPERTIES, INC. AND SUBSIDIARIES

 CONSOLIDATED BALANCE SHEETS

December 31,

2018

2017

 ASSETS

 Cash

$                   354,867

$                  824,240

 Rental properties, net

7,730,087

7,170,322

 Deferred rent receivable - related parties

-

1,708,734

 Note receivable - related party

-

182,365

 Prepaid expenses and other current assets

116,967

127,902

 Property and equipment, net

28,695

35,768

 Security deposits

600

2,890

 Total Assets

$                8,231,216

$             10,052,221

 LIABILITIES AND STOCKHOLDERS' EQUITY

 LIABILITIES:

 Convertible notes payable - related parties

$                2,020,000

$               2,020,000

 Accounts payable 

117,985

8,896

 Accrued expenses

54,636

48,468

 Accrued expenses - related parties

34,800

33,600

 Deferred revenues

2,750

28,750

 Security deposits payable - related parties

71,800

71,800

 Security deposits payable

6,032

5,864

 Total Liabilities

2,308,003

2,217,378

 Commitments and Contingencies

 STOCKHOLDERS' EQUITY:

Preferred stock, $0.001 par value, 5,000,000 shares authorized; 2,000,000 shares issued and outstanding at December 31, 2018 and 2017 ($1.00 per share liquidation preference)  

2,000

2,000

Common stock: $0.001 par value, 100,000,000 shares authorized; 17,441,552 and 17,345,497 issued and outstanding at December 31, 2018 and 2017, respectively

17,442

17,345

Additional paid-in capital

20,746,200

20,630,649

Accumulated deficit

(14,842,429)

(12,815,151)

 Total Stockholders' Equity

5,923,213

7,834,843

 Total Liabilities and Stockholders' Equity

$              8,231,216

$             10,052,221

ZONED PROPERTIES, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF OPERATIONS

 For the Years Ended

 December 31,

2018

2017

 REVENUES:

 Rental revenues

$                   50,155

$                  80,180

 Rental revenues - related parties

1,186,775

2,033,684

 Total revenues

1,236,930

2,113,864

 OPERATING EXPENSES:

 Compensation and benefits

411,682

569,215

 Professional fees

340,134

232,887

 General and administrative expenses

187,361

165,500

 Depreciation and amortization

276,665

225,220

 Property operating expenses

37,919

112,555

 Real estate taxes

91,113

90,821

 Settlement expense

-

20,500

     Write-off of related party receivable

1,853,539

-

 Total operating expenses

3,198,413

1,416,698

 (LOSS) INCOME FROM OPERATIONS

(1,961,483)

697,166

 OTHER (EXPENSES) INCOME:

    Interest expenses

-

(42,983)

    Interest expenses - related parties

(121,200)

(129,288)

    Other income

50,000

831,753

    Gain on sale of property and equipment

-

12,750

    Interest income

5,405

8,504

 Total other (expenses) income, net

(65,795)

680,736

 (LOSS) INCOME BEFORE INCOME TAXES

(2,027,278)

1,377,902

 PROVISION FOR INCOME TAXES

-

-

 NET (LOSS) INCOME

$             (2,027,278)

$             1,377,902

 NET (LOSS) INCOME PER COMMON SHARE:

 Basic

$                      (0.12)

$                      0.07

 Diluted

$                      (0.12)

$                      0.07

 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

 Basic

17,427,038

17,309,446

 Diluted

17,427,038

17,482,142

ZONED PROPERTIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

 For the Years Ended

December 31,

2018

2017

CASH FLOWS FROM OPERATING ACTIVITIES

Net (loss) income

$ (2,027,278)

$   1,377,902

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Depreciation and amortization expense

276,665

225,220

Stock-based compensation

84,132

223,375

Stock option expense

31,516

14,806

Stock-based settlement expense

-

10,500

Gain from sale of property and equipment

-

(831,753)

Impairment loss

1,853,539

-

Change in operating assets and liabilities:

Rent receivable

-

-

Deferred rent receivable - related parties

(144,805)

(702,563)

Real estate tax escrow

-

39,487

Note receivable

182,365

(182,365)

Prepaid expenses and other assets

10,935

12,108

Security deposits

2,290

5,268

Accounts payable

109,089

(69,415)

Accrued expenses

6,168

(26,406)

Accrued expenses - related parties

1,200

(51,941)

Deferred revenues

(26,000)

24,000

Security deposits payable - related party

-

1,800

Security deposits payable

168

(16,100)

NET CASH PROVIDED BY OPERATING ACTIVITIES

359,984

53,923

CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of buildings and improvements

(829,357)

(497,309)

Cash received from sale of property and equipment

-

1,984,188

Acquisition of property and equipment

-

(2,586)

NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES

(829,357)

1,484,293

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from convertible debt - related parties

-

2,020,000

Repayment of convertible note - related party

-

(500,000)

Repayment of convertible note

-

(500,000)

Repayment of mortgage payable

-

(2,100,000)

NET CASH USED IN FINANCING ACTIVITIES

-

(1,080,000)

NET (DECREASE) INCREASE IN CASH

(469,373)

458,216

CASH, beginning of year

824,240

366,024

CASH, end of year

$      354,867

$      824,240

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest paid

$     120,000

$      225,087

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Common stock issued for buildings and improvements

$                  -

$          7,700

Common stock issued for accrued settlement payable

$                  -

$        21,875

 

Cision View original content:http://www.prnewswire.com/news-releases/zoned-properties-reports-full-year-2018-financial-results-300819354.html

SOURCE Zoned Properties, Inc.


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