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Creative Learning Corporation Reports Fiscal 2014 Financial Results

By: Bricks 4 Kidz |  0 Shares     167 Reads

Revenue Increases 60.0% to $7.7 Million in Fiscal 2014

Royalty Fees Increased 85.3% to $1.8 Million

Shareholders’ Equity Increases to $3.3 million at the End of Fiscal 2014 Compared to $2.4 Million at the End of Fiscal 2013

ST. AUGUSTINE, Fla. - February 03, 2015 - (BUSINESS WIRE) - Creative Learning Corporation (OTCBB: CLCN), owner and developer of Bricks 4 Kidz®, and Challenge Island®, the highly-popular children’s education and enrichment programs, today announced financial results for the fiscal year ended September 30, 2014.

Brian Pappas, CEO of Creative Learning, commented: "We are pleased to report positive financial results for the fiscal year ended September 30, 2014. We continue to see top and bottom line growth, with revenue increasing 60.0% to $7.7 million and our high margin, recurring royalty fees increasing 85.3%. Notably, we achieved $1.4 million of EBITDA and net income of $799,171 for fiscal 2014, which includes earlier than expected recognition of certain expenses in the fourth quarter of 2014 that should enhance our bottom line in 2015. We attribute our strong growth to the rapid roll-out of our Bricks 4 Kidz® franchises and the early success we have experienced with Challenge Island®. At the same time, our balance sheet continues to improve as we increased shareholders’ equity to $3.3 million as of September 30, 2014."

"To date, we have awarded 702 franchises, 657 Bricks 4 Kidz ® franchises and 45 Challenge Island ® franchises. With respect to Sew Fun Studios®, we have revamped the model to become a mobile business model, which has proven successful with Bricks 4 Kidz® and Challenge Island® by lowering the capital requirements for the franchisees. Our goal is to award no less than 15 Sew Fun Studios® franchises in fiscal 2015. We continue to grow rapidly internationally and are in 35 countries to date. Our master franchise model generates significant cash flow along with high margins, and we currently have 18 master franchises. Looking ahead to fiscal 2015, we expect to continue our strong growth and further enhance our profitability. Specifically, we look forward to adding at least 120-150 new Bricks 4 Kidz franchises and entering at least 5 new countries bringing our total to over 40 countries. Our goal is to add at least 30 new Challenge Island® franchises and enter at least 3 new countries outside of the U.S. by the end of 2015."

"2014 has been a year of transition as we strengthened our internal infrastructure to support our anticipated growth. We are in the process of further enhancing our corporate governance and financial controls. Our plan is to list on a senior national exchange in 2015. In advance of this, we plan to expand the senior management team, and look forward to appointing new independent directors in the upcoming quarters. Overall, we are extremely well positioned in the market and believe the internal steps we have taken in 2014 and continue to take in 2015, along with the rapid growth in our high margin, recurring royalty revenue, position us to significantly enhance shareholder value in the coming years."

Revenue for the fiscal year ended September 30, 2014 increased 60.0% to $7.7 million versus $4.8 million for the fiscal year ended 2013. The increase in revenue of $2,890,087 was the result of increased awarded franchises and nearly doubling of royalty income. Operating income for fiscal 2014 was $1.4 million versus operating income of $1.0 million for fiscal 2013. Net income for fiscal 2014 was $799,171 or $0.07 per diluted share, versus net income of $947,956 or $0.08 per diluted share in fiscal 2013.

About Creative Learning Corporation

Creative Learning Corporation, operating under the trade names of Bricks 4 Kidz® and Challenge Island®, offers educational and enrichment programs to children ages 3-12+. Through a unique franchise business model that includes a proprietary curriculum and marketing strategies, plus a proprietary Franchise Marketing Tool (FMT), the Company provides a wide variety of programs designed to enhance students’ problem solving and critical thinking skills. Creative Learning Corp is now operating in 35 countries.

Safe Harbor Statement

This press release may contain "forward-looking statements" that are made pursuant to the "safe harbor" provisions as defined within the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words including "anticipates," "believes," "intends," "estimates," and similar expressions. These statements are based upon management's current expectations as of the date of this press release. Such forward-looking statements may include statements regarding the Company's future financial performance or results of operations, including expected revenue growth, cash flow growth, future expenses and other future or expected performances. The Company cautions readers there may be events in the future that the Company is not able to accurately predict or control and the information contained in the forward-looking statements is inherently uncertain and subject to a number of risks that could cause actual results to differ materially from those indicated in the forward-looking statements. Further information on these and other potential factors that could affect the Company's financial results is included in the Company's filings with the SEC under the "Risk Factors" sections and elsewhere in those filings.

CREATIVE LEARNING CORPORATION Condensed Consolidated Statements of Operations
						For The Fiscal
						Years Ended
						Sept 30,				Sept 30,
						2014				2013
Revenues:
	Initial franchise fees					$	5,787,058			$	3,700,221
	Royalty fees						1,845,530				995,900
	Corporate Creativity Center sales						78,218				124,598
							7,710,806				4,820,719
Operating expenses:
	Franchise consulting and commissions:
		Related parties					616,061				746,226
		Other					1,698,359				976,776
	Franchise training and expenses						502,661				272,125
	Salaries and payroll taxes						1,104,738				539,982
	Advertising						917,429				455,108
	Professional fees						265,742				97,886
	Office expense						295,039				158,964
	Depreciation						39,915				30,267
	Stock based compensation						56,630				108,280
	Other general and administrative expenses						820,540				389,348
				Total operating expenses			6,317,114				3,774,962
				Income from operations			1,393,692				1,045,757
Other income (expense):
	Interest (expense)						(455	)			(4,882	)
	Gain on sale of intangible assets						18,335				—
	Loss on disposal of property and equipment						(56,629	)			—
	Legal settlement						(106,250	)			—
	Other income (expense)						61,563				(80,846	)
				Total other income (expense)			(83,436	)			(85,728	)
				Income before provision for income taxes			1,310,256				960,029
Provision for income taxes (Note 12)							511,085				12,073
Net Income						$	799,171			$	947,956
Net Income attributable to common stockholders per share
	Basic					$	0.07			$	0.08
	Weighted average number of common shares outstanding						11,812,861				11,675,102
	Diluted						0.07				0.08
	Weighted average number of common shares outstanding						11,870,018				11,678,873

 

CREATIVE LEARNING CORPORATION Condensed Consolidated Balance Sheets
		September 30,				September 30,
		2014				2013
Assets
Current Assets:
Cash		$	3,061,458			$	2,004,947
Restricted Cash			180,009				—
Accounts receivable, less allowance for doubtful accounts of $41,000 and $10,000, respectively			303,122				310,150
Prepaid expenses			7,850				826
Other receivables - current portion			126,339				94,301
Income Tax Receivable			115,825				—
Deferred tax asset			48,723				1,058
Total Current Assets			3,843,326				2,411,282
Note receivable from related party			70,000				70,000
Other receivables - net of current portion			67,749				37,491
Property and equipment, net of accumulated depreciation of $98,238 and $60,073, respectively			322,659				294,863
Intangible assets			125,754				95,270
Deposits			11,425				15,000
Total Assets		$	4,440,913			$	2,923,906
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable:
Related parties		$	-			$	5,690
Third party			534,932				171,889
Payroll accruals			—				13,105
Unearned revenue			—				35,900
Accrued stock based compensation			98,400				—
Accrued marketing fund			180,009				100,754
Customer deposits			96,737				120,001
Income tax payable			—				13,131
Deferred tax liability			5,550				—
Notes payable:
Related parties			—				20,000
Other			2,225				3,560
Legal settlement			161,250				—
Total Current Liabilities			1,079,103				484,030
Notes payables - net of current portion			—				5,297
Long-term deferred tax liability			22,230				—
Total Liabilities			1,101,333				489,327
Commitment and Contingencies (Note 11)
Stockholders’ Equity:
Preferred stock, $.0001 par value; 10,000,000 shares authorized; -0- and -0- shares issued and outstanding, respectively			—				—
Common stock, $.0001 par value; 50,000,000 shares authorized;11,829,409 and 11,809,409 shares issued and outstanding, respectively			1,183				1,181
Additional paid-in capital			2,263,501				2,157,673
Retained earnings			1,074,896				275,725
Total Stockholders’ Equity			3,339,580				2,434,579
Total Liabilities and Stockholders’ Equity		$	4,440,913			$	2,923,906

SOURCE Creative Learning Corporation

Contacts:

David Waldman
Natalya Rudman
Crescendo Communications, LLC
212-671-1020 x 304
clcn@crescendo-ir.com

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