RTB Digital (RTB) Q1 2015 earnings summary

Executive summary

• Q1 revenue was $451,418 versus $612,625 in Q1 2014; net income rose to $92,164 from $77,360 as lower G&A, interest expense and tax provision outweighed lower gross profit.

• One hotel acquisition closed in Q1 2015 versus two in Q1 2014, driving lower consulting revenue and related costs.

Financial highlights

• Gross profit was $215,418 versus $321,625; operating income was $143,893 versus $135,672 for Q1 2014.

• G&A expense fell 61.5% to $71,525 from $185,953, mainly following removal of an officer from payroll.

• Net cash provided by operating activities was $177,305 versus $396,394; quarter-end cash was $36,764 versus $41,420 at Dec. 31, 2014.

Outlook and guidance

• Focus is on real estate transactions to generate revenue; management expected available working capital to sustain operations for 12 months, supported by service revenue and shareholder note funding.

• Growth plans target the next few years, leveraging hotel assets viewed as below replacement cost, reasonable cap rates and value-add opportunities.

• Long-term growth funding may combine internally generated cash with potential debt and equity financing; no 2015 capital expenditure commitments were planned.