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inContact Inc. Reports Operating Results (10-Q/A)

March 06, 2009 | About:
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inContact Inc. (SAAS) filed Amended Quarterly Report for the period ended 2007-03-31.

inContact Inc. operates as a hosted software as a service company offering a range of hosted contact handling and performance management software services in addition to a variety of connectivity options for carrying an inbound call into its inContact suite of services.The Company sells telecom services unbundled from its inContact service offering including dedicated switched toll free and data lines.The company also operates as a reseller of domestic and international long distance and other services provided by national and regional wholesale providers.It was formerly known as UCN Inc. and is based in Midvale Utah..

Highlight of Business Operations:

Total revenues decreased $2.8 million or 12% to $19.8 million for the three months ended March 31, 2007 from $22.6 million compared to the same period in 2006. The decrease is primarily due to UCN terminating its relationship with several large-volume low-margin customers during the second quarter of 2006. These losses were offset by increases in inContact segment revenue, which were $4.9 million for the quarter compared to $2.9 million during the same period in 2006. In mid February 2007, UCN closed two strategic acquisitions which added $535,000 of additional revenue to our inContact segment. The BenchmarkPortal, Inc. acquisition allows us to provide customers a hosted process for measuring the effectiveness of agent interactions with clients. The ScheduleQ acquisition allows us to provide our customers a hosted solution for automating the scheduling, forecasting and alert notification functions common to most contact center/customer service type operations. These additions augment our all-in-one hosted inContact solution.

For the three months ended March 31, 2007, the inContact segment revenue of $4.9 million includes $2.8 million of related long distance voice and data services and $2.1 million of inContact technology services. For the three months ended March 31, 2006, the inContact segment revenue of $2.9 million includes $2.2 million of long distance voice and data services and $.7 million of inContact technology services.

Net cash used in operating activities for the three months ended March 31, 2007 was $323,000 primarily due a significant decrease in trade accounts payable of $1.3 million which was partially offset by a decrease in accrued liabilities. Our net loss of $1.7 million includes: 1) $1.8 million of depreciation and amortization; and 2) stock-based compensation expense of $196,000 of non-cash stock-based compensation. Net cash used in investing activities was $1.2 for the three months ended March 31, 2007, which was made up of: 1) $686,000 paid in conjunction with the acquisition of BenchmarkPortal, and 2) $438,000 in purchases of property and equipment. Net cash provided by financing activities was $338,000 for the three months ended March 31, 2007 primarily due to: 1) $500,000 draw on the revolving line of credit, 2) $302,000 received from the exercise of stock options. The cash increases from financing activities were partially offset by: 1) $256,000 paid in conjunction with debt assumed in the ScheduleQ acquisition, and $158,000 of other payments on long-term debt.

Our current ratio as of March 31, 2007 decreased slightly to 1.07:1 from 1.13:1 at December 31, 2006. The primarily reason for the decrease is due to a $1.1 million in overall cash balances, These decreases in current assets were offset by a $1.2 million decrease in accounts payable during the quarter offset a by an increase in current portion of long-term debt. At March 31, 2007, we had $3.2 million of remaining available borrowing under the revolving credit facility compared to only $2.2 million available at December 31, 2006. As noted above, in April 2007, ComVest converted the entire convertible note, which will save UCN approximately $468,000 in cash payments during 2007 and will significantly improve the current ratio by eliminating the associated current portion of long-term debt.

Our working capital surplus of $1.6 million at December 31, 2006 decreased to $887,000 at March 31, 2007. The primarily reason for the decrease was a $1.2 million reduction in accounts payable that was offset by a $516,000 increase in the current portion of long-term debt. However, the available borrowings under our revolving credit facility increased $1.0 million to $3.2 million at March 31, 2007 compared to only $2.2 million available at December 31, 2006.

For the three months ended March 31, 2007, the inContact segment revenue of $4.9 million includes $2.8 million of related long distance voice and data services and $2.1 million of inContact technology services. For the three months ended March 31, 2006, the inContact segment revenue of $2.9 million includes $2.2 million of long distance voice and data services and $.7 million of inContact technology services.

Read the The complete Report

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