RALEIGH, N.C., August 14, 2019 – LandStar, Inc. (OTCPK: LDSR) (“LandStar” or the “Company”), the parent company of Data443™ Risk Mitigation, Inc. (“Data443”), a leading data security and privacy software company, today filed its Form 10-Q with the U.S. Securities and Exchange Commission (the “SEC”) to disclose its financial results for the three and six month periods ending June 30, 2019.
- Continued billing and subscription revenue growth
- Privacy, Security and Governance continue to be leading stories
- Stage set for H2-2019 Privacy Product Launches
- Full pipeline of RFPs, PoCs – Customer Conversions to Hybrid-Cloud
Jason Remillard, Founder of Data443 and CEO of LandStar, commented, “As our second-quarter results confirm, we are making progress on our plan to accelerate high-margin, recurring revenue into our business.We believe the large and growing addressable markets we operate in provides us with substantial runway for continued expansion. Strong execution and our focus on building deep customer relationships have driven customer renewals, which is of critical importance when integrating our current and planned acquisitions. Our recent contract awards combined with the elevated level of proposal activity sustains our optimism for further growth.
“On the acquisition front, we are excited to strengthen our capabilities with the strategic acquisition of DataExpress, which we expect to close in the third quarter of 2019. This acquisition will allow us to adopt a larger footprint into the retail and financial services industries, where data transfer activity continues to increase in volume, risk, sensitivity and overall value to the organizations. We intend to make additional prudent acquisitions that meet our strategic goals of increasing our customer base, expanding our service capabilities, and achieving high margin recurring revenue.
“As we look to the second half of the year, we still have plenty of work ahead in converting and increasing our new business pipeline. Our comprehensive portfolio of products and services, strong partnerships, nimble structure and depth of expertise, position Data443 to drive growth and deliver value for our clients and shareholders,” concluded Mr. Remillard.
Business Highlights for the Second Quarter of 2019:
- Signed a letter of intent to acquire the assets of secure, managed file transfer leader, DataExpress
- Collaborated with N8 Identity on a major client win following a three-month pilot for a global, NYC-based $1.4B market cap NYSE-traded company
- Announced the availability of its Enterprise Connector Framework for its expanding product line for all SaaS-based offerings – supporting major platforms such as Slack™, Microsoft Office365™, Altassian’s JIRA™
- Expanded its product line with the addition of high-profile new data sources for use in CCPA, GDPR, eDiscovery, archiving and data retention requirements
- Completion of negotiations with finance partners, resulting in favorable new terms on existing debt
- The WordPress GDPR Framework grew to over 20,000 active deployments
- Numerous customer wins for its hybrid-cloud archiving and eDiscovery platform
- New Versions of GDPR Framework, ClassiDocs and ARALOC client released
- New sales and marketing campaigns launched – aggressively targeting competitor client bases and CCPA legislation subjects
- New distributors and partners added to our roster, recertifications with technology partners
- CEO Jason Remillard was invited to become a part of the National SPARK Institute’s Privacy Committee, which assembles preeminent inter-industry experts in the privacy sector to analyze and understand the impact of global privacy laws. The committee also provides thought leadership, strategic recommendations and policy guidance to state and federal entities.
- Presented at the SPARK Institute’s 2019 SPARK National Conference, covering the state of privacy and its impact on the retirement industry
- Presented atthe LD Micro Invitational in Los Angeles, an investor event dedicated to growth-oriented companies engaging with the investment community
Second Quarter 2019 Financial Results:
Total revenues were $359,000 during the three months ended June 30, 2019, compared to zero revenue for the three months ended June 30, 2018. We had net billings for the three months ended June 30, 2019 of $483,000, compared to zero in the prior year period.
Deferred revenues were $427,000 as of June 30, 2019, an increase of $398,000 from $29,000 as of December 31, 2018.
General and administrative expenses for the three months ended June 30, 2019 were $1,211,000, as compared to $1,804,000 for the three months ended June 30, 2018, which is a decrease of $593,000, or 33%.
The net gain for the three months ended June 30, 2019 was $1,194,000 as compared to a loss of $1,460,000 for the three months ended June 30, 2018. The net gain for the three months ended June 30, 2019 was mainly derived from a gain on change in fair value of derivative liability of $2,421,000, associated with convertible notes payable and gross margin of $353,000, offset in part by general and administrative, and sales and marketing expenses incurred. The net loss for the three months ended June 30, 2018 was mainly derived from the general and administrative, and sales and marketing expenses incurred without generating revenue, offset in part by a gain on change in fair value of derivative liabilities.
First Half 2019 Financial Results:
Total revenues were $501,000 during the six months ended June 30, 2019, compared to zero revenue for the six months ended June 30, 2018. We had net billings for the six months ended June 30, 2019 of $957,000, compared to zero in the prior year period.
General and administrative expenses for the six months ended June 30, 2019 were $1,902,000, compared to $2,080,000 for the six months ended June 30, 2018, a decrease of $178,000, or 9%. The expenses for the six months ended June 30, 2019 primarily consisted of management costs, costs to integrate assets we acquired and to expand sales, audit and review fees, filing fees, professional fees, and other expenses, including the re-classification of sales-related management expenses, in connection with the projected growth of the Company’s business.
The net gain for the six months ended June 30, 2019 was $7,224,000 as compared to a loss of $7,665,000 for the six months ended June 30, 2018. The net gain for the six months ended June 30, 2019 was mainly derived from a gain on change in fair value of derivative liability of $9,234,000, associated with convertible notes payable and gross profit of $492,000, offset in part by general and administrative, and sales and marketing expenses incurred. The net loss for the six months ended June 30, 2018 was derived by the net loss on change in fair value of derivative liability of $4,739,000 associated with convertible notes payable, as well as general and administrative, and sales and marketing expenses incurred.
As of June 30, 2019, we had cash in the amount of $241,000 and other current assets in the amount of $521,000, compared to cash in the amount of $62,000, and other current assets in the amount of $41,000 as of June 30, 2018.
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About LandStar, Inc.
LandStar, Inc. (OTCPK: LDSR), through its wholly owned subsidiary DATA443™ Risk Mitigation, Inc., provides SaaS-based software solutions that secure data – across local devices, network, cloud, and databases – at rest and in flight. Its expanding suite of software products is highlighted by: (i) ArcMail, which is a leading provider of simple, secure and cost-effective enterprise data retention management, archiving and management solutions; (ii) ARALOC™, which is a market leading secure, cloud-based platform for the management, protection and distribution of digital content to the desktop and mobile devices, which protects an organization’s confidential content and intellectual property assets from leakage — malicious or accidental — without impacting collaboration between all stakeholders; (iii) ClassiDocs™, the Company’s award-winning data classification and governance technology, which supports CCPA, LGPD and GDPR compliance; (iv) ClassiDocs™ for Blockchain, which provides an active implementation for the Ripple XRP that protects blockchain transactions from inadvertent disclosure and data leaks; (v) Data443 Privacy Manager™, which is integrated with ClassiDocs to do the delivery portions of GDPR and CCPA as well as process DSARs – removal request – with inventory by ClassiDocs; (vi) Data443 virtual Data Protection Officer, our virtual solution for privacy laws requiring a Data Protection Officer; and (vii) the WordPress GDPR Framework with over 20,000 active site owners, enables organizations of all sizes to comply with the GDPR and other privacy frameworks. For more information, please visit https://www.data443.com.
The statements contained in this release that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursuant,” “target,” “continue,” and similar expressions are intended to identify such forward-looking statements. The statements in this press release that are not historical statements, including statements regarding LandStar’s plans, objectives, future opportunities for LandStar’s services, future financial performance and operating results and any other statements regarding LandStar’s future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts, are forward-looking statements within the meaning of the federal securities laws. These statements are not guarantees of future performance and are subject to numerous risks, uncertainties, and assumptions, many of which are beyond LandStar’s control, and which could cause actual results to differ materially from the results expressed or implied by the statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict, and include, without limitation, results of litigation, settlements and investigations; actions by third parties, including governmental agencies; volatility in customer spending; global economic conditions; ability to hire and retain personnel; loss of, or reduction in business with, key customers; difficulty with growth and integration of acquisitions; product liability; cybersecurity risk; and, anti-takeover measures in our charter documents. These and other important risk factors are described more fully in our reports and other documents filed with the Securities and Exchange Commission (“the SEC”), including under “Part I, Item 1A. Risk Factors”, in our Registration Statement on Form 10 filed with the SEC on January 11, 2019.
Any forward-looking statement is made only as of the date of which such statement is made. Except as otherwise required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.
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