10-Q: Cleartronic, Inc. Reports Increased Revenue but Net Loss for Q1 2025

Cleartronic, Inc. experienced a revenue increase of 59.61% in Q1 2025 compared to Q1 2024, but reported a net loss attributable to common stockholders.

Summary

• Cleartronic, Inc. reported its financial results for the first quarter of fiscal year 2025, ended December 31, 2024.
• Revenue increased by 59.61% to $967,324 compared to $606,047 in the same period last year, driven by growth in the ReadyOp platform and the addition of the Alastar platform.
• The company experienced a net loss attributable to common stockholders of $59,468, compared to a net income of $7,324 in the prior year.
• Operating expenses increased by 56.08% to $808,306, primarily due to higher administrative expenses.
• The company's loss before income taxes was $49,125, compared to income of $17,667 in the prior year.
• As of December 31, 2024, the company had cash and cash equivalents of $685,013, compared to $849,727 as of September 30, 2024.
• Deferred revenue was $1,333,984 as of December 31, 2024, compared to $1,373,325 as of September 30, 2024.

Sentiment

Score: 4

Explanation: The document presents mixed signals with increased revenue offset by a net loss and rising operating expenses. The ineffective disclosure controls and procedures are also a concern.

Positives

• Revenue increased significantly by 59.61% due to the ReadyOp and Alastar platforms.
• Gross profit increased from $487,152 to $752,386.
• Consulting fees and related income increased from $0 in 2023 to $94,453 in 2024.
• Hardware sales increased from $16,500 in 2023 to $21,395 in 2024.

Negatives

• The company experienced a net loss attributable to common stockholders of $59,468, compared to a net income of $7,324 in the prior year.
• Operating expenses increased significantly by 56.08% due to higher administrative expenses.
• The company's loss before income taxes was $49,125, compared to income of $17,667 in the prior year.
• Net cash used in operations was $164,714.

Risks

• The company's disclosure controls and procedures are not effective due to a limited number of personnel and inherent challenges in achieving complete segregation of duties within the financial reporting process.
• Interruption of adequate supply of components, primarily computer chips, to the manufacturing source presents additional risk to the Company.
• The company relies on no major supplier for its products.
• One customer accounted for 8.79% of the Company's revenues for the three months ended December 31, 2024.
• One customer accounted for 17% of the Company's total outstanding deferred revenue as of December 31, 2024.

Future Outlook

The company plans to conduct all operations and marketing of the Alastar platform in the ReadyOp Communications subsidiary in conjunction with the current ReadyOp and ReadyMed activities.

Industry Context

The company operates in the software as a service (SAAS) industry, providing platforms for planning, communications, and operations management.

Comparison to Industry Standards

• It is difficult to compare Cleartronic's results to industry standards without knowing the specific niche within the SaaS market they occupy and the size of their target customers.
• Companies like Motorola Solutions and Tyler Technologies also serve government and public safety sectors, but are significantly larger and offer a broader range of services.
• Smaller, more specialized SaaS companies might be more relevant comparables, but their financial data is often not publicly available.

Legal Proceedings

• Cleartronic is not engaged in any litigation at the present time and management is unaware of any claims or complaints that could result in future litigation.

Related Party Transactions

• During the three months ended December 31, 2024 and 2023, the Company paid $ 9,000 and $ 12,000 , respectively, to a related party consultant.
• As of September 30, 2024, the Company owed $ 1,024 to the Company's Chief Executive Officer for the Company's operating expenses.
• Prior to September 30, 2024, the Company advanced $ 53,302 to VoiceInterop, the Companys former wholly owned subsidiary and now 96% owned by our shareholders.

Stakeholder Impact

• Shareholders will be concerned about the net loss despite the revenue increase.
• Employees may be affected by the company's efforts to manage operating expenses.
• Customers may benefit from the company's expanded platform offerings through the Alastar acquisition.

Key Dates

Keywords

ReadyOp, Alastar, revenue, net loss, financial results, software, SAAS, Cleartronic