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Data443 Reports Second Quarter and First Half 2022 Results and Provides Corporate Update

·10-min read
Data443 Risk Mitigation, Inc.
Data443 Risk Mitigation, Inc.

Research Triangle Park, NC, Aug. 16, 2022 (GLOBE NEWSWIRE) -- Data443 Risk Mitigation, Inc. (“Data443” or the “Company”) (OTCPK: ATDS), the leading data security and privacy software company for ALL THINGS DATA SECURITY, today announced operating results for the second quarter and first half ended June 30, 2022.

Business Accomplishments and Highlights for the First Half of 2022:

  • Achieved 99% customer retention in the first half of 2022, despite economic conditions

  • Appointed IP Leader Pamela Maher to the position of Chief Legal Officer

  • Increased global product and brand visibility, attending four in-person trade shows

Acquisitions

  • Acquired ransomware protection and device recovery technology assets from Centurion Technologies

Contracts

  • Secured five-and-a-half-year contract with Fortune 500 fintech member for our Data443® Data Placement Manager technology solution

  • Secured three-and-a-half-year agreement with Puerto Rico’s leading financial services organization for a subscription license for Data443® Data Placement Manager

  • Secured a multi-year contract with Emirates NBD Group for our Data443® Data Identification Manager to support its ‘cloud-first’ strategy for rapidly migrating its data and user base to the cloud

Product Updates

  • Released Data443® Antivirus Protection Manager the Company’s our new antivirus product for Microsoft Windows® desktops, laptops, virtual desktops, database engines, cloud instances such as Microsoft Azure®, Amazon Web Services®, Google Cloud Platform® & hybrid on-premises/cloud instances, as well as standard servers

  • Announced Data443® Antivirus Protection Manager earned the prestigious VB100 Certification from Virus Bulletin. The certification can be viewed here: https://www.virusbulletin.com/uploads/vb100/test-reports/vb100-test-report-2022-03-22-data443-antivirus-protection-manager.pdf.

  • Announced support from the Gartner Security & Risk Management Summit 2022 for its Data443® Data Identification Manager Hybrid Classifications Taxonomy data platform

  • Announced support for Data443® Data Placement Manager product for commercial and open-source versions of leading Unix implementations on all major cloud services vendors – including Microsoft Azure, Google Cloud Platform, Amazon Web Services

Management Commentary:

Data443 CEO & Founder Jason Remillard commented, “The first half of 2022 was a very busy time for us. While we had to contend with customer concerns and uncertainty regarding economic headwinds, along with other global events likely contributing to customer reluctance to consider and close deals regarding new business opportunities, we saw organic growth in increased consumption of our services. It’s a testament to our amazing team that we have 99% customer retention while other companies are actively cost cutting.”

“As we pursue an uplist to the Nasdaq Capital Market, we continue executing on the business plan we’ve committed to - building and delivering data protection and discovery products that are unique, topical, and germane to market needs. We were pleased and encouraged to hear from hundreds of attendees at the four in-person tradeshows we participated in so far this year, that we have the most unique, functional, and complete offerings in the marketplace. We appreciate the support and loyalty of our customers and shareholders during our growth phase in a challenging investment landscape. Our results demonstrate the return on investment in our people, software assets, data center capabilities, and partnerships with sales, distribution, and integration developers.” Mr. Remillard concluded that he “anticipates the remainder of 2022 will be an exciting time as we grow and transform our company, continuing in our mission to Organize the worlds data by identifying and protecting all sensitive data regardless of location, platform or format.

Second Quarter 2022 Financial Highlights:

  • Total revenues were $750,989 during the three months ended June 30, 2022, compared to $762,352 of revenue for the three months ended June 30, 2021, a decrease of 1%. The decrease in revenue second quarter was primarily due to continued stabilization in the customer base for multi-term deals, resulting in fewer customers paying for new subscriptions or renewals in the quarter.

  • General and administrative expenses for the quarter ended June 30, 2022, were $2,116,220, compared to $1,311,396 for the quarter ended June 30, 2021, an increase of an increase of 61%. The increase in general and administrative expense primarily consisted of management costs, costs to integrate assets we acquired and to expand sales, product enhancements, audit and review fees, filing fees, professional fees, and other expenses related to SEC reporting, including the re-classification of sales-related management expenses, in connection with the projected growth of our business. Additionally, we continue to incur specific one-time costs in relation to our planned Nasdaq Capital Markets uplist, additional financing activities and related functions. The increase in general and administrative expense was primarily due to a decrease in professional service fees.

  • The net loss for the quarter ended June 30, 2022 was $2,446,212 compared to a loss of $1,545,354 for the quarter ended June 30, 2021.

    • The net loss for the three months ended June 30, 2022 was mainly derived from an operating loss of $1,503,459, and interest expense of $942,753. The net loss for the three months ended June 30, 2021 was mainly derived from an operating loss of $695,094, interest expense of $671,862 and loss on change in fair value of derivative liability of $178,398.

First Half 2022 Financial Highlights:

  • Total revenues were $1,363,505 during the six months ended June 30, 2022, compared to $1,600,220 of revenue for the six months ended June 30, 2021. The decrease in revenue for the six months ended June 30, 2022 was primarily due to increased pull through of deals in Q4 of 2021 - both by the Company and our customers who took advantage of prepaid multi-year discounts and also took advantage of multi-year commitments to our SaaS products and other software product offerings.

  • Total deferred revenues were $2,582,588 as of June 30, 2022, compared with $1,608,596 deferred revenues as of December 31, 2021 - representing an increase of 60.5%.

  • General and administrative expenses for the six months ended June 30, 2022, were $3,089,782, compared to $2,744,961 for the six months ended June 30, 2021, an increase of 13%. The increase in general and administrative expense primarily consisted of management costs, costs to integrate assets we acquired and to expand sales, product enhancements, audit and review fees, filing fees, professional fees, and other expenses related to SEC reporting, including the re-classification of sales-related management expenses, in connection with the projected growth of our business. Additionally, we continue to incur specific one-time costs in relation to our planned uplist to the Nasdaq Capital Market, increased overhead costs associated with our continued OTC Pink Market listing, and acquisition-related costs

  • The net loss for the six months ended June 30, 2022 was $4,279,531 compared to a loss of $3,721,652 for the six months ended June 30, 2021.

    • The net loss for the six months ended June 30, 2022 was mainly derived from an operating loss of $2,184,579, and interest expense of $2,037,069. The net loss for the six months ended June 30, 2021 was mainly derived from an operating loss of $1,553,209, interest expense of $1,577,288, loss on settlement of debt of $227,501 and loss on change in fair value of derivative liability of $363,654.

Liquidity:
As of June 30, 2022, we had no cash and a bank overdraft of $3,781 and our principal sources of liquidity were trade accounts receivable of $231,507 and prepaid, advance payment for acquisition of $2,726,188 and other current assets of $27,950, as compared to cash of $1,204,933, trade accounts receivable of $21,569 and prepaid and other current assets of $70,802 as of December 31, 2021.

About Data443 Risk Mitigation, Inc.

Data443 Risk Mitigation, Inc. (OTC: ATDS) is an industry leader in , providing software and services to enable secure data across local devices, networks, cloud, and databases, at rest and in flight. We are All Things Data Security™. With over 10,000 customers in over 100 countries, Data443 provides a modern approach to data governance and security by identifying and protecting all sensitive data regardless of location, platform, or format. Our industry-leading framework helps customers prioritize risk, identify security gaps, and implement overall data protection and privacy management strategies.

For more information, please visit https://www.data443.com

To learn more about Data443, please watch our video introduction on our YouTube channel: https://youtu.be/1Fp93jOxFSg

Data443 offers free trials of all its technologies using its shopping cart system at: https://orders.data443.com

Forward-Looking Statements 

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 Data443’s plans, objectives, future opportunities for Data443’s services, future financial performance and operating results and any other statements regarding Data443’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 Data443’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; anti-takeover measures in our charter documents; and, the uncertainties created by the ongoing outbreak of COVID-19. 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 in (i) “Part I, Item 1A. Risk Factors”, in our Registration Statement on Form 10 filed with the SEC on January 11, 2019 and amended on April 24, 2019; (ii) “Part I, Item 1A. Risk Factors”, in our Annual Report on Form 10-K filed with the SEC on March 31, 2022; and, (iii) subsequent filings. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. 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.

“DATA443” is a registered trademark of Data443 Risk Mitigation, Inc.

All product names, trademarks and registered trademarks are property of their respective owners. All company, product and service names used in this press release are for identification purposes only. Use of these names, trademarks and brands does not imply endorsement.

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Investor Relations Contact:
Matthew Abenante
ir@data443.com
919.858.6542