Reliance (US:RELI)2021-05-13 21:15Financial Performance - The company reported total revenue of $2,296,328 for the three months ended March 31, 2021, an increase of $292,014 or 15% compared to $2,004,314 for the same period in 2020[139] - The company reported a net loss of $641,328 for the three months ended March 31, 2021, compared to a net loss of $979,798 for the same period in 2020[137] - Net cash used in operating activities for Q1 2021 was $2,570,382, including a net loss of $641,328 and non-cash expenses of $686,404[152] - Cash flows used in investing activities were $0 in Q1 2021, a decrease from $1,000,000 in Q1 2020 due to no acquisitions during the period[153] - Cash provided by financing activities was $10,134,997 in Q1 2021, significantly up from $1,318,619 in Q1 2020, primarily from the offering of 2,070,000 shares of common stock[154] - The company experienced a net increase in cash of $9,488,395 in Q1 2021 compared to a net increase of $94,923 in Q1 2020[151] Expenses - Commission expense increased by $103,887 or 24% to $529,472 for the three months ended March 31, 2021, compared to $425,585 for the same period in 2020[140] - General and administrative expenses decreased to $1,004,401 for the three months ended March 31, 2021, down from $1,121,120 for the same period in 2020, primarily due to reduced professional fees[142] - Stock-based compensation expense for Q1 2021 included $352,299 related to share-based compensation[152] Cash and Working Capital - The company achieved a cash balance of $10,017,976 and working capital of $8,064,090 as of March 31, 2021, a significant improvement from a cash balance of $529,581 and a working capital deficit of $6,073,982 a year earlier[147] - The company paid down due balances upon the completion of its offering, contributing to the decrease in accounts payable of $893,505[152] Business Development - The company has acquired seven insurance brokerages to date, enhancing its competitive position within the insurance industry[129] - The company plans to focus on the expansion and growth of its business through continued asset acquisitions in insurance markets over the next 12 months[123] - The 5MinuteInsure.com platform is currently licensed to sell Home and Auto insurance in 46 states and the District of Columbia, with 11 carriers offered on the platform[126] Risk Management - The company is actively monitoring the impact of the COVID-19 outbreak on its financial condition and operations, although no material financial impact has been observed to date[148] Accounting and Valuation - The company recognizes contingent commissions based on achieving certain revenue or profit targets established by insurance carriers[164] - The company tests goodwill for impairment annually, with significant judgment involved in determining fair value[158] - The company estimates its provision for income taxes, which involves significant judgment and interpretations of regulations[161] - The company utilizes the Black-Scholes option valuation model to value employee stock options and awards granted under its employee stock purchase plan[166]