International Monetary Systems files 2nd Quarter Report

NEW BERLIN, Wis., Aug. 9, 2012 /PRNewswire/ -- International Monetary Systems, Ltd. (OTCBB: ITNM), a worldwide leader in business-to-business barter services, has filed its second quarter report on Form 10-Q.

HIGHLIGHTS

Operations

Revenue increased 5.5% in the first two quarters of 2012 compared to the same period in 2011.

Income from operations increased to $213,273 in the first half of 2012 compared to an operating loss of $(39,925) in the first half of 2011.

The Company has completed the sale of two franchise territories during the year. They are not expected to have a material affect on the Company's results of operations for the next twelve months.

Return to Shareholders

During the six months ended June 30, 2012, 793,351 shares of the Company's stock have been repurchased under the Company's stock buyback plan and stock buyback guarantees.

CURRENT QUARTER

During the quarter ended June 30, 2012 International Monetary Systems ("IMS" or "the Company") generated revenues of $3,390,078, an increase of $56,939 or 1.7 %, compared to the second quarter of 2011.

Operating expenses in the quarter were $3,188,978 an increase of $ 38,251 or 1.2% compared to the second quarter of 2011. This increase is primarily due to increased employee costs, including staff costs in offices acquired in 2011, higher variable compensation tied to higher revenue, and expansion of the Company's tele-selling staff.

The Company generated operating income of $201,100 for the second quarter, compared to $182,412 in 2011.After adjusting for interest and income taxes, the net income for the quarter was $98,647 compared to net income of $77,196 in the second quarter of 2012.Interest expense has increased as the Company services the increased debt load taken on strategically to fund the stock buyback program expanded in 2011.

EBITDA for the three months ended June 30, 2012 and 2011 were as follows:

Adjustments to Reconcile GAAP Net Income to EBITDA

2012

2011

Net (loss)

$

98,647

$

77,196

Interest expense

84,040

52,505

Income tax expense (benefit)

24,179

52,734

Depreciation and amortization

390,200

409,905

EBITDA

$

597,066

$

592,340

YEAR TO DATE

During the six months ended June 30, 2012 International Monetary Systems generated revenues of $6,656,857, an increase of $344,876 or 5.5 %, compared to the first six months of 2011. This is the result of a 6% increase in transactions processed, attributable in part to our 2011 acquisitions.

Operating expenses in the quarter were $6,443,584 an increase of $91,678 or 1.4% compared to the second quarter of 2011. This increase is primarily due to increased employee costs, including staff costs in offices acquired in 2011, higher variable compensation tied to higher revenue, and expansion of the Company's tele-selling staff.

The Company generated operating income of $213,273 year to date, compared to an operating loss of $(39,925) in 2011.After adjusting for interest and income taxes, the net income for the first six months of 2012 was $53,772 compared to a loss of $(107,359) for the same period in 2011.Interest expense has increased as the Company services the increased debt load taken on strategically to fund the stock buyback program expanded in 2011.

EBITDA for the six months ended June 30, 2012 and 2011 were as follows:

Adjustments to Reconcile GAAP Net Income to EBITDA

2012

2011

Net income (loss)

$

53,772

$

(107,359)

Interest expense

164,742

97,623

Income tax expense (benefit)

1,105

(30,047)

Depreciation and amortization

778,878

818,714

EBITDA

$

998,497

$

778,931

INTERNATIONAL MONETARY SYSTEMS, LTD.CONSOLIDATED BALANCE SHEETS

June 30,2012

December 31, 2011

(UNAUDITED)

ASSETS

Current assets

Cash

$

868,709

$

1,018,250

Restricted cash

-

206,956

Marketable securities

180,958

162,323

Accounts receivable, net

827,538

1,006,278

Earned trade account

388,244

210,582

Prepaid expenses

169,100

188,715

Total current assets

2,434,549

2,793,104

Other assets

Property and equipment, net

690,186

651,118

Membership lists and other intangibles, net

5,054,924

5,718,435

Goodwill

3,507,522

3,507,522

Assets held for investment

171,861

169,031

Total non-current assets

9,424,493

10,046,106

Total assets

$

11,859,042

$

12,839,210

LIABILITIES

Current liabilities

Accounts payable and accrued expenses

$

1,008,501

$

1,091,823

Credit lines, short term notes, and current portion of long term debt

1,173,491

1,009,897

Current portion of notes payable to related parties, including short term note

405,317

90,000

Common stock subject to guarantee

89,975

418,495

Total current liabilities

2,677,284

2,610,215

Long-term liabilities

Long term debt, net of current portion

2,429,324

2,159,434

Notes payablerelated parties, net of current portion

230,765

275,000

Deferred compensation

291,000

290,000

Deferred income taxes

833,581

1,015,325

Total long-term liabilities

3,784,670

3,739,759

Total liabilities

6,461,954

6,349,974

Commitments and Contingencies

STOCKHOLDERS' EQUITY

Preferred stock, $.0001 par value, 20,000,000 authorized, 0 outstanding

-

-

Common stock, $.0001 par value 280,000,000 authorized, and 8,107,020 and

8,097,020 issued and outstanding at June 30, 2012 and December 31, 2011 respectively

811

810

Paid in capital

9,472,306

9,137,003

Treasury stock, 699,383 shares at June 30, 2012 and 172,703 shares at December 31, 2011

(1,840,074)

(351,614)

Accumulated other comprehensive income

25,851

18,615

Accumulated deficit

(2,261,806)

(2,315,578)

Total stockholders' equity

5,397,088

6,489,236

Total liabilities and stockholders' equity

$

11,859,042

$

12,839,210

INTERNATIONAL MONETARY SYSTEMS, LTD.CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended

June 30,

Six Months Ended

June 30,

2012

2011

2012

2011

Net revenue

$

3,390,078

$

3,333,139

$

6,656,857

$

6,311,981

Operating expenses:

Employee costs

2,000,061

1,875,275

3,997,141

3,801,983

Selling, general and administrative

798,717

865,547

1,667,565

1,731,209

Depreciation and amortization

390,200

409,905

778,878

818,714

Total operating expenses

3,188,978

3,150,727

6,443,584

6,351,906

Income (loss) from operations

201,100

182,412

213,273

(39,925)

Other income (expense)

Interest income

94

23

674

142

Gain on sales of assets

5,672

--

5,672

--

Interest expense

(84,040)

(52,505)

(164,742)

(97,623)

Total other income (expense)

(78,274)

(52,482)

(158,396)

(97,481)

Income (loss) before income taxes

122,826

129,930

54,877

(137,406)

Income tax (expense) benefit

(24,179)

(52,734)

(1,105)

30,047

Net income (loss)

98,647

77,196

53,772

(107,359)

Components of comprehensive income (loss):

Foreign currency translation adjustment

(4,466)

1,802

(6,963)

6,567

Unrealized gain on available for sale securities

(7,331)

(370)

14,199

5,596

Comprehensive income (loss)

$

86,850

78,628

$

61,008

(95,196)

Net income (loss) per

common share basic

$

.01

$

.01

$

.01

$

(.01)

CONTACT: John Strabley, 1-800-559-8515

SOURCE International Monetary Systems, Ltd.