SEOUL, South Korea, May 8, 2018 /PRNewswire/ -- I-ON Communications, Ltd. ("I-ON") (OTCQB: ALES), www.i-on.net, a Seoul, South Korean based company global enterprise software company focused on delivering leading web CMS and unstructured data management products and solutions to mid and large-scale enterprises, reported its year end December 31, 2017 financial results today. The financial statements were filed as exhibits to I-ON's Current Report on Form 8-K filed with the SEC on May 7, 2018.
2017 Full Year Highlights
Total revenue came in at $9.2 million versus $9.2 million in 2016 and was composed predominantly of royalty, licensing and customized solutions and services. Major customers in 2017 included Korean Broadcasting System, Hyundai AutoEver, JoongAng Ilbo, Samsung, and the KPGA among many others. I-ON's top ten customer contribution approximated 52% of total revenue, consistent with recent trends. Gross income was $3.0 million versus $4.5 million in 2016 due partially to a shift in revenue mix and timing of new product launches, while operating expenses declined to $2.4 million from $3.5 million owing to less R&D to pivot more towards direct sales, marketing of newly launched products, and international expansion efforts. Operating income, as a result, came in at $586,679 versus $1.0 million in 2016 and comprehensive income was $766,803, in line with the prior year.
Healthy Balance Sheet
As of December 31, 2017, I-ON held total cash and equivalents of approximately $3.1 million, working capital of $6.7 million and total current assets of $8.6 million, a 14% year-over-year (y/y) increase. Total assets grew to $10.2 million from $9.2 million. Current liabilities grew slightly y/y to $1.9 million from $1.8 million, while long-term debt of $280,007 remained negligible and relatively unchanged. The Company also has available lines of credit with financial institutions for up to $3.7 million, of which there were no outstanding balances as of the end of 2017. Shareholders' equity increased 11.4% to $8.0 million from $7.1 million in 2016.
Since inception, I-ON has sold its solutions and services to over 1,000 mid to large sized public and private enterprises across numerous verticals, and now has over ten products at market that enable clients to create, measure, and optimizes digital experiences for their audiences across marketing channels and devices. The Company remains optimistic about the health of its business prospects based on existing engagements and initiatives taking hold, as well as the intermediate to long-term secular growth trends reflected across the digital marketing ecosystem.
As a result, I-ON is forecasting 2018 revenue to come in between $15-17 million, which assumes, as part of its stated strategy, the consummation of one acquisition by the end of the September 2018 and modest double digit organic growth. The Company is also implementing a plan to attain a revenue target of $25-30 million by the end of 2019, which would reflect an improving revenue mix and higher y/y gross and operating margins, above 40% and 15%, respectively.
Jae Cheol ("James") Oh, Chief Executive Officer of I-ON commented, "Having established a stable domestic foothold completed our public listing onto the OTCQB market, I-ON looks forward to the future. The Company will be more aggressively engaging with a broader addressable market and investor base while expanding our pipeline and making multiple new offerings available to our existing and future enterprise customers. We will also continue to opportunistically pursue acquisition and partnership opportunities in South Korea and Japan, as well as key markets across South East Asia, the U.K. and U.S."
"The enterprise CMS, digital marketing and unstructured data management arenas are worth billions annually and are rapidly evolving and growing at a double-digit growth rate globally, particularly across East Asia and other developed markets. We intend to capitalize on these tailwinds by rolling out or acquiring proprietary solutions that already meet the digital or mobile marketing needs of mid to large scale enterprises. Additionally, I-ON will continue to reinvest up to 15% of revenue annually into R&D, a team that comprises of over 100 full time developers and engineers"
I-ON filed an extension for its Annual Report on Form 10-K, The Company has changed its name to I-ON Communications Corp. and hopes to commence trading on the OTCQB under the new name and new symbol soon.
I-ON is a Seoul, South Korea-based enterprise software company founded in 1999. After being awarded its first of six patents by 2003, the Company has since evolved into an industry-leading and recognized developer of enterprise-class unstructured data management and digital marketing software solutions. I-ON has sold to over 1,000 mid to large clients across numerous verticals in both the private and public sectors, primarily throughout South Korea, Japan and Southeast Asia. The Company has 11 products at market that enable clients to create, measure, and optimizes digital experiences for their audiences across marketing channels and devices. These encompass enterprise web content management (CMS), web experience and service delivery software, digital marketing, smart mobility and analytics tools and energy management systems. I-ON's large R&D team has designed and developed industry-leading technologies that are compliant with global standards including GS (Good Software) and NET (New Excellent Technology), while holding numerous domestic and global industry awards and recognition from the likes of Gartner and Red Herring.
Forward Looking Statements
Statements in this document contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on many assumptions and estimates and are not guarantees of future performance. These statements may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Our actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation those set forth as "Risk Factors" in our filings with the Securities and Exchange Commission ("SEC"). There may be other factors not mentioned above or included in the Company's SEC filings that may cause actual results to differ materially from those projected in any forward-looking statement. The Company assumes no obligation to update any forward-looking statements as a result of new information, future events or developments, except as required by securities laws.
SM Lee/Byung Woo Yu
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