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Trusted by 40% of Fortune 1000
VALLEY COTTAGE, NY—May 14, 2024 – CreditRiskMonitor (OTCQX:CRMZ) reported operating revenues of $4.8 million, an increase of approximately $218 thousand or 5%, for the first quarter of fiscal 2024 compared to the same period of fiscal 2023. The Company reported pre-tax income of approximately $166 thousand, a decrease of approximately $189 thousand, for the first quarter of fiscal 2024 compared to the same period of fiscal 2023. The decrease in pre-tax profitability was primarily driven by increased expenses related to employee salaries, employee benefits, commissions, and third-party content due to inflation.
Mike Flum, CEO, said, “Our reduced operating income for the first quarter of 2024 reflects the increased investments we have made in new data, technology development, marketing, and employee upskilling to support larger revenue growth. We remain committed to staying marginally profitable while pursuing this goal; however, these operational improvements are more important to our long-term profitability and valuation than short-term cost management.
We continue to experience improved demand for our products due to rising corporate bankruptcies worldwide and mounting geopolitical risk. While financial risk may not currently be at the top of the list for supply chain concerns, we are increasingly hearing about how corporate bankruptcies in the European market are creating disruptions for clients and prospects. Given the massive debt loads, stubborn inflation, and demographic challenges facing much of the Western World coupled with deflationary movements in China, we expect the trend to continue and potentially accelerate. Additionally, with mounting trade tensions and expanding tariff discussions between the West and China, we expect global trade disruptions to become the norm versus the exception.
The early feedback from clients and prospects on our new Confidential Financial Statement Solution has confirmed its product-market fit in addressing the financial risk of unscored private companies. Removing the data entry requirements while ensuring the integrity of resulting standardized statements and risk scores has resonated for both credit and supply chain users. Customers also appreciate our innovative pricing model that only charges them when they receive a risk score, a clear example of our commitment to providing value in excess of cost. We expect to have significant interest from the credit community at the National Association of Credit Management (NACM) Credit Congress in June in line with what we experienced from the supply chain professionals at the recent Institute for Supply Management (ISM) World conference.”
A full copy of the financial statements can be found at https://crmz.ir.edgar-online.com/.
Overview
CreditRiskMonitor.com, Inc. (creditriskmonitor.com) sells a suite of web-based, SaaS subscription products providing access to comprehensive commercial credit reports, bankruptcy risk analytics, financial and payment information, and curated news on public and private companies worldwide. Our primary SaaS subscription products for analyzing commercial financial risk are CreditRiskMonitor® and SupplyChainMonitor™. These products help corporate credit and procurement professionals stay ahead of and manage financial risk more quickly, accurately, and cost-effectively. Our subscribers include nearly 40% of the Fortune 1000 and well over a thousand other large corporations worldwide.
To help subscribers prioritize and monitor counterparty financial risk, our SaaS platforms offer the proprietary FRISK® and PAYCE® Scores as well as the FAST Rating, the well-known Altman Z”-Score, agency ratings from key Nationally Recognized Statistical Rating Organizations (“NRSROs”), curated news, and detailed financial spreads & ratios. Our FRISK® and PAYCE® Scores are financial distress classification models that measure a business’s probability of bankruptcy within a year. The FRISK® score also includes a risk signal based on the aggregate research behaviors of our subscribers, who control counterparty access to trade credit at some of the most sophisticated companies in the world. The inclusion of this risk signal boosts the overall accuracy of this bankruptcy analytic by lowering the false positive rate for the riskiest corporations.
Through its Trade Contributor Program, the Company receives monthly confidential accounts receivables data from hundreds of subscribers and non-subscribers, which it parses, processes, aggregates, and reports to summarize the invoice payment behavior of B2B counterparties without disclosing the specific contributors of this information. The size of the Trade Contributor Program’s current annualized trade credit transaction data is approximately $3 trillion.
Safe Harbor Statement
Certain statements in this press release, including statements prefaced by the words “anticipates”, “estimates”, “believes”, “expects” or words of similar meaning, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include details of the accounting restatement, the expected impact of the accounting restatement and the remediation of the related material weakness in internal control over financial reporting. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, expectations or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, including, among others, those risks, uncertainties and factors referenced from time to time as “risk factors” or otherwise in the Company’s Registration Statements or Securities and Exchange Commission Reports. There can be no assurance that (i) the consequences of the Company’s restated results will be as anticipated above and (ii) the Company will be able to promptly and efficiently implement the appropriate remediation steps into its financial reporting. We disclaim any intention or obligation to revise any forward-looking statements, whether as a result of new information, a future event, or otherwise.
Contact
CreditRiskMonitor.com, Inc.
Mike Flum, Chief Executive Officer
(845) 230-3037
ir@creditriskmonitor.com
