Transportation and Logistics Systems, Inc. Announces Financial Results for the First Quarter Ended March 31, 2021

Rhea-AI Summary

Transportation and Logistics Systems (TLSS) reported significant challenges for Q1 2021, with revenues falling 82.7% to $1,492,000 compared to $8,635,000 in 2020, primarily due to the termination of its Amazon DSP business. Despite this decline, the net loss attributable to common shareholders decreased to $3,099,000, an improvement from $22,149,000 in the previous year. The company completed two acquisitions in early 2021, indicating a strategy focused on rebuilding its revenue base and enhancing shareholder value.

Positive

• Successfully completed two acquisitions in January and March 2021.
• Net loss attributable to common shareholders decreased significantly from $22,149,000 to $3,099,000.

Negative

• Revenue decreased by 82.7%, falling from $8,635,000 to $1,492,000.
• Loss from operations totaled $1,636,000.

Q1 Highlighted by Two Acquisitions

JUPITER, FL / ACCESSWIRE / May 18, 2021 / Transportation and Logistics Systems, Inc. (OTC PINK:TLSS), ("TLSS", or the "Company"), an eCommerce fulfillment service provider, announced today that on May 17, 2021, it filed its Form 10-Q, Quarterly Report for the first quarter ended March 31, 2021.

John Mercadante, Chairman and CEO of TLSS, commented, "The first quarter of 2021 is indicative of the Company's continued positive progress since commencing its restructuring initiatives in mid-February 2020 and then navigating the termination of its unprofitable Amazon DSP business at the end of September 2020. The Company has started to rebuild its revenue base with two acquisitions completed in January and March of 2021. Moreover, we continue to evaluate and pursue opportunities that could further strengthen our balance sheet and profitably grow the business, with the goal of enhancing shareholder value."

Financial Results for the First Quarter Ended March 31, 2021

Revenue for the three months ended March 31, 2021 decreased $7,143,000, or 82.7%, to $1,492,000, as compared to $8,635,000, for the same period in 2021. Such decrease was due primarily to the termination of the Company's former Amazon Delivery Service Provider ("DSP") business as of September 30, 2020.

The Company generated a net loss attributable to common shareholders for the three months ended March 31, 2021 of $3,099,000, as compared to a net loss attributable to common shareholders of $22,149,000 for the same period last year. This quarter's results were comprised of: (i) a loss from operations of $1,636,000; (ii) interest expense of $106,000; (iii) non-cash derivative expense of $695,000; and (iv) non-cash deemed dividend related to ratchet adjustment, beneficial conversion features, and accrued dividends of $830,000; and which were partially offset by: (i) other income $108,000 and (ii) gain from extinguishment of debt of $60,000.

About Transportation and Logistics Systems, Inc.

TLSS, through its wholly-owned operating subsidiaries, Shypdirect LLC, Shyp FX, Inc. and Cougar Express, Inc., operates as a full-service logistics and transportation company.

For more information, visit the Company's website, www.tlss-inc.com.

Forward Looking Statements

Statements in this press release regarding the Company that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause actual future events or results to differ materially from such statements. Any such forward-looking statements, including, but not limited to, financial guidance, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not directly or exclusively relate to historical facts. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "could," "would," "expects," "plans," "anticipates," "intend," "plan," "goal," "seek," "strategy," "future," "likely," "believes," "estimates," "projects," "forecasts," "predicts," "potential," or the negative of those terms, and similar expressions and comparable terminology. These include, but are not limited to, statements relating to future events or our future financial and operating results, plans, objectives, expectations and intentions. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these expectations may not be achieved. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to known and unknown risks, uncertainties and other factors outside of our control that could cause our actual results, performance or achievement to differ materially from those expressed or implied by these forward-looking statements. In addition to the risks described above, these risks and uncertainties include: our ability to successfully execute our business strategies, including integration of acquisitions and the future acquisition of other businesses to grow our company; customers' cancellation on short notice of master service agreements from which we derive a significant portion of our revenue or our failure to renew such master service agreements on favorable terms or at all; our ability to attract and retain key personnel and skilled labor to meet the requirements of our labor-intensive business or labor difficulties which could have an effect on our ability to bid for and successfully complete contracts; the ultimate geographic spread, duration and severity of the coronavirus outbreak and the effectiveness of actions taken, or actions that may be taken, by governmental authorities to contain the outbreak or ameliorate its effects; our failure to compete effectively in our highly competitive industry could reduce the number of new contracts awarded to us or adversely affect our market share and harm our financial performance; our ability to adopt and master new technologies and adjust certain fixed costs and expenses to adapt to our industry's and customers' evolving demands; our history of losses, deficiency in working capital and a stockholders' deficit and our ability to achieve sustained profitability; material weaknesses in our internal control over financial reporting and our ability to maintain effective controls over financial reporting in the future; our substantial indebtedness could adversely affect our business, financial condition and results of operations and our ability to meet our payment obligations; the impact of new or changed laws, regulations or other industry standards that could adversely affect our ability to conduct our business; and changes in general market, economic and political conditions in the United States and global economies or financial markets, including those resulting from natural or man-made disasters.

These forward-looking statements represent our estimates and assumptions only as of the date of this release and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this letter. Given these uncertainties, you should not place undue reliance on these forward-looking statements and should consider various factors, including the risks described, among other places, in our most recent Annual Report on Form 10-K and in our Quarterly Reports on Form 10-Q, as well as any amendments thereto, filed with the Securities and Exchange Commission.

Investor Relations Contact:

Phone: 833.764.1443
Email: info@tlss-inc.com

TRANSPORTATION AND LOGISTICS SYSTEMS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

		March 31,				December 31,
		2021				2020
		(Unaudited)
ASSETS
CURRENT ASSETS:
Cash		$	662,914			$	579,283
Accounts receivable, net			473,752				372,922
Prepaid expenses and other current assets			202,038				443,410
Total Current Assets			1,338,704				1,395,615
OTHER ASSETS:
Security deposit			135,340				94,000
Other receivable			622,240				-
Property and equipment, net			805,842				598,807
Intangible assets, net			2,604,782				-
Right of use assets, net			1,392,367				1,445,274
Total Other Assets			5,560,571				2,138,081
TOTAL ASSETS		$	6,899,275			$	3,533,696
LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES:
Convertible notes payable, net of put premium of $0 and $0 and debt discounts of $64,535 and $83,548, respectively		$	828,229			$	979,216
Notes payable, current portion, net of debt discount of $0 and $0, respectively			5,344,048				3,919,544
Note payable - related party			500,000				500,000
Accounts payable			1,468,474				1,104,263
Accrued expenses			708,498				424,595
Insurance payable			1,773,562				1,985,893
Contingency liabilities			3,311,272				3,311,272
Lease liabilities, current portion			400,102				380,843
Derivative liability			4,876,170				4,181,187
Due to related parties			195,884				297,692
Accrued compensation and related benefits			900,510				922,396
Total Current Liabilities			20,306,749				18,006,901
LONG-TERM LIABILITIES:
Notes payable, net of current portion			467,434				437,594
Lease liabilities, net of current portion			1,032,014				1,102,617
Total Long-term Liabilities			1,499,448				1,540,211
Total Liabilities			21,806,197				19,547,112
Commitments and Contingencies (See Note 10)
SHAREHOLDERS' DEFICIT:
Preferred stock, par value $0.001; authorized 10,000,000 shares:
Series B convertible preferred stock, par value $0.001 per share; 1,700,000 shares designated; 700,000 and 700,000 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively (Liquidation value $700 and $700, respectively)			700				700
Series D preferred stock, par value $0.001 per share; 1,250,000 shares designated; no shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively ($6.00 per share liquidation value)			-				-
Series E preferred stock, par value $0.001 per share; 562,250 shares designated; 416,370 and 105,378 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively ($13.34 per share liquidation value)			416				105
Common stock, par value $0.001 per share; 10,000,000,000 shares authorized; 1,749,302,040 and 1,733,847,494 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively			1,749,302				1,733,848
Additional paid-in capital			109,062,736				104,872,991
Accumulated deficit			(125,720,076	)			(122,621,060	)
Total Shareholders' Deficit			(14,906,922	)			(16,013,416	)
Total Liabilities and Shareholders' Deficit		$	6,899,275			$	3,533,696

TRANSPORTATION AND LOGISTICS SYSTEMS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

		For the Three Months Ended
		March 31,
		2021				2020
REVENUES		$	1,491,699			$	8,635,060
COST OF REVENUES			1,898,778				7,855,749
GROSS PROFIT (LOSS)			(407,079	)			779,311
OPERATING EXPENSES:
Compensation and related benefits			368,609				742,045
Legal and professional fees			530,538				414,810
Rent			133,955				164,350
General and administrative expenses			196,203				245,283
Total Operating Expenses			1,229,305				1,566,488
LOSS FROM OPERATIONS			(1,636,384	)			(787,177	)
OTHER (EXPENSES) INCOME:
Interest expense			(83,509	)			(3,046,727	)
Interest expense - related parties			(22,192	)			(107,138	)
Gain on debt extinguishment, net			59,853				275,034
Other income			108,035				67,831
Derivative (expense) income, net			(694,983	)			144,839
Total Other (Expenses) Income			(632,796	)			(2,666,161	)
LOSS BEFORE INCOME TAXES			(2,269,180	)			(3,453,338	)
Provision for income taxes			-				-
							.
NET LOSS			(2,269,180	)			(3,453,338	)
Deemed dividends related to ratchet adjustment, beneficial conversion features, and accrued dividends			(829,836	)			(18,696,012	)
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS		$	(3,099,016	)		$	(22,149,350	)
NET LOSS PER COMMON SHARE - BASIC AND DILUTED		$	(0.00	)		$	(1.79	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted			1,747,413,151				12,353,129

TRANSPORTATION AND LOGISTICS SYSTEMS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		For the Three Months Ended
		March 31,
		2021				2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(2,269,180	)		$	(3,453,338	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense			85,760				14,188
Amortization of debt discount to interest expense			19,013				1,359,388
Stock-based compensation and consulting fees			-				31,250
Interest expense related to debt default added to principal			-				1,387,785
Derivative expense, net			694,983				(144,839	)
Non-cash portion of gain on extinguishment of debt, net			(59,853	)			(327,584	)
Rent expense			1,563				5,571
Change in operating assets and liabilities:
Accounts receivable			164,345				(99,454	)
Prepaid expenses and other current assets			248,906				819,161
Security deposit			(8,000	)			(124,750	)
Accounts payable and accrued expenses			350,348				796,036
Insurance payable			(212,331	)			(661,668	)
Accrued compensation and related benefits			(21,886	)			288,180
NET CASH USED IN OPERATING ACTIVITIES			(1,006,332	)			(110,074	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment			-				(460,510	)
Cash acquired in acquisition			10,031				-
Cash used for acquisitions			(2,133,146	)			-
NET CASH USED IN INVESTING ACTIVITIES			(2,123,115	)			(460,510	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from sale of series E preferred share units			3,258,000				-
Proceeds from convertible notes payable			-				1,860,000
Repayment of convertible notes payable			-				(159,988	)
Net proceeds from notes payable			-				1,033,510
Repayment of notes payable			(37,114	)			(2,124,777	)
Net payments on related party advances			(7,808	)			(55,561	)
NET CASH PROVIDED BY FINANCING ACTIVITIES			3,213,078				553,184
NET INCREASE (DECREASE) IN CASH			83,631				(17,400	)
CASH, beginning of period			579,283				50,026
CASH, end of period		$	662,914			$	32,626
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for:
Interest		$	33,415			$	741,627
Income taxes		$	-			$	-
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Debt discounts recorded		$	-			$	262,893
Increase in derivative liability and debt discount		$	-			$	1,267,473
Conversion of debt and accrued interest for common stock		$	170,000			$	341,518
Reclassification of accrued interest to debt		$	-			$	80,155
Reclassification of due to related parties to accrued expenses		$	94,000			$	-
Decrease in put premium and paid-in capital		$	-			$	73,725
Reclassification of warrant value from equity to derivative liabilities		$	-			$	11,381,885
Deemed dividend related to price protection and beneficial conversion features		$	777,510			$	18,696,012
ACQUISITIONS:
Assets acquired:
Accounts receivable		$	265,175			$	-
Prepaid expenses			7,534				-
Property and equipment			257,416				-
Right of use assets			44,388				-
Other receivable			622,240				-
Security deposits			33,340				-
Total assets acquired			1,230,093				-
Less: liabilities assumed:
Accounts payable			132,155				-
Accrued expenses			79,138				-
Notes payable			1,491,458				-
Lease liabilities			44,388				-
Total liabilities assumed			1,747,139
Increase in intangible assets - non-cash		$	517,046			$	-

SOURCE: Transportation & Logistics Systems

View source version on accesswire.com:
https://www.accesswire.com/647626/Transportation-and-Logistics-Systems-Inc-Announces-Financial-Results-for-the-First-Quarter-Ended-March-31-2021

FAQ

What were the Q1 2021 financial results for TLSS?

In Q1 2021, TLSS reported revenues of $1,492,000, a decrease of 82.7% from $8,635,000 in Q1 2020.

What caused the revenue decline for TLSS in Q1 2021?

The revenue decline was primarily due to the termination of TLSS's Amazon Delivery Service Provider business as of September 30, 2020.

How did TLSS's net loss change in Q1 2021?

TLSS's net loss attributable to common shareholders decreased from $22,149,000 in Q1 2020 to $3,099,000 in Q1 2021.

What acquisitions did TLSS complete in early 2021?

TLSS completed two acquisitions in January and March 2021 as part of its restructuring initiatives.