Exhibit 99.1

 

Data Storage Corporation Reports Record Revenue of $25 Million and
Achieves Profitability for the 2023 Fiscal Year

 

MELVILLE, N.Y., March 28, 2024 (GLOBE NEWSWIRE) — Data Storage Corporation (Nasdaq: DTST) (“DSC” and the “Company”), a provider of diverse business continuity solutions for disaster-recovery, cloud infrastructure, cyber-security, and IT services, today provided a business update and reported financial results for the year ended December 31, 2023.

 

Chuck Piluso, CEO of Data Storage Corporation, stated, “We are proud to report record revenue of $25.0 million for the 2023 fiscal year which we believe is a direct result of the strategic growth initiatives we implemented throughout the year. Through our innovative marketing programs and highly attended events, we had continued success in securing one time equipment sales, however, our primary emphasis has been on our recurring subscription based services, which increased 17% over the prior year. Notably, gross profit grew 18.5% with gross profit margin increasing to 38.4% in 2023 from 33.9% in 2022—validating that our strategies are working. Importantly, we achieved profitability for the 2023 fiscal year and anticipate that as our revenue continues to grow, we will witness continued improvement in both our margins and overall profitability in 2024 and beyond.”

 

“We are witnessing strong contract momentum as evidenced by the several contract announcements made throughout the year. Specifically, we secured contracts with new clients as well as expanded relationships with existing clients, which we believe demonstrates our ability to meet the evolving needs of our clients. Furthermore, our newly implemented sales and marketing program is proving effective and strategically complements our Major Accounts Program, where we are capitalizing on the vast opportunities for upselling and cross-selling of our products and services.”

 

“We believe that by executing and advancing our growth strategies, including the CloudFirst and Flagship merger, as well as expanding distribution channels, enhancing digital and direct marketing efforts, refining lead generation processes, and investigating strategic M&A prospects, we can sustainably boost revenue and optimize long-term profitability. At the same time, we have preserved a strong balance with over $12.7 million in cash and marketable securities as of December 31, 2023. Overall, we believe we are at an inflection point where we are well positioned to further establish our leadership and capitalize on the vast and growing multibillion-dollar market opportunities our services address within the disaster-recovery, cloud infrastructure, cyber-security, and IT markets.”

 

Conference Call

 

The Company plans to host a conference call at 11:00 am ET today, to discuss the Company’s financial results for the 2023 fiscal year ended December 31, 2023, as well as corporate progress and other developments.

 

The conference call will be available via telephone by dialing toll-free 877-451-6152 for U.S. callers or for international callers +1-201-389-0879. A webcast of the call may be accessed at  https://viavid.webcasts.com/starthere.jsp?ei=1654217&tp_key=1962ffb408, or on the Company’s News & Events section of the website,  www.dtst.com/news-events.

 

A webcast replay of the call will be available on the Company’s website (www.dtst.com/news-events) through March 28, 2025. A telephone replay of the call will be available approximately three hours following the call, through April 4, 2024, and can be accessed by dialing 844-512-2921 for U.S. callers or + 1-412-317-6671 for international callers and entering conference ID: 13744138. 

 

 

 

 

About Data Storage Corporation

Data Storage Corporation (Nasdaq: DTST) is a family of fully integrated cloud-hosting, disaster-recovery, cyber security, and voice & data companies, built around technical asset investments in multiple regions, providing services to a broad range of domestic and global customers, including Fortune 500 clients, across a wide range of industries, such as government, education, and healthcare, with a focus on the rapidly growing, multi-billion-dollar business continuity market. A stable and emerging growth leader in cloud infrastructure support, DTST companies operate regional data center facilities across North America, sustainably servicing clients via recurring subscription agreements. Additional information about the Company is available at: www.dtst.com and on Twitter (@DataStorageCorp).

 

Safe Harbor Provision

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, that are intended to be covered by the safe harbor created thereby. Forward-looking statements are subject to risks and uncertainties that could cause actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. The forward looking statements in this press release include statements such as reporting record revenue of $25.0 million for the 2023 fiscal year being a direct result of the strategic growth initiatives the Company implemented throughout the year, witnessing continued improvement in both the Company’s margins and overall profitability in 2024 and beyond as revenue continues to grow, capitalizing on the vast opportunities for upselling and cross-selling of the Company’s products and services, sustainably boosting revenue and optimizing long-term profitability by executing and advancing the Company’s growth strategies, including the CloudFirst and Flagship merger, as well as expanding distribution channels, enhancing digital and direct marketing efforts, refining lead generation processes, and investigating strategic M&A prospects and being at an inflection point where the Company is well positioned to further establish its leadership and capitalize on the vast and growing multibillion-dollar market opportunities its services address within the disaster-recovery, cloud infrastructure, cyber-security, and IT markets. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can provide no assurance that such expectations will prove to have been correct. These forward-looking statements are based on management’s expectations and assumptions as of the date of this press release and are subject to a number of risks and uncertainties, many of which are difficult to predict that could cause actual results to differ materially from current expectations and assumptions from those set forth or implied by any forward-looking statements. Important factors that could cause actual results to differ materially from current expectations include the Company’s ability to continue to grow its subscription-based services and the Company’s ability to execute and advance its growth strategies. These risks should not be construed as exhaustive and should be read together with the other cautionary statements included in the Company’s Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it was initially made. Except as required by law, the Company assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or otherwise.

 

Contact:
Crescendo Communications, LLC
212-671-1020
DTST@crescendo-ir.com

 

 

[Tables to Follow]

 

 

 

 

CONSOLIDATED BALANCE SHEETS

 

   December 31, 2023  December 31, 2022
ASSETS          
Current Assets:          
Cash and cash equivalents  $1,428,730   $2,286,722 
Accounts receivable (less allowance for credit losses of $7,915 and $27,250 in 2023 and 2022, respectively)   1,259,972    3,502,836 
 Marketable securities   11,318,196    9,010,968 
Prepaid expenses and other current assets   513,175    584,666 
Total Current Assets   14,520,073    15,385,192 
           
Property and Equipment:          
Property and equipment   7,838,225    7,168,488 
Less—Accumulated depreciation   (5,105,451)   (4,956,698)
Net Property and Equipment   2,732,774    2,211,790 
           
Other Assets:          
 Goodwill   4,238,671    4,238,671 
 Operating lease right-of-use assets   62,981    226,501 
 Other assets   48,436    48,437 
 Intangible assets, net   1,698,084    1,975,644 
Total Other Assets   6,048,172    6,489,253 
           
Total Assets  $23,301,019   $24,086,235 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
Current Liabilities:          
Accounts payable and accrued expenses  $2,608,938   $3,207,577 
Deferred revenue   336,201    281,060 
Finance leases payable   263,600    359,868 
Finance leases payable related party   235,944    520,623 
Operating lease liabilities short term   63,983    160,657 
Total Current Liabilities   3,508,666    4,529,785 
           
 Operating lease liabilities       71,772 
Finance leases payable   17,641    281,242 
Finance leases payable related party   20,297    256,241 
Total Long-Term Liabilities   37,938    609,255 
           
Total Liabilities   3,546,604    5,139,040 
           
Commitments and contingencies (Note 7)          
           
Stockholders’ Equity:          
Preferred stock, Series A par value $.001; 10,000,000 shares authorized;0 shares issued and outstanding in 2023 and 2022        
Common stock, par value $.001; 250,000,000 shares authorized; 6,880,460 and 6,822,127 shares issued and outstanding in 2023 and 2022, respectively   6,881    6,822 
Additional paid in capital   39,490,285    38,982,440 
Accumulated deficit   (19,505,803)   (19,887,378)
Total Data Storage Corp Stockholders’ Equity   19,991,363    19,101,884 
Non-controlling interest in consolidated subsidiary   (236,948)   (154,689)
Total Stockholder’s Equity   19,754,415    18,947,195 
Total Liabilities and Stockholders’ Equity  $23,301,019   $24,086,235 

 

 

 

 

DATA STORAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

 

   Year Ended December 31,
   2023  2022
       
Sales  $24,959,576   $23,870,837 
           
Cost of sales   15,383,251    15,787,544 
           
Gross Profit   9,576,325    8,083,293 
           
Impairment of goodwill       2,322,000 
Selling, general and administrative   9,744,736    9,837,308 
           
Loss from Operations   (168,411)   (4,076,015)
           
Other Income (Expense)          
Interest income   542,229    10,969 
Interest expense   (74,502)   (141,056)
Impairment of deferred offering costs and financing costs associated with canceled financing efforts       (127,343)
Other expense       (75,418)
Total Other Income (Expense)   467,727    (332,848)
           
Income (Loss) before provision for income taxes   299,316    (4,408,863)
           
Provision from (Benefit from) income taxes        
           
Net Income (Loss)   299,316    (4,408,863)
           
Loss in Non-controlling interest in consolidated subsidiary   82,259    52,061 
           
Net Income (Loss) Attributable to Common Stockholders  $381,575   $(4,356,802)
           
Earnings (loss) per Share – Basic  $0.06   $(0.64)
Earnings (loss) per Share – Diluted  $0.05   $(0.64)
Weighted Average Number of Shares – Basic   6,841,094    6,775,140 
Weighted Average Number of Shares – Diluted   7,215,069    6,775,140 

 

 

 

 

 DATA STORAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS 

 

   Year Ended December 31,
   2023  2022
Cash Flows from Operating Activities:          
Net income (loss)  $299,316   $(4,408,863)
Adjustments to reconcile net income to net cash provided by operating activities:          
Depreciation and amortization   1,301,594    1,225,911 
Stock based compensation   506,205    734,479 
Impairment of deferred offering costs and financing costs associated with canceled financing efforts       127,343 
Impairment of goodwill       2,322,000 
Changes in Assets and Liabilities:          
Accounts receivable   2,242,864    (1,118,469)
Other assets       54,788 
Prepaid expenses and other current assets   71,491    (48,265)
Right of use asset   163,520    195,817 
Accounts payable and accrued expenses   (598,638)   1,864,188 
Deferred revenue   55,141    (85,799)
Operating lease liability   (168,446)   (199,329)
Net Cash Provided by Operating Activities   3,873,047    663,801 
Cash Flows from Investing Activities:          
Capital expenditures   (1,545,017)   (127,257)
Purchase of marketable securities   (2,307,228)   (9,010,968)
Net Cash Used in Investing Activities   (3,852,245)   (9,138,225)
Cash Flows from Financing Activities:          
Repayments of finance lease obligations related party   (520,624)   (867,741)
Repayments of finance lease obligations   (359,869)   (386,509)
Payments for deferred offering costs       (127,341)
Cash received for the exercise of stock options   1,699    6,934 
Net Cash Used in Financing Activities   (878,794)   (1,374,657)
           
Decrease in Cash and Cash Equivalents   (857,992)   (9,849,081)
           
Cash and Cash Equivalents, Beginning of Period   2,286,722    12,135,803 
           
Cash and Cash Equivalents, End of Period  $1,428,730   $2,286,722 
Supplemental Disclosures:          
Cash paid for interest  $65,057   $127,871 
Cash paid for income taxes  $   $ 
Non-cash investing and financing activities:          
Assets acquired by finance lease  $   $1,094,051