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Nov. 21, 2019, 9:30 a.m. EST

UnitedCorp Releases Q3 2019 Financial Results

MIAMI, Nov 21, 2019 (GLOBE NEWSWIRE via COMTEX) -- MIAMI, Nov. 21, 2019 (GLOBE NEWSWIRE) -- via OTC PR WIRE - On November 15, 2019, Miami-based United American Corp. ("UnitedCorp" or the "Company") (OTC: UAMA) released the financial results of its third quarter ended September 30, 2019. It also provided corporate updates regarding regulatory, legal and operational matters.

UnitedCorp reported positive results for the third quarter of 2019 including revenues of US $1.2 million, consolidated net earnings of $223,715 and consolidated EBITDA of $358,723. Revenues accrued are exclusively from its Canadian subsidiary, which owns and operates its Data Center Dome Heat Stations and also provides technical and management consulting services.

2019 Q3 Highlights
(all figures in US dollars)

  • Revenue in the quarter of $1,230,910 was primarily generated through the Data Center Dome Heat Stations for hosting, management and power and includes $20,033 of consulting revenue with an operating profit of $509,076 [ (1)] , with heat station operations contributing $489,043 to the operating profit

  • Consolidated net earnings for the quarter were $223,715

  • Consolidated EBITDA for the period of $358,723 [(2)]

  • Consolidated EBITDA for the 9-month period of $1,289,705

  • Increase in tangible assets to $4,860,429

  • 5,650 servers in service at (8.5 megawatts) with 24.5M BTU of heat generated per hour
    [(1)] Operating profit is a non-IFRS measure. Since the Company bills in advance for services and pays its main direct costs in arrears, gross profit as a percentage of revenue may be higher during the growth cycles.
    [(2)] EBITDA is a non-IFRS measure

Financial Review

3 months ended
Annualyear end
(US$)
September 30, 2019 June 30, 2019 March 31, 2019 Dec 31, 2018
Total Revenue $ 1,230,910 $ 1,425,382 $ 1,423,485 $ 1,703,259
Cost of Revenue 721,833 473,900 568,802 911,574
Gross Profit 509,076 951,482 854,684 791,685
General Expenses 150,353 394,059 215,559 451,843
Financial Expenses 44,597 33,693 42,130 37,363
Depreciation 71,326 71,697 58,963 52,786
Foreign Exchange 19,085 (18,796 ) 149,618 -
Net Income 223,715 470,653 388,414 249,693
EBITDA 358,723 557,423 639,125 339,842

While the Company will continue to develop its Data Center Heat Station business in 2019 as a primary source of revenue, it will also continue to develop its business in other strategic areas.

Financial Statements

The Company's financial statements are available at www.otcmarkets.com under UnitedCorp's profile.

United American Corp versus Bitmain et al.

Further to the litigation announced on December 6, 2018 against Bitmain, Bitcoin.com, Roger Ver, Kraken Bitcoin Exchange and others, Alleging Hijacking of the Bitcoin Cash Network, the Company has now served most of the defendants including those in China and Japan. The Company is also awaiting the outcome of a motion by some defendants to dismiss the action in its entirety.

United American Corp versus SNAP Inc. (SnapChat)

On June 28, 2017 UnitedCorp acquired all rights to Canadian and US patents on a technology known as iFramed from Investel Capital Corporation (Canada) ("Investel") and iFramed Canada Inc. As part of this rights transfer the Company assumed responsibility for a patent infringement suit originally launched by Investel on August 23, 2016 against Snap Inc. in the Federal Court of Canada. The suit claims amongst other things, that SnapChat's "geofilters" which use the geolocation of social media users in order to provide on demand insertion of external content in the form of a frame or overlay on pictures or videos, infringes upon several claims held by the iFramed patent. Continuation of this suit had been delayed due to administrative matters related to Investel, most of which have been resolved. The Company therefore intends to move forward with the action in the immediate future.

TNW Networks

On June 30, 2017, the Company announced the intent to acquire TNW Networks Corp. ("TNW Networks"). The potential acquisition of TNW Networks' assets is deemed by Management to support the Company's development plan, including TNW Wireless and iFramed. The Company was aware that on November 18, 2016, two of TNW Networks' clients (the "Petitioners") filed a Notice of Intention to make a Proposal pursuant to the Bankruptcy and Insolvency Act. This led to proceedings under the Companies' Creditors Arrangement Act (the "Proceedings") on November 25, 2016.

As a result of the Proceedings, certain of TNW client relationships and 3 [rd] party assets, both of which TNW Networks and the Company believe were not assets of the Petitioners, were nevertheless claimed in the Proceedings by the CCAA Monitor. In two instances during the course of the Proceedings, the determination of ownership by the Monitor was appealed to the British Columbia Court of Appeal and in both instances the Court of Appeal ruled unanimously against the Monitor. On March 18, 2019, a portion of certain 3 [rd] party assets were released by the Monitor and will be transferred to the Company. The exact list and value of such assets is currently being determined.

On April 23, 2019, the British Columbia Court of Appeal granted yet a third leave to appeal related to determination of ownership of the balance of assets in question. The appeal was heard on October 15 and 16, 2019 and the Company is currently awaiting the Court's ruling.

CPTAQ Matter

In April 2018, the Company's then landlord received a Notice of Infraction from the Commission de Protection du Territoire Agricole de Quebec ("CPTAQ"), the provincial body which oversees agricultural land in Quebec, related to its Data Center Domes Heat Campus #1. The Notice questioned whether the Data Center Domes Heat Station was an appropriate use of agricultural land, as based on their perception the Data Center Domes Heat Station was a non-agricultural commercial operation. On June 27, 2018, the Company and its legal counsel addressed the complaint at a hearing of the CPTAQ and stated its position that the operation was fully compliant with all existing rules and regulations, as the operation's final output was for agricultural purposes. Furthermore, the Data Center Domes Heat Station is consistent with the province's sustainable development guidelines and policies of encouraging more local food production.

The matter was then transferred to an independent provincial administrative tribunal for further review. Subsequently on March 26, 2019, the Company, its Counsel and its agricultural experts addressed the Tribunal Administratif du Quebec (the "Tribunal") at a hearing on this matter. The Tribunal is an independent provincial body which is intended to be a non-judicial arbitrator for matters regarding provincial boards. The Tribunal has no judicial or injunctive powers and decisions are appealable by companies and individuals to judicial courts up to and including the Quebec Court of Appeal.

On April 25, 2019 the Company received notification that the Tribunal had rejected the Company's position and supported the CPTAQ complaint. The Company and its Counsel believe that the Tribunal erred both in fact and in law in rendering its decision and as such on May 15, 2019, the Company filed for permission to appeal the decision to the Quebec Court and this proceeding was heard on August 15, 2019. On November 11, 2019 the Company received notification that leave to appeal had been denied. As a result, the Company has begun the process of seeking a judicial review of the decision. On a parallel track, the Company has filed for formal authorization of its heat stations with the CPTAQ.

The Company remains of the opinion that Data Center Dome Heat Stations are a permitted use. Should the original infraction be maintained after judicial review and subsequently if a formal application is denied, the Company would incur significant costs to move the BlockchainDome Heat Stations and related equipment to another location.

Retirement of Joseph Cote

On November 15, 2019, Joseph Cote, announced his long-awaited retirement and submitted his resignation as Chair of United American Corp. The Company's President, Benoit Laliberte stated "We would like to thank Joseph for all his support and guidance over the last few years. His valuable insights and infectious smile will be missed by all of us."

The Company intends to appoint a new Chair in the near future.

About United American Corp

Established in 1992, United American Corp is a Florida-based development and management company focusing on telecommunications and information technologies. The company currently owns telecommunications assets and holds the rights to manage a portfolio of patents and proprietary technology in telecommunications, social media and Blockchain technology, and owns and operates the Data Center Domes which are designed to provide heat for agricultural operations using computer equipment in naturally cooled data centers where efficiency and low-cost operations are a priority.

This news release contains forward-looking statements that are subject to various risks and uncertainties. The Company's actual results could differ materially from those anticipated in such forward-looking statements as a result of numerous factors that may be beyond the Company's control. Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made, and the Company assumes no obligation to update forward-looking statements should circumstances in management's expectations or opinions change.

Source:
United American Corp
Contact:
Jenna Trevor-Deutsch
Investor Relations
investorrelations@unitedcorp.com

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