Halitron, Inc. (OTC Pink: HAON)’s roll-up, equity investment business model has proven to be successful during 2015, demonstrated by its $1.2 million revenue, and now the company looks to continue building upon that success in 2016. Back in February 2015, Halitron, Inc. (OTC Pink: HAON)’s CEO Bernard Findley acquired the assets of a distressed iDealFurniture LLC at very cheap cost. From that point forward, Halitron, Inc. (OTC Pink: HAON) was able to implement its low-overhead, marketing-based approach and soon was able to turn the business around, before exiting the business in December 2015. While the turnaround of iDealFurniture LLC was successful and short-lived, Findley did not believe the business had the best opportunity over the long term and was able to profitably exit the position to allocate capital to more niche ventures.
Along with iDealFurniture LLC, Halitron, Inc. (OTC Pink: HAON) acquired the assets of another distressed company, ChamberBusinessCenters, for the purposes of turning the company around and selling it at a profit. Halitron, Inc. (OTC Pink: HAON) exited its ChamberBusinessCenters position in December 2015. The short-term, speculative distressed companies in iDealFurniture LLC and ChamberBusinessCenters not only made the company money, but it also shows that Halitron, Inc. (OTC Pink: HAON)’s strategy is successful and can be applied on a much larger scale. Halitron, Inc. (OTC Pink: HAON) would later report total revenue of $1.2 million in full year 2015.
First Quarter 2016 Overview
Turning to the first quarter of 2016, Halitron, Inc. (OTC Pink: HAON) has been very busy reallocating its resources after the exit of its assets at the end of 2015. The company completed four acquisitions during Q1 2016, which include PRD Holdings Inc. (Mexican manufacturing plant), PiecesInPlaces, ArchivalMuseumSupplies, and ArchivalPhotoPages. The acquisitions performed very well, despite having limited time and ability to have a greater impact on Q1 2016 earnings.
Halitron, Inc. (OTC Pink: HAON) acquired PiecesInPlaces on February 10, 2016 and therefore only had 41 days to contribute to the company’s first quarter earnings. During the 41 days, PiecesInPlaces generated $9,610 in sales. Next, ArchivalMuseumSupplies only had 15 days to contribute to first quarter earnings, in which, the business generated $2,878. Lastly, ArchivalPhotoPages was acquired two days before the first quarter ended on March 31st, but the business was still able to generate an impressive $2,236 in the short amount of time. Overall, Halitron, Inc. (OTC Pink: HAON) generated total revenues of $66,000 during the first quarter, while seeing minimal cost of revenue of $4,000.
Second Quarter Sees Halitron, Inc. (OTC Pink: HAON)’s Fifth Acquisition of 2016
During June 2016, Halitron, Inc. (OTC Pink: HAON) ventured further into acquisitions with its fifth acquisition of 2016 and the eighth since 2015. The company acquired CinchSigns, which sells retail place cards, labels, banners, sign holders, and other printed promotional materials, for the issuance of a Long Term Note Payable of $673,406. Along with CinchSigns came its 150,018 customer list, which is comprised of various businesses such as mattress stores, furniture stores, car dealers, appliance stores, flooring, and more. “CinchSigns is an excellent add-on brand for us in that we have the infrastructure to absorb the business model and, once again, the brands products can be manufactured, pick, pack, shipped out of the Mexican factory,” detailed CEO Bernard Findley on the acquisition.
Unfortunately, with the second quarter coming to a close in just three weeks, CinchSigns will have a limited impact on Halitron, Inc. (OTC Pink: HAON)’s second quarter earnings. However, Q2 earnings will give management and investors a chance to see how the first quarter acquisitions performed during a complete quarter under control of Halitron, Inc. (OTC Pink: HAON). With that being said, CinchSigns will provide Halitron, Inc. (OTC Pink: HAON) with another business in a niche market that has growth potential over the long term. Collectively, the five acquisitions of 2016 are forecasted to generate over $1.2M in sales and with the anticipated $300,000 debt raise mentioned below. Management believes it can generate $3M to $5M in sales 12 months post-close of growth capital.
Halitron, Inc. (OTC Pink: HAON) Seeks Growth Capital To Spur Revenue Growth In Second Half of 2016
Halitron, Inc. (OTC Pink: HAON)’s low-overhead, roll-up, marketing-based strategy continues to generate revenue for the company, while keeping costs very minimal. While the company has been very active with acquisitions in 2016, CEO Findley would ideally like to secure $300,000 in debt financing to further leverage the strategy and increase Halitron, Inc. (OTC Pink: HAON)’s revenue trajectory. In fact, Findley states that Halitron, Inc. (OTC PINK: HAON) would be able to generate $3-5 million additional revenue in the following twelve-month period after obtaining such growth capital.
The bottom line with Halitron, Inc. (OTC Pink: HAON) is that patience and allowing the company’s unique strategy to further develop should pay off for shareholders. First quarter 2016 results were good for the equity holding company, but the second quarter earnings will be very important to detail Halitron, Inc. (OTC Pink: HAON)’s Q1 2016 acquisitions and the growth potential they will bring in the quarters to come. In addition, the company continues to search for debt financing to help jumpstart Halitron, Inc. (OTC Pink: HAON)’s marketing-based strategy and total revenues.