CLEVELAND, OH / ACCESSWIRE / January 18, 2022 / Innovest Global, Inc. (OTC PINK:IVST), a diversified industrials company, continues corporate and operational milestones and goals for 2022. Sales have increased after the decline in 2020, overhead that scaled to accommodate previous rapid growth has been reduced by over 70 percent since the contraction period in advance of new planned growth, and existing operations are strong and profitable. A brief Company history, current status, and 2022 plan follow:
Innovest was founded in 2017 with plans to acquire operating companies, integrate them, and create value for shareholders by streamlining and growing those companies. By doing so, a platform company which would have a solid business foundation and could scale meaningfully would result. Despite limited capitalization, the Company grew quickly, executing multiple acquisitions and beginning with just $50 thousand in sales for 2017, reaching $40 million in sales for 2019 with growing gross profits, significant prospects for organic growth, and was on-track with its business plans and goals.
During 2020, Covid-19 disrupted ordinary operations, prompting cuts and the effects of the disruptions were amplified in the curtainwall commercial construction segment. That business had inherited an eight-figure contract on acquisition which had unknown risks due to the fact that the prior owner had passed away prior to acquisition. While the structure insulated the parent company (Innovest's) direct exposure to those risks, the success of that business required either the success of the inherited project or success in securing additional such projects. Prior to Covid-19, several such large projects were in the pipeline for the subsidiary, but were ultimately put on hold by potential clients due to the pandemic. As a result of this and other factors, as well as other impacted subsidiaries; the decision was made to cut costs, focus on unaffected subsidiaries, and limit the pursuit of other new acquisitions until the business climate stabilized. Also during 2020, Innovest exited biotechnology to focus solely on industrial businesses by spinning off its StemVax Therapeutics subsidiary to NovAccess Global. This exit resulted in an improvement to Innovest's balance sheet from a zero dollar illiquid asset of StemVax, to 7.5 million shares of XSNX worth over $3 million on Innovest's most recently reported quarter.
During 2021, this plan to focus on the present climate parameters was executed to ensure the sustainability of the company, in contrast to previous years which focused on growth and overhead structures to accommodate that growth. The 2022 plan was begun, including items which will continue to improve the balance sheet significantly, grow the company, and provide direct value to shareholders by actions more fully described below. 2021 also marked the addition of GPC Capital as a principal.
Entering 2022, the company has a lean overhead structure and two profitable subsidiaries. One is a commercial energy brokerage business operating throughout the USA, the other is a domestic call center service business clients as customer service and business to business sales which is PCI compliant and adheres to HIPAA for its healthcare clients. All of the agents are USA based. Overhead cuts were primarily achieved from elimination of executive level compensation positions which were previously in place to pursue new acquisitions, integrate acquisitions, and operate as a centralized management structure. The present decentralized adjustment allowed the company to make reductions to overhead of over 70 percent while only seeing headcount decline from approximately 100 to approximately 70. Over 90 percent of employees presently on payroll are either billed to clients or directly sell. This has stabilized the Company from experiencing losses during the growth years, to approximately breaking even from subsidiary profits despite a significant decline in revenue due to the previously described events.
Current Status, Developments, and 2022 Milestones:
- Board of Directors: per the aforementioned strategic changes the 2022 board will be appointed during the first quarter. Presently, pursuant to requirements of Nevada law and the Company's bylaws the Company has a single director, Shaheed Bailey, a principal of GPC Capital.
- Officers: Mr. Bailey is interim CEO and interim CFO. Ali Manov is the Chief Operating Officer.
- Reporting status: "Current" reporting status (ie removal of "Yield" sign) with OTC Markets is expected by the first week in February.
- Liabilities: Innovest will definitively close non-operating subsidiaries, which is expected to be reflected on the second or third quarter 2022 reports, resulting in a reduction of approximately $20 million in liabilities on Innovest's books contributed from these subsidiaries, and the Innovest balance sheet having more assets than liabilities. Other liabilities will be more fully described and detailed in the Company's annual report.
- Dividend: as originally disclosed, Innovest has approved the distribution of the 7.5 million XSNX shares to Innovest's shareholders as a free trading stock dividend. This distribution requires NovAccess to first register those shares. NovAccess has represented that it has prioritized the registration.
- Capitalization: The Company will continue to capitalize efforts by operations and will pay down existing debt and fund growth by efficiently and incrementally raising capital until such time that a significant equity capital raise would not detrimentally dilute common shareholders.
- Growth: Innovest plans to execute one meaningful acquisition in the second half of 2022, once other initiatives are accomplished. When combined with the above activities, this is expected to achieve the requirements for the Company to apply for listing on Nasdaq and scale its growth during 2023.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts included in this press release are forward-looking statements. These statements relate to future events or to the Company's future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company's control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company's current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. Such risks, uncertainties and other factors, which could impact the Company and the forward-looking statements contained herein are included in the Company's filings with the OTC Markets. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
Investor Relations Contact:
GPC Holdings, Inc.
Shaheed Bailey, Partner
SOURCE: Innovest Global, Inc.
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