Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.23.1
Segment Information
 3 Months Ended
Mar. 31, 2023
Segment Reporting [Abstract]  
Segment Information

Note 11 – Segment Information

 

We operate in three reportable segments: Nexxis, Flagship Solutions Group, and CloudFirst. Our segments were determined based on our internal organizational structure, the manner in which our operations are managed, and the criteria used by our Chief Operating Decision Maker (CODM) to evaluate performance, which is generally the segment’s operating income or losses.

  

   
Operations of:   Products and services provided:
Nexxis Inc   NEXXIS is a single-source solution provider that delivers fully-managed cloud-based voice services, data transport, internet access, and SD-WAN solutions focused on business continuity for today’s modern business environment. 
     
Flagship Solutions, LLC   Flagship Solutions Group (FSG) is a managed service provider. FSG invoices clients primarily for services that assist the clients’ technical teams. FSG has few technical assets and utilizes the assets or software of other cloud providers, whereby managing 3rd party infrastructure. FSG periodically sells equipment and software.
     
CloudFirst Technologies Corporation   CloudFirst, provides services from CloudFirst technological assets deployed in six Tier 3 data centers throughout the USA and Canada. This technology has been developed by CloudFirst. Clients are invoiced for cloud infrastructure and disaster recovery on the CloudFirst platform. Services provided to clients are provided on a subscription basis on long term contracts.

  

The following tables present certain financial information related to our reportable segments and Corporate:

  

                                       
As of March 31, 2023
                     
    Nexxis Inc.   Flagship Solutions LLC   CloudFirst Technologies   Corporate   Total
                     
Accounts receivable   $ 60,019     $ 2,895,708     $ 715,443     $ —     $ 3,671,170  
Prepaid expenses and other current assets     19,503       178,094       505,506       175,357       878,460  
Net Property and Equipment     737       18,533       2,397,542       2,670       2,419,482  
 Intangible assets, net     —       1,626,646       279,268       —       1,905,914  
 Goodwill     —       1,222,971       3,015,700       —       4,238,671  
 Operating lease right-of-use assets     —       141,933       33,909       —       175,842  
All other assets     —       —       —       11,062,166       11,062,166  
Total Assets   $ 80,259     $ 6,083,885     $ 6,947,368     $ 11,240,193     $ 24,351,705  
                                         
Accounts payable and accrued expenses   $ 46,335     $ 2,332,956     $ 905,137     $ 414,818     $ 3,699,246  
Deferred revenue     —       155,545       153,728       —       309,273  
Total Finance leases payable     —       —       500,846       —       500,846  
Total Finance leases payable related party     —       —       593,400       —       593,400  
 Total Operating lease liabilities     —       143,646       36,567       —       180,213  
Total Liabilities   $ 46,335     $ 2,632,147     $ 2,189,678     $ 414,818     $ 5,282,978  

 

                                         
As of December 31, 2022
                     
    Nexxis Inc.   Flagship Solutions LLC   CloudFirst Technologies   Corporate   Total
                     
Accounts receivable   $ 34,903     $ 1,924,184     $ 1,543,749     $ —     $ 3,502,836  
Prepaid expenses and other current assets     16,799       213,826       285,306       68,735       584,666  
Net Property and Equipment     —       19,705       2,192,085       —       2,211,790  
Intangible assets, net     —       1,696,376       279,268       —       1,975,644  
Goodwill     —       1,222,971       3,015,700       —       4,238,671  
Operating lease right-of-use assets     —       167,761       58,740       —       226,501  
All other assets     —       —       —       11,346,127       11,346,127  
Total Assets   $ 51,702     $ 5,244,823     $ 7,374,848     $ 11,414,862     $ 24,086,235  
                                         
Accounts payable and accrued expenses   $ 40,091     $ 1,563,408     $ 1,069,278     $ 534,800     $ 3,207,577  
Deferred revenue     —       165,725       115,335       —       281,060  
Total Finance leases payable     —       —       641,110       —       641,110  
Total Finance leases payable related party     —       —       776,864       —       776,864  
Total Operating lease liabilities     —       169,469       62,960       —       232,429  
Total Liabilities   $ 40,091     $ 1,898,602     $ 2,665,547     $ 534,800     $ 5,139,040  

 

                                         
For the three months ended March 31, 2023
                     
    Nexxis Inc.   Flagship Solutions LLC   CloudFirst Technologies   Corporate   Total
Sales   $ 264,796     $ 3,456,188     $ 3,158,739     $ —     $ 6,879,723  
Cost of sales     178,121       2,906,212       1,705,645       —       4,789,978  
Gross Profit     86,675       549,976       1,453,094       —       2,089,745  
                                         
Selling, general and administrative     124,750       540,327       606,452       570,520       1,842,049  
Depreciation and amortization     71       70,903       217,622       114       288,710  
Total operating expenses     124,821       611,230       824,074       570,634       2,130,759  
                                         
Loss from Operations     (38,146 )     (61,254 )     629,020       (570,634 )     (41,014 )
                                         
Interest expense, net     —       —       (27,346 )     103,423       76,077  
Total Other Income (Expense)     —       —       (27,346 )     103,423       76,077  
                                         
Income (Loss) before provision for income taxes   $ (38,146 )   $ (61,254 )   $ 601,674     $ (467,211 )   $ 35,063  

   

                                         
For the three months ended March 31, 2022
                     
    Nexxis Inc.   Flagship Solutions LLC   CloudFirst Technologies   Corporate   Total
Sales   $ 211,924     $ 6,043,222     $ 2,402,053     $ —     $ 8,657,199  
Cost of sales     139,876       4,518,346       1,353,067     $ —       6,011,289  
Gross Profit     72,048       1,524,876       1,048,986       —       2,645,910  
                                         
Selling, general and administrative     97,199       1,087,540       475,116     $ 448,673       2,108,528  
Depreciation and amortization     —       70,135       281,203     $ —       351,338  
Total operating expenses     97,199       1,157,675       756,319       448,673       2,459,866  
                                         
Loss from Operations     (25,151 )     367,201       292,667       (448,673 )     186,044  
                                         
Interest expense, net     —       (48 )     (41,723 )   $ (889 )     (42,660 )
Total Other Income (Expense)     —       (48 )     (41,723 )     (889 )     (42,660 )
                                         
Income (Loss) before provision for income taxes   $ (25,151 )   $ 367,153     $ 250,944     $ (449,562 )   $ 143,384