The Marketing Alliance Announces Financial Results for Fiscal Year Ended March 31, 2025

Rhea-AI Summary

The Marketing Alliance (OTC: MAAL) reported its fiscal year 2025 financial results, showing mixed performance with revenue growth but lower profitability. The company achieved total revenues of $21.37 million, a 9% increase from $19.59 million in the previous year, primarily driven by 12% growth in the insurance distribution business.

Key financial metrics include operating income of $730,005 (down from $1.1 million), net income of $465,599 ($0.06 per share, down from $0.13), and Operating EBITDA of $1.01 million (decreased from $1.39 million). The company's balance sheet showed cash and cash equivalents of $2.0 million and shareholders' equity of $5.4 million as of March 31, 2025.

Notable developments include the completion of a share repurchase program announced in October 2024 and the implementation of a new revenue recognition policy for reimbursement and marketing revenues. The company also repaid a $1.91 million note in full at maturity in June 2025.

Positive

• Revenue increased 9% to $21.37 million year-over-year
• Insurance distribution business grew 12% in revenue
• Operating expenses remained relatively flat at $3.53 million
• New share repurchase program authorized for up to 800,000 shares
• Successfully repaid $1.91 million note at maturity

Negative

• Net income decreased to $465,599 ($0.06 per share) from $1.04 million ($0.13 per share)
• Operating income declined to $730,005 from $1.1 million
• Construction business revenue declined with cancelled or postponed work
• Investment portfolio recorded loss of $138,010 compared to prior year gain of $493,334
• Working capital decreased to $5.1 million from $7.7 million
• Shareholders' equity declined to $5.4 million from $6.7 million

ST. LOUIS, June 30, 2025 (GLOBE NEWSWIRE) -- The Marketing Alliance, Inc. (OTC: MAAL) (“TMA” or the “Company”), announced its financial results today for its fiscal 2025 year ended March 31, 2025.

FY 2025 Financial Key Items (all comparisons to the prior year period)

• Revenues from operations were $21,373,673 compared to $19,585,772. The 9% increase was primarily due to 12% revenue growth in the insurance distribution business that was offset by a decline in construction revenue
• Operating income from continuing operations of $730,005 compared to $1,099,267 in the prior year  
• Net income was $465,599 or $0.06 per share compared to $1,043,214 or $0.13 per share in the prior year
• The Company completed its share repurchase program announced October 2024, to repurchase up to 800,000 shares of issued and outstanding common stock
  
  

Management Comments
Timothy M. Klusas, TMA’s Chief Executive Officer, commented, “We were pleased with our performance in the final quarter to finish this fiscal year, as some of the projects we initiated and key roles we created on our leadership team started to gain traction. We realized double-digit revenue gains in the insurance business and now turn to finding ways to streamline operations and improve operating efficiency.

Further, as our business continues to evolve, in the previous quarter we elected to acknowledge the changing nature of our reimbursement and marketing revenues by recognizing them over their respective projected project lives (often the calendar year) instead of when agreed and billed. Historically the company has treated non-refundable reimbursement and marketing fee revenue from carriers as earned when the agreed upon amount has been invoiced. We will now acknowledge any timing differences of these payments as deferred revenue on the balance sheet. Starting with the quarter that just ended, the company treated reimbursement and marketing revenue as a time-duration item and allocated revenue throughout its respective period.  

The construction business was difficult this year as we saw expected work get cancelled or postponed, which affected revenues adversely throughout the year. This year we did not have a multi-year job of the same size as previous years. Unfortunately, we were not able to reduce costs proportionately, which translated to adverse performance on the bottom line. We continued to maintain a very disciplined approach to only undertaking jobs that were economically profitable with respect to our capabilities.”

Fiscal Year 2025 Financial Review

• Revenues were $21,373,673 compared to $19,585,772, due to 12% growth in the insurance distribution business that was offset by a decrease in the construction business.
  
  
• Net operating revenue (gross profit) for the year was $4,259,504, compared to net operating revenue of $4,655,172 in the prior year. While Net operating revenue was less in both insurance distribution and construction, the decrease was substantially in the construction business versus the prior year.
  
  
• Although operating expenses were relatively flat at $3,529,499 compared to $3,555,905 for the prior year, the Company hosted two annual conferences during the fiscal year (April 2024 and March 2025) which increased travel and meeting expenses by approximately $150,000. This increase was offset by a decrease in compensation expense.
  
  
• The Company reported operating income from continuing operations of $730,005 compared to $1,099,267 in the prior year period, with differences due to factors discussed above.
  
  
• Operating EBITDA (excluding investment portfolio income) of $1,008,211 was less than the prior year EBITDA of $1,388,524. A note reconciling operating EBITDA to operating income can be found at the end of this release.
  
  
• Investment gain (loss), net (from non-operating investment portfolio) for the year was ($138,010) as compared with $493,334 the previous year. Unrealized (losses) gains on investments, net were ($267,988) in the current fiscal year and $401,886 in the previous fiscal year.  
  
  
• Net income was $465,599, or $0.06 per share, compared to $1,043,214 or $0.13 per share.
  
  
• Subsequent to the end of the fiscal year, on April 2, the Company announced that its Board of Directors had authorized a share repurchase program to repurchase up to 800,000 shares of the Company's issued and outstanding common stock, effective immediately and concluding March 31, 2026. As of June 26, the Company had repurchased 103,360 shares under this program.
  
  

Balance Sheet Information

• TMA’s balance sheet on March 31, 2025, reflected cash and cash equivalents of $2.0 million; working capital of $5.1 million; and shareholders’ equity of $5.4 million; compared to cash and cash equivalents of $2.9 million, working capital of $7.7 million, and shareholders’ equity of $6.7 million as of March 31, 2024.
  
  
• Subsequent to the end of the fiscal year, the Company repaid a $1,912,882 note (payable) in full at its maturity in June. The proceeds to satisfy the note were previously in restricted cash and cash and cash equivalents.
  
  

About The Marketing Alliance, Inc.

Headquartered in St. Louis, MO, TMA provides support to independent insurance brokerage agencies, with a goal of integrating insurance and “insuretech” engagement platforms to provide members value-added services on a more efficient basis than they can achieve individually.

Investor information can be accessed through the shareholder section of TMA’s website at: http://www.themarketingallianceinc.com.

TMA’s common stock is quoted on the OTC Markets (http://www.otcmarkets.com) under the symbol “MAAL”.

Forward Looking Statement
Investors are cautioned that forward-looking statements involve risks and uncertainties that may affect TMA's business and prospects. Examples of forward-looking statements include, among others, statements we make regarding our expectations of growth based upon our investments in our business, our recently announced stock repurchase program, our plans to reduce expenses, and our ability to undertake more suitable jobs and generate earnings from our construction business. Any forward-looking statements contained in this press release represent our estimates, expectations or intentions only as of the date hereof, or as of such earlier dates as are indicated, and should not be relied upon as representing our views as of any subsequent date. These statements involve a number of risks and uncertainties, including, but not limited to, expectations of the economic environment, material adverse changes in economic conditions in the markets we serve and in the general economy; the ability of our construction business to be engaged for projects and for those projects to commence on the anticipated timetable and with the anticipated profitability; the ways that insurance carriers may react in their underwriting policies and procedures to the continuing risks they perceive from public health matters; our reliance on a limited number of insurance carriers and any potential termination of those relationships or failure to develop new relationships; privacy and cyber security matters and our ability to protect confidential information; future state and federal regulatory actions and conditions in the states in which we conduct our business; our ability to work with carriers on marketing, distribution and product development; pricing and other payment decisions and policies of the carriers in our insurance distribution business, changes in the public securities markets that affect the value of our investment portfolio; and weather and environmental conditions in the areas served by our construction business. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so.

Contact:
The Marketing Alliance, Inc.	-OR-	The Equity Group Inc.
Timothy M. Klusas, President		Jeremy Hellman, Vice President
(314) 275-8713		(212) 836-9626
tklusas@themarketingalliance.com www.TheMarketingAlliance.com		jhellman@equityny.com

CONSOLIDATED STATEMENTS OF OPERATIONS
		Twelve Months Ended March 31,
		2025				2024
Insurance commission and fee revenue and related	$	20,409,278			$	18,301,751
Construction revenue		964,395				1,284,021
Total revenues		21,373,673				19,585,772
Insurance distributor related expenses:
Distributor bonuses and commissions		14,110,303				12,137,471
Business processing and distributor costs		1,996,731				1,780,758
Depreciation		5,521				9,382
		16,112,555				13,927,611
Costs of construction:
Direct and indirect costs of construction		744,738				757,064
Depreciation		256,876				245,925
		1,001,614				1,002,989
Total costs of revenues		17,114,169				14,930,600
Net operating revenue		4,259,504				4,655,172
Total General and administrative expenses		3,529,499				3,555,905
Operating income		730,005				1,099,267
Other income (expense):
Other		4,938				(67,390	)
Investment (losses) gains, net		(138,010	)			493,334
Interest		(119,572	)			(196,620	)
Income before provision for income taxes		477,361				1,328,591
Income tax expense		11,762				285,377
Net income	$	465,599			$	1,043,214
Average Shares Outstanding		7,397,594				8,081,266
Net Income per Share	$	0.06			$	0.13

CONSOLIDATED BALANCE SHEETS
		March 31,
		2025				2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	2,043,274			$	2,949,323
Equity securities		2,630,444				2,837,506
Restricted cash		1,623,608				573,841
Accounts receivable, net		8,480,785				7,492,812
Current portion of notes receivable		-				548,552
Prepaid expenses and other current assets		277,880				506,456
Total current assets		15,055,991				14,908,490
PROPERTY AND EQUIPMENT, net		650,875				829,680
OTHER ASSETS
Notes receivable, net of allowance and current portion		-				63,614
Restricted cash		-				1,523,812
Operating lease right-of-use assets		136,485				179,218
Total other assets		136,485				1,766,644
		15,843,351				17,504,814
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	6,877,555			$	6,151,797
Deferred revenue		726,606				30,000
Current portion of notes payable		2,173,614				938,068
Current portion of finance lease liability		103,350				36,174
Current portion of operating lease liability		93,865				95,305
Liabilities related to discontinued operations		677				677
Total current liabilities		9,975,667				7,252,021
LONG-TERM LIABILITIES
Lines of credit payable		-				675,000
Notes payable, net of current portion and debt issuance costs		235,218				2,359,132
Finance lease liability, net of current portion		-				103,200
Operating lease liability, net of current portion		46,064				78,982
Deferred taxes		149,200				313,000
Total long-term liabilities		430,482				3,529,314
Total liabilities		10,406,149				10,781,335
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common stock, no par value; 50,000,000 shares authorized,
7,397,594 shares issued and outstanding March 31, 2025
8,081,266 shares issued and outstanding March 31, 2024		1,114,406				1,025,341
Treasury stock at cost		(1	)			-
Retained earnings		4,322,797				5,698,138
Total shareholders' equity		5,437,202				6,723,479
	$	15,843,351			$	17,504,814

Note – Operating EBITDA (excluding investment portfolio income)
	Twelve Months Ended March 31,
		2025			2024
Operating Income from Continuing Operations	$	730,005		$	1,099,267
Add:
Depreciation/Amortization Expense	$	278,206		$	289,257
EBITDA (Excluding Investment Portfolio Income)	$	1,008,211		$	1,388,524

The Company elects not to include investment portfolio income because the Company believes it is non-operating in nature.

The Company uses Operating EBITDA as a measure of operating performance. However, Operating EBITDA is not a recognized measurement under U.S. generally accepted accounting principles, or GAAP, and when analyzing its operating performance, investors should use Operating EBITDA in addition to, and not as an alternative for, income as determined in accordance with GAAP. Because not all companies use identical calculations, its presentation of Operating EBITDA may not be comparable to similarly titled measures of other companies and is therefore limited as a comparative measure. Furthermore, as an analytical tool, Operating EBITDA has additional limitations, including that (a) it is not intended to be a measure of free cash flow, as it does not consider certain cash requirements such as tax payments; (b) it does not reflect changes in, or cash requirements for, its working capital needs; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Operating EBITDA does not reflect any cash requirements for such replacements, or future requirements for capital expenditures or contractual commitments. To compensate for these limitations, the Company evaluates its profitability by considering the economic effect of the excluded expense items independently as well as in connection with its analysis of cash flows from operations and through the use of other financial measures.

The Company believes Operating EBITDA is useful to an investor in evaluating its operating performance because it is widely used to measure a company’s operating performance without regard to certain non-cash or unrealized expenses (such as depreciation and amortization) and expenses that are not reflective of its core operating results over time. The Company believes Operating EBITDA presents a meaningful measure of corporate performance exclusive of its capital structure, the method by which assets were acquired, and non-cash charges and provides additional useful information to measure performance on a consistent basis, particularly with respect to changes in performance from period to period.

FAQ

What were The Marketing Alliance's (MAAL) key financial results for fiscal year 2025?

MAAL reported revenue of $21.37 million (up 9%), operating income of $730,005, and net income of $465,599 ($0.06 per share) for fiscal year 2025.

How did MAAL's insurance distribution business perform in fiscal 2025?

MAAL's insurance distribution business showed strong performance with 12% revenue growth compared to the previous fiscal year.

What changes did MAAL make to its revenue recognition policy in 2025?

MAAL changed its policy to recognize reimbursement and marketing revenues over their projected project lives instead of when agreed and billed, treating them as time-duration items.

What is the status of MAAL's share repurchase program announced in April 2025?

MAAL authorized a new program to repurchase up to 800,000 shares through March 31, 2026, and had repurchased 103,360 shares as of June 26, 2025.

How much debt did MAAL repay in 2025?

MAAL repaid a $1,912,882 note in full at its maturity in June 2025, using funds from restricted cash and cash equivalents.