Restaurant.com, owned by RDE, Inc. (OTCQB: RSTN), shares continue to rally on elevated volume. The more than 42% surge in March comes after RSTN announced several new partnerships that could drive revenues sharply higher over the coming months. The most recent agreement is with AMAC, the Association of Mature American Citizens, and its 2.3 million members that provides a direct pathway for RSTN to reach the senior adult population. That deal followed an announced partnership with MemberHub, the largest and fastest-growing community engagement software company for K-12 parent groups. Both deals can be lucrative.
AMAC represents Americans 50 plus and is centered on American values, freedom of the individual, free speech, exercise of religion, equality of opportunity, sanctity of life, rule of law, and love of family, with benefits at all levels. The organization plays a vital role in helping build the services that will enrich the lives of America’s seniors, and as a 501 (C)(4), advocates for issues important to its membership on Capitol Hill and locally through grassroots activism.
The partnership is a win-win deal. For AMAC, it extends RSTN’s national restaurant-focused digital discounts to its 2.3 million members. And for RSTN, it adds an additional target audience that can drive revenues and enhance long-term shareholder value by sharing its digital deals and providing access to discounted deals at local and national restaurants.
The AMAC deal is the third partnership announced in since late February.
Growing User Base Adds Momentum To Strong 2021 Start
As noted, the partnership with AMAC follows RSTN’s announcement of its partnership with MemberHub, the largest and fastest-growing community engagement software company for K-12 parent groups. That group currently serves over 12,800 organizations that engage with more than 2.8 million K-12 parents. A third partnership with Rosebud Restaurants rounds out a busy and productive few weeks of client expansion.
In that deal, RSTN said it will partner with Rosebud Restaurants to provide marketing services on its digital deals platform for their six Rosebud and two Carmine’s locations across Chicagoland. The three recent agreements add momentum to its report of strong earnings in 2020.
On March 1st, RDE, Inc. announced unaudited financial results for the year ending December 31, 2020. According to RSTN, despite the operating headwinds during the ongoing COVID-19 health pandemic, it recorded revenue of $2.9 million with a net income of $332,000, or $0.06 in earnings per share. Those results compare to a loss per share of ($1.37) in 2019.
RDE noted that the revenue figure reflects business recorded from March 1st, 2020, the effective date of RDE’s acquisition of Restaurant.com, rather than the full year 2020. Thus, the twelve months revenue for Restaurant.com was $4.4 million. All financial results are subject to the audit.
After audit, results could have RDE, Inc. swinging into a profit. A breakdown of the results showed income of $531,000, demonstrating marked improvement compared with a loss of $2.1 million in 2019. On a per-share basis, RDE delivered EPS of $0.06 compared with a negative EPS of ($1.37) in 2019. Notably, the 2020 net income and EPS include a positive non-cash change in derivative liability due to convertible notes’ accounting.
Shareholder’s Equity for the year also had a significant turn for the positive. According to its update, Equity jumped from a ($7.8 million) deficit to $1.1 million in Equity for the year. Further, with the removal of all institutional convertible debt, management expects balance sheet improvement and bottom-line growth to continue to demonstrate meaningful increases going forward.
Shares of RSTN have increased by more than 200% since the start of the year. In January, shares traded at roughly $1.00 and volume was anemic. Today, shares sit at $3.00 and average volume stands at 13.6K shares per day. Apparently, the company’s growth is earning investor attention.
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