RE:RE:Financials are out Revenue
Revenue during the three and six month period ended June 30, 2014 was $68,056 and $139,731respectively (2013: $43,421 and $59,412). The Company believes this increase reflects continued growthin the Natera product line, with national distribution now starting to have a tentative impact on sales.
Management believes that sales were somewhat hampered during the period due to staffing constraints andslower than expected penetration into new stores with the national distributors. The Company expects toincrease sales and is working with its distributors to achieve higher sales.
Costs of Sales and Gross Profit
Cost of Sales was $40,559 and $98,524 for the three and six month periods, compared to 2013 at $29,583and $41,374. This reflects the higher quantity of product sold in the current period compared to thecomparable period last year.
Accordingly, gross profit was $27,497 and $41,207 compared to 2013 results of $13,838 and $18,038. The
Company believes that gross profit is tending to grow as we work to increase margins and control costs.
Selling and Distribution Expenses
Commencing with the qualifying transaction and going public, the Company decided to report expenses inthe categories of selling and distribution expenses and administrative expenses. Previously, this distinctionwas not reflected in the accounts of the former private company. Management believes that this distinctionwill allow for a clearer assessment of the cost of sales and operations as opposed to public companyadministration which imposes significant expenses not previously incurred as a private company.
As aresult certain private company expenses have been reclassified.
Selling and Distribution Expenses were $34,659 and $94,660 respectively, compared to 2013 at $73,661and $123,255. The major difference this year is that net product development costs are lower at $$4,414 year the date as opposed to $64,900 in 2013. Product promotion costs were also down in the period ended
June 30th, at $16,848 (2013: $29,400) although they are up during the six month period ($58,542 asopposed to $36,576 in 2013). This reflects the timing of trade shows and product giveaways to potentialdistributors and customers.