RE:Q3 Financials & MD&A now available Naturally Splendid loses $2.04-million in Q3 2019 2019-11-29 08:15 ET - News Release
Mr. Craig Goodwin reports
NATURALLY SPLENDID REPORTS THIRD QUARTER RESULTS
Naturally Splendid Enterprises Ltd. has released its unaudited financial results for the nine months ended Sept. 30, 2019.
Naturally Splendid recorded sales of $2,359,525 during the nine months ended September 30, 2019, compared to $1,304,040 for the nine months ended September 30, 2018. T
he Company's sales increased by approximately $1,055,485 representing an 81% increase over the same period last year. The Company continued to expand its private label bars and bites business by approximately $856,000 and other branded products increased by approximately $11,000. Branded hemp products decreased by approximately $208,000 as the Company focused more on its new Natera Sport(TM) products which expanded by approximately $396,000. The Company is focused on private label and branded sales and has entered the international markets such as German, Australian and Japanese markets.
Gross profits increased by approximately 77% for the nine months ended September 30, 2019 at $731,251 (31.0% of sales) compared to $413,235 (31.7%) for the nine months ended September 30, 2018. Cost of Sales during the nine months ended September 30, 2019 was $1,628,274 compared to $890,805 in the nine months ended September 30, 2018. T
he Company continues to maintain an approximate 31% gross margin for the nine months ended September 30, 2019. Increases in the costs of sales were approximately consistent with increased revenue and sales.
The Company recorded a net loss from continuing operations of $3,627,472 for the nine months ended September 30, 2019, compared to a net profit from continuing operations of $301,793 during the nine months ended September 30, 2018. The net profit in 2018 was mainly due to the Company's disposition of its shareholding of POS BPC Manufacturing Corp. which resulted in a material gain of $5,102,068 for the same period ended in 2018.
STATEMENT OF LOSS DATA
Three Months Ended Sept. 30, Nine Months Ended Sept. 30,
2019 2018 2019 2018
Revenue $ 635,984 $ 499,538 $ 2,359,525 $ 1,304,040
Cost of sales 436,229 344,044 1,628,274 890,805
Gross profit 199,755 155,494 731,251 413,235
Selling and distribution expenses 689,911 193,587 1,395,274 622,055
Administrative expenses 1,632,409 1,658,467 4,081,547 4,557,017
Discontinued operations - - - 5,071,223
Net income (loss) 2,046,395) (1,699,726) (3,647,472) (301,793)
Basic & diluted earnings(loss)/share (0.02) (0.02) (0.03) 0.00
Market opportunities remain strong for Company Branded Products domestically with a vision to expand international distribution. Naturally Splendid's recently launched Natera(TM) Sport Key-to-Life Keto Bars were strong contributors to the increase in sales for the quarter.
It is expected that new company branded products under development and scheduled for launch soon, are expected to positively impact revenue. Products such as Natera(TM) Sport Bites are already gaining notoriety having appeared in an international sporting publication and are indicative of the growing roster of NSE branded products that are adding to the sales of the Company. Naturally Splendid CEO Mr. Craig Goodwin states, " I am pleased to be back in the role of CEO. In the first 60 days I have been focused on reviewing the operations of the Company and ongoing individual projects.
While in the role of President the past two years, I worked closely with Vice President, Bryan Carson overseeing the development of the Prosnack Division to diversify our business model. I am pleased to report the most significant growth came from our Prosnack Division and I am confident that our strategic plan of diversifying into a manufacturer of plant-based nutritional products, many of which will contain hemp, will continue to be a key driver to our business moving forward.
Our 2019 gross sales have now surpassed gross sales for all of 2018 representing an increase of over $1,000,000, over the same period last year, while maintaining margins exceeding 30%. Sales.
The Prosnack Division sales were accomplished, while undergoing over $600,000 in facility upgrades, including full scale shutdowns as we obtained our Safe Quality Food Level 2 (SQF2) certification this past July. The recent success of the company branded Natera Sport(TM) line spearheaded by Bryan Carson, significantly contributed to this increased revenue. The challenge of reduced production time during these expansions are well worth the effort as we begin to reap the rewards of our proactive diversification actions. This has resulted in several successful launches including the Natera Sport(TM) KEY-TO-LIFE keto-friendly line, as well as increased contract manufacturing business as was indicated in our news release of November 13, 2019. The Company acknowledges that the cannabis edibles opportunity presents significant growth and revenue potential, however much of the cannabis industry has been challenged with finding viable economic models which led to Naturally Splendid's diversification as a nutritional bar manufacturing Company. T
he Company will continue to expand business, focusing on manufacturing more traditional plant-based nutritional bars and bites while regulations regarding edibles continue to evolve. Since Naturally Splendids incorporation twelve years ago, the Company has proactively diversified and established a thriving business in our state-of-the-art, 20,000 square foot SQF2 certified manufacturing facility located in Pitt Meadows, BC.
We believe this is the foundation to delivering sustained shareholder value. " Naturally Splendid's financial statements can be viewed at: www.SEDAR.com
About Naturally Splendid Enterprises Ltd.
NSE has established numerous healthy, functional foods under recognized brands such as Natera Sport(TM), Natera Hemp Foods, CHII (TM), Elevate Me(TM) and Woods Wild Bar. The Company has a myriad of new products and line extensions under development that are approaching launch. NSE has also developed proprietary technologies for the extraction of high demand, healthy omega 3 and 6 oils from hemp. (NSE sales revenues for the first half 2019 exceeded FY2018). NSE is the current "go-to" manufacturer for healthy, functional food products and ingredients focusing on plant-based ingredients. The Company provides contract manufacturing services for many global healthy food companies, private labelling a wide variety of nutritional food products destined for global healthy food markets. NSE plans to utilize current and new technologies to meet the expected exponential demand developing in the cannabis market. Pending appropriate NSE licensing and regulations in permitting jurisdictions, NSE's current production facilities will be one of very few facilities that is capable of meeting the demand for infused edibles and oils for both in-house and contract manufacturers' brands.
We seek Safe Harbor.
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