With iPhone on the rise, this is a no brainer sitting at .05! Revenues increased exponentially.
"We are pleased with our Q4 and annual sales momentum and progress against our strategic plan," said Brooks Bergreen, CEO of HIT Technologies. "Q4 HITCASE sales were up 162% year over year, more than offsetting declining sales of legacy products, which resulted in an overall increase in sales of 96%. Gross margins for both Q4 and the year were strong. In addition, due to the foundation we laid previously and the momentum the business generated this year we significantly reduced operating costs. The majority of our sales were driven by our online marketing activities and our ability to convert our fan base into purchasers resulted in HITCASE products making up 94% of total revenues. These conversions were complemented by repeat business from our boutique retailers."
Bergreen continued: "With our increased product offerings, we are starting to see our suite of HITCASE products start appealing to the mass market and demonstrate the continued sales growth this market can translate into. Overwhelmingly, we continue to garner positive feedback on our products which underscore the competitive advantages of our offering. In addition, the launch of iPhone 7 and the anticipation for our new offerings for it, we have seen an increase in interest from and opportunity with customers, retailers and distributors which we are now working toward converting to new revenue growth. However, as many distributors are waiting for the availability of HITCASE offerings for iPhone 7 before placing orders, we are expecting Q1-F2017 and Q2-F2017 sales to lag before returning to growth in Q3-F2017 and Q4-F2017. Earlier in the year, to improve our cash position, we completed a non-brokered private placement raising gross proceeds of $1,180,000. In addition, we reduced our workforce during the latter half of our fiscal year without impacting our ability to generate revenue. These changes allowed us to reduce salaries across the Company and significantly lower overall cash operating expenses. Between Q2 and Q3 operating expenses declined by 32% and a further 24% in Q4."
Fourth Quarter Fiscal 2016 Financial and Operational Highlights - HITCASE product sales, excluding legacy products, increased 162% compared to the corresponding quarter last year and increased 178% for the year.
- Generated sales of $262,897 in Q4 F2016, up 96% from $134,412 in Q4 Fiscal 2015, reflecting HITCASE PRO-6, SNAP and accessories sales, products that were not available in Q4 2015. Due to seasonality, as expected Q4 sales were lower than our Q3 F2016 sales;
- Gross margin for Q4 was 37% compared to (10)% in the corresponding quarter in the prior year and 32% for the year compared to 18% in the prior year;
- During Q4 the Company scaled back its work force and reduced operating expenditures (excluding non-cash items and cost of sales) by 24% compared to Q3-F2016 levels. The Company continues to look for additional opportunities to realize further reductions;
- Reported an Adjusted EBITDA loss of $453,262 for Q4 F2016, a 60% reduction from the loss of $1,125,906 in Q4 F2015;
- Closed the quarter with working capital of $328,937 including cash and cash equivalents of $355,606 and inventory of $471,435 at June 30, 2016;
- The Company completed a private placement in May 2016 raising gross proceeds of $1,180,000;
- As part of Discovery Channel's Shark Week, an iPhone 6 equipped with a HITCASE PRO 6 was successfully used to livestream a shark dive off the coast of Florida. The livestream generated 80,000 comments, 4,500 shares and 6.4 million impressions over 2 days.
- Subsequent to the Quarter end, the Company launched its new SHIELD case. The SHIELD is a thin, aluminum case for the iPhone 6/6s and iPhone 6plus/6splus which extends the HITCASE brand into the everyday protective case market. The SHIELD's aluminum casing and unique HITCASE Shockseal provides shockproof and underwater protection to depths of 10 feet. SHIELD is thin, has a transparent back and comes in the colours of the iPhone, which is unique to the accessories market. The SHIELD for iPhone 7 is expected to launch in Q2 fiscal 2017.