Pioneering Technology Corp. Reports Q1 2014 Financial Results
The Company reaches a new milestone reporting its best quarter to date
Mississauga, Ontario CANADA, February 28, 2014 /FSC/ - Pioneering Technology Corp. (PTE - TSX Venture), ("Pioneering" or the "Company"), an "Energy Smart" product innovation/consumer goods company and North America's leader in cooking fire prevention technologies, reports its financial results for the three months ended December 31, 2013. The Company's unaudited financial statements together with its Management Discussion and Analysis are available for review at www.sedar.com.
The Company enjoyed its best quarter ever for the three months ending December 31, 2013. For the first time in the Company's history it has eclipsed the one million dollar mark in revenue for a single quarter.
Financial Results
Total revenue for the quarter ended December 31, 2013 of $1,105,421 was up approximately 358% as compared to $241,574 in the first quarter ended December 31, 2012 and up 482% versus the previous quarter (Q4 2013 - approx. $190,000). The majority of this revenue (approx. 98%) was driven by the Company's Safe-T-element (STE) cooking technology. The sales pipeline for the STE in Q2 is very strong. Volume and velocity from large distributors is driving growth in STE revenue and is based on end users strong demand for the product.
Comprehensive income for the period was $131,143 or approximately $.01 per share compared to a loss in the same period year ago of ($275,270) or approximately ($.02) per share. Adjusted EBITDA was $161,811 during the quarter versus a loss of ($348,965) during the same period year ago, an improvement of $510,776. Gross margin for the quarter ended December 31, 2013 was approximately 62%. Net income for the quarter was approximately 12% of total sales.
Total expenses for the three month period ended December 31, 2013 were $540,233 of which $144,000 were development costs that were expensed during the period. This compares to total expenses of $416,186 in the same period in 2012 when $93,000 of these development costs were capitalized. Of the $144,000 of development costs incurred in Q1 2014 approximately $72,000 were "hard" costs associated with tooling and other related expenses to enable production of the two new products.
Administration was down by approximately $6,000 versus same period year ago; Sales and Marketing expenses were up modestly by approximately $11,000 versus same period year ago as the Company invested in the commercialization and go-to-market plans of its two new product opportunities. Warranty/warehousing was down approximately $33,000 versus same period year ago as the company experienced lower costs related to in field service of the STE product.
While the Company's existing business is growing management believes that the Company's highly anticipated new products, which it intends to launch shortly, will drive additional growth in current channels and on-line and at retail.
The Company has worked hard to create awareness for this significant problem and its product solutions. The Company has created this category based on real end-user need and demand, with the help of the fire service, safety/public health experts/professionals, government, insurance companies and now the private sector.
While pre 2014 was focused on creating and building a new category, 2014 and beyond is focused on capitalizing on recent successes with existing products, launching new products and building this category into a meaningful revenue generator positioning the Company for long term growth and enhanced shareholder value.
Pioneering announces retail listing approval for new consumer version of the STE
On February 25th Pioneering announced that it had received regulatory listing approval and another patent paving the way for the introduction of the consumer version of its highly anticipated and award winning Safe-T-element cooking system technology this spring. This new easy to install consumer version delivers all of the benefits of the original except that this new consumer version looks even more upscale and no longer requires a professional installation so anyone can now install the technology in a few minutes. The product is expected to be available on line and at retail starting in May.
Pioneering closes short-term debt financing
On January 24th, 2014 the Company approved a $500,000 short term loan from a significant shareholder, McAllister Holdings Ltd. The loan carries no interest and is to be paid back by May 17, 2014 and was issued for consideration in the form of 2,000,000 warrants at an exercise price of $0.15, exercisable in the next year. The transaction received regulatory approval by the TSXV on February 7, 2014. The proceeds are to be used to help support increasing sales of the STE and to help get the two new products to market as quickly as possible.
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About Pioneering Technology Corp: Pioneering, based in Mississauga, Ontario is an "Energy Smart" product innovation/consumer goods company and North America's leader in cooking fire prevention technologies. Pioneering engineers and brings to market energy smart solutions for consumer products making them safer, smarter and/or more efficient. Pioneering's patented cooking technologies/products are engineered to help prevent cooking fires, the number one cause of household fire (a multi-billion dollar problem) in North America and around the world. The Company's proprietary, family of fire prevention technologies/products are designed to prevent cooking fires and false alarms on most cooking appliances (electric and gas stovetops and microwave ovens). The Company's flagship product, the Safe-T-element cooking system has been installed on over 100,000 ranges in multi-residential housing (low income, seniors, college/university and military housing) throughout the world. Pioneering trademarks include Safe-T-element, RangeMinder, Safe-T-burner, Safe-T-Sensor, Powergrill, Battery Eliminator, Powerpak and the Hydro-free Furnace Fan.
For more information visit: www.pioneeringtech.com or contact: Kevin Callahan, President & CEO at (905) 712-2061 ext. 222.
Forward Looking Statements
The statements made in this press release include forward-looking statements that involve a number of risks and uncertainties. These statements relate to future events or future performance and reflect management's current expectations and assumptions. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, such as the economy, generally, competition in the Corporation's target markets, the demand for the Corporation's products, the availability of funding, the efficacy of the Corporation's technology and governmental regulation. These forward-looking statements are made as of the date hereof an, except as required by applicable law, the Corporation does not assume any obligation to update or revise them to reflect new events or circumstances. Actual events or results could differ materially from the Corporation's expectations and projections.
Non-GAAP Measures
Adjusted EBITDA is a measure not recognized under Canadian generally accepted accounting principles ("GAAP"). However, management of Pioneering believes that most shareholders, creditors, other stakeholders and investment analysts prefer to have these measures included as reported measures of operating performance, a proxy for cash flow, and to facilitate valuation analysis. Adjusted EBITDA is defined as earnings before interest income, taxes, depreciation and amortization; stock based compensation, restructuring costs, impairment charges, and other non-recurring gains or losses. Management believes Adjusted EBITDA is a useful measure that facilitates period-to-period operating comparisons.
Adjusted EBITDA does not have any standard meanings prescribed by GAAP and therefore may not be comparable to similar measures presented by other issuers. Readers are cautioned that Adjusted EBITDA is not an alternative to measures determined in accordance with GAAP and should not, on its own, be construed as indicators of performance, cash flow or profitability. References to the Corporation's Adjusted EBITDA should be read in conjunction with the financial statements and management's discussion and analysis of the Corporation posted on SEDAR (www.sedar.com).
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy and accuracy of this release.
(Not for dissemination in the United States of America)
220 Britannia Road East,
Mississauga, Ontario,
Canada, L4Z 1S6
Tel: (905) 712-2061
Fax: (905) 712-3833
Toll Free: 1(800) 433-6026
info@pioneeringtech.com
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