Epicore BioNetworks Inc. Reports First Quarter Results for Fiscal Year 2017
(UNITED STATES, 12/7/2016)
Epicore BioNetworks Inc. (TSXV EBN) reported first quarter revenue of USD2.5 million and net income of USD0.2 million or USD0.009 per share for the period ended September 30, 2016.
First quarter revenue was 20% higher than last year's Q1. Net income was the same as last year. Shrimp diseases such as Early Mortality Syndrome (EMS) and a new microsporidian disease called enterocytozoon hepatopenaei (EHP) affected several Southeast Asian (SEA) producing regions. In SEA, low prices combined with the risk of disease have resulted in a curtailment in shrimp stocking. Despite this situation, sales resumed to Vietnam and increased in Indonesia and India. Sales were especially strong to newer sales areas like Australia and Singapore and to Africa.
Using nature's own biological approach to reduce pollution and minimize disease, Epicore applies biological science to solve problems in several operations around the world.
Results versus prior fiscal year quarter one were as follows:
Revenue increased by 20% to USD2.5 million
Gross profit increased by 12% to USD1.4 million
Operating expenses increased by 5% to USD0.9 million
Income before taxes increased 23% to USD0.4 million
Net income remained at USD0.2 million
EBITDA1 increased 15% to USD0.5 million
Achieved basic earnings per share of USD0.009
Increased shareholders' equity to USD9.7 million
Year-over-year cash increased 35% to USD3.7 million
Year-to-date cash flow from operations of USD0.3 million
Gross profit increased 12% in Q1 due to the increase in revenues.
Operating expense increased by 5%.
Higher revenues with relatively higher COGS expenses and a modest increase in operational expense combined to produce earnings on par with Q1 earnings prior year. Taxes were USD0.2 compared to prior year's USD0.1 because of the lack of equipment tax credits. The following table summarizes the Q1 results (rounded to thousands of US dollars):
Epicore continues to generate positive net income from operating activities. In fiscal 2016, working capital increases and investments in plant and equipment decreased cash balances but by Q1 the majority of planned capital spending is completed. Cash at the end of the quarter was USD3.7million versus USD3.4 million at the end of fiscal 2016.With these funds, expected sales revenue growth and continued relatively low operating costs, management expects there will be sufficient cash to meet the fiscal year's financial requirements, to fund expansion of aquaculture and environmental remediation marketing efforts and to pursue new strategies for enhancing shareholder value.
Over the last two years, Epicore has invested materially in a second building and automated packaging equipment. This added space is critical to its ability to increase production levels. All automated packaging equipment was in place and operational in Q1. The board has approved an ongoing capital program to enhance efficiencies and ensure redundancies in critical applications of Epicore's operations.
About Epicore BioNetworks Inc.
Epicore BioNetworks Inc. (Public, CVE:EBN) is a Canada-based company. The Company is engaged in sale of environmental biological products and specialty feeds primarily to the world aquaculture industry.
High quality granular hatchery feeds for post larval shrimp.
The Company operates in three industry segments: aquaculture, which is engaged in the development, manufacturing and marketing of biotechnology products and related services for the aquaculture industry; agriculture and municipal. Other includes products and services for the bioremediation and sanitation industries, and research and development and administrative costs.
The Company’s wholly owned subsidiaries include Epicore Networks (USA) Inc. and Epicore Ecuador S.A.
Based on the use of natural microbes and enzymes, Epicore offers a broad range of environmentally friendly biotech products to solve a variety of problems. Epicore specialty feed products are based on the company's proprietary nutritional technology. Epicore's line of aquaculture products work to improve growing water conditions, increase disease control and enhance animal nutrition.