Immunotec Inc. (IMM), a direct-to-consumer company and a leader in the nutritional industry (the Company or Immunotec), today announced its consolidated financial results for the third quarter of Fiscal 2015. All amounts in this press release are denominated in Canadian dollars unless otherwise indicated.
Our Company improved its profitability significantly during the first nine month period of this fiscal year, said Charles L. Orr, Chief Executive Officer of Immunotec. During the 3rd quarter, we were pleased to increase our presence in the United States, the largest Direct Selling market in the world, added Mr. Orr.
DEVELOPMENTS DURING THE THIRD QUARTER
— May 2015 – Immunotec announced that Health Canada granted a new health claim specific to Immunocal's ability to help increase muscle strength and enhance performance when combined with regular exercise. This achievement is the fruition of over four decades of research at leading university hospitals in Canada and abroad.
— May 2015 – Immunotec welcomes Dr. Ronald Prussick, MD, FRCPCopyright as a distinguished member of the Immunotec Scientific Advisory Board. Dr.Prussick currently serves as the medical director of The Washington Dermatology Center and Assistant Clinical Professor at George Washington University in Washington, DC. He will work with the Immunotec Product Development Committee (PDC) playing an integral role in the development of a new all-natural skin care line.
— July 2015 – Immunotec announced that it has obtained additional financing in the total amount of $2.8 M, to support growth, activities of its Mexican subsidiaries and the modernization of its Canadian manufacturing infrastructure.
— July 2015 – Immunotec announced that it had reached a Conclusive Agreement with both tax authorities Procuraduria de la Defensa del Contribuyente (PRODECON) and Servicio Administracion Tributaria (SAT) in regard to the Company's Mexican subsidiary's imports into Mexico.
Revenues for the three- and nine-month periods ending July 31, 2015 reached $22.1M and $60.0M compared to $22.3M and $57.5M during the same periods in the previous year, a decrease of $0.2M or 0.9% for the third quarter but an increase of $2.5M or 4.3% for the nine-month period.
In the United States, the increase in network sales is the result of an increase in the sponsoring(1) of new consultants and customers. For the three- and nine-month periods ended July 31, 2015, the number of new independent consultants and customers in the United States increased by 37.0% and 31.1% compared to the corresponding periods in the previous year. This increase primarily reflects the Company's continued success in attracting customers and independent consultants throughout the United States. To support this growth, the Company opened a satellite office in California in October 2014.
In Mexico, sponsoring activities declined by 20.6% and 16.5% over the same period the previous year, mostly attributable to the 16% value added tax (VAT) which the Company began charging on the sale of its products in Mexico as of October 1st, 2014. Management has and continues to invest efforts in communications with its field leaders in Mexico to explain the reasons for this change, and the Company expects the current adaptation period to continue through fiscal 2015.
In Canada, the number of new customers and independent consultants decreased by 2.6% for the three-month period and increased by 8.1% for the nine-month period compared to the same periods in the previous year. This increase was mostly from the Eastern provinces of Canada.
We are pleased to have concluded additional financing designed to support growth initiatives and modernize our supply chain said Mr. Patrick Montpetit, Chief Financial Officer. By harmonizing our import tax position in Mexico we can now increase our infrastructure to support future growth.
Adjusted EBITDA(1) for the three- and nine-month periods ended July 31, 2015 amounted to $1.5M or 6.7% and $4.0M or 6.7% of revenues compared to $1.7M or 7.5% and $3.8M or 6.7% in the same periods the previous year. For the nine-month periods, the Adjusted EBITDA(1) was relatively stable at 6.7% of total revenues and recording a 4% increase over the prior year.
(1) Refer to the NON-GAAP MEASURES section. The definition of Sponsoring and the Adjusted EBITDA reconciliation to Net (loss) profit is shown below.
Net profit for the three- and nine-month periods ended July 31, 2015 totalled $1.2M and $2.3M as compared to a loss of $4.3M and $2.7M in the corresponding periods in the previous year.
About Immunotec Inc.
Immunotec is a Canadian-based Company that develops, manufactures, markets and sells research-driven nutritional products through direct-to-consumer sales channels in Canada, the U.S. and Mexico. The Company offers an extensive family of nutritional products targeting health, wellness, weight management, as well as energy and performance. The Immunocal family of products is supported by over 40 published articles and supporting science in medical and scientific literature.
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