BOULDER, Colo., Aug. 24, 2004 (PRIMEZONE) -- CapSource Financial, Inc. (OTCBB:CPSO) announced that its consolidated net sales and rental income for the second quarter ended June 30, 2004 increased 26.0% to $1,401,955 compared with $1,112,437 for the comparable period last year. President and CEO Fred Boethling noted that the "growth was made up of two components: trailer sales income of $1,232,810, which grew by 37.1%, offset by lease/rental income of $153,216, which declined 12.4%."
According to Boethling, "growth in trailer sales was driven by our expanding sales efforts in Mexico. In January 2003, we intensified our focus on developing our sales infrastructure by opening a new trailer sale and storage facility in a strategic area of Mexico City, significantly improving customer awareness of our operations and our products. It would seem our efforts are beginning to pay off."
Boethling further noted that, "we believe that the new facility, which became fully operational in the second half of 2003, strengthened our capacity to respond more rapidly to our customers." Boethling said, "as we directed our working capital towards increased sales, we reduced our equipment lease portfolio by approximately 14.6% compared to the second quarter of last year, with the resulting decline in lease/rental income."
For the six months ended June 30, 2004, consolidated net sales and rental income increased 45.0% to $2,728,071, compared to $1,881,062 in the same period last year. This increase was a result of increased trailer sales, partially offset by reduced lease/rental income.
Gross margin consists of net sales and rental income less cost of sales and operating leases. For the second quarter ended June 30, 2004, gross margin increased 65.4% to $165,116 compared with $99,832 for the same period last year, as a result of higher net trailer sales and reduced lease/rental operating costs in 2004. For the six months ended June 30, 2004, gross margin increased 39.9% to $347,299 compared with $248,209 for the same period last year. This improvement resulted primarily from the increase in consolidated net trailer sales.
According to Boethling, "we recognized a net loss of $417,961 or $0.04 per diluted share, for the second quarter ended June 30, 2004, compared with a net loss of $464,943, or $0.06 per diluted share, for the same period last year. The reduction in net loss was due to higher net sales and gross margins, coupled with reduced interest expense, and partially offset by an increase in selling, general and administrative expenses which increased due to the added costs associated with our new sales and service facility."
For the six months ended June 30, 2004, the Company reported a net loss was $724,926, or $0.07 per diluted share for the second quarter ended June 30, 2004, compared with a net loss of $885,511, or $0.11 per diluted share, for the same period last year. This reduction in net loss was due to higher net sales and gross margins, coupled with reduced interest expense, and partially offset by an increase in selling, general and administrative expenses.
About CapSource Financial,
CapSource Financial, Inc. was incorporated in 1996 to take advantage of the 1994 North American Free Trade Agreement (NAFTA) and the increased economic activity that NAFTA triggered when the world's largest free trade area was created by linking 406 million people in Mexico, the U.S. and Canada producing more than $11 trillion worth of goods and services or about one-third of the world's total GDP. After ten years, NAFTA has been a huge success. Mexico is now the United States' second largest trading partner. Total trade among the three NAFTA countries has grown to $1.7 billion in goods crossing the borders each day. U.S. trade with Mexico has increased nearly 500 percent - from $48 billion to $239 billion since the passage of NAFTA. The vast majority of this trade moves by truck.