FAIRPORT HARBOR, OH--(Marketwire - May 10, 2011) - OurPet's Company (OTCBB: OPCO)(www.ourpets.com), a leading proprietary pet supply company today reported record financial results for its first quarter ended March 31, 2011. These results include those of Cosmic Pet Products ("Cosmic Pet") which sold certain inventory, equipment and product rights to OurPet's effective July 29, 2010.
Dr. Steven Tsengas, President and CEO, said, "The 32% increase in net revenue for the 2011 first quarter compared to a year ago reflects further market penetration in our growing dog and cat product lines. We are in the midst of significant, long-term growth in our business. Last week we re-launched SmartScoop®, a patented, automated self-cleaning cat litter box that offers a unique modular design for easy cleaning and maintenance using any type of clumping litter. Early this summer we also plan to extend the Cosmic® Catnip and Go! Cat Go!™ product lines. Initial feedback from our customers has been positive and we look forward to solid incremental sales from these products beginning in the second half of 2011."
Dr. Tsengas continued, "Positive benefits are being realized from our growth strategy. The temporary impact from recent investments in our business to meet current and future demand is anticipated to begin providing positive benefits during the remainder of 2011 and beyond based on improved operating leverage and increased sales. These investments are expected to position us to achieve sustained improvement in profitability beyond 2011 as we continue to implement our growth plans."
2011 First Quarter Results
Net revenue increased 32% to a record $4,795,183 for the 2011 first quarter compared to $3,643,933 for the same period in 2010. The 2011 first quarter net revenue particularly benefited from higher sales of Play-N-Squeak® cat toys, Durapet® stainless steel bonded rubber bowls, Cosmic® Catnip products and promotional sales.
Gross profit increased 17% to $1,345,421 for the 2011 first quarter from $1,151,715 for the same period in 2010. Recent investments in infrastructure and key personnel to support the Company's growth strategy contributed to a decline in gross profit margin to 28% for the 2011 first quarter from 32% for the same period last year. These investments have been specifically directed toward scale-up of operations to meet current and anticipated sales demand.
Income from operations increased 41% to $414,121 for the 2010 first quarter from $294,617 for the same period last year. Income before taxes increased 39% to $363,692 from $261,019 for the same period in 2010.
The Company's estimate of tax loss carry forwards and their utilization resulted in recognizing an income tax charge of $55,116 during the 2011 first quarter which contributed to total income tax expense for the period of $127,438 as compared to an income tax benefit of $1,227 for the same period a year ago.
Net income declined 10% to $236,254 from $262,246 for the same period a year ago due to income tax expense for the 2011 first quarter compared to a tax benefit the prior year. Diluted earnings per share were $0.01 for the first quarter of 2011 and 2010.
The annual shareholders meeting of OurPet's Company will be held at the corporate office (1300 East Street, Fairport Harbor, Ohio 44077) on Friday, May 20, 2011 at 9:00 a.m. EDT. Shareholders are encouraged to attend the meeting.
About OurPet's Company
OurPet's Company designs, produces and markets a broad line of innovative, high-quality accessory and consumable pet products in the U.S. and overseas. Investors and customers may visit www.ourpets.com for more information about the Company and its products. The Company's Websites include: www.smartscoop.com, www.ecopurenaturals.com, www.playnsqueak.com, www.flappydogtoys.com, www.clipnosis.com and www.hideperchandgo.com.
Certain of the matters set forth in this press release are forward-looking and involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: business conditions and growth in the industry; general economic conditions; addition or loss of significant customers; the loss of key personnel; product development; competition; risks of doing business abroad; foreign government regulations; fluctuations in foreign currency rates; rising costs for raw materials and sources of supply that may be limited or unavailable from time to time; the timing of orders booked; and the other risks that are described from time to time in OurPet's SEC reports.
OURPET'S COMPANY AND SUBSIDIARIES
CONSOLIDATED OPERATING RESULTS
(Unaudited)
For the Three Months
Ended
March 31,
------------------------
2011 2010
------------ -----------
Net revenue $ 4,795,183 $ 3,643,933
Cost of goods sold 3,449,762 2,492,218
------------ -----------
Gross profit on sales 1,345,421 1,151,715
Selling, general and administrative expenses 929,332 821,289
Litigation expense 1,968 35,809
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Income from operations 414,121 294,617
Other expense, net 4,346 3,790
Interest expense 46,083 29,808
------------ -----------
Income before taxes 363,692 261,019
Income tax expense net 127,438 (1,227)
------------ -----------
Net Income $ 236,254 $ 262,246
Basic and diluted earnings per common share
after dividend requirements for preferred stock:
Net income (loss) $ 0.01 $ 0.01
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Weighted average number of common and equivalent
shares outstanding used to calculate basic and
diluted earnings per share 19,758,034 18,173,581
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CONSOLIDATED BALANCE SHEETS
(Unaudited)
March 31, December 31,
2011 2010
------------ ------------
ASSETS
Cash and equivalents $ 111,040 $ 78,673
Receivables, net 2,194,471 2,657,865
Inventories 5,780,129 5,576,129
Prepaid expenses 296,015 210,340
Deferred Tax Asset, net - 55,116
------------ ------------
Total current assets 8,381,655 8,578,123
Property and equipment, net 2,229,582 2,260,873
Other 1,240,683 997,075
------------ ------------
Total assets $ 11,851,920 $ 11,836,071
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LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term borrowings and current maturities
of long-term debt $ 3,378,852 $ 3,574,216
Accounts payable 1,932,392 1,926,499
Accrued expenses 578,979 504,504
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Total current liabilities 5,890,223 6,005,219
Long-term debt 680,195 797,604
Stockholders' Equity 5,281,502 5,033,248
------------ ------------
Total liabilities and stockholders' equity $ 11,851,920 $ 11,836,071
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Contact Information: CONTACT: OurPet's Company Dr. Steven Tsengas CEO (440) 354-6500 (Ext. 111) INVESTOR RELATIONS: Robert A. Lentz and Associates, Inc. Robert Lentz (614) 876-2000