KENOSHA, WI--(Marketwired - Sep 27, 2013) - Pacific Sands, Inc. (
Net sales of $2,032,057 for the fiscal year ended June 30, 2013 were the highest for any year in the company's 19-year history. Fiscal fourth quarter operating profit of $64,539 was also the largest in company history. After deduction of interest costs and other items, the net, after tax, profit for the fourth quarter was $55,204.
"We enter the new fiscal year with a significant order backlog and continue to see growing demand for our products," said Michael Michie, President and CEO. "The company has moved to a modern facility in Kenosha and completed a quarter million dollar capital improvement program, which has contributed to our productivity and efficiency. We believe that the company will achieve significant milestones in sales and profitability in the new fiscal year."
The company recorded a net loss of $104,483 for the year ended June 30, 2013. During the first three quarters of the fiscal year, nearly $200,000 was spent on marketing personnel and programs to build visibility and momentum. The company now believes that it has reached a profitable level of annual sales, and marketing expenditures were reduced in fiscal fourth quarter, which had a significant impact on driving fourth quarter profitability. The company's loss from operations declined to $71,517 in fiscal 2013 compared to a loss of $129,208 in fiscal 2012.
Gross profit for the fiscal year ending June 30, 2013, was $838,312 a 12% increase over the gross profit of $746,070 for the prior year. Gross profit margins increased from 40% last fiscal year to 41% this year, or 2.5%. The company believes that additional volume related purchase price discounts on raw materials as well as continued operational improvements at the new Kenosha facility could increase profit margins again in the new fiscal year.
"We maintain our confidence that with stable marketing costs in fiscal 2014, and even modest organic growth, we will be able to generate an operating profit for the full year," said Michie. "We had no income tax expenses in fiscal 2013, and entered fiscal 2014 with a $3.25 million tax loss carryforward. We believe our strengthened balance sheet and improved debt structure, increased productivity and operating efficiency have all positioned Pacific Sands to build shareholder value."
During fiscal 2013, the company increased the number of shares outstanding by 1,116,959, or about 1.75%, primarily to fund the capital improvements at the new facility. On August 30, 2013, the company announced that it had repurchased, and retired, 500,000 shares of its common stock. Approximately 45% of the fourth quarter net profit was allocated to this purchase. Michie said the company will continue to reduce and restructure outstanding debt to strengthen its balance sheet and may also consider additional stock repurchases from time to time based on company profitability.
At June 30, 2013, the company had current assets and total assets of $673,588 and $906,956, respectively, compared to June 30, 2012, when the company had current assets of $672,536 and total assets of $828,625. Cash and cash equivalents totaled $90,040 and $57,575 at June 30, 2013 and 2012, respectively. Interest expense increased $16,014 or 82% for the year ended June 30, 2013, compared to the prior year, however, interest-bearing debt was reduced and new debt with lower interest rates replaced higher cost loans.
"We have a solid sales pipeline and increasingly diversified revenue stream, in part spurred by our marketing investment," said Michie. "We continue to experience growing demand for our products -- particularly our private label products -- and are enthusiastic about customer response to non-toxic solutions."
About The Company
Pacific Sands, Inc. (www.pacificsands.biz) is a rapidly growing company that develops, markets and sells unique non-toxic, earth-, health- and child-friendly products for cleaning, personal hygiene, and water maintenance applications. The company's ecoone® Spa Treatment system earned a third place finish in the "Best Green Product" category at the International Pool and Spa show held November 2012 in New Orleans. In 2011, the company was recognized by a Milwaukee-based business publication as the fastest growing public company in Wisconsin. Wal-Mart's Innovation Network awarded one of the company's products the highest "Success Likelihood Score" ever granted in the program's 22-year history.
Safe Harbor Act Disclaimer
The statements contained in this release and statements that the company may make orally in connection with this release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward-looking statements, since these forward-looking statements involve risks and uncertainties that could significantly and adversely impact the company's business. Therefore, actual outcomes and results may differ materially from those made in forward-looking statements.
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President & CEO