Environmental Solutions Worldwide, Inc. Reports December 2002 Financial Results & CEO Update; Completes Unit Private Placement
March 20, 2003 08:50:00 AM ET
TELFORD, Pa.--(BUSINESS WIRE)--March 20, 2003--Environmental Solutions Worldwide, Inc. (ESW) ESWW, a company that develops, manufactures and markets environmental technologies, today announced that it has filed its financial results for the fiscal year ended December 31, 2002 with the Securities and Exchange Commission in its Form 10-KSB.
Financial highlights for the three months ended December 31, 2002 as compared to the same period in the prior fiscal year include: Revenue of $364,493 compared to $311,627. Cost of Sales was $58,804 (net of returned merchandise in the amount of $70,275), compared to $131,770 for the same period in the preceding year. These three months generated a Gross Profit of $305,689 compared to $179,857 in 2001. Operating costs for this period were $574,644, resulting in a net loss of $268,955 in Q4'02 compared to Operating costs of $581,935 and a loss of $402,078 for this same period in 2001.
Financial highlights for the fiscal year ended December 31, 2002 as compared to the prior fiscal year include: Revenue for 2002 increased to $1.9 million from $716 thousand in 2001, or 166%. The increase in revenue is attributable to increased orders received and produced during the year. Cost of sales increased proportionately, and as a result, gross profit remained reasonably stable. Gross profit for fiscal 2002 was 47.3% as compared to 48.6% in 2001, a decrease of 2.7%. Operating costs continued to decrease, by $1.01 million or 33.4% to $2.02 million, as the Company reduced its dependence on Consultants ($788 thousand) and continued to reduce other Overhead, Sales and General and Administrative costs ($233 thousand). Due to the continued reduction in operating costs, the Company was able to reduce its loss from operations to $1.12 million, a reduction of $1.57 million from fiscal 2001 when the Company reported a loss of $2.69 million.
John Donohoe, ESW's Chairman, CEO & President, commented: "we are pleased with the improvements that were made in 2002 and further believe that these results reflect continued progress in the right direction for ESW. 2002 was an eventful year for the company, as ESW completed the transition from a research and development company into a manufacturing and sales organization. As reported in preceding 2002 Press Releases, ESW successfully completed changes in leadership, internal management, strategic direction, and operations. Further, by continuing to have our products certified and accepted by our customers, interest in our company has continued to increase.
Mr. Donohoe further stated, "that no longer, is ESW simply confronted by proving our capabilities. Our challenge today, is the understanding of our total sales-cycle. Because of our immaturity as a production company, we have recently struggled to absorb the variability of this process. The ongoing dynamics of this process, from a client inquiry, through our product sample results, to ultimately receiving the order and delivering the product, still has not produced the steady and recurring revenue model that we are seeking. However, we believe that we shall be successful in managing this area as well, in 2003, as ESW further develops into a self-sufficient successful company.
In the second half of fiscal 2002, the company also initiated and closed two traunches of a unit private placement under Regulation D of the Securities Act of 1933, whereby accredited investors subscribed to units at a per unit price of $.17. Each unit is comprised of one share of the company's restricted common stock, par value $.001 and one warrant that can be exercised for a period of three (3) years at an exercise price of $.15 per warrant to purchase one half (1/2) a share of common stock. Warrants are exercisable only in even lots for an aggregate exercise price $.30 for one share of common stock. With the completion of the third traunch and recent closing of the placement which had been extended with consent of all subscribers, the company has received an aggregate of $1,487,120 from (22) accredited investors and has issued a total of 8,747,762 units.
ENVIRONMENTAL SOLUTIONS WORLDWIDE, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MIONTHS ENDED DECEMBER 31, 2002 AND 2001
2002 2001(a)
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Revenues
Net sales $ 364,493 $ 311,627
Cost of revenues 58,804 131,770
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Gross profit 305,689 179,857
Operating expenses
Consulting fees 69,899 162,686
Officers compensation 61,921 235,575
General and administrative 442,824 183,674
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574,644 581,935
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Net loss $(268,955) $(402,078)
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ENVIRONMENTAL SOLUTIONS WORLDWIDE, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2002 AND 2001
2002 2001(a)
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Revenues
Net sales $ 1,902,297 $ 716,180
Cost of revenues 1,002,554 368,099
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Gross profit 899,743 348,081
Operating expenses
Consulting fees 193,086 1,050,514
Officers compensation 222,600 244,514
General and administrative 1,607,387 1,742,757
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2,023,073 3,037,796
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Net loss $(1,123,330) $(2,689,715)
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Loss per share information:
Basic and diluted $ (.03) $ (.07)
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Weighted average number of
shares outstanding 40,673,030 35,913,538
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(a) reclassified for comparative purposes
PRESS RELEASE UPDATE & SCHEDULED CEO INTERVIEW
As indicated, in the October 2002 Chairman-CEO letter to ESW shareholders, "to better communicate the company's ongoing activities, in quarterly updates, the company would be providing a status report of the previous quarters press releases, as well as participating in quarterly CEO interviews that would be made available for listening."
Pursuant to that initiative, CEOcast will be interviewing John Donohoe on Monday 3/24/03 at 10:00 AM. Details and replay instructions will be posted on the company's website www.cleanerfuture.com.
As this is the initial Press Release Update, the following table reflects commentary on all nineteen of the 2002 releases:
Date Title Subject and Update
15-Nov-02 ESW Announces Quarterly Third Quarter Financial Recap - As
Results Stated
25-Oct-02 ESW Files Schedule 14A Proxy & AGM - As Stated
Proxy Statement Notice
Of Annual Meeting Of
Stockholders
24-Oct-02 ESW Customers Continue ESW continues to supply the
to be Granted EPA/CARB customers granted the EPA/CARB
Certifications Using certifications Quiet Cat(TM)
Quiet Cat Catalyst- converters and substrates and has
Muffler Systems made the necessary modifications
in the manufacturing process to
streamline the production and
increase the profitability of
these programs. ESW continues to
draw the attention of new
customers as the word of our
efficient products and services
spreads among the utility engine
companies. To date, ESW customers
have received 21 certifications on
all of our product lines.
16-Oct-02 ESW Completes First Private Placement Update - Closed
Closing Of Private 2/28/03
Placement
16-Oct-02 ESW Chairman of the Bengt Odner steps down as Chairman
Board Steps Down - As Stated
28-Aug-02 ESW Receives Second EPA As was reported in the Press
Certification Release dated 5/9/02 ESW had filed
for a second CARB/EPA
Certification on behalf of one of
its diesel utility engine
customers. ESW received the full
certification for this engine
group and continues to manufacture
and ship this customer Quiet
Cat(TM) converters and substrates.
15-Aug-02 ESW Announces Quarterly Second Quarter Financial Recap
Results - As Stated
13-Aug-02 ESW Announces SEC Civil SEC Suit - Formal suit commenced
Suit against company. Settlement
efforts continue.
2-Aug-02 New CEO of ESW Addresses SEC Suit - Company discusses its
SEC Inquiry intentions to cooperate with SEC
24-Jul-02 ESW Appoints John A. As Stated
Donohoe..
18-Jul-02 ESW Letter from the Falling Stock Price & 11 PO's
Chairman received. By customer request, 8
of the 11 Purchase Orders were
filled in 2002. The remaining
three will be delivered in 2003.
29-May-02 ESW Signs Distribution Hudson Engineering continues to
Contracts work with ESW to expand our market
and sales into India for both
diesel and gas/petrol converters.
TTA continues to work with ESW on
various government tenders to sell
our gas/petrol catalytic
converters. TTA is currently
working with the pollution
regulatory body of the government
to implement the new diesel
emission regulations. To date,
neither of these programs has
netted new sales. However, we
believe that both will contribute
positively in the future.
23-May-02 ESW's Clean Cat Diesel To date, this program has not
Catalytic Converter matured, and currently there is no
Achieves OEM Status in meaningful activity between the
the Philippines Company and this Philippines
initiative. ESW will be
determining in 2003 if the
opportunity still exists.
22-May-02 ESW Announces Quarterly First Quarter Financial Recap
Results - As Stated
9-May-02 ESW Receives EPA Approval of Second EPA
Certification Certification. ESW has since begun
the delivery of the Quiet Cat(TM)
finished converters and individual
substrates to this CARB/EPA
Certified customer. ESW has also
been requested to do further
certifications for this customer
for a number of other engine
groups in their catalogue.
11-Apr-02 ESW Reports Dec 2001 2001 Results Release - As Stated
Financial Result
31-Jan-02 ESW Increases Order Although ESW received written
Bookings for Delivery commitments for sales and/or
in 2002 purchase orders for this period
and for 2002, as products were
shipped, orders were modified and
funding for some of these programs
was downsized or eliminated.
Unfortunately because of customer
changes, much of these sales
commitments did not turn into
revenue.
30-Jan-02 ESW Announces the Personnel requirements changed in
addition of Key Staff 2002 and the relationship with
at its Wholly Owned both these individuals was
Subsidiary, ESW America mutually discontinued in Q1 & Q2.
24-Jan-02 ESW Makes Strategic As Stated
Move To Consolidate
Operations To
Pennsylvania
About Environmental Solutions Worldwide Inc.
With headquarters in Telford, Pennsylvania Environmental Solutions Worldwide is a publicly traded research and development company engaged through its subsidiaries in the design, development, manufacture and sale of environmental technologies currently focused on the international automotive and transportation industries. ESW manufactures and markets a line of catalytic emission control products and catalytic conversion technologies for a multitude of applications.
For updated information, please visit the Company's Web site at: www.cleanerfuture.com.
Safe Harbor
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (The "Act"). In particular, when used in the preceding discussion, the words "pleased" "plan," "confident that," "believe," "expect," or "intend to," and similar conditional expressions are intended to identify forward looking statements within the meaning of the Act and are subject to the safe harbor created by the Act. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward-looking statements. Such risks and uncertainties include, but are not limited to, market conditions, general acceptance of the Company's products and technologies, competitive factors, the ability to successfully complete additional financings and other risks described in the Company's SEC reports and filings.
Contact Information:
Environmental Solutions Worldwide, Inc.
David Johnson, 905/850-9970
djohnson@cleanerfuture.com
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