NIA Quarterly Results Ending November 30th 2015
Cash decreased by $200,000 and at the same time Liabilities dropped by $100,000 compared to last quarter and inventory, prepaid expenses increased.
Financial Results
Assets
Cash: $722,010 - $0.036c a share in cash
Accounts Receivable: $183,544
Prepaid Expenses: $42,596
Inventory: $203,203
Property: $3,400
Unallocated purchase price: $990,344
Total Assets: $2,145,097
Liabilities
Payables: $93,465
Loan: $31,250
Total Liabilities: $124,715
MD&A Highlights
Results of Operations For the Three Months Ended November 30, 2015
As of November 30,, 2015, the Corporation had cash and cash equivalents of $722,010 including $650,000 in a business investment bank account with a major Canadian bank. Other current assets were $429,343 and net working capital was $1,042,888.
The Corporation’s net loss increased in 2015 as a result of the startup nature of the Blu-Dot acquisition. Sales of $98,059 in the quarter decreased from Sales of $159,299 in the previous quarter. Sales decreased as the weather cooled. Also, the previous quarter was buoyed by marketing programs and from the summer seasonally warmer weather in Canada. Like the previous quarter, gross margins were negatively affected by some of the operating changes. Margins will benefit from these changes in the longer term.
Sales and marketing costs of $43,636 were unchanged from $45,913 in the previous quarter. Operating costs of $75,390 increased as compared to those in the previous quarter ($50,113) due to the addition of a General Manager. Public corporation costs are within expectations and include such items as transfer agent fees, listing fees, audit fees and legal fees. Public corporation costs in the November 2014 quarter reflected costs related to the qualifying transaction while costs in the 2015 quarter reflected ongoing reporting obligations of an operating company. These expenses combined with inventory and accounts receivable increases, created most of the decrease in cash in the period.
Blu-Dot expends sales and marketing costs with two objectives; i) to identify, promote and close listings with new distributor and direct customer relationships that meet the company’s criteria, and ii) to drive consumer trial, demand and purchase of the Blu-Dot products from the store shelves where Blu-Dot has been listed. All costs and expenditures that are directly related to these revenue growth objectives are classified as sales and marketing costs.
Blu-Dot’s revenue growth strategy for the next three years is focused on:
1)gaining ever increasing sales velocity from each existing distributor and customer relationships via “same store” revenue increases from each store that the Blu-Dot product is sold in.
2) attracting new listings with additional new distributors and direct customers in Canada.
3) attracting new listings with additional new distributors and direct customers in the USA with a primary focus on the northeast US markets.
Blu-Dot expects its revenues to grow through the 2016 calendar year resulting from increasing revenues from existing relationships and new listings in both Canada and the USA from new distributors and new direct customers. The Blu-Dot business will monitor its performance in growing revenues in each of the three methods indicated above.
Potential New Acquisitions
Based on its overall strategic plan, NVC expects to expand its overall business by; the successful organic growth of each of its underlying brands and product lines as well as; acquiring (or investing in) additional brands and product lines, all within the healthy better for you beverage and foods consumer packaged goods sector. As such, as a significant component of its overall corporate strategy, NVC has established a strategic plan and process with the objective of identifying, soliciting, evaluating and closing additional future acquisitions that meet NVC’S objectives and criteria. The Blu-Dot acquisition was the first acquisition as part of this long term plan. NVC is currently and will continue to develop a pipeline of potential suitable acquisition/investment targets. The goal is to be in a position to move forward with the next acquisition within the next 12 to 18 months based on a number of criteria and milestones. |
