CARMANAH TECHNOLOGIES CORP ("CMH-V;CMHXF-0")
- Year End Results
- Financials Available From Company
Carmanah Technologies Corporation is pleased to announce it's audited
year end results for the years ended December 31, 2001 and 2000. Carmanah's
total revenues for the year ended December 31, 2001 increased 52% to
$3,379,745 compared with $2,227,731 for the preceding year. Revenue growth
was achieved through increased investment in sales and marketing resources
and activities. Sales were increased throughout our existing product lines
and through the introduction of several new products as well. Net income
(loss) for fiscal 2001 before depreciation and amortization was $(335,652),
compared with $136,385 in fiscal 2000. The 2001 loss includes the
significant increase to research and development expenses on the income
statement of $271,485, versus the minimal expense in 2000 of $24,773. The
loss can also be attributed to the one time costs of our public listing
last year and the additional resources and administrative expenses required
to support the extensive sales and marketing activities. Carmanah's gross
profit margin increased to 53% of sales, an 8% increase over previous
year's 45% gross profit margin. This increase is the result of an
aggressive direct sales program and an increased focus and emphasis on
e-commerce sales initiatives. Direct sales comprised 22% of total sales in
fiscal 2001, compared with 4% in fiscal 2000. Wages and benefits for the
2001 fiscal year increased 116% to $1,102,351, compared with $511,281 in
2000. This is the result of increased sales, business development,
production and administrative staff to support the Company's expansion into
new products and new markets. Carmanah's staffing grew 100% to 30 Full-Time
Equivalent's (FTE's) in fiscal 2001, compared with 15 FTE's in 2000. Fiscal
2001 office and administration expenses of $539,360 increased significantly
over last year's $167,440. This is the result of the one-time costs
incurred for the reverse takeover listing, additional ongoing public
company expenses and the increased infrastructure required to support
staffing growth. Sales and marketing expense in the amount of $200,705 at
2001 year end, represents a 111% increase over $95,406 at 2000 year end.
The Company continued to increase sales and marketing activities for new
and existing product lines, throughout its worldwide marketplace. Focus was
placed on new market introduction as well as key trade shows and customer
contact. Year end 2001 indicates research and development expenditures of
$271,485, compared with fiscal 2000's $24,773. This significant increase on
the statement of operations and deficit is the result of two factors.
Firstly, the Company did not book the Scientific Research and Experimental
Development (SRED) cost recovery against its R&D expenses in year 2001,
as was done in 2000. As a wholly owned subsidiary of the public company
Carmanah Technologies Corporation, Carmanah Technologies Inc. may no longer
recover research and development expense reimbursement through SRED. The
claim may only be applied as a tax credit against future tax payable.
Secondly, the Company did not capitalize as many of its projects in this
current year. Carmanah's previous investment in intellectual property (over
the past several years) to develop the underlying core technology has
resulted in the ability to turn new ideas for new markets into saleable
product much faster. The total investment in research and development
including the capitalized portion increased 42%, represented by $502,687 in
2001 compared with $354,112 in 2000. However, as a percen tage of sales,
total investment in research and development was 15% of 2001 sales,
compared to 16% of 2000 sales, indicating that growth in R&D investment is
maintained at a consistent level with sales. The Company's cash balance
increased from $185,634 as at December 31, 2000 to $1,060,817 as at
December 31, 2001, an increase of $875,183. Net cash usage from operations
and investing activities for the year was $750,345 versus $511,137 last
year. Financing for Carmanah's operations was funded from the $1.75 million
raised in the reverse takeover. Net working capital at year end was
$1,664,885, with a current ratio of 4.76 and $47,447 of non-current debt
obligations. The overall performance of the company for fiscal 2001 was
consistent with the objectives set forth before last year s public listing
and financing. The Company invested considerably into new product
development and sales and marketing initiatives that are intended to fuel
growth over the coming twelve months. The necessary infrastructure and
systems have been implemented and expectations for results early in the
2002 fiscal year are high.
TEL: (604) 629-0264 Art Aylesworth, CEO and Director
Toll Free: 866-629-0264 Mr. Praveen Varshney, Director
FAX: (604) 682-4768
E-mail: investors@carmanah.com
Media Contact:
TEL: (250) 382-4332 Mr. David Davies, Harbourwerks Communications
Email: ddavies@harbourwerks.com
Investor Relations Contact:
TEL: (604) 608-0824 Vanguard Shareholder Solutions
Toll-Free: 800-567-6223
Email: ir@vanguardsolutions.ca |
