EDMONTON, ALBERTA--(Marketwire - Aug. 10, 2007) - CV Technologies Inc. (TSX:CVQ) today released its financial results for the third quarter ending June 30, 2007. The Company reported net revenues of $3.2 million compared to $3.2 million for the same period last year.
Loss before tax was $1.8 million compared to a loss of $2.4 million for the same quarter in the prior year. Loss after tax was $1.9 million compared to $1.8 million loss for the same quarter in the previous year.
The Company is well underway in implementing its business recovery and revitalization program. Reduced expenditures related to the U.S. launch brought costs into line with seasonal sales levels, and it is employing a targeted approach to expanding U.S. sales. The Company is focused on preparing for the upcoming cold and flu season as it strengthens and grows its core Canadian business.
Gross margin decreased from 68.5% in the third quarter in the prior year to 59.6%. The Company incurred extra warehousing and distribution costs related to larger investments in inventory in the U.S. and made an inventory valuation allowance, during a period of relatively low seasonal sales.
Management continues to exercise strong cash management with cost containment, initiatives to reduce inventory, and better management of working capital. The Company is in the process of completing security documentation with its new banking partner and anticipates finalization by the end of August.
COLD-fX continues as the number one cold and flu remedy in the country (ACNielsen's MarketTrack Service for Cold Remedies, Natural Supplements & Vitamins Categories for the 52 weeks ending June 9, 2007). This sales performance occurred during unusually mild winter months.
Selected financial information relating to the three and nine month periods ended June 30, 2007 and 2006 is included in this press release. This information should be read in conjunction with the consolidated financial statements and the notes thereto of the Company for the three and nine month periods ended June 30, 2007 and 2006 and accompanying management's discussion and analysis that are being filed today with securities regulators and will be available on www.sedar.com and on the Company's website at www.cvtechnologies.com.
The Company's Audit Committee has reviewed the interim consolidated quarterly financial reports. The Company's auditors have also performed the quarterly review in accordance with CICA Handbook Section 7050, Auditor Review of Interim Financial Statements).
ABOUT CV TECHNOLOGIES INC.
CV Technologies, founded in 1992, is a global leader in the development and commercialization of naturally derived, evidence based, natural therapeutics for disease prevention and health maintenance. The Company's lead product - COLD-fX® - strengthens the immune system and is widely used as a leading over the counter remedy (OTC) for preventing and relieving cold and flu infections. In the United States it is marketed as an immune enhancing dietary supplement. COLD-fX®, with its unique and patented mechanism of action was standardized according to the Company's ChemBioPrint (CBP) Process. The CBP process precisely identifies the chemical profile and biological activity of multi-active compounds in evidence-based natural therapeutics. The CBP process also provides a manufacturing protocol that ensures each batch of the final product delivers verifiable and provable health benefits. All international patents and trademarks are held by fX Life Sciences International GmbH. COLD-fX® is distributed and sold in the U.S. by COLD-fX Pharmaceuticals (USA) Inc. Both companies are wholly-owned subsidiaries of CV Technologies.
This news release contains forward-looking statements that are subject to risks and uncertainties that may cause actual results or events to differ materially from the results or events predicted in this discussion, including those comments predicting the timing and/or initiation of clinical trials, clinical trial results and associated regulatory clearances, and the potential success of U.S marketing initiatives, corporate re-organization, and product acceptance in the U.S. Factors which could cause actual results or events to differ include, but are not limited to: the impact of competition; consumer confidence and spending levels; general economic conditions; interest and currency exchange rates; unseasonable weather patterns; the cost and availability of capital; the cost and availability of grants/funding; product development and the risk that clinical trials may not demonstrate the safety and efficacy required to satisfy the regulatory authorities. Although we believe that the forward-looking statements contained herein are reasonable, we can give no assurance that our expectations are correct and that the results, performance or achievements expressed in, or implied by, forward-looking statements within this disclosure will occur, or if they do, that any benefits may be derived from them. All forward-looking statements are expressly qualified in their entirety by this cautionary statement. For a more in-depth account of risks and uncertainties, please refer to documents filed with the securities regulators on www.sedar.com. The Company assumes no duty to update this disclosure, except as required by law. The Company is a 12g3-2(b) SEC registrant.