Edmonton, Alberta - CV Technologies Inc. (TSX-VEN:CVQ) announced today the release of its first quarter financial statements. CV Technologies is reporting continuing progress in the strategic areas of the Company.
Dr. Jackie Shan, CVT's President & CSO, reports during the previous fiscal year we re-aligned the organization resulting in a leaner, more agile company, focused on marketing. During the first quarter this year we expanded and improved our distribution network with new and existing retail partners for our products in Canada. In October we launched our first product with a Drug Identification Number; Nurite-FX(r). These activities grew consolidated gross sales revenue to $509,720 (net consolidated sales revenue, $474,401), a 26% increase in net sales revenue when compared to the same period the previous year. We initiated a partnership with Centaur Pharmaceuticals to create Vet Ex Inc. to pursue the possibilities in the animal care market for our products. Lastly during this period, we continued our fundraising efforts, and raised an additional $692,500 through equity.
Consolidated net revenues from FX (tm) product sales for period ending December 31, 2002 were $474,401. This compares to $376,310 for the previous year and represents an increase of 26%. Non-consolidated gross revenues were $509,720 compared to $450,469 for the previous fiscal year, a noteworthy increase of 13%. The year-over-year increases are attributable to increasing sales, as well as to the positive changes in our discount structures with our retail partners.
Consolidated net losses from continuing operations for the period ending December 31, 2002, decreased by 0.5% percent from $134,580 in 2001 to $133,937 this year. The proportion between the different groupings has changed, an increase in Selling, General & Administrative. and a decrease in Quality Control/Research & Development, to reflect the nature of the Company's operations today, an increased emphasis on marketing and sales. Consolidated cash flow from (to) operations for the period 2002 and 2001 were $(250,268) and $10,221, respectively. This decrease in cash flows from operations is a result of the company's increased sales resulting in increased receivables due the cyclical nature of the Company's products. Furthermore, a decrease in payables and accruals had a negative impact on the cash flow from operations. Consolidated cash flow for the periods ending December 31, 2002 and 2001 were $391,922 and $(52,068), respectively. The increase in cash flow is caused by th e Company's financing activities
through private placements.
CV Technologies' consolidated Selling, General & Administrative expenses for the period ending December 31, 2002 were $391,654 or 78% of the consolidated total expenses. This represented an increase of 30% compared to the previous year's expenses. The increase is mainly due to the increased activities of sales and marketing, and investor & public relations/financing activities.
Quality Control, Research & Development expenses were $108,742, which represented 22% of the consolidated total expenses. This was a significant decrease, from $204,921 of the total expenses in the 2001 period. The company's halting of major research & development expenditures, until such time as revenues permit re-investment in this area was the driver behind this reduction.
CVT's immediate growth will depend on building Cold-FX and the FX product line as leading brands in North America. The Company expects to be increasingly successful in marketing its premium quality FX line of products. The regulatory environment is changing in Canada with the imminent implementation of the Natural Health Product Directorate. CV Technologies has a competitive advantage due to its high quality science and having put its products through the rigorous FX (ChemBioPrint(tm)) process in the past years, in preparation for the new regulations. No other natural health products company has achieved the FX standard of quality.
In the long term, we are determined to maximize the potential of our science by gradually launching other FX products. Consumers in this market are looking:
* For products that are toxicity tested to be safe;
* For products that have proper scientific evidence to show effectiveness;
* For products that are uniform and consistent;
* For products that are natural and have virtually no side effects.
CV Technologies has products that meet these needs, developed and standardized using the ChemBioPrint( (FX (tm)) technology. We will use this FX logo on all our brands, to guarantee to the consumer; safety, effectiveness, uniformity, and all natural.
Complete First Quarter Financial Statements and more information about CV technologies, Inc. can be found at www.cvtechnologies.com and www.sedar.com
This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. For this purpose, any statements that are contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words "believes", "anticipates", "plans", "intends", "expects" and similar expressions are intended to identify forward-looking statements. Such risks and uncertainties include, but are not limited to, the need for capital, changing market conditions, completion of clinical trials, patient enrolment rates, uncertainty of pre-clinical, retrospective and early clinical trial results, the establishment of manufacturing processes and new corporate alliances, the timely development, regulatory approval and market acceptance of the Company's products, and other risks detailed from time to time in the Company's filings with Canadian securities authorities.
Jackie Shan, Ph.D., D.Sc., President & CSO, CV Technologies, (780) 989-4476, [email protected]