Profire Energy Reports Financial Results for Fiscal Year 2016

In the 2016 Transition Period Profire Recognized Quarter-over-Quarter Revenue Growth of 41%

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| Source: Profire Energy

LINDON, Utah, March 09, 2017 (GLOBE NEWSWIRE) -- Profire Energy, Inc. (NASDAQ:PFIE), a technology company which creates, installs and services burner and chemical management solutions in the oil and gas industry, today reported financial results for the nine-month transition period ended December 31, 2016. A conference call will be held on Friday, March 10, 2017 at 1:00 p.m. EST to discuss the results.

As previously communicated, due to a change in the Company’s fiscal year-end, the Company filed a transition report on Form 10-K covering the transition period from April 1, 2016 to December 31, 2016, which is the period between the closing of the Company's most recent fiscal year and the opening date of the newly selected fiscal year. The results from the quarter ended December 31, 2016 are reflected in the nine-month period covered by the transition report.

Transition Period Highlights

  • Revenues Increased 41% Quarter-Over-Quarter
  • Generated Positive Cash Flows in Each Quarter of the Transition Period
  • Cash and liquid investments at period-end totaled $20 million
  • Remained debt-free    

Transition Period Financial Results
                                                                                                                                       
In the final quarter of the transition period total revenues increased to just over $7 million, which was an increase of 41% as compared to the previous quarter. This was achieved while keeping operating costs under control, which only increased 5% over the same comparable period.

Net income for the transition period was approximately $78,000 or $0.00 per diluted share, compared to a net income of $799,000 or $0.01 per diluted share in the comparable nine-month period of 2015.  Net income in the final quarter of the transition period was $609,000 or $0.01 per diluted share as compared to $75,000 or $0.00 per diluted share in the previous quarter. The net loss in the first quarter of the transition period was $605,000 or a loss of $0.01 per diluted share.  In the transition period the Company’s net income increased from -15% of total revenue in the first quarter to 9% of total revenue in the last quarter of the period.

At the end of the transition period cash and cash equivalents totaled $9.3 million, as compared to $21.3 million at the end of the fiscal year ended March 31, 2016. The Company has invested $11 million in low risk, CD’s, bonds and mutual funds. Without these investments, the Company’s cash position would have been $20 million, despite having repurchased $3.6 million in Profire stock during the transition period.

Management Commentary

“We continue to strategically allocate capital according to the plan we have previously communicated,” stated Ryan Oviatt, CFO of Profire.  “We remain focused on the preservation of cash, seeking opportunities to acquire adjacent technologies, conducting our stock repurchase program, and other value creation activities that may be identified from time to time. We believe this plan will continue to drive long-term value for Profire and our shareholders.”

“The stabilization of oil prices has had a positive effect on our Company as our customers appear to have gained confidence in the oil markets and have returned to spending their capex budgets,” said Brenton Hatch, President and CEO of Profire Energy. “The oil industry is still recovering and while we don’t know how oil prices will react throughout our next fiscal year, many analysts believe oil prices will average in the mid $50’s price range.  We remain optimistic that the stabilization of commodity prices will allow us to maintain the growth we have achieved in the final two quarters of the period.”

Conference Call

Profire Energy President and CEO Brenton Hatch and CFO Ryan Oviatt will host the teleconference. Following the teleconference, they will be joined by Cameron Tibdall, VP of Sales and Marketing, for a question and answer period.

Date: Friday, March 10, 2017
Time: 1:00 p.m. EST (11:00 a.m. MST)
Toll-free dial-in number: 1-877-705-6003
International dial-in number: 1-201-493-6725

The conference call will be telecast live and available for replay via this link: http://public.viavid.com/index.php?id=123227. The telecast replay will be available for one year. 

Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting the conference call, please contact Todd Fugal at 1-801-796-5127. 

A replay of the call will be available after 5:00 p.m. ET on the same day through March 17, 2017.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay Pin Number: 13656825

About Profire Energy, Inc.
Profire Energy assists energy production companies in the safe and efficient production and transportation of oil and natural gas. As energy companies seek greater safety for their employees, compliance with more stringent regulatory standards, and enhanced margins with their energy production processes, Profire Energy's burner management and chemical injection systems are increasingly becoming part of their solution. Profire Energy has offices in Lindon, Utah; Houston, Texas; Shelocta, Pennsylvania; Greeley, Colorado; and Edmonton, Alberta, Canada. For additional information, visit www.profireenergy.com.

Cautionary Note Regarding Forward-Looking Statements. Statements made in this release that are not historical are forward-looking statements. This release contains forward-looking statements, including, but not limited to statements regarding the Company holding a conference call on March 10, 2017, regarding the transition period financial results; the effect the stabilization of oil prices will have on the Company’s customers spending their capex budgets; the effect the stabilization of oil prices will have on the Company’s ability to maintain recent growth; or, the Company’s capital allocation plan will be able to deliver long-term shareholder value. Forward-looking statements are not guarantees of future results or performance and involve risks, assumptions and uncertainties that could cause actual events or results to differ materially from the events or results described in, or anticipated by, the forward-looking statements. Factors that could materially affect such forward-looking statements include certain economic, business, public market and regulatory risks and factors identified in the company's periodic reports filed with the Securities Exchange Commission. All forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are made only as of the date of this release and the Company assumes no obligation to update forward-looking statements to reflect subsequent events or circumstances, except as required by law. Readers should not place undue reliance on these forward-looking statements.

 

 
PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
      
 As of
ASSETS December 31, 2016  March 31, 2016
      
CURRENT ASSETS     
Cash and cash equivalents $ 9,316,036  $21,292,595 
Accounts receivable, net   5,633,802     4,132,137 
Inventories, net   7,839,503     11,046,682 
Income tax receivable   180,981     268,326 
Short term investments   2,965,536     -  
Investments - other   2,250,000     -  
Prepaid expenses & other current assets   410,558     315,757 
Total Current Assets   28,596,416     37,055,497 
      
LONG-TERM ASSETS     
Deferred tax asset   60,940     -  
Long Term Investments   5,504,997     -  
      
PROPERTY AND EQUIPMENT, net   7,458,723     8,232,911 
      
OTHER ASSETS     
Goodwill   997,701     997,701 
Intangible assets, net   490,082     529,300 
Total Other Assets   1,487,783     1,527,001 
      
TOTAL ASSETS $   43,108,859  $  46,815,409 
      
LIABILITIES AND STOCKHOLDERS' EQUITY      
      
CURRENT LIABILITIES     
Accounts payable $   1,220,478  $  893,822 
Accrued vacation   154,307     171,089 
Accrued liabilities   284,214     449,694 
Income taxes payable   61,543     335,375 
Total Current Liabilities   1,720,542     1,849,980 
      
LONG-TERM LIABILITIES     
Deferred income tax liability   -      180,301 
      
TOTAL LIABILITIES   1,720,542     2,030,281 
      
STOCKHOLDERS' EQUITY      
Preferred shares: $0.001 par value, 10,000,000   -      -  
  shares authorized:  no shares issued and outstanding     
Common shares: $0.001 par value, 100,000,000 shares authorized:     
53,582,250 issued and 50,705,933 outstanding at December 31, 2016     
and 53,256,296 issued and outstanding at March 31, 2016   53,582     53,256 
Treasury stock, at cost   (3,582,805)    -  
Additional paid-in capital   26,800,298     26,164,622 
Accumulated other comprehensive loss   (2,810,743)    (2,282,682)
Retained earnings   20,927,985     20,849,932 
Total Stockholders' Equity   41,388,317     44,785,128 
      
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $   43,108,859  $  46,815,409 
      
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Operations and Other Comprehensive Income (Loss)
      
 For the Nine-Month
Ended December 31, 2016
 For the Year Ended
March 31, 2016
  
REVENUES     
Sales of goods, net $   14,336,618   $   23,992,324 
Sales of services, net   1,650,568     3,080,122 
Total Revenues   15,987,186     27,072,446 
      
COST OF SALES     
Cost of goods sold-product   6,732,822     11,027,114 
Cost of goods sold-services   1,154,326     2,405,012 
Total Cost of  Goods Sold   7,887,148     13,432,126 
      
GROSS PROFIT   8,100,038     13,640,320 
      
OPERATING EXPENSES     
General and administrative expenses   7,198,081     12,264,442 
Research and development   757,880     899,013 
Depreciation and amortization expense   482,311     516,786 
      
Total Operating Expenses   8,438,272     13,680,241 
      
LOSS FROM OPERATIONS   (338,234)    (39,921)
      
OTHER INCOME (EXPENSE)     
Gain (Loss) on sale of fixed assets   (2,680)    20,278 
Other income   102,206     144,937 
Interest income   90,028     37,278 
      
Total Other Income   189,554     202,493 
      
NET INCOME (LOSS) BEFORE INCOME TAXES   (148,680)    162,572 
      
INCOME TAX EXPENSE (BENEFIT)   (226,733)    127,828 
      
NET INCOME$  78,053  $  34,744 
      
OTHER COMPREHENSIVE LOSS     
Foreign Currency Translation Loss$  (415,698) $  (393,701)
Unrealized Losses on Investments   (112,363)    - 
      
Total Other Comprehensive Loss   (528,061)    (393,701)
      
TOTAL COMPREHENSIVE LOSS$  (450,008) $  (358,957)
      
BASIC EARNINGS PER SHARE$0.00  $0.00 
      
FULLY DILUTED EARNINGS PER SHARE$0.00  $0.00 
      
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING   52,857,299     53,243,151 
      
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING   53,483,110     53,558,942 
      
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity 
                    
      Additional Other       Total
 Common Stock Paid-In Comprehensive Treasury Retained Stockholders'
 Shares Amount Capital Income Stock Earnings Equity
                    
Balance, March 31, 2015  53,199,136   $   53,199  $   25,525,052  $   (1,888,981)  $   -    $   20,815,188  $   44,504,458 
                    
Fair value of options vested  -      -     565,646    -     -     -    565,646 
                    
Stock issued in exercise of stock options  57,160     57    73,924    -     -     -    73,981 
                    
Foreign currency translation  -      -     -    (393,701)    -     -    (393,701)
                    
Net Income for the year ended December 31, 2015  -      -     -    -     -     34,744    34,744 
                    
Balance, March 31, 2016  53,256,296     53,256    26,164,622    (2,282,682)    -      20,849,932    44,785,128 
                    
Fair value of options vested        242,801             242,801 
                    
Stock issued in exercise of stock options  86,808     87    112,913             113,000 
                    
Stock issued in settlement of RSUs  239,146     239    279,962             280,201 
                    
Treasury stock repurchased  (2,876,317)             (3,582,805)       (3,582,805)
                    
Foreign currency translation           (415,698)          (415,698)
                    
Unrealized Losses on Investments           (112,363)          (112,363)
                    
Net income for the nine-months ended December 31, 2016                 78,053    78,053 
                    
Balance, December 31, 2016  50,705,933   $   53,582  $   26,800,298  $   (2,810,743)  $   (3,582,805)  $   20,927,985  $   41,388,317 
                    
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
    
   For the Nine Months Ended For the Year Ended
   December 31, 2016 March 31, 2016
OPERATING ACTIVITIES      
 Net Income $  78,053  $  34,744 
 Adjustments to reconcile net income to      
   net cash provided by operating activities:      
 Depreciation and amortization expense    756,927     989,484 
 (Gain) Loss on sale of fixed assets    3,480     (20,278)
 Bad debt expense    272,807     143,192 
 Stock options issued for services    616,802     678,971 
 Changes in operating assets and liabilities:      
 Changes in accounts receivable    (2,063,449)    5,114,485 
 Changes in income taxes receivable/payable    (190,746)    (276,075)
 Changes in inventories    3,304,972     641,410 
 Changes in prepaid expenses    (95,156)    (171,411)
 Changes in deferred tax asset/liability    (241,241)    49,490 
 Changes in accounts payable and accrued liabilities    (58,736)    148,921 
        
   Net Cash Provided by Operating Activities    2,383,713     7,332,933 
        
INVESTING ACTIVITIES      
 Proceeds from sale of equipment    16,896     158,641 
 Purchase of investments    (10,685,553)    - 
 Purchase of fixed assets    (18,485)    (62,465)
 Purchase of Intangible assets    -      - 
        
 Net Cash Provided by (Used in) Investing Activities    (10,687,142)    96,176 
        
FINANCING ACTIVITIES      
 Value of equity awards surrendered by employees for tax liability    (30,000)    (39,342)
 Cash received in exercise of stock options    15,000     - 
 Purchase of Treasury stock    (3,582,805)    - 
        
   Net Cash Used in Financing Activities    (3,597,805)    (39,342)
        
 Effect of exchange rate changes on cash    (75,325)    (241,968)
        
 NET INCREASE (DECREASE) IN CASH    (11,976,559)    7,147,799 
 CASH AT BEGINNING OF PERIOD    21,292,595     14,144,796 
        
 CASH AT END OF PERIOD $  9,316,036  $  21,292,595 
        
SUPPLEMENTAL DISCLOSURES OF      
 CASH FLOW INFORMATION      
        
 CASH PAID FOR:      
 Interest  $   -    $   - 
 Income taxes  $   255,769   $   127,828 
        
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

Profire Energy, Inc. And Subsidiaries
Quarterly Financial Result for Nine-Months Ended December 31, 2016
  For the Quarters Ending  
Transition Period Jun 30, 2016 Sep 30, 2016 Dec 31, 2016  
Total revenues $  3,974,043  $  4,990,813  $  7,022,330  
Gross profit    1,914,250     2,624,659     3,561,129  
Income (loss) from operations    (881,278)    (127,369)    670,413  
Income tax expense (benefit)    (245,877)    (99,701)    118,845  
Net income (loss)    (605,295)    74,452     608,896  
Basic earnings per common share $  (0.01) $  0.00   0.01  
Diluted earnings per common share $  (0.01) $  0.00   0.01  
         
  For the Quarters Ending
Fiscal Year 2016 Jun 30, 2015 Sep 30, 2015 Dec 31, 2015 Mar 31, 2016
Total revenues $  6,877,243  $  8,097,294  $  7,554,255 $  4,543,654 
Gross profit    3,313,519     4,028,403     3,998,502    2,299,895 
Income (loss) from operations    (539,374)    675,396     490,322    (666,265)
Income tax expense (benefit)    (149,525)    254,781     194,227    (171,654)
Net income (loss)    (459,079)    779,195     479,243    (764,617)
Basic earnings per common share $  (0.01) $  0.01  $  0.01 $  (0.01)
Diluted earnings per common share $  (0.01) $  0.01  $  0.01 $  (0.01)
         
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.


Contact:
Profire Energy, Inc.
Ryan Oviatt, CFO
(801) 796-5127