iFabric Corp. Reports Record Second Quarter 2017 Results

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| Source: iFabric Corp.

MARKHAM, ONTARIO--(Marketwired - May 15, 2017) - iFabric Corp. (TSX:IFA), hereinafter referred to as "iFabric" or the "Company", today announced its financial results for its second quarter and six months ended March 31, 2017.

"I am extremely pleased with the Company's performance in Q2 2017. Both the Intelligent Fabrics and Intimate Apparel divisions are poised to meet the growth objectives we have established for 2017 and beyond," said Hylton Karon, President and CEO of iFabric.

Q2 2017 HIGHLIGHTS:

  • Revenues of $4,255,192 compared to $3,072,027 in Q2 2016, an increase of $1,183,165 or 39%. Revenues in the Intimate Apparel division increased by 19% or $483,588 to $3,022,496 from $2,538,908 in Q2 2016, whilst revenues in the Intelligent Fabrics division, increased by 138% or $699,577 to $1,207,096 from $507,519.
  • Record net earnings before tax of $647,399 compared to loss of $440,796 in 2016, representing an increase of $1,088,195. The increased earnings were mainly as a result of higher revenues, higher gross profit contribution, lower selling, general and administrative costs, as well as increased foreign exchange gains.
  • Record EBITDA of $739,168 compared to negative EBITDA of $375,084 in Q2 2016, an increase of $1,114,252.
  • Gross profit of $2,082,915 (49% of revenue) compared to $1,502,446 (49% of revenue) in Q2 2016, an increase of $580,469. The Intimate Apparel division realized higher gross profit margins than in the comparable quarter of 2016, mainly due to lower clearances of seasonal goods. However, the Intelligent Fabrics division contributed a higher proportion of consolidated revenue in Q2 2017 versus Q2 2016, at lower margins, thereby offsetting this increase, resulting in the overall gross profit % being unchanged from Q2 2016.
  • Net earnings after tax attributable to shareholders was $472,221 ($0.018 per share basic and $0.017 per share diluted) compared to a net loss attributable to shareholders of $324,657 in Q2 2016 ($0.013 per share basic and diluted), representing an increase of $796,878.
  • Working capital at March 31, 2017 amounted to $6,170,802 compared to $5,176,837 at December 31, 2016, an increase of $993,965.
  • Shareholder equity at March 31, 2017 attributable to common shareholders increased by $506,922 to $8,036,016 from $7,529,094 at December 31, 2016.
  • Net cash on hand of $601,731 as at March 31, 2017 compared to net cash on hand of $732,775 as at the end of the previous quarter ended December 31, 2016, a decrease of $131,044. The Company's full bank operating line of $3,500,000 remains available to fund the anticipated future growth and expansion in both divisions.

SIX MONTH HIGHLIGHTS:

  • Revenues increased by $956,274 to $7,357,311 compared to $6,401,037 for the corresponding six months in 2016, representing an increase of 15%. With respect to its two operating divisions, Intimate Apparel revenues decreased by 16% or $913,781 while Intelligent Fabrics division revenues increased by 307% or $1,884,129.
  • Gross profit for the six months ended March 31, 2107 decreased by $56,660 to $3,230,001 (44% of revenues) from $3,286,661 (51% of revenues) for the comparable six months of 2016. The decrease in gross profit percentage for the six months was mostly the result of a higher proportion of sales in the Intelligent Fabrics division, which carry lower margins compared to the Intimate Apparel Division.
  • The net profit attributable to iFabric shareholders for the six months ended March 31, 2017 was $346,846 ($0.013 per share basic and diluted) compared to a loss of $285,069 in the corresponding six months of 2016 ($0.011 per share basic and diluted), representing an increase of $631,915. This increase was mainly as a result of lower selling general and administrative costs, and increased foreign exchange gains.

Complete Financial Statements are available on www.sedar.com

FINANCIAL HIGHLIGHTS
Quarter Ended March 31 Six Months Ended March 31
2017 2016 2017 2016
$ $ $ $
Revenue 4,255,192 3,072,027 7,357,311 6,401,037
Income (loss) from operations 654,955 (226,413 ) 515,070 (156,337 )
Share based compensation 16,101 41,258 32,560 85,663
EBITDA 739,168 (375,084 ) 664,154 (238,083 )
Net income (loss) before tax 647,399 (440,796 ) 495,460 (282,471 )
Net income (loss) after tax attributable to shareholders 472,221 (324,657 ) 346,846 (285,069 )
Net income (loss) per share - basic 0.018 (0.013 ) 0.013 (0.011 )
Net income (loss) per share - dliuted 0.017 (0.013 ) 0.013 (0.011 )

ABOUT iFABRIC CORP.:

Headquartered in Markham, Ontario, iFabric Corp. www.ifabriccorp.com currently has 26.0 million shares issued and outstanding.

Through its wholly-owned subsidiaries, Intelligent Fabric Technologies (North America) Inc. ("IFTNA") and Coconut Grove Pads Inc. ("Coconut Grove"), the Company offers a variety of products and services in both of its strategic divisions:

IFTNA is focused on proprietary chemical formulations that render fabrics, foams, plastics and numerous other surfaces intelligent, thereby improving the safety and well-being of the consumer.

Coconut Grove, operating as Coconut Grove Intimates, is a designer, manufacturer, distributor, licensor and licensee of ladies intimate apparel products, accessories and sleepwear.

FORWARD-LOOKING STATEMENTS:

Forward-looking statements provide an opinion as to the effect of certain events and trends on the business. Certain statements contained in this news release constitute forward-looking statements. The use of any words such as "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on current expectations and various estimates, factors and assumptions and involve known and unknown risks, uncertainties and other factors. Forward-looking information includes, but is not limited to, statements with respect to the development potential of the Company's products.

Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Readers are cautioned not to place undue reliance on these statements as the Company's actual results, performance, or achievements may differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements if known or unknown risks, uncertainties or other factors affect the Company's business, or if the Company's estimates or assumptions prove inaccurate. Therefore, the Company cannot provide any assurance that forward-looking statements will materialize. The Company assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or any other reason except as required by applicable securities laws.

Any financial outlook or future oriented financial information in this news release, as defined by applicable securities legislation, has been approved by management of iFabric. Such financial outlook or future oriented financial information is provided for the purpose of providing information about management's reasonable expectations as to the anticipated results of its proposed business activities. Readers are cautioned that reliance on such information may not be appropriate for other purposes. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the TSX nor its Regulations Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this press release.

Contact Information:

Hilton Price
CFO
647.465.6161
hilton.price@rogers.com

Gary Perkins
Investor Relations
416.882.0020
garyperkins@rogers.com
http://www.ifabriccorp.com/