Revenues in the 2nd Quarter of 2019 Were 14.2 Times Larger than Revenues in the Same Period in 2018.
2nd Quarter Operational Loss was half of the Same Period in 2018.
Las Vegas, NV & Hong Kong, Aug. 20, 2019 (GLOBE NEWSWIRE) -- 12 ReTech Corporation RETC, released its 2nd Quarter, 2019 financial results yesterday and showed further progress in improving the operations of their business with increased revenues and decreased operational expenses which resulted in reduced operational losses.
The Company has improved their operational results by integrating its three USA recently acquired consumer micro-brands so that they can work together as a cohesive business unit. This effort has resulted in reduced operational expenses.
Angelo Ponzetta, Founder and CEO of 12 ReTech commented, "On the consumer products side of our business, our Rune NYC women's apparel business has made good progress since our acquisition in the 1st Quarter 2019. Rune NYC has added several new wholesale customers who should soon be ordering their upcoming Fall 2019 and Holiday 2019 collections."
CEO, Ponzetta, continued, "Our Red Wire Group apparel manufacturing operation is benefitting from the increase in Rune NYC customers. In addition, they have added a half dozen new clients themselves. It would seem that the global trade wars between the USA and other countries is generating interest in USA manufacturing for domestic USA sales channels. We are expanding work shifts as we are taking on more business in Salt Lake City, Utah".
For the second quarter ("Q2:FY2019") ended June 30, 2019, the Company posted revenues of $238,131 which represents a 1,427.5% improvement over the comparable 2018 period when revenues were only $16,682.
For the 6 months ended June 30, 2019 the Company posted revenues of $459,260 versus the comparable period ended June 30, 2018 when the Company had revenue of $25,624. That represented a year to date increase of 1,692.3%
Excluding the non-operational, non-cash "Other Income (Expenses)" expenses (see below) the Company experienced an Adjusted Net Loss of $513,512 for the 3-month period ended June 30, 2019 versus an Adjusted Net Loss of $1,018,786 for the comparable 2018 period. This represents a $505,274 decrease or 50% improvement in Adjusted Net Loss, when compared year over year.
Using the same analysis, for the 6 months ended June 30th 2019 as compared to that same period in 2018 the Company reported a Net Loss of $1,154,631 in 2019 vs $1,716,066 in 2018 which represents an improvement of $561,435 or 32.7%.
When comparing quarter over quarter to the prior 1st Quarter, 2019, this quarter's revenues were better by 7.7%, gross margins were down by less than 1% and operating expenses were down by 18.8%.
CEO Ponzetta commented, "We are doing better each quarter in our search for new business and profitability. The difference between the past two quarters in 2019 have shown us some incremental improvements which we know will become better as we enter the 2nd half of the year, and significant improvement over the prior periods in 2018."
The GAAP results reported include; a) Impairment of Software Development Costs, b) General Reserve Expense, c) Interest Expense & d) Derivative Liability Expenses which are all non-cash expenses deriving from our prior use of convertible note financing. These reserves, impairments and derivative liabilities represent the most conservative estimates and accounting treatments required under GAAP but the actual expenses realized may be greater or less than that which is reported below and may result in wide swings in expenses, profits and/or losses as the final results are determined. Events that could if realized dramatically affect these estimates and reserves would be a settlement with one or more convertible debt holders or a major sale of our technology. It is for those reasons that Management discusses the non-GAAP and non-cash results of operations so that readers can follow our operational results more closely.
When looking at the full 2nd quarter 2019 GAAP results including these non-cash asset impairments, reserves expense, interest expense and derivative liabilities expense, the Company posted a larger GAAP Net Loss of $8,710,833 versus a GAAP Net Loss of $2,692,840 in the comparable 2018 period.
The larger GAAP Net Loss is mainly due to accounting treatments for the financing expenses of how the Company has raised working capital over the past two years. The Company also recorded a write-down of its software investment for its 12 Technology Suite in the 2nd Quarter.
The write-down does not mean that the Company is abandoning its efforts to help retailers compete against the likes of Amazon and Walmart. On the contrary, the Company is continuing its efforts to execute its primary objective of helping retailers to compete in today's retail environment. The write-down's primary effect is to eliminate all future depreciation and amortization expenses when we find future success in selling our technology to the retailers of the globe.
CEO Ponzetta finished, "We started this business as a technology company whose purpose was to help retailers compete in this modern world. One thing that will really change the way that retailers and the investment community view our Company, is for us to get some traction in our technology business. If things go as planned, we will have an immediate opportunity to put our technology on display in the USA and prove our value proposition to the retailing world. More on that front later."
The figures referenced above are not audited, readers are advised to consider these figures along with footnotes and any other accompanying information that is contained in the Company's Form 10-Q as well as all of the filings that the Company has previously filed with the U.S. Securities and Exchange Commission.
About 12 ReTech Corporation:
At our core, we are a software company whose technology allows retailers to combat the dual threats of Walmart and Amazon — both online and in physical stores. Our microbrand rollup acquisition strategy allows us to demonstrate the effectiveness of our software, devise and test new products, while providing shareholder value through immediate revenue and earnings growth. The Company operates through our subsidiaries on three continents: 12 Hong Kong, Ltd., 12 Japan, Ltd., 12 Europe A.G., 12 Retail Corporation (and its subsidiaries in North America, including Emotion Fashion Group, Inc., Red Wire Group, LLC and Rune NYC, LLC). For more information please visit our website at www.12ReTech.com.
12 ReTech Corporation is publicly listed on the OTC Markets under the symbol RETC.
Safe Harbor: This document contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Investors are cautioned that all forward-looking statements involve risks and uncertainty, including without limitation, the ability of the Company to successfully implement its turnaround strategy, changes in costs of raw materials, labor, and employee benefits, as well as general market conditions, competition and pricing. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements included in this letter will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as representation by the Company or any other person that the objectives and plans of the Company will be achieved. In assessing forward-looking statements included herein, readers are urged to carefully read those statements. When used in the Annual Report on Form 10-K, the words "estimate," "anticipate," "expect," "believe," and similar expressions are intended to be forward-looking statements.
Investors Relations Contacts:
Mark Gilbert
Magellan FIN, LLC
mgilbert@magellanfin.com
317-361-2392 (USA)
Corporate Headquarters
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
