SOURCE: Elgrande International Inc

April 14, 2005 10:11 ET

Elgrande Reports Third Fiscal Quarter Results

VANCOUVER, BC -- (MARKET WIRE) -- April 14, 2005 -- Elgrande International, Inc. (OTC BB: EGDE), specializing in importing, marketing and distributing European-designed quality products, today announced results for the third fiscal quarter and the nine months ending February 28, 2005.

For the quarter ended February 28, 2005, revenues were $175,725 versus revenues of $244,316 for the same period ending last year. Gross profit for the quarter ended February 28, 2005, was $46,717 or 27% of revenue compared to $58,997 or 25% of revenue for the same period ending last year. The Comprehensive loss was $367,522 for the third fiscal quarter or $0.02 per share compared to a Comprehensive loss of $538,700 or $0.05 per share.

Pending sales [orders booked but not yet shipped] at the close of the quarter ended February 28, 2005, were $220,144 compared to $123,589 for the quarter ended February 29, 2004. The 78% boost in pending sales reflects an overall increase in customer activity and in particular orders written at the January through February spring 2005 trade shows.

For the nine months ended February 28, 2005, revenues increased 18% to $811,206 versus $685,558 for the same period ended last year. Gross profit for the nine months ended February 28, 2005, was $343,427 or 42% of revenue compared to $202,451 or 30% for the same period ending last year. The Comprehensive loss was $730,785 for the nine months or $0.04 per share compared to a Comprehensive loss of $1.51 million or $0.10 per share. Weighted average of common shares outstanding for the nine months was 17.1 million shares compared to 11.2 million shares.

Mr. Michael Holloran, President and CEO, commented, "Our third quarter starts with December, the slowest month of the year, and closes with the spring trade shows which set the buying trends for the balance of the calendar year. This year, while sales in December and January were slightly behind expectation, we exceeded forecast and set a record for new business at the spring trade shows and closed the quarter with our largest ever backlog of booked orders. Our expanded product range continues to be very well received by both the media and our customers and is reflected in our pending orders and year-to-date sales which are up 18%."

"We are continuing to improve our logistics and are actively working with our suppliers to optimize our overall cost of goods. The result of this ongoing effort is improved gross margin and inventory utilization. These efforts over the past year have resulted in a 40% improvement in gross margin based on a year-to-date comparison of operating results. Our product is very price point competitive and there is further scope to improve our gross margins through selective selling price adjustments which we plan to implement over the coming year."

The Company's new spring 2005 catalogue was launched this past quarter and is available at the Company's wholesale division web site, www.europeansourcesdirect.com. For additional information please visit the web site at www.elgrande.com.

To receive e-mail alerts and other information please send request to egde@focuspartners.com.

About Elgrande International

Elgrande International (www.elgrande.com) specializes in sourcing, importing, marketing and distributing unique European-designed quality products in the medium to high-end tabletop market. Their products are exclusively produced for the North American home décor, giftware and artware sectors. The Company has a North American sales and distribution infrastructure that currently services approximately 650 customers with over 1,100 retail locations that include independent retailers and national key accounts. Management has structured a national network of 12 major giftware representatives with showrooms in the principal U.S. markets, supported by 128 professional sales representatives. Elgrande was the winner of the 2003 CGTA "Best New Giftware" award (www.cgta.org).

Safe Harbor Provision

This press release may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include "...we are in a good position to finish the year as forecast," and are based on the Company's current expectations as to future events. However, the forward-looking events and circumstances discussed in this press release might not occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements. Risk factors include, lack of inventory financing, foreign currency, availability of product and other risk factors as outlined in the Company's SEC filings.


                          ELGRANDE INTERNATIONAL, INC.
                          CONSOLIDATED BALANCE SHEETS


                                                  February 28,    May 31,
                                                      2005         2004
                                                  (Unaudited)
                                                  -----------  -----------
ASSETS
  CURRENT ASSETS                                      558,193      632,985
  PROPERTY AND EQUIPMENT, NET                               -       22,769
  OTHER ASSETS                                         67,134       79,878

  TOTAL ASSETS                                    $   625,327  $   735,632
                                                  ===========  ===========

LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
  CURRENT LIABILITIES                               1,941,766    1,303,108
  COMMITMENTS AND CONTINGENCIES                       130,096      170,992

  STOCKHOLDERS' EQUITY (DEFICIT)
   Common stock, 200,000,000 shares
    authorized, $.001 value; 17,301,621 and
    16,959,600 shares issued and
    outstanding, respectively                          17,301       16,959
   Stock options and warrants                         172,705      172,705
   Additional paid-in capital                       8,680,887    8,658,511
   Accumulated deficit                            (10,325,444)  (9,577,395)
   Accumulated other comprehensive income (loss)        8,016       (9,248)
  TOTAL STOCKHOLDERS' EQUITY (DEFICIT)             (1,446,535)    (738,468)

  TOTAL LIABILITIES & STOCKHOLDERS'
   EQUITY (DEFICIT)                               $   625,327  $   735,632
                                                  ===========  ===========


CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

                    Three Months  Three Months  Nine Months   Nine Months
                       ended         ended         ended         ended
                    February 28,  February 29,  February 28,  February 29,
                        2005          2004          2005          2004
                    (Unaudited)   (Unaudited)   (Unaudited)   (Unaudited)
                    -----------   -----------   -----------   -----------
REVENUES            $   175,725   $   244,316   $   811,206   $   685,558
COST OF REVENUES        129,008       185,319       467,779       483,107
GROSS PROFIT             46,717        58,997       343,427       202,451

EXPENSES
  OPERATING
   EXPENSES             398,093       549,785     1,100,222     1,215,959
  OTHER EXPENSE          21,901        32,966        (8,746)       51,197
                        419,994       582,751     1,091,476     1,267,156

NET LOSS               (373,277)     (523,754)     (748,049)   (1,064,705)

COMPREHENSIVE
 INCOME/LOSS              5,755       (14,946)       17,264       (14,946)

COMPREHENSIVE LOSS  $  (367,522)  $  (538,700)  $  (730,785)  $(1,079,651)
                    ===========   ===========   ===========   ===========

  BASIC AND
   DILUTED NET
   LOSS PER
   COMMON SHARE     $     (0.02)  $     (0.05)  $     (0.04)  $     (0.10)
                    ===========   ===========   ===========   ===========

  WEIGHTED AVERAGE
   NUMBER OF COMMON
   SHARES
   OUTSTANDING,
   BASIC AND
   DILUTED           17,519,179    11,406,031    17,088,245    11,201,243
                    ===========   ===========   ===========   ===========

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