Gourmet Ocean Products Inc.
TSX VENTURE : GOP

Gourmet Ocean Products Inc.

January 27, 2017 20:38 ET

Gourmet Ocean Products Announces Financial Results for the Fiscal Year Ending September 30th, 2016

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan. 27, 2017) - Gourmet Ocean Products Inc. ("Gourmet" or the "Company") (TSX VENTURE:GOP) announces its annual financial results for the year ended September 30, 2016.

Highlights

  • In the year ended September 30, 2016, Gourmet reported sales of $3,882,581, compared with $4,282,879 during the year ended September 30, 2015. Sales decreased by $400,298 as a result of the decrease in sales of harvested sea cucumber in China due to a slowing down Chinese economy.
  • Cash flow improved during the year ended September 30, 2016 as adjusted EBITDA was negative $631,563 versus negative $1,304,350 during the prior year.
  • Gross margin during the year ended September 30, 2016 was 31.1% compared with 22.9% in the year ended September 30, 2015. This increase was due to the change to a new Chinese distributor in April 2015. As a result of this change, the Company has experienced higher sales prices. The increase in gross margin was also due to an increase in higher margin, retail sales in Canada and China.
  • Net loss for the year ended September 30, 2015 was $2,369,162, compared to a net loss of $1,892,016 for the year ended September 30, 2015. The increase in net loss for the year ended September 30, 2016 is due to an inventory impairment taken as part of our audit in the amount of $1,338,246.

"The China market situation started to recover in the last quarter of fiscal year 2016 as the Company achieved record sales during the fourth quarter of fiscal year 2016. Further, with the change in our distributor, we have experienced improved margins of sea cucumber and added new retail customers," stated Mr. Peter Hughes, President and CEO of Gourmet Ocean Products.

SUMMARY OF FINANICAL RESULTS

Three-Month Period Ended
(Unaudited)
Year Ended
(Audited)
Year Ended
(Audited)
09/30/2016 09/30/2015 09/30/2016 09/30/2015
Sales 1,944,457 88,808 3,882,581 4,282,879
Gross profit 470,224 103,465 1,207,855 982,771
Loss from operations (44,191) (432,479) (1,015,386) (1,892,016)
Other expenses (1,346,390) 1,520 (1,353,776) -
Net income (loss) (1,390,581) (430,959) (2,369,162) (1,892,016)
EBITDA (1,245,696) (270,932) (1,978,933) (1,524,305)
Adjusted EBITDA 92,500 (247,794) (631,563) (1,304,350)
Earnings per share
Diluted (0.01) (0.01) (0.02) (0.01)
Weighted average number of shares
Basic 125,068,733 125,068,733 125,068,733 125,068,733

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 2016 the Company had cash on deposit in the amount of $90,233, accounts and other receivables of $1,848,466, prepaid expenses of $52,988 and inventory of $1,408,370 compared to cash on deposit in the amount of $582,787, accounts and other receivables of $259,181, prepaid expenses of $105,949 and inventory of $3,647,856 at September 30, 2015.

The working capital position of the Company at September 30, 2016 declined to $1,515,219 compared to a working capital position of $3,609,027 at September 30, 2015.

Net assets declined to $1,990,471 at September 30, 2016 compared to $4,350,509 at September 30, 2015. At September 30, 2016 the Company had a short-term debenture of $1,402,468, which $1,082,468 loan from one of related parties at an interest rate of 4% and $320,000 loan ($50,000 from a related party and $270,000 from non-related parties) with an interest rate of 12% per annum. The debentures are unsecured and have a renewed maturity date of April 30, 2017, with the exception of a $20,000 loan due on October 31, 2016.

For additional financial information please see Gourmet's unaudited condensed interim consolidated financial statements and MD&A filed on SEDAR at www.sedar.com.

About Gourmet Ocean Products Inc.

Gourmet is a B.C.-based aquaculture company specializing in the production, distribution, marketing and sale of high-quality, specialty seafood products including sea cucumbers, scallops, and oysters with distribution to customers primarily in Asia and Canada.

ON BEHALF OF THE BOARD

Peter Hughes, President, Chief Executive Officer

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

This press release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities by the Company to be made in the United States will be made by means of a prospectus, which may be obtained from the Company and will contain detailed information about the Company and its management, as well as financial statements.

Forward-Looking Statements

Certain of the statements made and information contained in this press release constitute forward-looking information within the meaning of applicable securities legislation. Forward-looking statements in this press release include that (a) the Company has adequate capital to grow its business and execute on its business plan, (b) continued growth in revenues is expected from contracts with aquaculture farmers and distributors and (c) Gourmet's will become a global leader in aquaculture. All information and statements which are not historical fact constitute forward-looking information and, in many cases, can be identified by words such as "proposed", "may", "will", "expect", "intend", "anticipate", "believe", "estimate", "potential", or other similar terminology. Forward-looking statements involve risks, assumptions, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from the forward-looking statements made in this press release include: products that are or become available from competitors, political and economic factors, including in China and environmental factors. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements of the Company may vary materially from those described in this press release. Accordingly, readers are advised not to place undue reliance on forward looking information. Except as otherwise required by law, the Company does not intend to and assumes no obligation to update or revise forward looking information, whether as a result of new information, plans, events or otherwise.

Contact Information

  • Gourmet Ocean Products Inc.
    Peter Hughes
    President, Chief Executive Officer
    604.802.7372
    petehughes@me.com