VANCOUVER, BC--(Marketwired - January 24, 2017) - Legend Power Systems Inc. (TSX VENTURE: LPS) today reported its fiscal 2016 financial results for the year ended September 30, 2016 which was a record year for the Company.
Fiscal 2016 Highlights:
- Record revenue of $2.08 million; an increase of 925% over 2015
- Blended Gross margin for the year was 30%, up from 25% in 2015
- Sales to 15 unique customers
- A total of 36-units sold at an average sales price of $57,754
- $2.28 million in gross proceeds from financing activities
Fiscal 2016 was a positive and transformative year for Legend. Our product became more widely accepted as a proven energy saver in Ontario commercial buildings and, for the first time, we achieved real order flow; a game-changer brought to life by our commitment to product innovation and operational excellence.
Corporately, we established what we believe are the five pillars, critical for significant sales growth and future success (product excellence, operational capacity, strong sales and marketing capabilities and systems, an excellent people development platform, and appropriate working capital).
With this solid foundation in place, we see 2017 as the year to shift our focus to the pursuit of rapid and sustainable sales growth as a leader in energy saving solutions, while continuing to focus on operational best practices and developing our people.
Legend's Five Pillars
- Our products consistently meet or exceeded customer expectations in a broad spectrum of commercial buildings, across multiple market verticals
- We filed additional patents for product innovations and architecture improvements that will be incorporated in our next generation product, which we expect to release to the market by October 1, 2017. The new platform will provide additional energy savings for our customers' buildings, decrease our cost of goods sold, provide an interface to visually present useful data for our customers to proactively manage their buildings electrical environments, and be a platform that allows customers to seamlessly integrate various electrical efficiency technologies beyond our existing offering
- We expect our significantly enhanced next generation technology to empower us to continually expand our intellectual property and patent portfolio. We anticipate the new architecture will improve our depth of capability, offering revenue growth through expanded market reach
- We have significantly improved our product assembly capacity through improved operating systems, processes, and skills enhancement programs
- Our carefully managed inventory control practices better match our recently improved production capacity and forecasted growth in unit sales
- Legend is well positioned with the capacity to attain significant sales growth. Increased volume is expected to offer improved margins with a minimal increase in variable costs and no need for additional capital investment
- Our ability to deliver on-time and well executed installation services has been strengthened through core partner relationships with dedicated electrical contractors and the establishment of an "in-house" install team
- Our growing and mutually beneficial relationship with strong electrical partners provides the additional benefit of feeding referral and reseller opportunities to our sales funnel
- We have enhanced our operations capabilities with the addition of a seasoned energy industry operations professional in the role of Director Customer Support, and a finance professional who has assumed the dual role of Chief Financial Officer and Chief Operating Officer
Strong Sales and Marketing Capabilities
- During 2016, Legend's sales team expanded the number of verticals we have sold into to 13; each with a minimum of 1 unit sold and a key recommender account. We also achieved our goal of at least three follow-on orders during the year
- The growth in number of key recommenders representing multiple verticals has provided the critical third party product endorsement needed to propel product sales. Additionally, some of the key recommenders will evolve to represent Legend and our solutions in distinct geographically areas as independent resellers
- In 2016 Legend's sales team made strong progress. We expect significant sales growth in 2017 due to the addition of an experienced Director of Marketing to lead the implementation of our marketing plan, and a restructuring of personnel within our sales team
- We hired a proven field operations executive based in Toronto to build out our customer support team and processes. Our customer focused, repeatable business development and field operations strategy is expected to drive improved customer experience, expedite our multi-region US growth, and shorten the timeline from first order to installation
People Development Platform
- We are dedicated to constantly improving the Legend team and ensuring we are viewed by top talent as the right place/right time for an outstanding career opportunity
- Recent expansion of our team and a mentality of hiring from within has empowered our people step into important leadership roles; applying their of breadth of experience and "can do" attitude to new and exciting challenges
- With $1.66 million in gross private placement funding and $0.62 million in warrant exercise proceeds received during fiscal 2016, plus $2.33 million in proceeds from warrant exercises received subsequent to fiscal year-end, we feel the Company is well positioned to confidently implement our business plan
Over the last 12 months, we were obsessed with ensuring the critical pillars for business success were established and constantly strengthened to support our planned sales growth. It didn't happen overnight and the process is by no means complete, but we are committed to ensuring our business is built on a strong foundation for achieving the success we envision and will manifest for 2017 and beyond.
We thank all stakeholders for their support during the last year and particularly our dedicated shareholders. We now have a going concern organization with a team that is excited, dedicated, and capable of making Legend Power an outstanding organization.
A complete set of the September 30, 2016 Consolidated Financial Statements and Management's Discussion & Analysis are available on Legend's corporate website. To view these documents, visit: http://legendpower.com/investors/financial-statements/. Both documents are also filed on SEDAR (www.sedar.com (link is external)).
About Legend Power Systems Inc.
Legend Power Systems Inc. (www.legendpower.com) markets a proprietary device, the 'Harmonizer' that helps individual buildings reduce energy consumption through the utility-proven concept of Conservation Voltage Reduction, (CVR). Legend provides customers risk free energy savings, improves the value of their physical assets, and enhances their sustainability efforts. As an application with demand side benefits, Legend is also a key contributor toward utility conservation goals. Legend was recognized as the top performing cleantech company on the TSX Venture Exchange in 2015.
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
This Press Release may contain statements which constitute "forward-looking information", including statements regarding the plans, intentions, beliefs and current expectations of the Company, its directors, or its officers with respect to the future business activities and operating performance of the Company. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions, as they relate to the Company, or its management, are intended to identify such forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future business activities or performance and involve risks and uncertainties, and that the Company's future business activities may differ materially from those in the forward-looking statements as a result of various factors. Such risks, uncertainties and factors are described in the periodic filings with the Canadian securities regulatory authorities, including the Company's quarterly and annual Management's Discussion & Analysis, which may be viewed on SEDAR at www.sedar.com. Should one or more of these risks or uncertainties materialize, or should ssumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update these forward-looking statements other than as may be required by applicable law.