SOURCE: Long Island Iced Tea Corp.

Long Island Iced Tea Corp.

August 16, 2016 08:00 ET

Long Island Iced Tea Corp. Announces 2016 Second Quarter Results

Second Quarter Net Sales Increase 137% Compared to Prior Year; First Half Net Sales Increase 125% Compared to Prior Year

HICKSVILLE, NY--(Marketwired - Aug 16, 2016) - Long Island Iced Tea Corp. (NASDAQ: LTEA) (the "Company"), a growth-oriented company focused on the ready-to-drink tea segment in the beverage industry, today reported results for the second quarter and six months ended June 30, 2016.

For the second quarter of 2016, the Company reported net sales of $1,603,667 and a net loss of $2,082,166, compared to the prior year's second quarter net sales of $675,735 and net loss of $683,486, respectively. For the first six months of 2016, the Company reported net sales of $2,111,836 and a net loss of $3,499,236, compared to the prior year's first six months net sales of $940,457 and net loss of $1,062,152, respectively. The increase in net sales was primarily due to continued brand momentum and an increase in distribution including the addition of new customers and expansion into new geographies. Net losses increased primarily as the result of increased operating expenses resulting from increased payroll costs (including stock based compensation), increased Advisory Board and Board of Director fees, and increased legal and consulting fees.

Philip Thomas, CEO of the Company, commented, "We are proud of achieving significant net sales growth in the second quarter and reaching several exciting milestones, including surpassing one-and-a-half million dollars in quarterly net sales for the first time. The Company continued to leverage its success in the northeast and made significant investments further expanding its customer base and distribution into new markets. The Company also received trademark protection of our mark 'Long Island Iced Tea' on the supplemental register from the U.S. Patent and Trademark Office, allowing us to further protect our brand. We strengthened our balance sheet with a recently completed capital raise in which we saw our stock listed on the Nasdaq Capital Markets. We are very excited to build upon this momentum in the second half of 2016."

Second Quarter Review - Comparison of Quarters Ended June 30, 2016 and 2015

  • Net sales increased 137% to $1,603,667, compared to $675,735 in the prior year's second quarter.
  • Gross margin decreased to 1% of net sales, compared to 23% in the prior year's second quarter.
  • Operating expenses increased by $1,079,882, or 133%, to $1,893,659, compared to $813,777 in the prior year's second quarter.
  • Net loss was $2,082,166, or $(0.42) per share, compared to a net loss of $683,486, or $(0.21) per share, in the prior year's second quarter.

Six Month Review - Comparison of Six-Months Ended June 30, 2016 and 2015

  • Net sales increased 125% to $2,111,836, compared to $940,457 in the prior year's first six months.
  • Gross margin decreased to 3% of net sales, compared to 24% in the prior year's first six months.
  • Operating expenses increased by $1,916,886, or 154%, to $3,157,867, compared to $1,240,981 in the prior year's first six months.
  • Net loss was $3,499,236, or $(0.72) per share, compared to a net loss of $1,062,152, or $(0.36) per share in the prior year's first six months.

About Long Island Iced Tea Corp.

Headquartered in Long Island, New York, Long Island Iced Tea Corp. operates in the ready-to-drink tea segment of the beverage industry. The Company has developed non-alcoholic, premium iced tea bottled beverages made with quality ingredients that are offered at an affordable price. The Company is currently organized around its flagship brand Long Island Iced Tea®, a premium, ready-to-drink iced tea sold primarily on the East Coast of the United States through a network of distributors. The Company's website is www.longislandicedtea.com.

Forward Looking Statements

This press release includes statements of the Company's expectations, intentions, plans and beliefs that constitute "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 and are intended to come within the safe harbor protection provided by those sections. These statements, which involve risks and uncertainties, relate to the discussion of the Company's business strategies and its expectations concerning future operations, margins, sales, new products and brands, potential joint ventures, potential acquisitions, expenses, profitability, liquidity and capital resources and to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. These statements include any statement that does not directly relate to a historical or current fact. You can also identify these and other forward-looking statements by the use of such words as "may," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "thinks," "estimates," "seeks," "predicts," "could," "projects," "potential" and other similar terms and phrases, including references to assumptions. These forward looking statements are made based on expectations and beliefs concerning future events affecting the Company and are subject to uncertainties, risks and factors relating to its operations and business environments, all of which are difficult to predict and many of which are beyond its control, that could cause its actual results to differ materially from those matters expressed or implied by these forward looking statements. These risks include its history of losses and expectation of further losses, its ability to expand its operations in both new and existing markets, its ability to develop or acquire new brands, its relationships with distributors, the success of its marketing activities, the effect of competition in its industry and economic and political conditions generally, including the current economic environment and markets. More information about these and other factors are described in the reports the Company files with the Securities and Exchange Commission. When considering these forward looking statements, you should keep in mind the cautionary statements in this press release and the reports the Company files with the Securities and Exchange Commission. New risks and uncertainties arise from time to time, and the Company cannot predict those events or how they may affect it. The Company assumes no obligation to update any forward looking statements after the date of this press release as a result of new information, future events or developments, except as required by the federal securities laws.

   
LONG ISLAND ICED TEA CORP. AND SUBSIDIARIES  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
(Unaudited)  
   
  For the Three Months Ended
June 30,
    For the Six Months Ended
June 30,
 
  2016     2015     2016     2015  
                               
Net sales $ 1,603,667     $ 675,735     $ 2,111,836     $ 940,457  
Cost of goods sold   1,588,870       518,808       2,056,488       712,117  
Gross profit   14,797       156,927       55,348       228,340  
Operating expenses:                              
  General and administrative expenses   1,009,576       398,225       1,787,241       617,648  
  Selling and marketing expenses   884,083       415,552       1,370,626       623,333  
Total operating expenses   1,893,659       813,777       3,157,867       1,240,981  
                               
Operating loss   (1,878,862 )     (656,850 )     (3,102,519 )     (1,012,641 )
                               
Other expenses:                              
  Other expense   -       (3,327 )     -       (3,327 )
  Interest expense   (203,304 )     (23,309 )     (396,717 )     (46,184 )
                               
Net loss $ (2,082,166 )   $ (683,486 )   $ (3,499,236 )   $ (1,062,152 )
                               
Weighted average number of common shares outstanding - basic and diluted   4,973,715       3,227,713       4,847,322       2,932,166  
                               
Basic and diluted net loss per share $ (0.42 )   $ (0.21 )   $ (0.72 )   $ (0.36 )
                               

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