Tomorrow VRUS EruptsVERUS INTERNATIONAL, INC. REPORTS 101% INCREASE IN ANNUAL REVENUE
By GlobeNewswire, March 19, 2019, 05:30:00 PM EDT
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Gaithersburg, MD, March 19, 2019 (GLOBE NEWSWIRE) -- Verus International, Inc. ("Verus" or the "Company") today announced financial results for its fiscal 2018 fourth quarter and full year ended October 31, 2018. In conjunction with this release, the Company will also provide additional details on its strategy for fiscal 2019.
For the full year, management is noting the following items of importance:
In fiscal 2018, Verus posted sales of $5.8 million, a 101% increase over the $2.9 million registered in fiscal 2017.
The company's gross margin averaged 12.9%, within the higher range of expectations.
Total operating expenses increased slightly by 4% to $1.7 million compared to $1.6 million in fiscal 2017.
As of October 31, 2018, the Company had sold approximately $8.2 million in products pursuant to its original $79 million buffalo order.
Investors should be aware that a large, negative charge ($0.9 million) listed as "default principal increase on convertible notes payable" will be reversed in the 2nd quarter Form 10-Q, as these penalty provisions were extinguished subsequent to the fiscal year end.
Highlights from Q4, Fiscal 2018 include the following:
Q4/18 revenue was the highest in company history at $2.2 million, marking a 134% increase over last year (Q4/17) and a 60% increase over the preceding quarter (Q3/18)
Q4/18 gross margins where within the expected higher range for the current product mix, coming in at close to 11.6%
"The fiscal 2018 10-K is a true look back in time, because it still includes the impact of the legacy real estate business and negative provisions from the convertible debt. So, the Q4 portion of this release is a better indicator of things to come," explained Verus CEO Anshu Bhatnagar. "In Q4 we began shipping on our multiproduct order, which commenced part way through the quarter. Sales will accelerate even faster as our newest orders begin to ship in upcoming months. Perhaps most importantly, investors got a glimpse of how close Verus is to profitability, without the finance and equity related changes, this would have been a profitable quarter."
On a forward basis, the Company would like to provide the following update:
Verus is projecting that quarterly sales will grow in excess of 100% on a year over year basis and accelerate significantly throughout fiscal 2019
The Company is currently in negotiations for new contracts in both its core markets and other markets that would represent an expansion of the current product portfolio
With completion of the recent recapitalization, Verus has reinitiated discussions with commercial banks and other sources of non-dilutive financing
In terms of potential mergers and acquisitions, Verus is conducting due diligence on seven candidates and is moving forward on several of these companies. It is not possible to say how many of these candidates will become operating subsidiaries until final negotiations are completed.
Verus is approached almost weekly with partnership, acquisition, distribution and similar growth opportunities, so the consumer products space continues to show robust activity.
"Today's update should be considered Part One, because the recap delay in filing our annual report has us bumping into the first quarter report for fiscal 2019, giving us the unusual case of near back-to-back financials," said CEO Bhatnagar. "Because I have so many growth initiatives pending and we have fresh financials so close at hand, I have decided to resume our traditional earnings call format to coincide with our upcoming Q1/19 quarterly release, which is already in work. That will give me a little extra time to complete some important initiatives and provide us with more relevant financials to discuss."
"Looking back at fiscal 2018, investors should be encouraged at how strongly we finished in Q4, despite operating the entire year under a dark cloud of uncertainty. With the recap completed, that uncertainty is gone and I can now concentrate on growing the business. I just completed my most successful business trip, to Dubai and India, since founding Verus. The results of that trip have already been seen in some recent orders, but those are just the beginning. Our pending book of business gives me great confidence in projecting accelerating triple-digit growth throughout 2019."
The Company will return to a more normalized financial reporting format with the upcoming fiscal 2019 Q1 filing. In conjunction with that report, Verus will conduct an earnings call and provide additional commentary on expectations for 2019.
Interested investors are reminded to watch for product updates on the official Twitter feed @Verus_Foods.
About Verus International, Inc.
Verus International operates an international food subsidiary (Verus Foods) that sells branded consumer products to customers worldwide. The Company trades on the OTC market (OTC:VRUS). Investors can find Real-Time quotes and market information for the Company on www.otcmarkets.com.
