Taronis Technologies Inc (TRNX)

[Golden Cross]

Taronis Generates a Record $9.7 Million_Revenue_in_2018
ACCESSWIRE ACCESSWIREApril 11, 2019
Represents 161% Annual Increase in Sales

TAMPA, FL / ACCESSWIRE / April 11, 2019 / Taronis Technologies, Inc. (''Taronis'' or ''the Company'') ( $TRNX ), a leading clean technology company in the renewable resources and environmental conservation industry, today announced its 2018 audited results of operations. Taronis generated record sales of $9.7 million, which represented a 161% increase when compared to the $3.7 million in revenues generated in 2017. The primary factors for growth during 2018 were a series of six acquisitions made during the year, in California and Texas, with the primary purpose to rapidly expand the Company's geographic reach for its retail distribution capabilities in the industrial gas and welding supply market.

''2018 was a year of significant development and transformation for Taronis,'' commented Scott Mahoney, Chief Executive Officer of Taronis Technologies. ''We entered the year with a goal to dramatically expand our industrial gas distribution network in the US, and we executed extremely well on six transactions that closed over the course of the year.''

Mr. Mahoney continued, ''We grew revenues by more than 161% on a GAAP basis, and established a $13 million revenue run rate in the fourth quarter of 2018, for a more than 400% increase in sales heading into 2019. Our goal is to achieve a $25 million revenue run rate, which we believe will enable Taronis to become a cash flow positive business. We are close to meeting this objective as we are now running at a $24 million run rate through the completion of three additional transactions in early 2019.''

''Equally importantly, we added tremendous resources across our entire team. We increased our industrial gas sales team from fewer than 20 to more than 75 across the best markets in the US. We added 175 years of industrial gas management experience to a team that only had 50 years combined prior to 2018. We added a chemical engineer, an environmental engineer, and a technical project manager to help coordinate highly technical proprietary gas production across multiple markets. We now have an experienced, successful team that can handle and capitalize on scalable growth in 2019 and beyond,'' concluded Mr. Mahoney.

Regarding additional results from operations, the Company generated gross profits of $3.6 million in 2018, which represented a $2.0 million increase as compared to $1.5 million in 2017. Gross profits were $4.1 million excluding the effects of acquisition accounting on inventory valuations. The Company generated a net loss of $15 million, which included $3.1 million in non-cash stock compensation paid to vendors. The Company also incurred expenses related to six acquisitions and three capital markets transactions.

Taronis also enacted a series of cost cuts under new executive leadership in the fourth quarter of 2018. These actions resulted in a decrease of approximately 33% in quarterly operating expenses, and are expected to contribute significantly to improved operating performance in 2019.

The Company invested heavily in its expansion throughout 2018 which, in turn, resulted in certain balance sheet increases. Total assets increased to $27.6 million, as compared to $11.7 million in at the end of 2017. The largest increases in tangible assets were $1.0 million in accounts receivable, $1.5 million in inventory, and $4.5 million in fixed assets such as vehicle, industrial gas cylinders, and other long-lived industrial gas fulfillment infrastructure.

From a liquidity perspective, cash flow from operations was a negative $9.6 million in 2018, as compared to a negative $4.7 million in 2017. Quarterly cash flow from operations as a percentage of revenues improved over the course of the year. In the first quarter of 2018, cash flow losses were 205% of the quarterly sales. In the fourth quarter of 2018, cash flow losses decreased to 97% of quarterly sales, despite the incurrence of approximately $0.6 million in non-recurring expenses for three acquisitions and two capital markets transactions. Cash on hand at year end was $2.6 million, including all restricted cash and refundable deposits.

Additional information regarding the results of operations, international expansion and technology innovations in 2018 will be provided on the Company's 2018 earnings conference call to be held at 4:00pm EST on Thursday, April 11th. For dial-in information relating to the call, please see the information below.