Well they turned some gross profit, but a net loss which is ultimately what matters. If they can increase revenues as they say they will and keep costs constant they should be able to fix that. I think they are doing the right things in terms of the Ecig business. However they seem to have some potential toxic debt and dilution is always worrisome.
"It is worth noting that the first quarter 2014 had some extraordinary occurrences and expenses. We merged with AvWorks Aviation Corp., and then acquired the majority interest in American Vaporizer, LLC, picking up its revenues, assets and costs. January through March we experienced significant levels of backorders meaning that there was considerable revenue that we couldn't book. In April, we undertook aggressive inventory financing in order to relieve oversold situations growing across most of our brands. Simply put, demand (greatly) exceeded supply. Now, for the second quarter, with additional inventory either in place or in manufacture, we are fulfilling and booking those backorders and meeting the continuing strong demand for our products.
Today, sales continue to accelerate over the first quarter's pace, meaning that our results for the second quarter should well surpass those of the first. Important to remember, we anticipate a major breakthrough in revenue to be reported for our third quarter, due to the rapidly expanding sales base of the American Smoke brand and our forthcoming launch of our Vapor 123 direct sales e-liquid home delivery system -- more on that later.""
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