Natunola Releases Q1 2011 Results

WINCHESTER, ON, June 29, 2011 /CNW/ - Natunola Health Biosciences Inc. (TSX-V:NHI) ("Natunola") reports its financial results for the first quarter ended March 31, 2011.

Summary of results:

Revenue of $388,141 was recorded for the quarter ended March 31, 2011, representing an increase of $1,618 (0.4%) compared to the quarter ended March 31, 2010.

A net loss of $76,154 was recorded for the quarter ended March 31, 2011, an increase of $39,866 over the quarter ended March 31, 2010. This increased loss was attributable to: (a) an increase of $61,280 in cost of sales due to an increase in the labour component which had been understated in the previous year's quarter and (b) an increase of  $10,561 for sales and marketing expenses due to the initiation of a contract for consulting services with PRPR Proactive Services Inc. costing $17,500 in the quarter less $6,939 lower costs in other sales & marketing areas.

Basic and diluted loss per share was $0.01 per share for the quarters ended March 31, 2011 and March 31, 2010.

Selected Information for the Quarters Ending March 31, 2011, 2010 and 2009:

     Q1 2011   Q1 2010 Q1 2009*
Revenues $  388,141 $  386,523 $  281,688
Net loss for the period     (76,154)     (36,288)   (130,605)
Loss per common share
(basic and diluted)
        (0.01)         (0.01)        (0.01)

*Under Canadian GAAP

Results of operations:

Comparison of the Quarters ended March 31, 2011 and 2010:

Revenue:

                 
    Q1 2011   Q1 2010   Change   % Change
Cosmetics $ 192,634 $ 232,293 $ (39,659)   (17%)
Flax   156,736   140,227   16,509   12%
Packaging   38,771   14,003   24,768   177%
  $ 388,141 $ 386,523 $ 1,618   (0%)

Changes in revenue in the latest quarter as compared to the quarter ending March 31, 2010 were timing-related:

  • Cosmetic sales decreased as there was one fewer shipment to a significant customer as compared to the quarter ended March 31, 2010.
  • Flax sales increased as there were more sales to one  specific customer as compared to the quarter ended March 31, 2010
  • Packaging sales increased as there was an additional shipment to a specific customer as compared to the quarter ended March 31, 2010

Gross profit:

                 
    Q1 2011   Q1 2010   Change   % Change
All sales $ 166,485 $ 226,147 $ (59,662)   (26%)

Gross profit decreased due to an increase of lower margin products sold during the quarter ended March 31, 2011 as compared to the quarter ended March 31, 2010. Also related labour costs in the year-ago quarter were based on actual 2009 labour allocations which were revised upwards at year end 2010 to reflect actual costs. These costs were used as best estimates for this quarter.

Expenses:

                 
    Q1 2011   Q1 2010   Change   % Change
Sales and marketing $ 44,803 $ 34,242 $ 10,561   31%
General and administrative   176,403   161,808   14,595   9%
Research and development   27,586   25,290   2,296   9%
Amortization of property, plant and equipment   20,750   22,709   (1,959)   (9%)
Amortization of intangible assets   11,252   11,138   114   1%
Stock-based compensation *   2,000   -   2,000   -%
  $ 282,794 $ 255,187 $ 27,607   11%

* Included in General and Administrative expenses in Financial Statements

The increase in selling and marketing expense was due to the initiation of a contract for consulting services with PRPR Proactive Services Inc. Research and development ("R&D") expenses increased marginally due to increased activity. Stock based compensation of $2,000 resulted from 50,000 stock options having been issued since January 1, 2011, of which 50,000 remain outstanding, representing 2% of the total options outstanding at March 31, 2011.

The complete audited annual report and financial statements are available for review on SEDAR at www.sedar.com

About the Company:

Natunola and its manufacturing plant are located in Winchester, Ontario. Natunola  is a manufacturer and researcher in the field of flax seed derived omega -3 fatty acids, flax protein, flax lignans, specialty natural products, bio-nutrients and functional supplements for human and animal care markets. Natunola also produces canola oil gels and other natural ingredients for the cosmetic and personal care industry. Natunola has a retail health product line under the brand name of Natunola® health's delight. Natunola was the winner for the National Canadian Agri-Food Award of Excellence for Innovation for the year 2008. To know more about Natunola, visit www.natunola.com

Some of the statements contained in the release are forward-looking statements, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this press release. 

SOURCE Natunola Health Biosciences Inc.

For further information:

Dr. Nam Fong Han
President & CEO
Natunola Health Biosciences Inc.
661, St Lawrence Street,
Winchester, Ontario.
K0C 2K0
Tel (613) 774-9998

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Natunola Health Biosciences Inc.

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