ThermoCeramix Reports Operational and Financial Second Quarter 2015 Results

- Quarter marked by new development deals for TCX's proprietary heating technology -
- Expanded distribution of Downtown Grill Electric Hibachi though Costco.ca -

MONTREAL, Aug. 20, 2015 /CNW/ - ThermoCeramix Corporation ("ThermoCeramix", "TCX" or the "Company") (TSX Venture Exchange: TCX.V), a technology-licensing company engaged in the development of high-performance, energy-efficient electric heating solutions, today reported its operational and financial results for the three months ended June 30, 2015.

"Over the last quarter, our business strategy has continued to unfold according to plan," stated Louis Desmarais, CEO of ThermoCeramix. "We secured a critical distribution agreement with Costco.ca for our Downtown Grill Hibachi (the "Hibachi"), which we believe is key to increasing our presence in the Canadian market. We anticipate that the ramp-up of sales over the last few weeks is an early indication of the Hibachi's long-term market potential. We do believe we're on track to achieving large-scale commercialization of this application and overall, market validation of our platform technology."

Louis Desmarais further commented, "In parallel to these efforts, we've made steady progress in advancing our licensing strategy by securing development agreements with Zephyr Ventilation Inc. and Gotec SA. We believe that successful completion of these agreements will give us the opportunity to tap into the growing consumer appliance industry over the next year. We are confident not only in our ability to continue this steady progress in the second half of the year but also the ability to convert these projects into stable, revenue producing licensing contracts."

Second Quarter 2015 Highlights

  • Expanded distribution of the Downtown Grill through Costco.ca, the second largest online retailer in Canada with $352 million in e-commerce revenues annually; and,
  • Strengthened the management team with the appointment of Daniel Cyr as President of Downtown Grill Inc.

Highlights Subsequent to Quarter End

  • Finalized co-development agreement with Zephyr Ventilation Inc., a San Francisco-based market leader in kitchen ventilation hood design, innovation and technology, to design and develop an electric grill using the TCXTM heating technology; and,
  • Secured development deal with global pump manufacturer, Gotec SA, to develop an all-in-one ("AIO") heated pump. ThermoCeramix understands that upon completion of the agreement, Gotec intends to finalize a supply agreement with a leading international appliance manufacturer to use the AIO pump in the development of a high-performance espresso machine.

Outlook

ThermoCeramix is focused on achieving mass-market validation of its high-performance, energy-efficient, platform heating technology. The Company believes that this validation will be instrumental in securing licensing agreements for its TCX™ technology.

Having proven and secured a broad patent portfolio, the Company is now advancing a defined number of priority projects that it believes will accelerate validation of its technology, most notably large-scale commercialization of its lead application, the Hibachi.

In parallel to these efforts, ThermoCeramix is continuing to make steady progress on development projects with select global aerospace, appliance and automotive manufacturers that the Company believes have the potential to translate into meaningful licensing revenue.

Commercialization of the Hibachi

In 2013, 14 million new barbeques were shipped to households across the U.S. – a total market of $5.6 billion. Of those annual sales, electric barbeques only accounted for approximately 300,000 units which the Company believes was primarily due to the weaker performance of current electric heating technologies compared to standard gas barbeques.

In the second quarter, ThermoCeramix expanded the distribution of the Hibachi through Costco.ca, the second largest online retailer in Canada with $352 million in e-commerce revenues annually. The Company anticipates that Costco's loyal membership base will help ThermoCeramix gain a more meaningful foothold with consumers across Canada while allowing them to maintain healthy margins on their product. Furthermore, the Company believes that healthy sales will allow ThermoCeramix to build on this initial agreement with the wholesale retailer over the longer-term.

In addition to these efforts, ThermoCeramix is focused on expanding its distribution network with other select retail and wholesale players and developing next generational models of the Hibachi at lower price points for greater consumer appeal.

Technology Licensing

The adaptability of ThermoCeramix's technology allows it to target applications in the global residential, commercial and industrial spaces.

ThermoCeramix has identified a significant market opportunity in the household appliance industry. This industry, which has been experiencing a compounded annual growth rate of 6.1% over the last few years, is forecast to be worth an estimated $384 billion in 2017. Growth in this market is propelled by the rate of developing economies in the Asia Pacific region, the emergence of smart appliances, and increasing demand for energy-efficient products.

ThermoCeramix is focused on advancing its development projects with Zephyr Ventilation Inc. and Gotec SA. The Company believes that successful completion of these development agreements will allow it to tap into the household appliance industry and translate into meaningful licensing opportunities.

Financial Highlights


Three months
ended June 30,
2015
Unaudited ($)

Three months
ended June 30,
2014
Unaudited ($)

Six months
ended June 30,
2015
Unaudited ($)

Six months
ended June 30,
2014
Unaudited ($)

Net research & development expenses

211,841

50,224

467,175

271,988

Administrative expenses

1,078,424

583,239

1,844,534

2,342,626

Other expense (income)

81,059

(42,176)

-

Net loss for the period

1,503,924

686,143

2,336,393

2,701,555

Net loss per share (basic and diluted)

0.04

0.02

0.07

0.15

Research and Development

Research and development ("R&D") expenses for the three months ended June 30, 2015 were $261,841 compared to $293,543 in the same quarter in the previous year. This decrease was more than offset by a decrease of $193,319 in R&D tax credits to $50,000, resulting in an overall increase of $161,617 in net R&D expenses to $211,841 in 2015.

R&D expenses for the six months ended June 30, 2015 were $517,175, a decrease of $23,132 from the same period in 2014. This decrease was more than offset by a decrease in R&D tax credits and government grants of $218,319, resulting in a year-over-year increase of $195,187 in net R&D expenses.

General and administrative expenses

General and administrative expenses were $1,078,424 for the quarter ended June 30, 2015, which represented an increase of $495,185 from $583,239 in the quarter ended June 30, 2014. This increase was primarily attributable to higher expenses associated with the ramp-up of operations.

General and administrative expenses were $1,844,534 for the six months ended June 30, 2015, which represented a decrease of $498,092 from $2,342,626 in the same period in 2014. This decrease was primarily attributable to higher expenses in 2015 associated with the ramp-up of operations, more than offset by non-recurring listing costs of $961,269 incurred in 2014 associated with the Company's Qualifying Transaction.

Other Income

Other income (expense) consists of development contract revenues and net product sales (net of discounts, allowances and cost of goods sold). For the quarter ended June 30, 2015, other expense was $81,059 compared to nil in the prior year period, and was primarily due to start-up costs associated with Hibachi manufacturing. For the six months ended June 30, 2015, other income was $42,176 compared to nil in the prior year period.

Net Loss

Net loss for the quarter ended June 30, 2015 was $1,503,924, up from a loss of $686,143 recorded in the same period in the prior year. The change was primarily attributed to higher general and administrative expenses and lower R&D tax credits.

Net loss for the six months ended June 30, 2015 was $2,336,393, down from the loss of $2,701,555 recorded in the prior year period. The primary contributors to this change were the absence of expenses related to the Company's Qualifying Transaction in 2014, partially offset by higher general and administrative expenses in 2015 associated with the ramp-up of operations and lower R&D tax credits.

Amendments to Option Plan

On May 20, 2015 at the Company's annual and special meeting of shareholders, the shareholders of the Company ratified, confirmed and approved amendments to the Company's stock option plan (the "Plan") resulting in the increase of the total number of common shares of the Company reserved for issuance under the Plan, inclusive of existing options, from 4,061,161 to 5,065,198, representing 15% of the issued and outstanding common shares of the Company as at April 13, 2015. For further details regarding the amendments to the Plan, please refer to the Company's "Management Information Circular" dated April 22, 2015 filed under the Company's SEDAR profile at www.sedar.com.

About ThermoCeramix

ThermoCeramix Corporation (TSX.V: TCX) is a technology-licensing company engaged in the development of high-performance, energy-efficient electric heating solutions. The Company's patented and proprietary TCX™ heating technology uses sprayed-on heaters applied directly to almost any profile and material that requires heat. The technology is energy-efficient, scalable, and adaptable to almost any size and shape. The Company holds a strong and broad intellectual property portfolio of over 25 patents. The Company's strategy is to commercialize one application of its technology platform through the development, production and sales of the Hibachi, a unique indoor-outdoor grill, and then license the technology for numerous additional consumer, commercial & industrial applications. For more information, please visit the Company's web site at www.thermoceramix.com.

Caution Regarding Forward Looking Information

Certain information set forth in this press release may contain "forward-looking statements" or "forward-looking information" under applicable securities laws. Except for statements of historical fact, certain information contained herein may constitute forward-looking statements. Any such forward-looking statements may be identified by words such as "could", "estimated", "will", "expects", "anticipates", "believe", "projects", "plans", "to be" and similar expressions. Any such statements are not guarantees of future performance and undue reliance should not be placed on them. Any such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause the Company's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. There can be no assurance that any such forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. For more information relating to risks which may cause the Company's actual results to be different from expected and historical results, please see the Company's "Management's Discussion and Analysis for the six months ended June 30, 2015 and 2014" dated August 20, 2015 filed under the Company's SEDAR profile at www.sedar.com.

Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE ThermoCeramix Corporation

For further information: ThermoCeramix Corporation, Louis Desmarais, Chief Executive Officer, (450) 641-5461 ext. 5651, ldesmarais@thermoceramix.com; NATIONAL | Equicom, Keith Richards, Investor Relations, (416) 815-0700 ext. 232, krichards@tmxequicom.com

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