VANCOUVER, Aug. 7, 2013 /CNW/ - Smartcool Systems Inc. (TSX-V: SSC) is pleased to provide an update on activities so far this year and some thoughts concerning the balance of the year.
Smartcool is well positioned to see improving performance through the third and fourth quarters. Revenue from new customer accounts, and from a healthy and expanding distribution network is to be expected. Smartcool is pursuing some exciting opportunities for innovative product development both independently and through new partnerships.
Direct Sales
The cost of running refrigeration and air conditioning equipment is one of the largest operating costs for food retailers, making this sector a primary target for Smartcool. Smartcool's ESM achieves on average a 5% reduction in the overall energy bill in a supermarket by improving the energy efficiency of the refrigeration systems. This outstanding and proven performance ensures our position as a leading product provider for installation across major food retailers' facilities.
This year we have begun introducing the ECO3 product to convenience and gas station stores, saving energy on their smaller refrigeration, air conditioning and/or heat pump systems. Providing our customers with the product mix of both ESM and ECO3 expands the overall energy savings we can deliver across a blended portfolio of facilities. This tactic puts Smartcool in a strong competitive position, making us an attractive energy saving partner to large retail customers looking to cut energy costs across a variety of facilities.
Our success with Sainsbury's over the last number of years as a participant in their Energy Reset programs has given us a wealth of case study documentation that is supporting our initiatives with five additional retailers in the UK. For Sainsbury's we have consistently been in the top three service and product providers reducing the company's energy consumption. This gives us a strong position from which to begin work with the other retailers, some of whom have even larger portfolios than Sainsbury's.
Developing these major new customer accounts is achieving our goal of revenue diversification, and gives us a strong base for sustainable growth.
Distribution
Leveraging the knowledge gained by the UK team has allowed our distributors to also secure major retail customers in the USA, Mexico, Central America, and south east Asia. Smartcool has developed online technical support and a secure web portal for distributors where they can access documentation, allowing scalability of growth in this area.
Smartcool's ECO3 targets the hundreds of millions of single and dual compressor refrigeration, air conditioning and heat pump systems installed both in commercial and residential sites worldwide. To date, tens of thousand of ECO3 units have been installed by distributors as the key sales channel. This demonstrates not only the value of distribution as a growing source of revenue, but also the ease of expansion through the development of new relationships. Smartcool's distribution network continues to grow across existing markets and further afield into new markets.
Product Development
Smartcool has identified another path to market this year for our proprietary software. The potential to license the use of our algorithm to developers of other form factors such as digital thermostats, has a large potential for revenue generation with minimal costs to Smartcool. Integrating our software or hardware platforms with refrigeration or air conditioning equipment, accelerates the speed of deployment of our technology. This can be done remotely using wireless protocols or through third party installation and service organizations. We are actively pursuing this option.
Profitability
Not only is Smartcool seeking new customers and new sources of revenue to leverage our proven technology, we are also identifying ways of reducing operating costs on our path to profitability. We have sourced new supply chains to improve gross margins on production and have renegotiated existing cost structures wherever possible. We believe we can improve product margins by 15%. We have also reduced our operating costs by approximately 30% this year.
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About Smartcool
Smartcool Systems Inc. (TSX-V: SSC) provides cutting edge energy efficient and energy cost reduction solutions for businesses around the world. The ECO3 and ESM are Smartcool's unique retrofit technologies that reduce the energy consumption of compressors in air conditioning, refrigeration and heat pump systems by 15% to 20%, giving customers a return on investment in 12 to 36 months.
SOURCE: SmartCool Systems Inc.
WEB www.smartcool.net and www.smartcooleco3.com
EMAIL [email protected]
USA Office
TEL +1 866 571 6554
UK Office
TEL +44 1420 544868
Canada Office
TEL +1 604 904 8632
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