TORONTO, Aug. 14, 2017 /CNW/ - SPOT COFFEE (CANADA) LTD. (TSX-V: SPP) ("SPoT" or the "Company") has released its financial and operating results for the second quarter ended June 30, 2017. The company's unaudited consolidated financial statements for the three and six months ended June 30, 2017, together with management's discussions and analysis are available on SEDAR under the Company's name.
The Company is pleased to report that its second quarter operations this year have resulted in a company-wide net profit of $30,191 and an EBITDA of $234,080. These financial results have further improved the company-wide EBITDA to a positive position of $137,215 for the six months ended June 30, 2017.
Same-store corporate café sales increased by 3% in the second quarter of 2017 as compared with those in the same period of 2016. With the addition of SPoT Kenmore franchise café, franchise café sales grew by 16%, from $1,294,349 in the second quarter of 2016 to $1,495,238 in the same period of 2017.
Management continued to drive costs down wherever possible without affecting the quality of the Company's goods and services. Reduction in costs in the six months ended June 30, 2017 as compared with those ended in the same period of 2016, are outlined below as follows:
- Cost of sales as a percentage of revenue have dropped from 36.6% in 2016 down to 32.9% in 2017;
- Accordingly, gross profit as a percentage of revenue has increased to 67.1% in 2017 from 63.4% in 2016;
- Interest and accretion expenses are down by $168,542 from $307,637 in 2016 down to $139,095 in 2017;
- Credit card fees and bank charges are down by $18,141, from $103,385 in 2016 down to $85,244 in 2017;
- Office and general expenses are down by $178,531, from $349,948 in 2016 down to $178,417 in 2017;
- Professional and consulting fees as well as travel expenses were all down by a total of $92,317, collectively, from a total of $227,659 in 2016 down to a total of $135,342 in 2017.
During this second quarter and in accordance with the Company's financial plan concerning debt reduction, the Company has further reduced its indebtedness by $207,000.
The Company realized a gain of $250,054 on the disposition of its remaining 25% equity in SPoT Coffee Hertel Inc. which owns the SPoT Hertel café.
"Q2 of 2017 has seen the dawn of transformation of the company's operations into profitability," said John Lorenzo, chairman of the Company. "This transition is the result of the internal growth of our franchise business and the continual improvements that our management team has unfailingly continued to implement. We have a great and dedicated team who share a common belief in the SPoT Coffee special distinguishing features that characterize the unique SPoT brand and business concept. Our goal is to work very hard in order to sustain and grow this trend of profitability year after year."
About SPoT Coffee
SPoT Coffee trades on the TSX Venture Exchange under the symbol SPP. SPoT designs, builds, operates and franchises community oriented cafés and express cafés in New York State and the US Northeast. SPoT's community cafés provide its customers with the highest quality service, signature made-to-order meals and award-winning micro-roasted coffee. Each SPoT café is distinctively designed to suit its local neighbourhood, creating a warm and friendly gathering place for the community. SPoT's commercial business focuses on the sale of roasted coffee beans to food service and grocery chains, business offices and third party resellers such as universities and hospitals.
Forward Looking Statements
Except for statements of historical fact relating to the Company, certain information contained herein constitutes forward-looking statements. In particular, forward-looking information in this press release includes, but is not limited to, the potential use of proceeds of the financing that is the subject of this release. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The forward-looking information contained in this news release is expressly qualified by this cautionary statement. Except as required by applicable securities laws, the Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of the release.
SOURCE Spot Coffee (Canada) Ltd.
For further information: Anton Ayoub, CEO & President, (416) 368-2220 Ext 228, [email protected]