PFIE Profire Energy Inc

Profire Energy, Inc. (NASDAQ:PFIE), a technology company which creates, installs and services burner and chemical management solutions in the oil and gas industry, today reported financial results for the nine-month transition period ended December 31, 2016. A conference call will be held on Friday, March 10, 2017 at 1:00 p.m. EST to discuss the results.

As previously communicated, due to a change in the Company’s fiscal year-end, the Company filed a transition report on Form 10-K covering the transition period from April 1, 2016 to December 31, 2016, which is the period between the closing of the Company's most recent fiscal year and the opening date of the newly selected fiscal year. The results from the quarter ended December 31, 2016 are reflected in the nine-month period covered by the transition report.

Transition Period Highlights

• Revenues Increased 41% Quarter-Over-Quarter
• Generated Positive Cash Flows in Each Quarter of the Transition Period
• Cash and liquid investments at period-end totaled $20 million
• Remained debt-free    

Transition Period Financial Results                                                                                                                                        In the final quarter of the transition period total revenues increased to just over $7 million, which was an increase of 41% as compared to the previous quarter. This was achieved while keeping operating costs under control, which only increased 5% over the same comparable period.

Net income for the transition period was approximately $78,000 or $0.00 per diluted share, compared to a net income of $799,000 or $0.01 per diluted share in the comparable nine-month period of 2015.  Net income in the final quarter of the transition period was $609,000 or $0.01 per diluted share as compared to $75,000 or $0.00 per diluted share in the previous quarter. The net loss in the first quarter of the transition period was $605,000 or a loss of $0.01 per diluted share.  In the transition period the Company’s net income increased from -15% of total revenue in the first quarter to 9% of total revenue in the last quarter of the period.

At the end of the transition period cash and cash equivalents totaled $9.3 million, as compared to $21.3 million at the end of the fiscal year ended March 31, 2016. The Company has invested $11 million in low risk, CD’s, bonds and mutual funds. Without these investments, the Company’s cash position would have been $20 million, despite having repurchased $3.6 million in Profire stock during the transition period.

Management Commentary

“We continue to strategically allocate capital according to the plan we have previously communicated,” stated Ryan Oviatt, CFO of Profire.  “We remain focused on the preservation of cash, seeking opportunities to acquire adjacent technologies, conducting our stock repurchase program, and other value creation activities that may be identified from time to time. We believe this plan will continue to drive long-term value for Profire and our shareholders.”

“The stabilization of oil prices has had a positive effect on our Company as our customers appear to have gained confidence in the oil markets and have returned to spending their capex budgets,” said Brenton Hatch, President and CEO of Profire Energy. “The oil industry is still recovering and while we don’t know how oil prices will react throughout our next fiscal year, many analysts believe oil prices will average in the mid $50’s price range.  We remain optimistic that the stabilization of commodity prices will allow us to maintain the growth we have achieved in the final two quarters of the period.”

Conference Call

Profire Energy President and CEO Brenton Hatch and CFO Ryan Oviatt will host the teleconference. Following the teleconference, they will be joined by Cameron Tibdall, VP of Sales and Marketing, for a question and answer period.

Date: Friday, March 10, 2017Time: 1:00 p.m. EST (11:00 a.m. MST)Toll-free dial-in number: 1-877-705-6003International dial-in number: 1-201-493-6725

The conference call will be telecast live and available for replay via this link: http://public.viavid.com/index.php?id=123227. The telecast replay will be available for one year. 

Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting the conference call, please contact Todd Fugal at 1-801-796-5127. 

A replay of the call will be available after 5:00 p.m. ET on the same day through March 17, 2017.

Toll-free replay number: 1-844-512-2921International replay number: 1-412-317-6671Replay Pin Number: 13656825

About Profire Energy, Inc.Profire Energy assists energy production companies in the safe and efficient production and transportation of oil and natural gas. As energy companies seek greater safety for their employees, compliance with more stringent regulatory standards, and enhanced margins with their energy production processes, Profire Energy's burner management and chemical injection systems are increasingly becoming part of their solution. Profire Energy has offices in Lindon, Utah; Houston, Texas; Shelocta, Pennsylvania; Greeley, Colorado; and Edmonton, Alberta, Canada. For additional information, visit www.profireenergy.com.

Cautionary Note Regarding Forward-Looking Statements. Statements made in this release that are not historical are forward-looking statements. This release contains forward-looking statements, including, but not limited to statements regarding the Company holding a conference call on March 10, 2017, regarding the transition period financial results; the effect the stabilization of oil prices will have on the Company’s customers spending their capex budgets; the effect the stabilization of oil prices will have on the Company’s ability to maintain recent growth; or, the Company’s capital allocation plan will be able to deliver long-term shareholder value. Forward-looking statements are not guarantees of future results or performance and involve risks, assumptions and uncertainties that could cause actual events or results to differ materially from the events or results described in, or anticipated by, the forward-looking statements. Factors that could materially affect such forward-looking statements include certain economic, business, public market and regulatory risks and factors identified in the company's periodic reports filed with the Securities Exchange Commission. All forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are made only as of the date of this release and the Company assumes no obligation to update forward-looking statements to reflect subsequent events or circumstances, except as required by law. Readers should not place undue reliance on these forward-looking statements.

 

PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
	As of
ASSETS		December 31, 2016				March 31, 2016
CURRENT ASSETS
Cash and cash equivalents	$	9,316,036			$	21,292,595
Accounts receivable, net		5,633,802				4,132,137
Inventories, net		7,839,503				11,046,682
Income tax receivable		180,981				268,326
Short term investments		2,965,536				-
Investments - other		2,250,000				-
Prepaid expenses & other current assets		410,558				315,757
Total Current Assets		28,596,416				37,055,497
LONG-TERM ASSETS
Deferred tax asset		60,940				-
Long Term Investments		5,504,997				-
PROPERTY AND EQUIPMENT, net		7,458,723				8,232,911
OTHER ASSETS
Goodwill		997,701				997,701
Intangible assets, net		490,082				529,300
Total Other Assets		1,487,783				1,527,001
TOTAL ASSETS	$	43,108,859			$	46,815,409
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable	$	1,220,478			$	893,822
Accrued vacation		154,307				171,089
Accrued liabilities		284,214				449,694
Income taxes payable		61,543				335,375
Total Current Liabilities		1,720,542				1,849,980
LONG-TERM LIABILITIES
Deferred income tax liability		-				180,301
TOTAL LIABILITIES		1,720,542				2,030,281
STOCKHOLDERS' EQUITY
Preferred shares: $0.001 par value, 10,000,000		-				-
shares authorized:  no shares issued and outstanding
Common shares: $0.001 par value, 100,000,000 shares authorized:
53,582,250 issued and 50,705,933 outstanding at December 31, 2016
and 53,256,296 issued and outstanding at March 31, 2016		53,582				53,256
Treasury stock, at cost		(3,582,805	)			-
Additional paid-in capital		26,800,298				26,164,622
Accumulated other comprehensive loss		(2,810,743	)			(2,282,682	)
Retained earnings		20,927,985				20,849,932
Total Stockholders' Equity		41,388,317				44,785,128
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	43,108,859			$	46,815,409
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Operations and Other Comprehensive Income (Loss)
	For the Nine-Month Ended December 31, 2016				For the Year Ended March 31, 2016
REVENUES
Sales of goods, net	$	14,336,618			$	23,992,324
Sales of services, net		1,650,568				3,080,122
Total Revenues		15,987,186				27,072,446
COST OF SALES
Cost of goods sold-product		6,732,822				11,027,114
Cost of goods sold-services		1,154,326				2,405,012
Total Cost of  Goods Sold		7,887,148				13,432,126
GROSS PROFIT		8,100,038				13,640,320
OPERATING EXPENSES
General and administrative expenses		7,198,081				12,264,442
Research and development		757,880				899,013
Depreciation and amortization expense		482,311				516,786
Total Operating Expenses		8,438,272				13,680,241
LOSS FROM OPERATIONS		(338,234	)			(39,921	)
OTHER INCOME (EXPENSE)
Gain (Loss) on sale of fixed assets		(2,680	)			20,278
Other income		102,206				144,937
Interest income		90,028				37,278
Total Other Income		189,554				202,493
NET INCOME (LOSS) BEFORE INCOME TAXES		(148,680	)			162,572
INCOME TAX EXPENSE (BENEFIT)		(226,733	)			127,828
NET INCOME	$	78,053			$	34,744
OTHER COMPREHENSIVE LOSS
Foreign Currency Translation Loss	$	(415,698	)		$	(393,701	)
Unrealized Losses on Investments		(112,363	)			-
Total Other Comprehensive Loss		(528,061	)			(393,701	)
TOTAL COMPREHENSIVE LOSS	$	(450,008	)		$	(358,957	)
BASIC EARNINGS PER SHARE	$	0.00			$	0.00
FULLY DILUTED EARNINGS PER SHARE	$	0.00			$	0.00
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING		52,857,299				53,243,151
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING		53,483,110				53,558,942
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
							Additional			Other											Total
	Common Stock						Paid-In			Comprehensive				Treasury				Retained			Stockholders'
	Shares			Amount			Capital			Income				Stock				Earnings			Equity
Balance, March 31, 2015	53,199,136			$	53,199		$	25,525,052		$	(1,888,981	)		$	-			$	20,815,188		$	44,504,458
Fair value of options vested	-				-			565,646			-				-				-			565,646
Stock issued in exercise of stock options	57,160				57			73,924			-				-				-			73,981
Foreign currency translation	-				-			-			(393,701	)			-				-			(393,701	)
Net Income for the year ended December 31, 2015	-				-			-			-				-				34,744			34,744
Balance, March 31, 2016	53,256,296				53,256			26,164,622			(2,282,682	)			-				20,849,932			44,785,128
Fair value of options vested								242,801														242,801
Stock issued in exercise of stock options	86,808				87			112,913														113,000
Stock issued in settlement of RSUs	239,146				239			279,962														280,201
Treasury stock repurchased	(2,876,317	)													(3,582,805	)						(3,582,805	)
Foreign currency translation											(415,698	)										(415,698	)
Unrealized Losses on Investments											(112,363	)										(112,363	)
Net income for the nine-months ended December 31, 2016																			78,053			78,053
Balance, December 31, 2016	50,705,933			$	53,582		$	26,800,298		$	(2,810,743	)		$	(3,582,805	)		$	20,927,985		$	41,388,317
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
			For the Nine Months Ended				For the Year Ended
			December 31, 2016				March 31, 2016
OPERATING ACTIVITIES
	Net Income		$	78,053			$	34,744
	Adjustments to reconcile net income to
	net cash provided by operating activities:
	Depreciation and amortization expense			756,927				989,484
	(Gain) Loss on sale of fixed assets			3,480				(20,278	)
	Bad debt expense			272,807				143,192
	Stock options issued for services			616,802				678,971
	Changes in operating assets and liabilities:
	Changes in accounts receivable			(2,063,449	)			5,114,485
	Changes in income taxes receivable/payable			(190,746	)			(276,075	)
	Changes in inventories			3,304,972				641,410
	Changes in prepaid expenses			(95,156	)			(171,411	)
	Changes in deferred tax asset/liability			(241,241	)			49,490
	Changes in accounts payable and accrued liabilities			(58,736	)			148,921
	Net Cash Provided by Operating Activities			2,383,713				7,332,933
INVESTING ACTIVITIES
	Proceeds from sale of equipment			16,896				158,641
	Purchase of investments			(10,685,553	)			-
	Purchase of fixed assets			(18,485	)			(62,465	)
	Purchase of Intangible assets			-				-
	Net Cash Provided by (Used in) Investing Activities			(10,687,142	)			96,176
FINANCING ACTIVITIES
	Value of equity awards surrendered by employees for tax liability			(30,000	)			(39,342	)
	Cash received in exercise of stock options			15,000				-
	Purchase of Treasury stock			(3,582,805	)			-
	Net Cash Used in Financing Activities			(3,597,805	)			(39,342	)
	Effect of exchange rate changes on cash			(75,325	)			(241,968	)
	NET INCREASE (DECREASE) IN CASH			(11,976,559	)			7,147,799
	CASH AT BEGINNING OF PERIOD			21,292,595				14,144,796
	CASH AT END OF PERIOD		$	9,316,036			$	21,292,595
SUPPLEMENTAL DISCLOSURES OF
	CASH FLOW INFORMATION
	CASH PAID FOR:
	Interest		$	-			$	-
	Income taxes		$	255,769			$	127,828
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

 

Profire Energy, Inc. And Subsidiaries Quarterly Financial Result for Nine-Months Ended December 31, 2016
		For the Quarters Ending
Transition Period		Jun 30, 2016				Sep 30, 2016				Dec 31, 2016
Total revenues		$	3,974,043			$	4,990,813			$	7,022,330
Gross profit			1,914,250				2,624,659				3,561,129
Income (loss) from operations			(881,278	)			(127,369	)			670,413
Income tax expense (benefit)			(245,877	)			(99,701	)			118,845
Net income (loss)			(605,295	)			74,452				608,896
Basic earnings per common share		$	(0.01	)		$	0.00				0.01
Diluted earnings per common share		$	(0.01	)		$	0.00				0.01
		For the Quarters Ending
Fiscal Year 2016		Jun 30, 2015				Sep 30, 2015				Dec 31, 2015			Mar 31, 2016
Total revenues		$	6,877,243			$	8,097,294			$	7,554,255		$	4,543,654
Gross profit			3,313,519				4,028,403				3,998,502			2,299,895
Income (loss) from operations			(539,374	)			675,396				490,322			(666,265	)
Income tax expense (benefit)			(149,525	)			254,781				194,227			(171,654	)
Net income (loss)			(459,079	)			779,195				479,243			(764,617	)
Basic earnings per common share		$	(0.01	)		$	0.01			$	0.01		$	(0.01	)
Diluted earnings per common share		$	(0.01	)		$	0.01			$	0.01		$	(0.01	)
These financial statements should be read in conjunction with the Form 10-KT and accompanying footnotes.

Contact:
Profire Energy, Inc.
Ryan Oviatt, CFO
(801) 796-5127