- Revenue Increases 26.9% YoY to $24.3
Million
- 81.4% YoY Increase in Sales
of Intelligent Pet Products
- Gross Margin Expands 282.8% YoY to $9.1 Million, with Gross Margin of 33.1% Compared
to 9.0% a Year Ago
- Comprehensive Income Increases to $6.2 million from a Loss of $10.3 million a Year Ago
- EPS Grows to $0.05 per Basic
and Diluted Share from a Loss of $0.33 per Basic and Diluted Share a Year
Ago
DONGGUAN, China, Oct. 29, 2021 /PRNewswire/ -- Dogness
(International) Corporation ("Dogness" or the "Company") (NASDAQ:
DOGZ), a developer and manufacturer of a comprehensive line of
Dogness-branded, OEM and private label pet products, today
announced its unaudited financial results for the fiscal year ended
June 30, 2021.
Silong Chen, Chairman and Chief
Executive Officer of Dogness, commented, "We are pleased with our
continued strong growth but know it would have been even stronger
if not dampened by the ongoing global logistics crisis. We
simply cannot get products fast enough to sell. With that
said, we were still able to drive strong growth with a 26.9%
increase in revenue for fiscal year 2021 compared to fiscal year
2020. We are even more pleased with our expansion in gross margin
and profitability. The quality of our revenue also improved, with a
nearly 163% increase in sales volume for our intelligent pet
products in fiscal year 2021 compared to fiscal year 2020. We have
been prioritizing this important long-term growth opportunity and
strategically shifted our resources to produce and promote the
sales of higher margin intelligent pet products across our
integrated Smart Pet Ecosystem, which includes innovative
App-controlled pet feeders, pet water fountains, and smart pet
toys."
"We have been working to mitigate the impact of COVID-19 and the
supply chain shortages by expanding our sales through popular large
retail and online shopping platforms. At the same time, we continue
to upgrade our production lines to improve production efficiencies
and lower costs. As a result, we were able to reduce our selling
price for traditional pet products to help our customers, while
still maintaining a healthy profit margin. Overall, our strategy
and expanded product lines have been well received by customers
worldwide, as reflected in the double-digit growth we achieved in
our international sales and the momentum for our intelligent pet
products. We are optimistic in our outlook and will continue to
execute as we drive revenue and profit growth to build value for
shareholders."
Financial Results for the Fiscal Year Ended June 30, 2021
Revenue for the fiscal year ended June
30, 2021 increased 26.9% to $24.3
million from $19.2 million in
the fiscal year ended June 30, 2020.
The increase in revenue was primarily attributable to an 81.4% expansion in sales of Dogness'
intelligent pet products, which are benefitting from high demand
and a higher average selling price than the Company's traditional
pet products. Dogness has built an integrated sales platform
across all channels, with major customers including Anyi Trading,
Petco, Trendspark, PetSmart, Pet Value, Walmart, Target, IKEA,
SimplyShe, Pets at Home, PETZL, and Petmate, and online shopping
platforms, such as Amazon, Chewy.com, Boqii, Target.com,
HomeDepot.com, Loews.com, Wayfair.com, JD, Tmall and Taobao, as
well as live streaming sales platforms hosted by influencers.
During the fiscal year ended June 30,
2021, Dogness' total sales in international markets
increased by approximately $1.2
million or approximately 13% from $10.6 million in fiscal 2020 to approximately
$10.6 million in fiscal year
2021.
Cost of revenues decreased by approximately $1.6 million, or 9.6%, from approximately
$16.8 million in fiscal 2020 to
approximately $15.2 million in fiscal
2021. As a percentage of revenues, the cost of goods sold decreased
by approximately 25.1 percentage points to 62.4% in fiscal 2021
from 87.5% in fiscal 2020. This was mainly because the Company
continues to upgrade its production lines for both traditional and
intelligent pet products to improve the productivity and lower the
production costs.
Gross profit increased by approximately $6.8 million or 282.8%, to approximately
$9.2 million in fiscal 2021 from
approximately $2.4 million in fiscal
2020 primarily because the Company continues to upgrade its
production lines for both traditional and intelligent pet products,
which led to the improved productivity and lower the production
costs. Overall gross profit margin was 37.6%, an increase of 25.1
percentage points, for the year ended June
30, 2021 as compared to 12.5% for the year ended
June 30, 2020.
Comprehensive income was approximately $6.2 million or $0.05 per basic and diluted share for the fiscal
year ended June 30, 2021, compared to
a loss of $10.3 million or a loss of
$0.33 per basic and diluted share for
the fiscal year ended June 30,
2020.
The Company had a $5.5 million
balance of cash and short-term investments as of June 30, 2021. This does not include
approximately $4 million in gross
proceeds from the Company's offering with institutional investors,
which closed on July 19, 2021.
About Dogness
Dogness (International) Corporation was founded in 2003 from the
belief that dogs and cats are important, well-loved family members.
Through its smart products, hygiene products, health and wellness
products, and leash products, Dogness' technology simplifies pet
lifestyles and enhances the relationship between pets and pet
caregivers. The Company ensures industry-leading quality through
its fully integrated vertical supply chain and world-class research
and development capabilities, which has resulted in over 200
patents and patents pending. Dogness products reach families
worldwide through global chain stores and distributors. For more
information, please visit: ir.dogness.com.
Forward Looking Statements
No statement made in this press release should be interpreted as
an offer to purchase or sell any security. Such an offer can only
be made in accordance with the Securities Act of 1933, as amended,
and applicable state securities laws. Certain statements in this
press release concerning our future growth prospects are
forward-looking statements regarding our future business
expectations intended to qualify for the "safe harbor" under the
Private Securities Litigation Reform Act of 1995, which involve a
number of risks and uncertainties that could cause actual results
to differ materially from those in such forward-looking statements.
The risks and uncertainties relating to these statements include,
but are not limited to, risks and uncertainties regarding lingering
effects of the Covid-19 pandemic on our customers' businesses and
end purchasers' disposable income, our ability to raise capital on
any particular terms, fulfillment of customer orders, fluctuations
in earnings, fluctuations in foreign exchange rates, our ability to
manage growth, our ability to realize revenue from expanded
operation and acquired assets in China and the U.S., our ability to attract and
retain highly skilled professionals, client concentration, industry
segment concentration, reduced demand for technology in our key
focus areas, our ability to successfully complete and integrate
potential acquisitions, and unauthorized use of our intellectual
property and general economic conditions affecting our industry.
Additional risks that could affect our future operating results are
more fully described in our United States Securities and Exchange
Commission filings. These filings are available at www.sec.gov.
Dogness may, from time to time, make additional written and oral
forward-looking statements, including statements contained in the
Company's filings with the Securities and Exchange Commission and
our reports to shareholders. In addition, please note that any
forward-looking statements contained herein are based on
assumptions that we believe to be reasonable as of the date of this
press release. The Company does not undertake to update any
forward-looking statements that may be made from time to time by or
on behalf of the Company unless it is required by law.
DOGNESS
(INTERNATIONAL) CORPORATION
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
2021
|
|
|
2020
|
|
|
2019
|
|
|
|
For the Years
Ended June 30,
|
|
|
|
2021
|
|
|
2020
|
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
Revenues- third
party customers
|
|
$
|
23,112,435
|
|
|
$
|
18,261,707
|
|
|
$
|
25,887,948
|
|
Revenues – related
parties
|
|
|
1,207,686
|
|
|
|
909,651
|
|
|
|
328,567
|
|
Total
Revenues
|
|
|
24,320,121
|
|
|
|
19,171,358
|
|
|
|
26,216,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues –
third party customers
|
|
|
(14,501,166)
|
|
|
|
(16,146,856)
|
|
|
|
(16,583,904)
|
|
Cost of revenues –
related parties
|
|
|
(663,742)
|
|
|
|
(633,132)
|
|
|
|
(202,606)
|
|
Total cost of
revenues
|
|
|
(15,164,908)
|
|
|
|
(16,779,988)
|
|
|
|
(16,786,510)
|
|
Gross
Profit
|
|
|
9,155,213
|
|
|
|
2,391,370
|
|
|
|
9,430,005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
|
1,815,771
|
|
|
|
2,336,229
|
|
|
|
2,101,403
|
|
General and
administrative expenses
|
|
|
4,941,036
|
|
|
|
5,746,812
|
|
|
|
6,015,901
|
|
Research and
development expenses
|
|
|
540,613
|
|
|
|
1,528,062
|
|
|
|
673,131
|
|
Loss from disposal of
fixed assets
|
|
|
-
|
|
|
|
1,036,304
|
|
|
|
-
|
|
Impairment of fixed
assets
|
|
|
-
|
|
|
|
281,680
|
|
|
|
-
|
|
Impairment loss of
investment in equity investees
|
|
|
-
|
|
|
|
177,750
|
|
|
|
-
|
|
Total operating
expenses
|
|
|
7,297,420
|
|
|
|
11,106,837
|
|
|
|
8,790,435
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
|
1,857,793
|
|
|
|
(8,715,467)
|
|
|
|
639,570
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
(expense), net
|
|
|
(264,408)
|
|
|
|
15,560
|
|
|
|
616,878
|
|
Foreign exchange
transaction gain (loss)
|
|
|
(228,260)
|
|
|
|
214,171
|
|
|
|
503,528
|
|
Other income
(expenses), net
|
|
|
215,233
|
|
|
|
23,937
|
|
|
|
23,498
|
|
Rental income from
related parties
|
|
|
354,968
|
|
|
|
89,411
|
|
|
|
-
|
|
Gain from disposition
of a subsidiary
|
|
|
5,162
|
|
|
|
-
|
|
|
|
-
|
|
Total other income
(expense)
|
|
|
82,695
|
|
|
|
343,079
|
|
|
|
1,143,904
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
|
|
1,940,488
|
|
|
|
(8,372,388)
|
|
|
|
1,783,474
|
|
Provision for
income taxes
|
|
|
641,460
|
|
|
|
164,537
|
|
|
|
380,296
|
|
Net income
(loss)
|
|
|
1,299,028
|
|
|
|
(8,536,925)
|
|
|
|
1,403,178
|
|
Less: net loss
attributable to noncontrolling interest
|
|
|
(213,336)
|
|
|
|
(95,366)
|
|
|
|
(18,603)
|
|
Net income (loss)
attributable to Dogness (International)
Corporation
|
|
|
1,512,364
|
|
|
|
(8,441,559)
|
|
|
|
1,421,781
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation income (loss)
|
|
|
4,879,315
|
|
|
|
(1,896,934)
|
|
|
|
(2,010,170)
|
|
Comprehensive
income (loss)
|
|
|
6,178,343
|
|
|
|
(10,433,859)
|
|
|
|
(606,992)
|
|
Less: comprehensive
loss attributable to noncontrolling interest
|
|
|
(161,701)
|
|
|
|
(98,635)
|
|
|
|
(19,224)
|
|
Comprehensive
income (loss) attributable to Dogness
(International) Corporation
|
|
$
|
6,340,044
|
|
|
$
|
(10,335,224)
|
|
|
$
|
(587,768)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
earnings Per share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.05
|
|
|
$
|
(0.33)
|
|
|
$
|
0.05
|
|
Diluted
|
|
$
|
0.05
|
|
|
$
|
(0.33)
|
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares Outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
27,499,367
|
|
|
|
25,913,631
|
|
|
|
25,913,631
|
|
Diluted
|
|
|
27,554,811
|
|
|
|
25,913,631
|
|
|
|
25,941,606
|
|
DOGNESS
(INTERNATIONAL) CORPORATION
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
2021
|
|
|
2020
|
|
|
|
As of June
30,
|
|
|
|
2021
|
|
|
2020
|
|
ASSETS
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
4,912,442
|
|
|
$
|
1,266,873
|
|
Restricted
cash
|
|
|
23,312
|
|
|
|
-
|
|
Short-term
investments
|
|
|
549,895
|
|
|
|
3,551,968
|
|
Accounts receivable
from third-party customers, net
|
|
|
2,367,326
|
|
|
|
1,916,840
|
|
Accounts receivable –
related parties
|
|
|
515,193
|
|
|
|
559,465
|
|
Inventories,
net
|
|
|
4,203,163
|
|
|
|
2,860,700
|
|
Due from related
parties
|
|
|
32,528
|
|
|
|
-
|
|
Prepayments and other
current assets
|
|
|
1,662,272
|
|
|
|
1,471,612
|
|
Total current
assets
|
|
|
14,266,131
|
|
|
|
11,627,458
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
|
69,876,039
|
|
|
|
43,533,512
|
|
Right-of-use lease
assets
|
|
|
5,170,395
|
|
|
|
5,123,898
|
|
Intangible assets,
net
|
|
|
2,223,285
|
|
|
|
2,104,803
|
|
Long-term investments
in equity investees
|
|
|
1,703,900
|
|
|
|
1,046,360
|
|
Deferred tax
assets
|
|
|
605,658
|
|
|
|
115,230
|
|
TOTAL
ASSETS
|
|
$
|
93,845,408
|
|
|
$
|
63,551,261
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Short-term bank
loans
|
|
$
|
704,446
|
|
|
$
|
5,142,000
|
|
Current portion of
long-term loan
|
|
|
796,416
|
|
|
|
-
|
|
Accounts
payable
|
|
|
847,151
|
|
|
|
705,223
|
|
Accounts payable –
related parties
|
|
|
350,199
|
|
|
|
305,215
|
|
Due to a related
party
|
|
|
2,001,940
|
|
|
|
25,462
|
|
Advance from
customers
|
|
|
209,508
|
|
|
|
152,299
|
|
Taxes
payable
|
|
|
4,443,192
|
|
|
|
2,814,411
|
|
Accrued liabilities
and other payable
|
|
|
11,737,680
|
|
|
|
1,452,408
|
|
Operating lease
liabilities, current
|
|
|
171,803
|
|
|
|
172,716
|
|
Total current
liabilities
|
|
|
21,262,335
|
|
|
|
10,769,734
|
|
|
|
|
|
|
|
|
|
|
Long term bank
loan
|
|
|
6,557,608
|
|
|
|
73,300
|
|
Operating lease
liabilities, non-current
|
|
|
1,123,060
|
|
|
|
1,200,299
|
|
TOTAL
LIABILITIES
|
|
|
28,943,003
|
|
|
|
12,043,333
|
|
|
|
|
|
|
|
|
|
|
Commitments
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
|
Common stock, $0.002
par value, 100,0000,000 shares authorized,
29,624,814 and 25,913,631 issued and outstanding as of June 30,
2021 and 2020, respectively
|
|
|
|
|
|
|
|
|
Class A Common
stock
|
|
|
41,111
|
|
|
|
33,689
|
|
Class B Common
stock
|
|
|
18,138
|
|
|
|
18,138
|
|
Common
stock
|
|
|
|
|
|
|
|
|
Additional paid-in
capital
|
|
|
60,355,278
|
|
|
|
53,221,610
|
|
Statutory
reserve
|
|
|
291,443
|
|
|
|
191,716
|
|
Retained
earnings
|
|
|
4,628,708
|
|
|
|
3,216,071
|
|
Accumulated other
comprehensive loss
|
|
|
(960,285)
|
|
|
|
(5,787,965)
|
|
Total Dogness
(International) Corporation stockholders' equity
|
|
|
64,374,393
|
|
|
|
50,893,259
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling
interest
|
|
|
528,012
|
|
|
|
614,669
|
|
Total
equity
|
|
|
64,902,405
|
|
|
|
51,507,928
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
$
|
93,845,408
|
|
|
$
|
63,551,261
|
|
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SOURCE Dogness International Corporation