TOMI Environmental Solutions, Inc.® (“TOMI”) (NASDAQ:TOMZ), a global company specializing in disinfection and decontamination utilizing its premier Binary Ionization Technology (BIT) platform through its SteraMist brand of products, today announced its financial results for the first quarter 2021.

TOMI Chief Executive Officer, Dr. Halden Shane stated, “Our first quarter 2021 revenues had a steep comparison to last year’s first quarter, when the onset of COVID-19 pandemic created an unprecedented demand in the marketplace for disinfection and decontamination solutions, including demand for our products. While the economy has begun to reopen, this year’s first quarter results reflect headwinds from the impact of many of our customers’ continued remote work environment as well as delays in capital expenditure projects across our customer base. As a result, it has been difficult for us to fully implement our strategies to generate sustained growth following the spike of demand we experienced in 2020. For example, our in-person demos with potential customers remained suspended in the quarter and many custom engineered systems (CES) were postponed. That said, we made considerable progress advancing key building blocks for our long term growth, including expanding our internal sales force and continuing the development of three exciting new products. We are particularly excited about the upcoming launch of our SteraPak product, a much anticipated offering which further differentiates our 6-log kill solutions in the marketplace and better position us to continue our mission to make the world a safer place.”

Dr. Shane continued, “The pandemic accelerated the introduction of our product to a broader, highly satisfied customer base, many of whom ordered our hardware and solution quickly at the outset of the pandemic and are beginning to integrate our solution into their ongoing disinfection procedures. This pandemic has truly changed how people think about proactive decontamination and we are optimistic about our ability to capitalize on that new thinking as we continue to execute our long term plan to become the standard in decontamination worldwide. We believe these factors will drive sustained, higher margin sales at levels above pre-pandemic levels as more businesses reopen and commercial activities accelerate.”

Financial Results for the Three Months Ended March 31, 2021 compared to March 31, 2020

  • Total net revenue was $2.1 million compared to $7.1 million, a decrease of 70%.
    • SteraMist® equipment-based revenues were $1.7 million and $6.6 million respectively, a decrease of 74%.
    • SteraMist® BIT Solution-based revenues were $0.4 million and $1.0 million, respectively, a decrease of 60%.
    • Service-based revenues were $0.4 million for both 2021 and 2020.
    • Domestic revenues were $1.8 million and $3.6 million, respectively, a decrease of 50%; International revenues were approximately $0.3 million and $3.5 million, respectively, a decrease of 91%.
  • Gross margin was 59.6% compared to 63.6%. The decline in gross margin is attributable to product mix.
  • Operating loss was ($1.5 million) compared to operating income of $2.7 million.
  • Net loss was ($1.5 million) or ($0.09) per basic and diluted share, compared to net income of $2.6 million or $0.17 per basic share.
  • EBITDA was a loss of ($1.4 million) compared to EBITDA of $2.8 million. A table reconciling EBITDA to the appropriate GAAP financial measure is included with the Company's financial information below.
  • Adjusted EBITDA was a loss of ($1.4 million) compared to Adjusted EBITDA of $3.0 million. A table reconciling Adjusted EBITDA to the appropriate GAAP financial measure is included with the Company's financial information below.

     Balance sheet highlights as of March 31, 2021

  • Cash and cash equivalents were approximately $3.9 million compared to $5.2 million at December 31, 2020, a decrease of $1.3 million.
  • Working capital was $10.1 million compared to $11.5 million at December 31, 2020.
  • Shareholders’ equity was $11.9 million compared to $13.2 million at December 31, 2020, a decrease of $1.3 million.

Current Business Highlights To Date

  • Ongoing development of new products such as SteraBox and SteraPack, with the latter to have a tentative launch set for mid year 2021.
  • TOMI’s Custom Engineered System (CES ) in Pfizer Missouri was recently showcased in a New York Times article about Pfizer’s COVID vaccine processes.
  • Added two Vice Presidents of Sales to oversee the Company’s sales efforts and capitalize on the growing pipeline of opportunities across the Commercial, Healthcare Divisions.
  • The iHP Corporate Service team treated one of four fill lines in a North Carolina pharmaceutical company that manufacturers one of the COVID vaccines. The remaining three lines are expected to be decontaminated at a later date with SteraMist
  • An increase in health system purchasing during the first quarter, including the expansion of sales to a third Mercy hospital in Ohio, with a fourth Mercy facility expected to implement SteraMist soon. Zimmer, a medical device company, had multiple location purchases, demonstrating that referrals from existing relationships is one of the Company’s highest lead generation methods.
  • TOMI continues to work with premium companies in testing and validating SteraMist® technology in the Food Safety and seed industries. In the first quarter of 2021, TOMI increased brand awareness through promotions and marketing in this division. A majority of the independent marketing representatives recently onboarded are part of this division
  • In the second half of 2021, as conferences and tradeshows reopen for in-person exhibition, TOMI’s sales team will attend these events across the country to perform live demonstrations to showcase the difference between our SteraMist iHP technology and our competitors. These in-person conferences and trade shows are a key component of our marketing strategy.
  • The Company continues to work with its German aircraft partner and Boeing in a third-party test required for the aviation industry and anticipates the testing will be completed in the second quarter of 2021. TOMI will incur no expense for this work as both testing partners are clients.
  • TOMI has engaged HYGCEN Germany GmbH to perform a quantitative test of germ carriers for airborne room disinfection and testing of the effectiveness of a method for disinfecting room air to meet the new EU norm (standard) EN 17272. Certification that Binary Ionization Technology meets the new standard will continue to position iHP as the premier decontamination/disinfection technology available on the market today.
  • The Company continues to work with the Virginia State University Agricultural Research Station and its partner, Arkema on a food safety pilot study based on novel, nonthermal, and environmentally friendly technology to control foodborne pathogens on industrial hemp seed and strawberry as representative model foods. TOMI anticipates the pilot will be completed by the second quarter of 2021.
  • TOMI is working with University of Virginia on two separate studies. The first, which explored SteraMist’s efficacy against SARS-CoV-2, has reported successful results and is currently awaiting the final published paper. The second, using the handheld SteraMist Surface Unit and testing spray and contact time variables against Adenovirus is currently awaiting results. TOMI anticipates the testing will be completed by the third quarter of 2021.
  • TOMI has partnered with the Department of Chemistry and Biochemistry of Texas Tech University to conduct a wide range of studies on spray pattern, deposition, and hydrogen peroxide content in order to compare its 1% label to other similar products on the market.
  • TOMI's long term relationship with USDA Agricultural Research Service continues to progress. In March 2021, "Hydrogen peroxide residue on tomato, apple, cantaloupe, and Romaine lettuce after treatments with cold plasma-activated hydrogen peroxide" was accepted for publication in the Journal of Food Microbiology. TOMI has also begun discussions with another ARS facility to evaluate the benefits of iHP on blueberries to prevent rot and reduce post-harvest losses.

Conference Call Information

TOMI will hold a conference call to discuss first quarter 2021 results at 4:30 p.m. ET today, May 17, 2021.

To participate in the call by phone, dial (877) 545-0320 and entry code 408875 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0016 and entry code 408875. To access the live webcast or view the press release, please visit the Investor Relations section of the TOMI website at: http://investor.tomimist.com/TOMZ/webcasts_and_events/2145

A replay of the teleconference will be available until May 28, 2021 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use replay access code: 41341 A replay of the webcast will be available for at least 90 days on the company’s website, starting approximately one hour after the completion of the call.

TOMI™ Environmental Solutions, Inc.: Innovating for a safer world®TOMI™ Environmental Solutions, Inc. (NASDAQ:TOMZ) is a global decontamination and infection prevention company, providing environmental solutions for indoor surface disinfection through the manufacturing, sales and licensing of its premier Binary Ionization Technology® (BIT™) platform. Invented under a defense grant in association with the Defense Advanced Research Projects Agency (DARPA) of the U.S. Department of Defense, BIT™ solution utilizes a low percentage Hydrogen Peroxide as its only active ingredient to produce a fog of ionized Hydrogen Peroxide (iHP™). Represented by the SteraMist® brand of products, iHP™ produces a germ-killing aerosol that works like a visual non-caustic gas.TOMI products are designed to service a broad spectrum of commercial structures, including, but not limited to, hospitals and medical facilities, cruise ships, office buildings, hotel and motel rooms, schools, restaurants, meat and produce processing facilities, military barracks, police and fire departments, and athletic facilities. TOMI products and services have also been used in single-family homes and multi-unit residences.

TOMI develops training programs and application protocols for its clients and is a member in good standing with The American Biological Safety Association, The American Association of Tissue Banks, Association for Professionals in Infection Control and Epidemiology, Society for Healthcare Epidemiology of America, America Seed Trade Association, and The Restoration Industry Association.

For additional information, please visit http://www.tomimist.com/ or contact us at info@tomimist.com. 

Forward-Looking Statements

This press release contain forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management’s judgment, beliefs, current trends, and anticipated product performance. These forward-looking statements include, without limitation, statements relating to anticipated financial performance and operating results; upcoming launch of new products; expected growth in sales and market demand; timing and process relating to research studies and testing; impact of COVID-19 pandemic on our business operation; and our ability to execute sale strategies. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, the impact of COVID-19 pandemic on our business and customers; our ability to maintain and manage growth and generate sales, our reliance on a single or a few products for a majority of revenues; the general business and economic conditions; and other risks as described in our SEC filings, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed by us with the SEC and other periodic reports we filed with the SEC. The information provided in this document is based upon the facts and circumstances known at this time. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today’s date, unless otherwise stated, and we undertake no duty to update such information, except as required under applicable law.

Use of Non-GAAP Financial Measures

To supplement our unaudited consolidated financial statements presented on a basis consistent with U.S. GAAP, we disclose certain non-GAAP financial measures for our historical performance, including EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin. We define EBITDA as net income (loss), adjusted to exclude: interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measure and is intended to serve as a supplement to our results provided in accordance with GAAP. We define Adjusted EBITDA as net income (loss), adjusted to exclude: interest, taxes, depreciation and amortization; stock-based compensation expense. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net revenue. We believe that these historical non-GAAP financial measures provide useful information to both management and investors by excluding certain items and expenses that are not indicative of our core operating results or do not reflect our normal business operations. In addition, our management uses non-GAAP measures to evaluate our performance internally and to benchmark our performance externally against competitors. Our use of non-GAAP financial measures has certain limitations in that such non-GAAP financial measures may not be directly comparable to those reported by other companies. Although we believe that the use of non-GAAP financial measures enhances its investors’ understanding of its business and performance, our use of non-GAAP financial measures should not be considered an alternative to GAAP basis financial measures and should be read in conjunction with the relevant GAAP financial measures. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. Because of these limitations, the non-GAAP financial measure used in this release should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We seek to compensate for the limitation of our non-GAAP presentation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable U.S. GAAP as set forth below. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures.

 
TOMI ENVIRONMENTAL SOLUTIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
 
       
ASSETS      
  March 31, 2021    
Current Assets: (Unaudited)   December 31, 2020
Cash and Cash Equivalents $ 3,945,658     $ 5,198,842  
Accounts Receivable - net   3,743,430       3,716,701  
Other Receivables   -       198,951  
Inventories   4,765,455       3,781,515  
Vendor Deposits   146,130       388,712  
Prepaid Expenses   316,439       421,305  
Total Current Assets   12,917,114       13,706,027  
       
Property and Equipment – net   1,235,483       1,298,103  
       
Other Assets:      
Intangible Assets – net   720,494       722,916  
Operating Lease - Right of Use Asset   619,989       631,527  
Capitalized Software Development Costs - net   41,902       52,377  
Other Assets   516,230       358,935  
Total Other Assets   1,898,614       1,765,755  
Total Assets $ 16,051,211     $ 16,769,885  
       
LIABILITIES AND SHAREHOLDERS’ EQUITY      
       
Current Liabilities:      
Accounts Payable $ 2,046,667     $ 1,501,469  
Accrued Expenses and Other Current Liabilities   629,797       501,849  
Customer Deposits   28,949       118,880  
Current Portion of Long-Term Operating Lease   83,768       81,223  
Total Current Liabilities   2,789,181       2,203,421  
       
Long-Term Liabilities:      
Loan Payable   410,700       410,700  
Long-Term Operating Lease, Net of Current Portion   931,697       953,190  
Total Long-Term Liabilities   1,342,397       1,363,890  
Total Liabilities   4,131,577       3,567,311  
       
Commitments and Contingencies   -       -  
       
Shareholders’ Equity:      
Cumulative Convertible Series A Preferred Stock;      
par value $0.01 per share, 1,000,000 shares authorized; 63,750 shares issued    
and outstanding at March 31, 2021 and December 31, 2020   638       638  
Cumulative Convertible Series B Preferred Stock; $1,000 stated value;    
7.5% Cumulative dividend; 4,000 shares authorized; none issued    
and outstanding at March 31, 2021 and December 31, 2020   -       -  
Common stock; par value $0.01 per share, 250,000,000 shares authorized;    
16,811,513 and 16,761,513 shares issued and outstanding    
at March 31, 2021 and December 31, 2020, respectively.   168,115       167,615  
Additional Paid-In Capital   52,369,899       52,142,399  
Accumulated Deficit   (40,619,018 )     (39,108,078 )
Total Shareholders’ Equity   11,919,634       13,202,574  
Total Liabilities and Shareholders’ Equity $ 16,051,211     $ 16,769,885  
       
TOMI ENVIRONMENTAL SOLUTIONS, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
       
  For The Three Months Ended
  March 31,
   2021   2020 (1)
       
Sales, net $ 2,073,455     $ 7,053,418  
Cost of Sales   838,297       2,565,410  
Gross Profit   1,235,158       4,488,008  
       
Operating Expenses:      
Professional Fees   173,493       136,125  
Depreciation and Amortization   83,449       171,909  
Selling Expenses   474,389       378,645  
Research and Development   195,620       59,458  
Equity Compensation Expense   -       182,772  
Consulting Fees   106,174       81,545  
General and Administrative   1,712,366       818,145  
Total Operating Expenses   2,745,491       1,828,599  
Income (loss) from Operations   (1,510,333 )     2,659,409  
       
Other Income (Expense):      
Interest Income   427       542  
Interest Expense   (1,035 )     (40,689 )
Total Other Income (Expense)   (608 )     (40,147 )
       
Income (loss) before income taxes   (1,510,940 )     2,619,261  
Provision for Income Taxes   -       -  
Net Income (loss) $ (1,510,940 )   $ 2,619,261  
       
Net income (loss) Per Common Share      
Basic $ (0.09 )   $ 0.17  
Diluted $ (0.09 )   $ 0.14  
       
Basic Weighted Average Common Shares Outstanding   16,805,402       15,850,352  
Diluted Weighted Average Common Shares Outstanding   16,805,402       18,117,710  

(1) Share amounts with respect to the common stock and Convertible Series A Preferred Stock have been retroactively restated to reflect the reverse split thereof, which was effected as of the close of business on September 10, 2020.

The following is a reconciliation of net income (loss) to EBITDA and Adjusted EBITDA (in thousands, except percentages; unaudited):

   
  For The Three Months Ended
  March 31,
   2021    2020
  (Unaudited)   (Unaudited)
Net income (loss) $ (1,510,940 )   $ 2,619,261  
       
Interest Income   (427 )     (542 )
Interest Expense   1,035                 40,689  
Depreciation and Amortization   83,449       171,909  
Other   -       -  
EBITDA $ (1,426,883 )   $ 2,831,317  
       
Equity Compensation Expense   -       182,772  
Adjusted EBITDA $ (1,426,883 )   $ 3,014,089  
       
Net revenue $ 2,073,455     $ 7,053,418  
Adjusted EBITDA Margin   (69 %)     43 %
               

INVESTOR RELATIONS CONTACT:

John Nesbett/Jennifer BelodeauIMS Investor Relationsjnesbett@imsinvestorrelations.com

TOMI Environmental Solut... (NASDAQ:TOMZ)
Historical Stock Chart
From Sep 2021 to Oct 2021 Click Here for more TOMI Environmental Solut... Charts.
TOMI Environmental Solut... (NASDAQ:TOMZ)
Historical Stock Chart
From Oct 2020 to Oct 2021 Click Here for more TOMI Environmental Solut... Charts.