Clearly Canadian Beverage Corporation (OTCBB:CCBC) (TSX:CLV) today reported consolidated financial results for its first fiscal quarter ended March 31, 2004. (ALL FIGURES BELOW AND IN THE ATTACHED SCHEDULES ARE STATED IN U.S. DOLLARS.)
@@google Net loss for the three months ended March 31, 2004 was $497,000 (or $0.07 per share) on sales of $2,934,000 compared to net loss of $628,000 (or $0.09 per share) on sales of $3,125,000 for the same period in 2003. This represents a decline in sales of $191,000 over the same period in 2003, which management believes is due in part to the Company’s inability to fully supply product demand during the first three weeks in January 2004, due to inventory constraints attributable to the Company’s working capital condition. As such, the Company was out of stock on some flavours of Clearly Canadian sparkling water and its Clearly Canadian O+2(R) oxygen-enhanced water beverage. Management believes that these stock shortages resulted in estimated lost sales of approximately $400,000 to $500,000 in the first quarter of 2004.
The Company continues to view the shift to stronger distribution systems in the United States and Canada as integral to its strategy for 2004. Even though overall sales in the first quarter of 2004 were less than sales in the first quarter of 2003, trends in a number of the new distribution relationships continue to be positive. For example, sales for Seven-Up/RC of Southern California were up 56.7% and for All-American Bottling sales were up 21.1%. Also, sales in Canada during the first quarter grew 32.4% over the corresponding period of 2003.
Gross profit for the three months ended March 31, 2004 was $873,000 (29.7%) compared to $874,000 (28.0%) for the three months ended March 31, 2003. The increase in gross margin percentage is due to product mix changes and supply efficiency improvements.
Selling, general and administrative expenses were $1,332,000 for the three months ended March 31, 2004 compared to $1,471,000 for the same period in 2003, representing a reduction of 9.4%. The Company closely controlled or reduced its spending in all areas of selling, general and administrative expense.
“Our ongoing focus is to increase sales, market share and profitability. We plan to do so through improving the performance of our existing distributors, establish stronger distribution relationships in additional regions in the United States and by pursuing new business and product development opportunities. We believe that the combination of stronger distributors, new formulation Clearly Canadian and additional anticipated funding will be instrumental towards delivering operating profitability in the second half of 2004 and beyond,” said Douglas L. Mason, President and CEO of Clearly Canadian Beverage Corporation.
About Clearly Canadian
Based in Vancouver, British Columbia, Clearly Canadian markets premium alternative beverages, including Clearly Canadian(R) sparkling flavored water, Clearly Canadian O+2(R) oxygen-enhanced water beverage and Tre Limone(R) sparkling lemon drink which are distributed in the United States, Canada and various other countries. Additional information on Clearly Canadian may be obtained on the world wide web at www.clearly.ca
Statements in this news release that are not historical facts are forward-looking statements that are subject to risks and uncertainties. Words such as “expects”, “intends”, “may”, “could”, “should”, “anticipates”, “likely”, “believes” and words of similar import also identify forward-looking statements. Forward-looking statements are based on current facts and analyses and include the Company’s analysis of its current and future sales and sales trends, its product distribution systems, and recent, as well as anticipated changes thereto, and the Company’s expectations regarding the effects of its restructuring efforts, and anticipated reductions in expenses associated therewith, and the Company’s product distribution, promotional and marketing activities and the potential benefits of such changes, efforts and activities on its results of operations in future periods. Actual results may differ materially from those currently anticipated due to a number of factors including, but not limited to, general economic conditions, changing beverage consumption trends of consumers, the Company’s ability to generate sufficient cash flows to support general operating activities and capital expansion plans, competition, pricing and availability of raw materials, the Company’s ability to maintain the current and future retail listings for its beverage products and to maintain favorable supply, production and distribution arrangements, laws and regulations and changes thereto that may affect the way the Company’s products are manufactured, distributed and sold and other factors beyond the reasonable control of the Company. Additional information on factors that may affect the business and financial results of the Company can be found in filings of the Company with the U.S. Securities and Exchange Commission and with the British Columbia and Ontario Securities Commissions.
CLEARLY CANADIAN BEVERAGE CORPORATION
Douglas L. Mason, President and C.E.O.
CLEARLY CANADIAN BEVERAGE CORPORATION is the registered holder of various trademarks, including CLEARLY CANADIAN(R). CLEARLY CANADIAN BEVERAGE CORPORATION, and its wholly owned subsidiaries, produce, distribute and market CLEARLY CANADIAN(R), CLEARLY CANADIAN O+2(R) and TRE LIMONE(R).