Profire Energy Reports Financial Results for Second Quarter Fiscal 2018

Profire Increased Net Income by 31% Over the Same Quarter in 2017

LINDON, Utah, Aug. 08, 2018 (GLOBE NEWSWIRE) -- Profire Energy, Inc. (NASDAQ: PFIE), a technology company (the “Company”) which creates, installs and services burner and chemical management solutions in the oil and gas industry, today reported financial results for its fiscal quarter ended June 30, 2018. A conference call will be held on Thursday, August 9, 2018 at 1:00 p.m. EDT to discuss the results.

Fiscal Q2 2018 Highlights

  • Recognized Revenue of $11.3 million, The Second-Best Quarter in 9 Fiscal Quarters
  • Net Income of $1.7 Million or $0.04 Per Share, a 31% Increase From the Same Quarter Last Year
  • Realized Gross Profit of $5.9 Million
  • Cash and Liquid Investments at Period End totaled over $21 Million
  • Remained Debt-Free

Fiscal Quarter Financial Results
Total revenues for the period equaled $11.3 million or a 20% increase from the same quarter a year ago. This increase is largely attributed to our ability to leverage our expanding customer base.
Total operating expenses were approximately $3.8 million or a 21% increase over the same quarter last year which was highly attributable to the growth in staff and additional R&D spend. Compared with the same year ago quarter, operating expenses for general and administrative increased 23%, R&D increased 15%, and depreciation decreased slightly.

Gross profit increased to $5.9 million or 52.1% of total revenues, as compared to $5 million or 52.6% of total revenues in the year-ago quarter. Gross profit margins fluctuate slightly each quarter due to product mix changes, increased direct labor costs, and adjustments in our inventory and warranty reserves.

Net income was $1.7 million or $0.04 per share, compared to a net income of $1.3 million or $0.03 per share in the same year-ago quarter.

Cash and liquid investments totaled over $21 million at the end of the quarter and the Company continues to operate debt-free.

Management Commentary

“We continually seek opportunities that can help further our strategic goals and currently have the resources and balance sheet to make investments that we believe will be beneficial to Profire and its shareholders,” stated Ryan Oviatt, CFO of Profire. “Our management team remains focused on allocating spending to meet market demand and to accelerate growth potential. We have focused our investment in R&D over the past year as we believe the new SIL certification, which allows us to enter new markets that we could not previously serve, and product enhancements will be significant drivers for future growth.”

“In addition, we continue to look at merger and acquisition opportunities that will complement our existing product offerings and leverage our sales force and customer base,” said Brenton Hatch, President and CEO of Profire Energy. “We have a renewed focus on automation, including the exploration of the internet-of-things capabilities, and other technologies that could be used within our market. These adjacent technologies could allow Profire to become a leader in not only burner management but in a variety of processes within our industry.”

Conference Call

Profire Energy President and CEO Brenton Hatch and CFO Ryan Oviatt will host the presentation, followed by a question and answer period.
Date: Thursday, August 9, 2018
Time: 1:00 p.m. EDT (11:00 a.m. MDT)
Toll-free dial-in number: 1-877-705-6003
International dial-in number: 1-201-493-6725
The conference call will be webcast live and available for replay via this link: The webcast 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 via the dial-in numbers below after 5:00 p.m. EDT on the same day through August 16, 2018.
Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay Pin Number: 13682308

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; Homer, Pennsylvania; Greeley, Colorado; and Spruce Grove, Alberta, Canada. For additional information, visit

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 August 9,2018, regarding the financial quarter results; and the ability of the Company to support growth. 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 and 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.
Ryan Oviatt, CFO
(801) 796-5127

Three Part Advisors
Steven Hooser, Partner


Condensed Consolidated Balance Sheets
    As of
    June 30,
  December 31, 2017
Cash and cash equivalents   $9,298,677     $11,445,799  
Short-term investments   531,248     300,817  
Short-term investments - other   3,788,507     4,009,810  
Accounts receivable, net   7,311,689     8,069,255  
Inventories, net   8,281,125     6,446,083  
Prepaid expenses & other current assets   350,260     437,304  
Income tax receivable   191,369      
Total Current Assets   29,752,875     30,709,068  
Net deferred tax asset       72,817  
Long-term investments   8,024,247     8,517,182  
Long-term investments - other        
Property and equipment, net   7,801,954     7,197,499  
Goodwill   997,701     997,701  
Intangible assets, net   459,229     494,792  
Total Long-Term Assets   17,283,131     17,279,991  
TOTAL ASSETS   $47,036,006     $47,989,059  
Accounts payable   1,872,095     1,780,977  
Accrued vacation   257,149     196,646  
Accrued liabilities   1,048,487     1,044,284  
Income taxes payable   325,272     919,728  
Total Current Liabilities   3,503,003     3,941,635  
Net deferred income tax liability   19,073      
TOTAL LIABILITIES   3,522,076     3,941,635  
Preferred shares: $0.001 par value, 10,000,000 shares authorized: no shares issued or outstanding        
Common shares: $0.001 par value, 100,000,000 shares authorized: 54,685,119 issued and 48,082,423 outstanding at June 30, 2018 and 53,931,167 issued and 48,606,425 outstanding at December 31, 2017   54,685     53,931  
Treasury stock, at cost   (10,890,349 )   (6,890,349 )
Additional paid-in capital   27,828,804     27,535,469  
Accumulated other comprehensive loss   (2,618,543 )   (2,200,462 )
Retained earnings   29,139,333     25,548,835  
TOTAL STOCKHOLDERS’ EQUITY   43,513,930     44,047,424  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $47,036,006     $47,989,059  

These financial statements should be read in conjunction with the Form 10-Q and accompanying

Condensed Consolidated Statements of Operations and Other Comprehensive Income
    For the Three Months Ended
June 30,
  For the Six Months Ended
June 30,
    2018   2017   2018   2017
Sales of goods, net   $10,724,409     $8,834,650   $22,179,024     $16,126,879
Sales of services, net   615,352     630,301   1,330,454     1,162,568
Total Revenues   11,339,761     9,464,951   23,509,478     17,289,447
COST OF SALES                
Cost of goods sold-product   4,959,539     4,035,528   10,517,249     7,090,828
Cost of goods sold-services   471,555     452,591   953,422     854,613
Total Cost of Goods Sold   5,431,094     4,488,119   11,470,671     7,945,441
GROSS PROFIT   5,908,667     4,976,832   12,038,807     9,344,006
OPERATING EXPENSES                
General and administrative expenses   3,364,826     2,739,055   6,706,726     5,682,368
Research and development   317,002     275,776   720,221     479,520
Depreciation and amortization expense   129,070     130,838   257,787     279,913
Total Operating Expenses   3,810,898     3,145,669   7,684,734     6,441,801
INCOME FROM OPERATIONS   2,097,769     1,831,163   4,354,073     2,902,205
OTHER INCOME (EXPENSE)                
Gain on sale of fixed assets   21,254     46,374   86,085     48,476
Other income (expense)   (4,164 )   18,798   (5,956 )   13,385
Interest income   174,771     54,840   225,479     86,118
Total Other Income   191,861     120,012   305,608     147,979
INCOME BEFORE INCOME TAXES   2,289,630     1,951,175   4,659,681     3,050,184
INCOME TAX EXPENSE   575,363     638,528   1,069,183     1,137,465
NET INCOME   $1,714,267     $1,312,647   $3,590,498     $1,912,719
Foreign currency translation gain (loss)   $(427,307 )   $238,543   $(394,072 )   $313,656
Unrealized gains (losses) on investments   9,226     26,659   (24,009 )   62,947
Total Other Comprehensive Income (Loss)   (418,081 )   265,202   (418,081 )   376,603
NET COMPREHENSIVE INCOME   $1,296,186     $1,577,849   $3,172,417     $2,289,322
BASIC EARNINGS PER SHARE   $0.04     $0.03   $0.07     $0.04
FULLY DILUTED EARNINGS PER SHARE   $0.03     $0.03   $0.07     $0.04
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING   48,266,199     49,678,917   48,467,136     50,152,958
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING   49,095,575     50,283,144   49,237,938     50,757,185

These financial statements should be read in conjunction with the Form 10-Q and accompanying

Condensed Consolidated Statements of Cash Flows
    For the Six Months Ended June 30,
    2018   2017
Net income   $3,590,498     $1,912,719  
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization expense   442,959     458,293  
Gain on sale of fixed assets   (76,703 )   (48,255 )
Bad debt expense   141,348     121,015  
Stock awards issued for services   861,189     372,086  
Changes in operating assets and liabilities:        
Changes in accounts receivable   548,419     (1,107,574 )
Changes in income taxes receivable/payable   (790,946 )   1,327,884  
Changes in inventories   (2,074,974 )   (646,870 )
Changes in prepaid expenses   114,907     (205,781 )
Changes in deferred tax asset/liability   91,890     (134,427 )
Changes in accounts payable and accrued liabilities   274,744     716,436  
Net Cash Provided by Operating Activities   3,123,331     2,765,526  
Proceeds from sale of equipment   159,449     112,183  
Sale of investments   368,379     66,045  
Purchase of fixed assets   (1,184,126 )   (181,566 )
Net Cash Used in Investing Activities   (656,298 )   (3,338 )
Value of equity awards surrendered by employees for tax liability   (736,160 )   (20,800 )
Cash received in exercise of stock options   174,002      
Purchase of Treasury stock   (4,000,000 )   (2,840,932 )
Net Cash Used in Financing Activities   (4,562,158 )   (2,861,732 )
Effect of exchange rate changes on cash   (51,997 )   94,403  
NET DECREASE IN CASH   (2,147,122 )   (5,141 )
CASH AT BEGINNING OF PERIOD   11,445,799     7,621,708  
CASH AT END OF PERIOD   $9,298,677     $7,616,567  
CASH PAID FOR:        
Interest   $—     $—  
Income taxes   $1,691,397     $67,078  

These financial statements should be read in conjunction with the Form 10-Q and accompanying

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Source: Profire Energy, Inc.