Profire Energy Reports Financial Results for Fiscal First Quarter of 2017

Company Generates Cash and Aggressively Controls Costs through Difficult Industry Conditions

LINDON, Utah, August 10, 2016 - 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 its fiscal first quarter ended June 30, 2016. A conference call will be held on Thursday, August 11, 2016 at 1:00 p.m. EST to discuss the results.

Fiscal Q1 2017 Highlights

·	Total revenues of $3,974,043

·	Cash provided by operating activities of $736,681, bringing cash balance to $22 million

·	Operating expenses down 27% or $1 million from a year ago

·	Improved gross margin on service to 32%

·	Net loss of $605,295 or ($0.01) per diluted share

·	Remained debt-free

Profire has maintained high margins despite the challenging industry. Gross profit decreased to $1.9 million or 48% of total revenues, as compared to $3.3 million or 48% of total revenues in the year-ago quarter.

During the quarter, Sales of Services represented approximately 13% of total sales compared to 10% a year earlier. Gross margin on service increase to 32% from 10% a year ago.

Total operating expenses decreased 27%, from the same quarter of last year, to $2.8 million or 70% of total revenues compared with $3.9 million or 56% of total revenues a year ago.

Compared with the same year ago quarter, operating expenses for general and administrative decreased 31%, R&D decreased 18%, and depreciation increased 48%, as some fixed assets were parked and the depreciation, which had previously been allocated to cost of goods sold, has been reclassified to operating expenses.

Net loss was $605,000 or a loss of $0.01 per diluted share, compared to a net loss of $459,000 or $0.01 per diluted share in the same year-ago quarter.

Cash and cash equivalents totaled $22 million, compared to $21.3 million at year end. Profire continues to generate cash flow from operating activities and operates debt free.

Management Commentary

"For more than a year now, our industry has faced significant headwinds, to which we have not been immune," said Brenton Hatch, President and CEO of Profire Energy. "We feel that relative to many of our industry peers we have dealt with these challenges as well as, or better, than our counterparts. There are so many variables out of our control, but for those aspects of the business we can control, we feel that we've managed them well. The number of customers we now have is two to three times what it was before the commodity prices tanked, and our product offering is stronger than it has ever been.  These advancements may provide us with opportunities to serve markets previously unattainable."

"We believe the cost- and Company-structures we now have, is fairly scalable," said Ryan Oviatt, CFO of Profire Energy. "As revenues begin to improve, which we believe they will in the second half of fiscal 2017, we anticipate being able to absorb higher revenues, without needing to build out our cost base accordingly.  This is a difficult time for our industry, but we are positive about our long-term market opportunity. We feel we are positioned well for the coming months and years, as the industry finds its balance in activity and commodity prices. "

Conference Call

Profire Management will host a conference Thursday, August 11, 2016 to discuss these financial results. Please call the conference telephone number at least five minutes prior to the start time. An operator will register your name and organization.

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.

Contact:

Profire Energy, Inc.

Ryan Oviatt, CFO

(801) 796-5127

PART I. FINANCIAL INFORMATION
Item 1 Financial Information
PROFIRE ENERGY, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
		For the Period Ending
ASSETS		June 30, 2016				March 31, 2016
		(Unaudited)
CURRENT ASSETS
Cash and cash equivalents		$	22,043,090			$	21,292,595
Accounts receivable, net			3,211,835				4,132,137
Inventories			9,971,352				11,046,682
Income tax receivable			474,796				268,326
Prepaid expenses & other current assets			308,263				315,757
Total Current Assets			36,009,336				37,055,497
LONG-TERM ASSETS
Deferred tax asset			437,336				452,431
PROPERTY AND EQUIPMENT, net			7,969,169				8,232,911
OTHER ASSETS
Goodwill			997,701				997,701
Intangible assets, net of accumulated amortization			522,923				529,300
Total Other Assets			1,520,624				1,527,001
TOTAL ASSETS		$	45,936,465			$	47,267,840
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable		$	551,742			$	893,822
Accrued liabilities			427,620				620,783
Income taxes payable			-				335,375
Total Current Liabilities			979,362				1,849,980
LONG-TERM LIABILITIES
Deferred income tax liability			632,732				632,732
TOTAL LIABILITIES			1,612,094				2,482,712
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: 53,316,134 and 53,256,296 shares issued and outstanding, respectively			53,316				53,256
Additional paid-in capital			26,308,327				26,164,622
Accumulated other comprehensive loss			(2,281,909	)			(2,282,682	)
Retained earnings			20,244,637				20,849,932
Total Stockholders' Equity			44,324,371				44,785,128
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	45,936,465			$	47,267,840

 

The accompanying notes are a integral part of these condensed consolidated financials statements.