Profire Energy Reports Financial Results for Fiscal Year 2017
Company Recognizes Second-Best Year in Company History with Revenues up 86% YOY to $38.2 million
Net Income up over 700% to $4.4 Million or $0.09 Per Share
LINDON, Utah March 7, 2018 - Profire Energy, Inc. (NASDAQ: PFIE), a technology company (the “Company”) which designs, installs and services burner and chemical management solutions in the oil and gas industry, today reported financial results for fiscal year ending December 31, 2017. A conference call will be held on Thursday, March 8, 2018 at 1:00 p.m. EST to discuss the results.

Fiscal 2017 Highlights
 
•
Revenues Increased 86% Year-Over-Year to $38.2 Million
•
Net Income of $4.4 Million or $0.09 Per Share
•
Gross Profit Increased to just over $20 Million or 53% of Total Revenues
•
Cash and Liquid Investments at Year End Were in Excess of $24 Million
•
Remained Debt-Free

Fiscal Quarter Financial Results
    
Total revenues increased to $38.2 million for the year which is an 86% increase from the previous 12-month period. Total revenues for 2017 mark Profire’s second-best revenue year in Company history.

In the year Profire maintained its cost management strategy and total operating expenses were up only 18% to $13.4 million, over the previous 12-month period.

Gross profit increased to roughly $20 million or 53% of total revenues, as compared to $10.4 million or 51% of total revenues in the prior 12-month period.

Compared with the same 12-month period in the previous year, operating expenses for general and administrative increased 16%, R&D increased 72%, and depreciation decreased 16%.

Net income was $4.4 million or a gain of $0.09 per share, compared to a net loss of $686,000 or a loss of $0.01 per share in the previous 12-month period.
 
Cash and liquid investments totaled over $24 million at the end of the year and the Company continues to operate debt-free.

Management Commentary
“Many factors contributed to the increase in revenue, including the growing customer base and our focus on providing superior products and solutions to our customers” stated Ryan Oviatt, CFO of Profire. “This significant net income increase is attributable to our staff’s hard work to grow revenue while keeping cost




growth under control. However, we believe our ongoing committed investment in R&D will ensure we remain a market leader for technology and automation in the oil and gas industry.”

“Throughout the year we were able to outpace the industry recovery by almost four times. In 2017 the average oil price per barrel rose 18% compared to our increased revenues of 86%,” said Brenton Hatch, President and CEO of Profire Energy. “With input from our customers we are constantly developing new technologies to bring to the market place and expand automation in the oil field. We will continue to leverage our growing customer base to increase revenues. We remain optimistic for 2018.”

Conference Call

Profire Energy’s President and CEO Brenton Hatch and CFO Ryan Oviatt will host the presentation, followed by a question and answer period.

Date: Thursday, March 8, 2018
Time: 1:00 p.m. EST (11:00 a.m. MST)
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: http://public.viavid.com/index.php?id=128636. 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 after 5:00 p.m. EST on the same day through March 15, 2018.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay Pin Number: 13677179





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 Spruce Grove, Alberta, Canada. For additional information, visit www.profireenergy.com.

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 March 8, 2018, regarding the financial year results; the ability of the Company’s ability to grow in 2018; and the Company’s ability to further invest in R&D.. 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 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.

Contact:
Profire Energy, Inc.
Ryan Oviatt, CFO
(801) 796-5127








PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
the
 
 
As of
ASSETS
 
December 31, 2017
 
December 31, 2016
CURRENT ASSETS
 
 
 
 
Cash and cash equivalents
 
$
11,445,799
 
 
$
7,679,621

 
Accounts receivable, net
 
8,069,255
 
 
5,633,802
 
 
Inventories, net
 
6,446,083
 
 
7,839,503
 
 
Income tax receivable
 
0
 
 
180,981
 
 
Short term investments
 
300,817
 
 
2,965,536
 
 
Investments - other
 
4,009,810
 
 
2,993,825
 
 
Prepaid expenses & other current assets
 
437,304
 
 
410,558
 
 
Total Current Assets
 
30,709,068
 
 
27,703,826
 
 
 
 
 
 
 
LONG-TERM ASSETS
 
 
 
 
Long term investments - other
 
0
 
 
892,590
 
 
Long term investments
 
8,517,182
 
 
5,504,997
 
 
Property and equipment, net
 
7,197,499
 
 
7,458,723
 
 
Deferred tax asset, net
 
72,817
 
 
60,940
 
 
Goodwill
 
997,701
 
 
997,701
 
 
Intangible assets, net
 
494,792
 
 
490,082
 
 
Total Long-Term Assets
 
17,279,991
 
 
15,405,033
 
 
 
 
 
 
 
TOTAL ASSETS
 
$
47,989,059
 
 
$
43,108,859

 
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES
 
 
 
 
Accounts payable
 
1,780,977
 
 
1,220,478
 
 
Income taxes payable
 
919,728
 
 
61,543
 
 
Accrued vacation
 
196,646
 
 
154,307
 
 
Accrued liabilities
 
1,044,284
 
 
284,214
 
 
Total Current Liabilities
 
3,941,635
 
 
1,720,542
 
 
 
 
 
 
 
TOTAL LIABILITIES
 
3,941,635
 
 
1,720,542
 
 
 
 
 
 
 
STOCKHOLDERS' EQUITY
 
 
 
 
Preferred shares: $0.001 par value, 10,000,000 shares authorized:  no shares issued and outstanding
 
0
 
 
0
 
 
Common shares: $0.001 par value, 100,000,000 shares authorized: 53,931,167 issued and 48,606,425 outstanding at December 31, 2017 and 53,582,250 issued and 50,705,933 outstanding at December 31, 2016
 
53,931
 
 
53,582
 
 
Treasury stock, at cost
 
(6,890,349)
 
 
(3,582,805
)
 
Additional paid-in capital
 
27,535,469
 
 
26,628,983
 
 
Accumulated other comprehensive loss
 
(2,200,462)
 
 
(2,810,743
)
 
Retained earnings
 
25,548,835
 
 
21,099,300
 
 
Total Stockholders' Equity
 
44,047,424
 
 
41,388,317
 
 
 
 
 
 
 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
$
47,989,059
 
 
$
43,108,859

 
These financial statements should be read in conjunction with the Form 10-K and accompanying footnotes.





PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Operations and Other Comprehensive Income (Loss)
 
 
For the Year Ended December 31, 2017
 
For the Nine-Month Transition Period Ended December 31, 2016
REVENUES
 
 
 
 
Sales of goods, net
 
$
35,502,510
 
 
$
14,336,618

 
Sales of services, net
 
2,783,866
 
 
1,650,568
 
 
Total Revenues
 
38,286,376
 
 
15,987,186
 
 
 
 
 
 
 
COST OF SALES
 
 
 
 
Cost of goods sold-product
 
16,116,161
 
 
6,732,822
 
 
Cost of goods sold-services
 
1,906,308
 
 
1,154,326
 
 
Total Cost of  Goods Sold
 
18,022,469
 
 
7,887,148
 
 
 
 
 
 
 
GROSS PROFIT
 
20,263,907
 
 
8,100,038
 
 
 
 
 
 
 
OPERATING EXPENSES
 
 
 
 
General and administrative expenses
 
11,676,693
 
 
7,198,081
 
 
Research and development
 
1,221,211
 
 
757,880
 
 
Depreciation and amortization expense
 
526,583
 
 
482,311
 
 
 
 
 
 
 
Total Operating Expenses
 
13,424,487
 
 
8,438,272
 
 
 
 
 
 
 
INCOME (LOSS) FROM OPERATIONS
 
6,839,420
 
 
(338,234
)
 
 
 
 
 
 
OTHER INCOME (EXPENSE)
 
 
 
 
Gain (loss) on sale of fixed assets
 
62,492
 
 
(2,680)
 
 
Other income
 
40,992
 
 
102,206
 
 
Interest income
 
180,325
 
 
90,028
 
 
 
 
 
 
 
Total Other Income
 
283,809
 
 
189,554
 
 
 
 
 
 
 
NET INCOME (LOSS) BEFORE INCOME TAXES
 
7,123,229
 
 
(148,680
)
 
 
 
 
 
 
INCOME TAX EXPENSE (BENEFIT)
 
2,673,694
 
 
(226,733
)
 
 
 
 
 
 
NET INCOME
 
$
4,449,535
 
 
$
78,053

 
 
 
 
 
 
OTHER COMPREHENSIVE INCOME (LOSS)
 
 
 
 
Foreign Currency Translation Gain (Loss)
 
$
587,951
 
 
$
(415,698
)
 
Unrealized Gains (Losses) on Investments
 
22,330
 
 
(112,363
)
 
 
 
 
 
 
Total Other Comprehensive Income (Loss)
 
610,281
 
 
(528,061
)
 
 
 
 
 
 
TOTAL COMPREHENSIVE INCOME (LOSS)
 
$
5,059,816
 
 
$
(450,008
)
 
 
 
 
 
 
BASIC EARNINGS (LOSS) PER SHARE
 
$
0.09
 
 
$
0

 
 
 
 
 
 
FULLY DILUTED EARNINGS (LOSS) PER SHARE
 
$
0.09
 
 
$
0

 
 
 
 
 
 
BASIC WEIGHTED AVG NUMBER OF SHARES OUTSTANDING
 
$
49,365,592
 
 
$
52,857,299

 
 
 
 
 
 
FULLY DILUTED WEIGHTED AVG NUMBER OF SHARES OUTSTANDING
 
$
49,858,435
 
 
$
53,483,110

 


These financial statements should be read in conjunction with the Form 10-K and accompanying footnotes.





PROFIRE ENERGY, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
 
 
For the Year Ended December 31, 2017
 
For the Nine-Month Transition Period Ended December 31, 2016
OPERATING ACTIVITIES
 
 
 
 
Net Income
 
$
4,449,535

 
 
$
78,053

 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
Depreciation and amortization expense
 
889,724
 
 
 
756,927
 
 
(Gain) Loss on sale of fixed assets
 
(62,574)
 
 
 
3,480
 
 
Bad debt expense
 
262,766
 
 
 
272,807
 
 
Stock options issued for services
 
841,166
 
 
 
616,802
 
 
Changes in operating assets and liabilities:
 
 
 
 
Changes in accounts receivable
 
(2,591,392
)
 
 
(2,063,449
)
 
Changes in income taxes receivable/payable
 
1,040,713
 
 
 
(190,746
)
 
Changes in inventories
 
1,346,919
 
 
 
3,304,972
 
 
Changes in prepaid expenses
 
(49,923)
 
 
 
(95,156)
 
 
Changes in deferred tax asset/liability
 
(11,876
)
 
 
(241,241
)
 
Changes in accounts payable and accrued liabilities
 
1,597,753
 
 
 
(58,736
)
 
 
 
 
 
 
Net Cash Provided by Operating Activities
 
7,712,811
 
 
 
2,383,713
 
 
 
 
 
 
 
INVESTING ACTIVITIES
 
 
 
 
Proceeds from sale of equipment
 
140,462
 
 
 
16,896
 
 
Purchase of investments
 
(334,910
)
 
 
(10,685,553
)
 
Purchase of fixed assets
 
(611,060)
 
 
 
(18,485
)
 
 
 
 
 
 
Net Cash Used in Investing Activities
 
(805,508
)
 
 
(10,687,142
)
 
 
 
 
 
 
FINANCING ACTIVITIES
 
 
 
 
Value of equity awards surrendered by employees for tax liability
 
(43,139)
 
 
 
(30,000
)
 
Cash received in exercise of stock options
 
111,676
 
 
 
15,000
 
 
Purchase of Treasury stock
 
(3,307,544)
 
 
 
(3,582,805
)
 
 
 
 
 
 
Net Cash Used in Financing Activities
 
(3,239,007)
 
 
 
(3,597,805
)
 
 
 
 
 
 
Effect of exchange rate changes on cash
 
97,882
 
 
 
(75,325
)
 
 
 
 
 
 
NET INCREASE (DECREASE) IN CASH
 
3,766,178
 
 
 
(11,976,559
)
 
CASH AT BEGINNING OF PERIOD
 
7,679,621
 
 
 
19,656,180
 
 
 
 
 
 
 
CASH AT END OF PERIOD
 
$
11,445,799

 
 
$
7,679,621

 
 
 
 
 
 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
 
 
 
 
 
 
 
 
 
CASH PAID FOR:
 
 
 
 
Interest
 
$
0

 
 
$
0

 
Income taxes
 
$
1,710,135

 
 
$
255,769

 
These financial statements should be read in conjunction with the Form 10-K and accompanying footnotes.