TORONTO, June 27, 2022 /CNW/ - Mimi's Rock Corp. (TSXV: MIMI) (OTCQB: MIMNF) (the "Company"), an online dietary supplement and wellness company, today announced the filing of its annual audited financial statements for the year ended December 31, 2021 and its related management's discussion and analysis, and officer certifications (collectively, the "Year End Filings").
The Company also announced its first quarter financial results for the period ending March 31, 2022 (the "Q1 Financials"). With respect to the 2022 first quarter:
"Management has actively monitored volumes, supply chain constraints and pricing pressure, and has been pro-active in taking steps to improve our gross margins, with a significant improvement that translated not only into improved EBITDA, but also positive net earnings." commented CEO, David Kohler. "Importantly, the business at this scale and with our newly implemented measures is generating positive cash flow from operations."
First Quarter Highlights
The first quarter of 2022 showed significant improvement in both gross margin and earnings.
Revenues in Q1 of 2022 were $9.5 million, compared to $9.8 million in the same period last year.
In market revenues for the Dr. Tobias supplements business were stronger in Q1 of 2022 compared to the same period in 2021. However, the Company's skincare businesses revenues were lower compared to the same period last year due to considerable discounting in 2021, which drove top line revenue at the expense of margin. While overall revenues were lower in Q1 of 2022, gross margin was higher compared to Q1 of 2021 as a focus on pricing and limited promotional pricing increased product profitability.
Gross margin for Q1 of 2022 was $6.9 million (72.7%) compared to $6.7 million (68.6%) for Q1 of 2021.
Online advertising in Q1 of 2022 was considerably higher compared to the same period in 2021. This was primarily attributable to higher advertising spend on the primary Amazon market platforms and also considerable promotional efforts on other search and social media platforms designed to increase overall awareness. Investments were also made to establish sales listings on major sites in certain foreign markets.
EBITDA for Q1 of 2022 was $0.5 million, compared to $0.1 million Q1 of 2021. Similarly, Adjusted EBITDA, which adds back non-cash stock-based compensation and foreign exchange losses was $0.5 million for Q1 of 2022, compared to Adjusted EBITDA of $0.2 million for Q1 of 2021.
Net income for Q1 of 2022 was $0.2 million, compared to a net loss of $0.2 million for Q1 of 2021.
2021 Year End Audited Results
As previously announced, the Company's year end audit process, and the associated filing of the Year End Filings, was delayed due to challenges associated with auditing inventories at third party warehouses. There was no material impact to the Year End Filings as a result of this delay.
The Company's performance in Q4 of 2021 was not as strong as originally projected due in part to a change in the Company's advertising partners in October of last year. Beginning mid-Q4 of 2021, the Company began to see increased momentum and volumes in its supplements business. However, as a result of a change in market conditions for its skincare businesses, the Company recognized a goodwill impairment loss of approximately $4.2 million in Q4 of 2021. For the year ended December 31, 2021, the Company incurred a net loss of $5.0 million, compared to a net income of $2.3 million for the year ended December 31, 2020.
Following the filing of the Year End Filings, the Company has initiated steps to seek revocation of the failure to file cease trade order (the "CTO") issued against the Company by the Ontario Securities Commission on May 2, 2022. The CTO orders that general trading, whether direct or indirect, of the securities of the Company cease. The Company expects this to occur within a week of filing the Year End Filings and the Q1 Financials. However, there is no assurance that the Company will be able to remedy its filing default and have the CTO lifted in a timely manner or at all.
Summary of Quarterly Results
Management expects to announce a conference call promptly after the CTO is revoked. At that time, financial results set out in the Q1 Financials and the Year End Filings will be discussed and questions will be taken. Details of such conference call will be communicated once available.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
About Mimi's Rock Corp.:
Mimi's Rock Corp. is an online dietary supplement and wellness company which market and sells its products under the Dr. Tobias, All Natural Advice and Maritime Naturals brand names. The Dr. Tobias brand features over 30 products, including the top-selling Colon 14-Day Cleanse and the #1 selling Omega 3 Fish Oil on Amazon.com. All Natural Advice and Maritime Naturals products focus on skin and beauty care. Products sold under the All Natural and Maritime Naturals brand names are made in Canada and registered with Health Canada and under the EU Cosmetics Act. All Natural Advice has been featured on BNN as a top selling skincare brand in Canada, and has been rated the #1 Beauty Brand on Amazon Canada for the past four years.
This news release contains forward-looking statements and forward looking information (collectively "Forward-Looking Statements") within the meaning of applicable securities laws. Often, but not always, Forward-Looking Statements can be identified by the use of words such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
Please refer to the 2021 Annual Financial Statements for more details on the Company's calculation of EBITDA and adjusted EBITDA.
All Forward-Looking Statements reflect the Company's beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these Forward-Looking Statements. All of the Company's Forward-Looking Statements are qualified by the assumptions that are stated or inherent in such Forward-Looking Statements, including the assumptions listed below. Although the Company believes that these assumptions are reasonable, this list is not exhaustive of factors that may affect any of the Forward-Looking Statements.
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in Forward-Looking Statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that Forward-Looking Statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on Forward-Looking Statements. All Forward-Looking Statements contained in this press release are given as of the date hereof and are based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any Forward Looking Statements whether as a result of new information, future events, or otherwise, except in accordance with applicable securities laws.
SOURCE Mimi's Rock Corp.
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