XPEL Announces 1st Quarter 2008 Financial Results
XPEL ANNOUNCES 1ST QUARTER 2008 FINANCIAL RESULTS
– 133% Increase in Total Revenues –
SAN ANTONIO, TEXAS, June 2, 2008…XPEL Technologies Corp. (TSXV: DAP.U) announced today results for the three months ended March 31, 2008, as compared to the three months ended March 31, 2007.
XPEL’s CEO, Steven J. McAuley, commented, “The first quarter of 2008 saw us further integrate our fourth quarter 2007 acquisitions of Paintshield Ltd., and ArmourfendCAD Inc., make final preparations for our annual Innovation Conference in April 2008, participate in a productive NADA trade show in February 2008, further build exposure of our XPEL paint protection film (PPF) and launch our strategy to develop our XPEL Motorsports brand. We believe that the sales and marketing efforts we initiated in the first quarter of 2008 will lead to greater XPEL brand awareness, greater revenue opportunities and new and exciting acquisition possibilities. Further we are confident that the time and energy we have spent integrating the acquisitions will serve us well as we build a global XPEL brand and work cohesively as an organization to find our place in the dealer services arena.”
Three Months Ended March 31, 2008 compared to the Three Months Ended March 31, 2007
Revenues. Revenues increased from $850,491 to $1,985,655, or 133% between periods. The increase in revenues is primarily a result of significant increases in our installation, kit and material sales between periods. Installation, kit and material sales increased $1,186,821 or 455% between quarters. This increase was primarily due to the acquisition of Shadow Tinting, Ltd., and its strong installation and wholesale PPF and Tint film business in June of 2007.
Cost of Sales. Cost of sales increased from $256,238 to $832,913, or 225% and increased as a percentage of revenues to 42%. Our cost of sales is primarily related to the selling of paint and headlamp protection film and third-party enabling equipment such as plotters, which are used by the Company’s DAP Partners for the production of products using the DAP software..
Expenses. General and administrative expenses increased 65% to $1,360,177 from $826,111 in the first quarter of 2007. The increased general and administrative expenses were primarily a result of the acquisition of Shadow Tinting, Ltd., in June 2007. Other factors in the increase were increased general and administrative expenses as a result of our acquisitions of Paintshield Ltd., and ArmourfendCAD Inc. in the fourth quarter of 2007.
Sales and Marketing expenses increased $207,858 from $68,211 to $276,069, or 305% from the first quarter of 2007 to the first quarter of 2008. The Company incurred sales and marketing expenses during the first quarter related to the launch of XPEL Protection Film in the fourth quarter of 2007, its sponsorship in the Grand-Am Rolex series and expenses related to NADA trade show in February of 2008.
Net earnings (loss). The Company had a net loss of $566,568 for the quarter ended March 31, 2008 as compared to a net loss of $334,258, an increase of $232,310 or 69.5% for the quarter ended March 31, 2007. While the Company may continue to incur a net loss early in 2008 as it integrates its most recent acquisitions, it is imperative that the Company continue to increase the sales of paint protection film (PPF), increase same store installation sales and increase its DAP revenues which will lead to a profitable operation overall.
XPEL Technologies Corp. is the worldwide leader in the electronic delivery of automotive aftermarket products, utilizing the Internet as an integral component for its design, manufacturing, distribution and customer relationship strategies. The Company’s DAP software utility offers Dealers the industry’s most efficient and productive tool set to better serve customers with “best-in-class” solutions in real-time. XPEL has clear advantages over the competition through its expansive proprietary library of installation-friendly paint and headlight protection and window tint products, coupled with a unique web-based remote manufacturing and distribution software, superior installation training curriculum and world-class facilities, with established and growing sales channels.
Certain statements contained herein (“We believe that the sales and marketing efforts we initiated in the first quarter of 2008 will lead to greater XPEL brand awareness, greater revenue opportunities and new and exciting acquisition ”) are considered “forward-looking statements.” These statements are based upon the belief of the Company’s management, as well as assumptions made beyond information currently available to the Company’s management. Because “forward-looking statements” are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, price competition, the inability to obtain additional capital, loss of key personnel, unavailability of leased facilities, technological changes, service interruptions, equipment failures, customer attrition, general economic conditions, relationships with vendors, government supervision and regulation, changes in industry practices, the inability to settle legal disputes, and other factors.
The TSXV has not reviewed and does not accept responsibility for the adequacy and accuracy of this information.
Chief Executive Officer
John Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)