XPEL Technologies Corp. Reports 2004 Annual Results
XPEL TECHNOLOGIES CORP. REPORTS 2004 ANNUAL RESULTS
– Operating Revenues Increased 28.6% –
– Design Access Program Revenues Improved 43.5% –
SAN ANTONIO, TEXAS, May 2, 2005…Nevada-based XPEL Technologies Corp. (CNQ: XPEL.U) announced today results for the year ended December 31, 2004, as compared to the year ended December 31, 2003.
XPEL’s Chairman and CEO W. Rege Brunner, commented, “We believe that history will show 2004 to be a pivotal year for XPEL Technologies Corp. We successfully made the transition from being a private entity to a publicly-traded company. During the year we experienced continued growth in our revenues, and launched the first steps of an aggressive sales, marketing, and product awareness initiative.” Mr. Brunner further stated, “Due to these increased sales and marketing expenses, and professional fees associated with our move to become public, we did not achieve profitability. However, we did achieve the goals set out for the Company, and believe we have laid the foundation for a strong 2005 and beyond. Make no mistake about it, the future for XPEL and its stockholders remains extremely bright.”
Year ended December 31, 2004 Compared to the Year ended December 31, 2003
Revenues increased to $2,594,935 from $2,017,481, or 28.6% between the years. We experienced increases in all of our revenue streams between years with the biggest percentage increase coming in our Design Access Program fees, which increased from $539,695 to $774,639, or approximately 43.5% between years. As we move forward into 2005, we believe our sales and marketing initiatives will continue to drive increased revenues.
Cost of sales increased from $840,518 to $1,302,681, or 41.7% to 50.2%, year to year. While the increased cost of sales was primarily a function of the increased sales between years, cost of sales increased as a percentage due to increased activity in selling our lower margin bulk paint and headlight film, and third-party enabling equipment such as plotters.
Total expenses increased approximately $730,041 from $1,217,456 to $1,947,497, or approximately 60% between the years. General and administrative expenses increased from $922,876 to $1,418,403. This increase was due mainly to increased professional fees, related to our move to become a public company, along with increased personnel costs, which resulted from an increase in the number of full-time employees from 10 in December 2003 to 15 in December 2004. The Company believes that its current employee base and several additions made in the first quarter of 2005 will be critical to the Company’s growth over the near-term. Management does not anticipate the professional fees going forward to be at the same level as those previously incurred, as the Company has completed its move to becoming a public company.
Sales and marketing expenses increased to $247,175 from $156,329, or 58% between years. The increase in Sales and marketing expenses is attributable to “stepped-up” advertising activities, which the Company believes has contributed to an improvement in Design Access Program fees. As the Company continues to execute a growth strategy, it will continue to incur advertising and public awareness costs in advance of the associated revenues.
The Company had a net loss of $655,243 for the year ended December 31, 2004 as compared to a net loss of $40,493 for the year ended December 31, 2003. Although revenue increased between periods, expenses increased even more, as the Company made the transition to become a public company, added key positions to its employee base, and accelerated its advertising and marketing activities. The Company will likely incur a net loss during the first half of 2005, as it continues to increase its marketing and awareness initiatives, however, management believes the increase in these activities will generate additional revenues for improved and continued growth in the latter half of 2005 and beyond.
XPEL Technologies Corp. (www.xpel.com), publicly traded on the Canadian Trading and Quotation System Exchange, is the worldwide leader in the electronic delivery of top 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 for better serving customers with “best of breed” solutions in real-time. XPEL has clear advantages over the competition through its proprietary corporate framework consisting of an expansive library of installation-friendly window tint, paint and headlight protection products, coupled with a unique web-based remote manufacturing and distribution software, superior installation training curriculum and facilities, and established and growing sales distribution channels.
Certain statements contained herein (“We believe that history will show 2004 to be a pivotal year for XPEL Technologies Corp.” and “However, we did achieve the goals set out for the Company, and believe we have laid the foundation for a strong 2005 and beyond. Make no mistake about it, the future for XPEL and its stockholders remains extremely bright.” and “As we move forward into 2005, we believe our sales and marketing initiatives will continue to drive increased revenues.” and “…, management believes the increase in these activities will generate additional revenues for improved and continued growth in the latter half of 2005 and beyond.” 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, and other factors.
The CNQ 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)