LOUISVILLE, CO--(Marketwire - November 17, 2008) - Eldorado Artesian Springs, Inc. (
OTCBB:
ELDO) today announced higher revenue for its fiscal second quarter and
six-month period ended September 30, 2008.
Second quarter revenue increased 17.3% to $2.8 million from $2.4 million in
the same quarter last year. The increase was attributable to two factors:
One, the Company's unique Organic Vitamin Charged Spring Water line,
introduced in September 2007, continued to show strong momentum with sales
gains of 280% over the first quarter of 2008. All six flavors of Organic
Vitamin Charged Spring Water are now available in major regional retailers
such as Whole Foods, Albertson's, Vitamin Cottage, K&G (Jenny's Markets),
Kroger's (King Soopers and City Markets), and many other retail outlets.
Additionally, near the end of the second quarter the Company made its first
shipment of Organic Vitamin Charged Spring Water outside of the Rocky
Mountain region as part of a new distribution agreement with United Natural
Foods in Northern California as a prelude to a full Western/Southwestern
United States rollout.
The other key factor in the second quarter revenue increase was a new
supplier agreement with America's largest retailer under which Eldorado is
now providing private label, one-gallon purified drinking water to the
retailer's Colorado distribution center that serves 90 of the chains
regional locations. In addition to potential for further growth of the
one-gallon product, Eldorado has the opportunity to leverage the
relationship with additional product lines such as Organic Vitamin Charged
Spring Water. Additionally, due to the new filtration equipment and water
rights agreement put in place to service the new one-gallon customer,
Eldorado has substantial excess capacity with which to pursue additional
one-gallon business, either under private label or Eldorado branding.
The Company reported a net loss of $33,500 in the third quarter, which
included $122,400 in non-cash depreciation and amortization, down from a
net loss of $61,000, including $107,700 in non-cash depreciation and
amortization, in the same quarter a year ago. Total operating expenses
increased to $2.0 million from $1.8 million in the same quarter last year
due to a combination of higher revenue and increased delivery and fuel
costs as well as higher salary and insurance costs. However, operating
expenses as a percent of revenue declined to 70% in the third quarter from
76% in the same quarter last year, contributing to positive income from
operations of $26,000 versus an operating loss of $7,600 in the comparable
quarter a year ago.
"We are very pleased with our double digit revenue gains, particularly in
light of prevailing economic conditions," said Doug Larson, president and
CEO. "We are achieving excellent results with our Organic Vitamin Charged
Spring Water. In addition, our introduction of a new one-gallon, private
label product made a significant contribution to revenue and, perhaps more
importantly, established a relationship for Eldorado with America's largest
retailer that we are hopeful will result in shelf space for our Organic
Vitamin Charged Spring Water.
"Moving forward, we will remain focused on our strategic priorities of
expanding our core operations, product lines and distribution using
internally generated cash while maintaining our bottom line at or near
breakeven on a cash basis," Larson added. "We believe our expanded product
mix, distribution agreements and available bottling capacity will allow us
to increase revenue depending upon the severity of the economic downturn
and be in a position to further accelerate sales once the economy begins to
rebound."
About Eldorado Artesian Springs, Inc.
Eldorado Artesian Springs, Inc. is a leading bottler, marketer, and
distributor of natural spring water beverages in the Rocky Mountains. The
Company's growing product portfolio includes the nation's only Organic
Vitamin Charged Spring Water, which was recently introduced in six flavors
and has generated strong market acceptance. The Company also markets
five-gallon and three-gallon bottles of water directly to homes and
businesses, national retail grocery chains, and regional distributors.
Additionally, the Company markets its water in smaller, more convenient
size packaging to retail food stores. The source of the natural spring
water is located on property owned by the Company in Eldorado Springs,
Colorado. More information about the Company can be found at
http://www.eldoradosprings.com.
Safe Harbor Statement
Some portions of this press release, particularly those describing
Eldorado's goals and strategies, contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. While
Eldorado is working to achieve those goals and strategies, actual results
could differ materially from those projected in the forward-looking
statements as a result of a number of risks and uncertainties, including
difficulties in marketing its products and services, need for capital,
competition from other companies and other factors, any of which could have
an adverse effect on the business plans of Eldorado, its reputation in the
industry or its expected financial return from operations and results of
operations. In light of significant risks and uncertainties inherent in
forward-looking statements included herein, the inclusion of such
statements should not be regarded as a representation by Eldorado that it
will achieve such forward-looking statements. For further details and a
discussion of these and other risks and uncertainties, please see our most
recent reports on Form 10-KSB and Form 10-Q, as filed with the Securities
and Exchange Commission, as they may be amended from time to time. Eldorado
undertakes no obligation to publicly update any forward-looking statement,
whether as a result of new information, future events, or otherwise.
Statements of Operations
(Unaudited) Three months ended Six months ended
September 30, September 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenues
Water and related $2,734,821 $2,311,041 $4,909,871 $4,429,864
Resort operations 83,552 92,395 125,840 138,598
---------- ---------- ---------- ----------
Net revenue 2,818,373 2,403,436 5,035,711 4,568,462
---------- ---------- ---------- ----------
Cost of goods sold 817,616 585,836 1,339,312 1,032,083
---------- ---------- ---------- ----------
Gross profit 2,000,757 1,817,600 3,696,399 3,536,379
---------- ---------- ---------- ----------
Operating expenses
Salaries and related 1,034,506 946,127 2,005,828 1,845,908
Administrative and
general 470,193 466,802 976,589 896,743
Delivery 262,771 213,765 501,336 413,736
Advertising and
promotions 84,906 90,838 181,524 160,927
Depreciation and
amortization 122,353 107,665 238,921 211,986
---------- ---------- ---------- ----------
Total operating
expenses 1,974,729 1,825,197 3,904,198 3,529,300
---------- ---------- ---------- ----------
Operating income (loss) 26,028 (7,597) (207,799) 7,079
---------- ---------- ---------- ----------
Other income (expense)
Interest income 15,166 15,519 21,909 30,746
Interest expense (92,429) (87,944) (181,885) (172,863)
---------- ---------- ---------- ----------
Total other expense (77,263) (72,425) (159,976) (142,117)
---------- ---------- ---------- ----------
Net loss before provision
for income taxes (51,235) (80,022) (367,775) (135,038)
Income tax benefit 17,700 19,000 127,700 25,000
---------- ---------- ---------- ----------
Net loss $ (33,535) $ (61,022) $ (240,075) $ (110,038)
========== ========== ========== ==========
Basic loss per common
share $ (0.01) $ (0.01) $ (0.04) $ (0.02)
========== ========== ========== ==========
Diluted loss per common
share $ (0.01) $ (0.01) $ (0.04) $ (0.02)
========== ========== ========== ==========
Weighted average common
shares outstanding, basic
and dilutive 6,696,914 6,109,207 6,638,468 6,070,936
========== ========== ========== ==========
Balance Sheet
September 30, March 31,
2008 2008
---------- ----------
ASSETS
Current Assets
Cash $ 241,949 $ 389,440
Accounts receivable - trade, net 1,202,837 893,660
Inventories 507,910 437,171
Prepaid expenses and other 49,102 107,144
Deferred tax asset 29,648 29,648
---------- ----------
Total current assets 2,031,446 1,857,063
---------- ----------
Non-current assets
Property, plant and equipment - net 4,437,420 4,177,350
Notes receivable - related party 330,208 318,138
Water rights - net 432,871 432,871
Deposits 140,447 135,785
Long-term deferred tax asset - net 163,646 35,944
Other - net 63,361 72,878
---------- ----------
Total non-current assets 5,567,953 5,172,966
---------- ----------
Total assets $7,599,399 $7,030,029
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 791,358 $ 417,929
Accrued expenses 235,943 318,352
Customer deposits 87,310 80,530
Line of credit 215,000 -
Current portion of capital lease obligations 79,228 -
Current portion of long-term debt 82,938 56,748
---------- ----------
Total current liabilities 1,491,777 873,559
Non-current liabilities
Capital lease obligations, less current portion 228,441 -
Long-term debt, less current portion 4,347,675 4,403,789
Deferred gain on the sale of real estate 178,822 178,822
---------- ----------
Total non-current liabilities 4,754,938 4,582,611
---------- ----------
Total liabilities 6,246,715 5,456,170
---------- ----------
Stockholders' equity
Preferred stock - -
Common stock 6,699 6,426
Additional paid-in capital 1,652,786 1,634,159
Accumulated deficit (306,801) (66,726)
---------- ----------
Total stockholders' equity 1,352,684 1,573,859
---------- ----------
Total liabilities and stockholders' equity $7,599,399 $7,030,029
========== ==========
Contact Information: Contacts:
Doug Larson
Chief Executive Officer
Eldorado Artesian Springs, Inc.
303-499-1316
Jay Pfeiffer
Pfeiffer High Investor Relations, Inc.
303-393-7044