Isodiol International Inc. Reports Fiscal Year 2019 Audited Financial Results
Aug 16, 2019 – Vancouver, BC – Isodiol International Inc. (CSE: ISOL) (OTCQB:ISOLF)
(FSE: LB6B.F)(the “Company” or “Isodiol”), announces that it has filed its audited consolidated
financial statements and MD&A for the year ended March 31, 2019.
Highlights of Fiscal Year 2019 include:
- Total revenues of $22,248,171, an increase of 16.26% over the prior year, and which
figure does not include revenues from divested companies Azure, Kure or BSPG, as had
previously been included in the consolidated statement of loss for the FY2019 Q1, Q2 and
Q3 periods; - Gross profits of $7,378,194, realizing gross margins of 33.16%;
- Total Q4 revenue of $9,089,401; a historic number for the Company. The Company is
especially pleased with this number, as this figure does not include the activities of the
recently divested assets of Azure, Kure, or BSPG; - Total operating expenses decreased by $3,283,658.
Breakdown of Significant Other Expenses:
- Loss on the sale of business of $35M is primarily non-cash and is attributable to the
divestitures of Azure, Kure and BSPG;
- The primary reason for divesting Kure was to prevent significant shareholder
dilution. Given the current share price, the Company believed that future
acquisition payments of USD$35M couldn’t be justified given the risks associated
with uncertainty surrounding the pending FDA regulations on the vape industry; - The sale of BSPG was due to the significant financial requirements needed for
expansion. The Company sold BSPG for a sale price of USD$14M, of which,
USD$9.75M has been received to date, with USD$4.5M of such amount paid to
complete the final obligation towards the original acquisition, and the remainder
used for general working capital. The divestment terms included an off-take right
in favour of the Company, giving the Company access to the API required for
Purodiol, Isodiolex and Isoderm in the Brazil Pharma market; - The Company moved away from manufacturing and is now focusing on high
margin consumer goods; with that, the Company divested Azure for sale price of
USD$1M.
- Asset impairment of $38,877,626 can be broken down into two primary categories:
-
- Terminations and divestitures:
$14.6M of the balance relates to the carrying values associated with the
divestiture of certain operations, investments and acquisition deposits
that do not directly benefit from: a focus on sale of finished goods; were
not in line with our core business; didn’t contribute to our bottom line; and
represented significant future outflows of cash before any ROI could be
realized; and
- Terminations and divestitures:
- Impairment of goodwill and intangible assets
$24.3M of the balance specifically relates to the IFRS requirement to
assess the Company’s goodwill for impairment annually and intangible
assets for indicators of impairment. Impairment of goodwill was
determined through a comparison of the capitalized cash flows to the
carrying amounts of these assets. Because the Company’s US-based cash
generating units were operating at a loss, this inherently resulted in the
requirement to impair goodwill and the related intangible assets as they
were in excess of the measured recoverable amount. Although, these
assets have now been expensed, the Company considers them to continue
to add value to our bottom line and will continue to use them to drive
revenues and build our operations.
“We have just realized our most profitable quarter to date and have reduced our operating
expenses considerably, which will be seen in the first quarter of FY2020,” said CEO of Isodiol,
Marcos Agramont. “The majority of losses experienced in FY 2019 are a by-product of our shift
in our focus towards higher margin consumer products vs raw ingredient supply, prevention of
massive shareholder dilution and protecting our future cash flows through divestitures”. Marcos
went on, “Over the last several months we have sharpened our focus significantly, cut costs,
curbed shareholder dilution and we believe the Company is in a strong position heading into
FY2020 and beyond”.
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About Isodiol International Inc.
Isodiol International Inc. is focused on the nutritional health benefits that are derived from hemp
and is a product development, sales, marketing and distribution company of hemp-based
Consumer Packaged Goods (CPG) and solutions. Isodiol has commercialized a 99%+ pure,
naturally isolated CBD, including micro-encapsulations, and nano-technology for quality
consumable and topical skin care products. Isodiol’s growth strategy includes the development
of over-the-counter and pharmaceutical drugs and continued international expansion into Latin
America, Asia, and Europe.
ON BEHALF OF THE BOARD
Marcos Agramont, CEO & Director
INVESTOR RELATIONS:
[email protected]
604-409-4409
MEDIA CONTACT:
Christopher Hussey
[email protected]
The CSE has not reviewed, approved or disapproved the content of this press release.
Forward-Looking Information: This news release contains “forward-looking information” within
the meaning of applicable securities laws relating to statements regarding the Company’s
business, business plans, products and future the Company’s business, its product offerings and
plans for sales and marketing, including with respect to the Company’s expectation that it will
have continued access to the API required for Purodiol, Isodiolex and Isoderm, the Company’s
expectations generally regarding the market for high margin consumer goods, and the Company’s
belief that its operating expenses will continue to remain at a relatively reduced level into the next
financial quarter or beyond. Although the Company believes that the expectations reflected in the
forward-looking information are reasonable, there can be no assurance that such expectations
will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking
information. Such forward-looking statements are subject to risks and uncertainties that may
cause actual results, performance and developments to differ materially from those
contemplated by these statements depending on, among other things, the risks that the
Company’s products and plan will vary from those stated in this news release, that the Company
may not be able to carry out its business plans as expected, including with respect to having
continued access to the API required for Purodiol, Isodiolex and Isoderm, that the Company will
achieve a favourable position within the high margin consumer goods market, and that the
Company’s operating expenses will remain at a relatively reduced level into the next financial
quarter or beyond. Except as required by law, the Company expressly disclaims any obligation and
does not intend, to update any forward-looking statements or forward-looking information in this
news release. Although the Company believes that the expectations reflected in the forwardlooking
information are reasonable, there can be no assurance that such expectations will prove
to be correct and makes no reference to profitability based on sales reported. The statements in
this news release are made as of the date of this release.
The CSE has not reviewed, approved or disapproved the content of this press release.