Menē Inc. (TSX-V:MENE) (US:MENEF) (“Menē” or the “Company”), an online 24 karat jewelry brand, today announced financial results for the fourth quarter and fiscal year ended December 31, 2019. All amounts are expressed in Canadian dollars unless otherwise noted.
FOURTH QUARTER FINANCIAL HIGHLIGHTS:
2019 FISCAL YEAR FINANCIAL HIGHLIGHTS:
OPERATIONAL AND BUSINESS HIGHLIGHTS:
IFRS Consolidated Income Statement Data & Key Performance Indicators (KPIs) 1 |
FY 2019 |
FY 2018 |
||||||||||||||
Q4 |
Q3 |
Q2 |
Q1 |
Q4 |
Q3 |
Q2 |
Q1 |
|||||||||
Revenue (CAD) 2 | 4,653,601 |
3,218,281 |
2,456,930 |
2,733,596 |
3,266,663 |
1,985,711 |
1,392,867 |
1,038,947 |
||||||||
Gross profit (CAD) | 458,201 |
1,000,210 |
600,719 |
678,814 |
740,130 |
208,408 |
229,461 |
170,486 |
||||||||
Gross profit (%) | 10% |
31% |
24% |
25% |
23% |
10% |
16% |
16% |
||||||||
Net loss | (3,449,094) |
(1,535,114) |
(672,661) |
(1,107,752) |
(2,668,276) |
(1,644,097) |
(1,164,185) |
(1,494,104) |
||||||||
Total comprehensive loss | (3,991,270) |
(1,405,212) |
(868,784) |
(1,166,288) |
(2,703,205) |
(1,691,124) |
(919,106) |
(1,348,026) |
||||||||
Non-IFRS Adjusted Revenue (CAD) 2 | 5,095,968 |
3,445,952 |
2,601,569 |
2,914,297 |
3,704,403 |
2,346,622 |
1,891,608 |
1,162,777 |
||||||||
Non-IFRS Adjusted Gross Profit (CAD) 3 | 501,757 |
1,070,968 |
636,083 |
723,686 |
839,309 |
246,287 |
311,623 |
190,806 |
||||||||
Non-IFRS Adjusted Loss 4 | (904,338) |
(1,014,832) |
(310,197) |
(476,562) |
(870,654) |
(1,093,533) |
(998,123) |
(1,387,954) |
||||||||
Total Shareholders' Equity (CAD) | 15,176,016 |
17,399,693 |
18,423,043 |
17,833,109 |
18,494,246 |
10,077,520 |
11,251,166 |
11,878,195 |
||||||||
Inventory balance (kg of gold) 5 | 212 |
249 |
255 |
222 |
244 |
135 |
131 |
90 |
||||||||
Customer orders | 4,548 |
2,998 |
5,167 |
4,437 |
6,729 |
3,994 |
2,389 |
951 |
||||||||
Units of jewelry sold | 7,225 |
5,164 |
7,183 |
8,182 |
9,111 |
6,168 |
2,920 |
941 |
||||||||
Jewelry weight sold (total kg) | 65 |
44 |
42 |
43 |
51 |
35 |
23 |
16 |
(1) The Company’s financial statements for fiscal year-ending 2019 and 2018 are audited by an external assurance firm.
(2) The Company adjusts its revenue by adding back the value of jewelry that was returned by customers, and discounts given to customers. These adjustments are made to assess the gross revenue before deducting these items from revenue per IFRS. See Non-IFRS Measures for a full reconciliation.
(3) The Company adjusts its gross profit by adjusting for revenue and cost of sales to be added back for the value of jewelry that was returned by customers, and discounts given to customers. See Non-IFRS Measures for a full reconciliation.
(4) The Company adjusts its total comprehensive loss by adjusting for Non-IFRS Adjusted Gross Profit, and removing the impact of non-cash expenses, consisting of depreciation and amortization, stock-based compensation and other non-cash expenses. See Non-IFRS Measures for a full reconciliation.
(5) Inventory balances in kilograms of gold are calculated by taking the total Canadian Dollar (CAD) inventory value at each quarter-end date, and dividing the value by the CAD gold spot price per gram.
IMPACT OF COVID-19 SUBSEQUENT TO Q4 2019:
While the COVID-19 pandemic weighed on the economy and subdued consumer spending globally, it has increased demand for safe-haven assets and accelerated the shift of retail from brick and mortar stores to e-commerce. Menē is uniquely positioned to continue to reach clients online during this challenging time and help them protect their financial wealth by owning jewelry crafted from 24K gold and platinum bullion. During the first quarter of 2020, the Company introduced a number of initiatives with a focus on supporting its clients, ensuring the wellbeing of its staff and community, while safeguarding the long-term financial strength of the business:
As at the time of this press release, the Company has begun the phased reopening of its manufacturing facilities while taking into considerations of the guidance of local authorities. Menē has implemented extensive health and safety measures designed to protect its people while working to meet the rising demand from its clients.
STATEMENT FROM FOUNDER & CEO ROY SEBAG:
I am pleased to be reporting our second year of annual results since launching Menē in January 2018. Fiscal 2019 was another memorable year for our business and we feel optimistic about our Company’s future. I would like to draw your attention to three points relating to fiscal 2019 which give management these reasons for optimism.
Menē is a business that was designed to grow and disrupt a large industry over the long-term. Our founding mission was to restore the link between jewelry and savings. Two and a half years in, I believe it is clear that we are delivering on that mission. There remain a few surmountable challenges for our business model to scale to the levels we believe are ultimately attainable. We see our current capital position as adequate to address those challenges. Consequently, we remain focused on growing our brand organically and sustainably. Finally, I would like to extend my sincerest gratitude to our customers, team-members, and shareholders for their continued support and advocacy in fiscal 2019.
Non-IFRS Measures
This news release contains non-IFRS financial measures; the Company believes that these measures provide investors with useful supplemental information about the financial performance of its business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating its business. Although management believes these financial measures are important in evaluating the Company's performance, they are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with IFRS. These non-IFRS financial measures do not have any standardized meaning and may not be comparable with similar measures used by other companies. For certain non-IFRS financial measures, there are no directly comparable amounts under IFRS. These non-IFRS financial measures should not be viewed as alternatives to measures of financial performance determined in accordance with IFRS. Moreover, presentation of certain of these measures is provided for year-over-year comparison purposes, and investors should be cautioned that the effect of the adjustments thereto provided herein have an actual effect on the Company's operating results.
Non-IFRS Adjusted Revenue2 is a non-IFRS measure. The Company adjusts its revenue by adding back the value of jewelry that was returned by customers, and discounts given to customers. These adjustments are made to assess the gross revenue before deducting these items per IFRS revenue. The closest comparable IFRS measure is revenue.
Non-IFRS Adjusted Gross Profit3 is a non-IFRS measure. The Company adjusts its gross profit by adjusting for the additional revenue and associated cost of sales added back for the value of jewelry that was returned by customers, and discounts given to customers. The closest comparable IFRS measure is gross profit.
Non-IFRS Adjusted Loss4 is a non-IFRS measure. Non-IFRS Adjusted Loss is a non-IFRS measure, calculated as total comprehensive loss, plus adjustment for Non-IFRS Adjusted Gross Profit and debt forgiveness, and excluding depreciation and amortization, loss on sale of equipment, (gain)/loss on foreign exchange and foreign currency translation (gain)/loss, stock-based compensation, accretion, listing expense and other adjustments. The closest comparable IFRS measure is total comprehensive loss.
Tangible Common Equity(5) is a non-IFRS measure. It is calculated as total shareholder’s equity excluding intangible assets.
For a full definition of non-IFRS financial measures used herein to their nearest IFRS equivalents, please see the section entitled "Non-IFRS Financial Measures" in the Company's MD&A for the year ended December 31, 2019.
About Menē Inc.
Menē crafts pure 24 karat gold and platinum jewelry that is transparently sold by gram weight. Through mene.com, customers may buy jewelry, monitor the value of their collection over time, and sell or exchange their pieces by gram weight at prevailing market prices. Menē was founded by Roy Sebag and Diana Widmaier-Picasso with a mission to restore the relationship between jewelry and savings. Menē empowers consumers by marrying innovative technology, timeless design, and pure precious metals to create pieces which endure as a store of value.
For more information about Menē, visit mene.com.
Forward-Looking Statements
This news release contains certain “forward-looking information” within the meaning of applicable Canadian securities laws that are based on expectations, estimates and projections as at the date of this news release. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information and are intended to identify forward-looking information.
This forward-looking information is based on reasonable assumptions and estimates of management of the Company at the time it was made, and involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, the risks associated with Covid-19 and other infectious diseases presenting as major health issues; failure to comply with environmental and health and safety laws and regulations; operating or technical difficulties in connection with the manufacture, sale and distribution of jewelry; actual audited results differing from reported unaudited results; global economic climate; dilution of the Company’s shares; the Company’s limited operating history; future capital needs and uncertainty of raising capital; the competitive nature of the jewelry industry; currency exchange risks; the need for the Company to manage its planned growth and expansion; the effects of product development and need for continued technology and manufacturing change; protection of proprietary rights; the effect of government regulation and compliance on the Company and the industry; network security risks; the ability of the Company to maintain properly working systems; theft and risk of physical harm to personnel; reliance on key personnel; global economic and financial market deterioration impeding access to capital or increasing the cost of capital; and volatile securities markets impacting security pricing unrelated to operating performance. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such 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 information. The Company undertakes no obligation to revise or update any forward-looking information other than as required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
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