PR Newswire
VANCOUVER, April 9, 2018
VANCOUVER, April 9, 2018 /PRNewswire/ - RYU Apparel Inc. (TSXV: RYU) ("RYU" or the "Company"), creators of urban athletic apparel, is pleased to report its financial results for its second full year of operations since relaunching the brand in November 2015.
Revenue for the year ended December 31, 2017 was $3,019,586, 121% higher than revenue of $1,367,043 during the year ended December 31, 2016. After completing its second year of operations, the RYU team is encouraged with its sales record to date and a 46% gross profit for the year.
In Canadian dollars |
Three months ended December 31, |
Year ended December 31, | ||
2017 |
2016 |
2017 |
2016 | |
Revenue |
$1,166,126 |
$474,844 |
$3,019,586 |
$1,367,043 |
Gross profit |
$529,472 |
$214,336 |
$1,382,293 |
$627,866 |
Gross profit % |
45% |
45% |
46% |
46% |
Fourth quarter 2017 results included additional revenue from the Company's new retail store locations in Park Royal South in West Vancouver, Queen St. West in Toronto, and Metrotown in Burnaby. The Metrotown location in Burnaby was only open for one month within the quarter.
The fourth quarter of 2017 is RYU's ninth consecutive quarter of increasing gross profit.
"We are pleased with this quarter and yearly results and the steady progress we are making in our strategic plan," said Marcello Leone, CEO. "Moving forward, RYU remains focused and we have a solid road map in place to position the brand for success. As creators of Urban Athletic Apparel, we are the leader in this new category that evolved from Athleisure."
During the year ended December 31, 2017, the Company achieved the following milestones:
The Company is also pleased to provide the following 2018 updates:
Fourth quarter summary:
Annual summary:
For convenience, copies of the Company's annual consolidated statements of financial position, comprehensive loss and cash flows for the years discussed herein are attached to this news release. Readers are encouraged to review such statements in their entirety, including the notes thereto, on SEDAR. Full details of the Company's financial performance can be obtained by viewing the annual consolidated financial statements and corresponding MD&A available on SEDAR.
For regular updates on RYU Apparel visit: http://ryu.com
About RYU
Respect Your Universe is an award winning urban athletic apparel and accessories brand engineered for the fitness, performance and lifestyle of athletically minded men and women. Innovatively designed without compromise and tailored for fit, comfort, and durability, RYU exists to facilitate human performance. For more information, visit: http://ryu.com
On Behalf of the Board
RYU APPAREL INC.
"Marcello Leone"
Marcello Leone, CEO, President and Chairman of the Board
Tel: 604-235-2880
Neither the 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.
This news release contains forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of the Company, such as statements that: (i) the expansion plan is to have eight stores open by the end of 2018 and to achieve +100% year over year growth in retail revenue; (ii) the intention to open its New York and California locations during the second and third quarters of 2018; (iii) that high priority tasks with netamorphosis started to deploy in the fourth quarter of 2017 to accelerate and expand e-commerce revenue and performance and will continue into the third quarter of 2018; (iv) the Company is focused on a clear roadmap to achieve a 65:35 "bricks and clicks" business model by the year 2021; (v) that a new ryu.com will launch with improved performance, speed and integration in the third quarter of 2018, and (vi) that deliveries of inventory are expected to continue into the first quarter of 2018. There are numerous risks and uncertainties that could cause actual results and the Company's plans and objectives to differ materially from those expressed in the forward-looking information, including the ability of the company to finance operations, the ability of the management team to execute on its business plan, risks in the apparel industry in general, and delays and risks associated with renovating and opening new store locations. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Except as required by law, the Company does not intend to update these forward-looking statements.
RYU APPAREL INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Expressed in Canadian dollars)
As at
December 31, 2017 |
December 31, 2016 | |||
ASSETS |
||||
Current |
||||
Cash |
$ 466,809 |
$ 767,263 | ||
Accounts receivable |
169,439 |
82,297 | ||
Inventory |
2,359,681 |
1,067,560 | ||
Prepaid expenses and deposits |
978,151 |
263,912 | ||
3,974,080 |
2,181,032 | |||
Non-current |
||||
Deposits |
398,292 |
172,521 | ||
Property and equipment |
2,546,729 |
1,439,500 | ||
Intangible assets |
32,432 |
6,549 | ||
$ 6,951,533 |
$ 3,799,602 | |||
LIABILITIES AND EQUITY |
||||
Current |
||||
Accounts payable |
$ 1,178,126 |
$ 745,894 | ||
Accrued liabilities |
384,355 |
169,404 | ||
Current portion of finance lease |
14,068 |
14,779 | ||
Deferred revenue |
121,750 |
64,732 | ||
1,698,299 |
994,809 | |||
Non-current |
||||
Finance lease |
45,070 |
63,296 | ||
Derivative liability |
- |
7,703 | ||
1,743,369 |
1,065,808 | |||
Equity |
||||
Share capital |
53,008,315 |
42,230,355 | ||
Share subscriptions received in advance |
355,000 |
- | ||
Equity reserve |
7,469,620 |
6,927,354 | ||
Deficit |
(55,691,865) |
(46,491,009) | ||
Accumulated other comprehensive income |
67,094 |
67,094 | ||
5,208,164 |
2,733,794 | |||
$ 6,951,533 |
$ 3,799,602 |
RYU APPAREL INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Expressed in Canadian dollars)
For the years ended December 31,
2017 |
2016 | ||||
Revenue |
$ |
3,019,586 |
$ |
1,367,043 | |
Cost of sales |
1,637,293 |
739,177 | |||
Gross Profit |
1,382,293 |
627,866 | |||
46% |
46% | ||||
Expenses |
|||||
Depreciation |
455,136 |
245,794 | |||
Foreign exchange loss (gain) |
43,873 |
(57,246) | |||
Interest and bank charges |
84,774 |
144,419 | |||
Investor relations |
278,475 |
629,771 | |||
Office and general |
2,480,301 |
1,174,206 | |||
Product creation |
508,490 |
553,855 | |||
Professional fees |
560,545 |
1,020,293 | |||
Salaries and benefits |
3,813,468 |
2,778,121 | |||
Selling and marketing |
1,806,097 |
1,032,523 | |||
Share-based payments |
331,513 |
333,341 | |||
Travel and entertainment |
228,180 |
121,915 | |||
10,590,852 |
7,976,992 | ||||
Other items |
|||||
Gain on settlement of debt |
- |
208,923 | |||
Recovery of warrant derivative liability |
7,703 |
1,518,541 | |||
Comprehensive loss |
$ |
(9,200,856) |
$ |
(5,621,662) | |
Loss per share - Basic and diluted |
$ |
(0.04) |
$ |
(0.05) | |
Weighted average number of common shares |
217,230,136 |
106,507,976 |
RYU APPAREL INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in Canadian dollars)
For the years ended December 31,
2017 |
2016 | |||||||
Cash flows from operating activities |
||||||||
Net loss |
$ |
(9,200,856) |
$ |
(5,621,662) | ||||
Items not affecting cash: |
||||||||
Depreciation |
455,136 |
245,794 | ||||||
Share-based payments |
331,513 |
333,341 | ||||||
Foreign exchange |
- |
(76,230) | ||||||
Accrued interest |
1,347 |
108,581 | ||||||
Gain on settlement of debt |
- |
(208,923) | ||||||
Recovery of warrant derivative liability |
(7,703) |
(1,518,541) | ||||||
Changes in non-cash working capital |
||||||||
Accounts receivable |
(87,142) |
223,555 | ||||||
Inventory |
(1,292,120) |
14,888 | ||||||
Prepaid expenses and deposits |
(940,010) |
(297,821) | ||||||
Accounts payable and accrued liabilities |
582,585 |
119,414 | ||||||
Deferred revenue |
57,018 |
41,014 | ||||||
Interest paid |
- |
(128,742) | ||||||
Net cash flows used in operating activities |
(10,130,232) |
(6,765,332) | ||||||
Cash flows from investing activities |
||||||||
Property and equipment |
(1,448,187) |
(551,621) | ||||||
Intangible assets |
(15,973) |
- | ||||||
Net cash flows used in investing activities |
(1,464,160) |
(551,621) | ||||||
Cash flows from financing activities |
||||||||
Issuance of common shares |
12,072,819 |
10,001,552 | ||||||
Share issuance costs |
(1,128,387) |
(721,981) | ||||||
Share subscriptions received in advance |
355,000 |
- | ||||||
Short-term loans received |
154,000 |
1,009,050 | ||||||
Repayment of short-term loans and interest |
(154,000) |
(2,297,000) | ||||||
Exercise of warrants |
8,800 |
- | ||||||
Finance lease |
(14,294) |
(11,923) | ||||||
Net cash flows provided by financing activities |
11,293,938 |
7,979,698 | ||||||
Change in cash |
(300,454) |
662,745 | ||||||
Cash – beginning |
767,263 |
104,518 | ||||||
Cash - end |
$ |
466,809 |
$ |
767,263 | ||||
Supplemental cash flow disclosure |
||||||||
Common shares issued for settlement of accounts payable |
$ |
- |
$ |
578,660 | ||||
Common shares issued for settlement of related party advances |
$ |
- |
$ |
739,050 | ||||
Common shares issued for services |
$ |
35,481 |
$ |
140,600 | ||||
Finder warrants issued for share issuance costs |
$ |
210,753 |
$ |
80,992 | ||||
Unpaid intangible asset additions |
$ |
16,459 |
$ |
- | ||||
Unpaid property and equipment additions |
$ |
107,630 |
$ |
168,617 | ||||
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SOURCE RYU Apparel Inc.