ALUULA ANNOUNCES SECOND QUARTER 2023 RESULTS AND PRODUCT UPDATE
Victoria, British Columbia – (June 29, 2023) / CNW: ALUULA Composites Inc. (the “Company” or “ALUULA“) (TSXV: AUUA) ) today announced its financial results for the three month period ended (“Q2 2023”) and six month period ended April 30, 2023. All currency amounts are listed in Canadian dollars.
Q2 2023 Highlights:
- Completed the reverse takeover (“RTO”) with Bastion Square Partners to enter the public capital markets,
- Achieved 34% quarter-on-quarter revenue growth over the three month period ended January 31, 2023 and a 247% increase over the same period of the prior year,
- Achieved record rolled fabric sales of more than fifty thousand meters shipped in the current quarter, tripling the shipments made in the first quarter of 2023 and second quarter of 2022,
- Net Loss increased to $2,612,145 due to the listing expense of $1,640,538 and stock compensation expense of $390,317 generated from the RTO.
“The significant quarterly revenue growth was achieved through expansion within windsports as well as increased customer development in the other markets we are pursuing,” says Richard Myerscough, CEO and director of ALUULA. “With the capital infusion from the qualifying transaction, we are continuing to execute on our strategy of bringing our products to a wide range of customers.”
Q2 2023 Financial Results:
Three months ended April 30
|Six months ended April 30
|Net and Comprehensive Income (loss)
|Net income (loss) per share
|Net income (loss) per share: diluted
Q2 2023 revenue grew by 247% over that achieved in the same period of the prior year as the company shipped fifty thousand meters of rolled fabric, compared to only sixteen thousand meters in the second quarter of 2022. In addition, three customers each purchased more than five thousand meters of fabric in Q2 2023, only two of which are in windsports, compared to only a single customer purchasing such volumes in the same period of the prior year. With multiple large orders shipped in Q2 2023, the windsports market represented 86% of the Company’s revenue compared to being over 98% for the same period of the prior year.
Net and comprehensive loss increased to $2,612,145 in the three month period ended April 30, 2023, compared to $176,091 from the same period of the prior year. The increase in net loss was caused by accounting adjustments connected to the RTO and stock compensation expense derived from the RTO in April 2023 as well as from an undercapitalization experienced by the Company up to, and remedied by, the completion of the RTO in April 2023.
Through the RTO, the Company received $4.4 million of cash through the merger and subsequent private placement. The funds were used to pay down long term debt ($0.8 million), bank indebtedness ($1.7 million) and draw down accounts payable and other liabilities ($0.7 million). ALUULA retained $1.2 million of cash as of the balance sheet date which will be used to capitalize the acquisition of inventory in anticipation of sales in the coming quarters.
54% of the Company’s revenue during the three month period ended April 30, 2023 was generated by its first product: ALUULA Gold. Through the work with an initial adopter, to the addition of nine new premium windsport brands in various stages of commercialization over the past months, the product has been the foundation for the Company’s growth of composite rolled fabrics.
In the upcoming third and fourth quarters, we will be introducing two new composites to our brand partners in the Windsports and Outdoors industries. With the introduction of these new composites, we anticipate further revenue growth as we actively pursue opportunities to replace the incumbent nonrecyclable polyester ripstop canopy materials. Additionally, we aim to target the traditional nonrecyclable bag materials, further expanding our market presence and revenue potential.
ALUULA Aeris, our second generation composite designed for sails, kites, wings, paragliders, ultra-light packs, and more. It boasts exceptional characteristics, including being ultra-lightweight, incredibly strong, highly resistant to UV radiation, and fully recyclable. Aeris is available in two canopy weights: 34 grams per square meter (“gsm”) and 46 gsm. Aeris is typically half the weight of current industrystandard materials while exhibiting strength that is 5 to 20 times greater. We are also excited to announce the upcoming release of an 86 gsm version of Aeris, specifically tailored for airframe and heavy-duty sail panels. We are currently collaborating with sail brands and our current windsport customers to expedite the implementation of Aeris into their products.
ALUULA Graflyte, our dedicated offering for the outdoor pack market. Following extensive testing, we are now progressing into larger pre-production runs with several major brands, and we are reaching the final stages of development. The first technical backpacks made from Graflyte are expected to hit the retail market in the Fall of 2023. ALUULA Composites uses a patented fusion technology to bond technical films to an Ultra High Molecular Weight Polyethylene (“UHMWPE”) core, resulting in a new generation of performance composite fabrics that deliver unique and superior performance results. This “process, rather than a product” allows for a wide range of iterations to meet a broad range of applications.
About ALUULA Composites
ALUULA Composites Inc. (TSX-V: AUUA) is a new class of composite materials built from components with eight times the strength-to-weight ratio of steel, and yet lighter than nylon, polyester or aramid. Using a patented and proprietary approach to increase fiber strength at the molecular level, ALUULA core weaves and outer facing films are fused without the use of heavy glues. This remarkable process allows ALUULA to achieve strength to weight ratio materials that have been previously unachievable. The company continues to add patented innovation to its product offerings and specialized core competencies to its growing team.
Partnering with world-class brands, ALUULA Composites is quickly becoming the top choice for innovators seeking to set a new standard of high-performance.
ALUULA is a Canadian company founded by a team of highly experienced chemists and engineers who share a common passion for exploring and enjoying the outdoors. They have created a new realm in dimensionally stabilized multilayer materials that are the result of an innovative bonding of co-polymer layers, creating composites which are extremely light, highly tear and stretch resistant, and are easily fabricated into a multitude of products across a wide range of markets. ALUULA Composites strives to develop products and processes that are not hazardous to our environment and minimize the footprint we leave behind.
Learn more about ALUULA Composites at: www.aluula.com
Peter Dorrius, CFO and Corporate Secretary
Investor Relations General Contact
TSX Venture Exchange
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.
The information in this news release includes certain information and statements about management’s view of future events, expectations, plans and prospects that constitute forward looking statements. These statements are based upon assumptions that are subject to significant risks and uncertainties. Forward looking statements in this news release include, but are not limited to, the expected engagement of HIS and its provision of market making services. Because of these risks and uncertainties and as a result of a variety of factors, including the timing and receipt of all applicable regulatory, corporate and third party approvals, the actual results, expectations, achievements or performance may differ materially from those anticipated and indicated by these forward looking statements. Although the Company believes that the expectations reflected in forward looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statement will prove to be correct. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise.