Dallas, Texas (August 18, 2011) – StockGuru Shines its Spotlight on Auri, Inc. (OTCBB: AURI) announced yesterday financial results for the three and six months ended June 30, 2011. The Company closed on August 17, 2011, at $0.58, trading in volume slightly below its three month average and in its fifty-two week range of $0.80 – 0.02.
Second Quarter 2011 Highlights:
- Women’s footwear generated $61,452 in sales in the second quarter with Men’s footwear generating $108,335 in sales for the same period.
- Added 29 new retail distribution points in the 2nd quarter; 148 total retail locations at June 30, 2011
Three Months Ended June 30, 2011
Auri designs and markets branded contemporary footwear for men and women in several unique styles. Auri’s men’s line consists of both causal/sport shoes and fashion/dress shoes and an array of sandals, while its new women’s line, which debuted in February 2011, consists of an assortment of high-heel designs and flats. The Company’s fall 2011 women’s line will also include boots, wedges and platforms.
“With respect to both our men’s and women’s lines, our design platform fuses high fashion with proprietary technologies to create shoes that present true luxury with unparalleled performance and uncompromised style,” stated Ori Rosenbaum, CEO and Chairman of Auri. “Our design team has created shoes with active suspension systems, which incorporate compression control and anti-fatigue features complemented by removable foot beds. By integrating Outlast® temperature regulating linings, Liquicell® ultra-thin interface technology, and encapsulated gel technologies, we are able to provide form and function unlike other brands. To this end, our innovative design philosophy and solid business fundamentals earned Auri the #8 spot on Forbes Magazine’s 2009 ‘America’s Most Promising Companies’ list and we were the only footwear, fashion or apparel brand to make the list.”
Revenues
Revenues for the three months ended June 30, 2011 were $169,787, 23% lower than the $221,380 for the three months ended June 30, 2010. The primary cause of the year-over-year decline, which occurred in both the women’s and men’s collections, was that the Company shipped the majority of its spring merchandise to retailers in the first quarter vs. the previous year spring sales coming in the second quarter.
Cost of Sales
Cost of sales for the three months ended June 30, 2011 increased to $169,975 from $154,180 a year ago. Gross margin decreased to 0% in the three months ended June 30, 2011 from 30% in the comparable period a year ago.
Operating Expenses
Selling, general and administrative expenses were $488,628 in the second quarter of 2011 compared to $194,108 in the same period a year ago. Auri incurred $201,273 of public company expenses, including $122,500 of non-cash stock-based compensation expense, which was not present in the year-ago period. Excluding these costs, adjusted operating expenses increased approximately 48% to $287,355.
Loss from operations was $483,816 in the second quarter of 2011 compared to $126,908 in the same period in 2010.
Net Income (Loss)
Net loss for the three months ended June 30, 2011 was $508,391 compared to a $130,536 loss for the three months ended June 30, 2010. The diluted loss per share was $0.01 based on 88.7 million weighted average shares outstanding in the second quarter of 2011 compared to $0.00 and 53.5 million shares in the same period a year ago, respectively.
The Company sold 1,190,000 units in a private placement during the six months ended June 30, 2011. Each unit consists of one share of common stock and one warrant to purchase one share of common stock at $1.00 per share. The warrants are exercisable for a period of two years.
Six months Ended June 30, 2011
Revenues
Revenues for the six months ended June 30, 2011 increased 31% to $473,824 from the year ago period. Sales of women’s footwear increased approximately 112% to $234,306 and benefited from the Company’s launch of its women’s line in February 2011 into 58 department stores and boutique doors.
Cost of Sales
Cost of sales for the six months ended June 30, 2011 was $383,029 versus $251,750 last year. Gross profit was $90,795 in the first half of 2011 versus $108,949 in the first half of 2010, with associated gross margins of 19% and 30%, respectively.
Operating Expenses
Selling, general and administrative expenses increased from $442,792 to $881,273 due primarily to additional legal fees, addition of sales personnel and increased marketing/trade show attendance. In addition, the Company spent approximately $201,273 in public company expenses during the first six months of 2011, which were not present in the comparable period a year ago. Operating loss was $790,478 compared to $333,843 in the first half of 2010.
Net Income (Loss)
Net loss for first six months of 2011 was $837,723 as compared to a loss of $337,594 during the six months ended June 30, 2010. The diluted net loss per share was $0.01 based on 79.7 million weighted average shares outstanding.
Liquidity and Capital Resources
As of June 30, 2011, the Company had $233,060 of cash and cash equivalents and $133,333 of long term debt outstanding. Working capital was $537,946 at June 30, 2011 compared to $240,325 at December 31, 2010. The Company received $0.6 million in net proceeds from various private placements in the six months ended June 30, 2011. Based on current projected working capital needs for the next twelve months, the Company needs to raise additional capital to meet its operating goals.
Business Updates
On July 18th, 2011, Auri announced its entry into the Middle East with an initial shipment to Fifty One East (“51 East”), a luxury retailer located in Qatar. Auri’s fall 2011 men’s sport and fashion footwear will be sold through 51 East’s retail locations. Auri currently has made its first shipment to 51 East with additional orders scheduled for September delivery.
During the first two quarters the brand has added 52 new doors of distribution with prominent department and premium boutique stores domestically and internationally. Additionally, many of these doors are expected to provide vertical growth and door count for the fall 2011 collection.
Spring business has generated successful growth and brand awareness with positive sell throughs in the women’s collection generating reorder activity and increased interest for fall.
Fall 2011 launch — Auri’s men’s and women’s fall collections will be delivered on September 9th at approximately 150 retail locations including Fred Segal, Rubenstein Brothers, The Tannery, and Gary’s Newport Beach and Del Mar.
Auri’s women’s fall collection incorporates 10 patterns in 32 SKU’s. Retail prices range from $145-$295. The men’s collection features a diverse lineup of casual, dress, and sportswear oriented footwear. The offering consists of 9 patterns in 24 SKU’s. Retail prices for the men’s line range from $150-$285.
We believe the combination of great styles and unmatched comfort will expand our sales and brand in this large and growing market. A new marketing campaign and appearances at 7 trade shows this fall are expected to produce additional positive momentum in the 4th quarter carrying over in to 2012.
About Auri, Inc.
Auri designs, crafts and markets fashion footwear for men and women, fusing performance engineering, innovative designs and advanced technical materials to provide a new level of luxury in fashion footwear. Crafted with Italian leathers and hand finished details, the products incorporate a seamless fusion of next level technologies with pure style delivering a unique experience of a no compromise style.
Advanced technologies include active suspension systems, compression control, Outlast® temperature regulating linings, Liquicell® ultra-thin liquid-filled interface technology, and encapsulated gel technologies. For more information, please visit www.aurifootwear.com.
Safe Harbor Statement
This press release contains certain statements that may include ‘forward-looking statements’ as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are often identified by the use of forward-looking terminology such as “believe, expect, anticipate, optimistic, intend, will” or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of risks and factors, including those discussed in the Company’s periodic reports that are filed with and available from the Securities and Exchange Commission. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risks and other factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
| AURI, INC. | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| June 30, 2011 | December 31, 2010 | |||||||
| ASSETS | (unaudited) | |||||||
| Cash and cash equivalents | $ | 233,060 | $ | 406,439 | ||||
| Accounts receivable – net | 130,198 | 104,355 | ||||||
| Due from factor | 68,423 | 15,796 | ||||||
| Inventory – net | 325,534 | 226,773 | ||||||
| Prepaid expenses and other assets | 168,235 | 116,320 | ||||||
| Deferred finance fee – net | – | 18,778 | ||||||
| Total current assets | 925,450 | 888,461 | ||||||
| Property and equipment – net | 57,896 | 85,035 | ||||||
| TOTAL ASSETS | $ | 983,346 | $ | 973,496 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Accounts payable | $ | 130,263 | $ | 85,337 | ||||
| Accrued liabilities | 90,574 | 46,132 | ||||||
| Short-term note payable | 100,000 | – | ||||||
| Short-term portion of long-term note payable | 50,000 | 12,500 | ||||||
| Short-term portion of long-term related party note payable | 16,667 | 4,167 | ||||||
| Short-term convertible note payable | – | 500,000 | ||||||
| Total current liabilities | 387,504 | 648,136 | ||||||
| Long-term note payable – net of short term portion | 100,000 | 137,500 | ||||||
| Long-term related party note payable – net of short term portion | 33,333 | 45,833 | ||||||
| TOTAL LIABILITIES | 520,837 | 831,469 | ||||||
| STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Preferred stock – $0.001 par value; 1,000,000 shares authorized, no shares issued and outstanding | – | – | ||||||
| Common stock – $0.001 par value; 300,000,000 shares authorized, 59,735,360 shares issued and outstanding at December 31, 2010 and 89,991,580 shares issued and outstanding at June 30, 2011 | 89,992 | 59,735 | ||||||
| Additional paid in capital | 5,579,544 | 4,451,596 | ||||||
| Accumulated deficit | (5,207,027 | ) | (4,369,304 | ) | ||||
| Total stockholders’ equity (deficit) | 462,509 | 142,027 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 983,346 | $ | 973,496 | ||||
| AURI, INC. | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months Ended June 30, 2011 |
Three Months Ended June 30, 2010 |
Six Months Ended June 30, 2011 |
Six Months Ended June 30, 2010 |
|||||||||||||
| Sales – net | $ | 169,787 | $ | 221,380 | $ | 473,824 | $ | 360,699 | ||||||||
| Cost of goods sold | 169,975 | 154,180 | 383,029 | 251,750 | ||||||||||||
| Gross profit | (188 | ) | 67,200 | 90,795 | 108,949 | |||||||||||
| Selling, general and administrative expenses | 483,628 | 194,108 | 881,273 | 442,792 | ||||||||||||
| Loss from operations | (483,816 | ) | (126,908 | ) | (790,478 | ) | (333,843 | ) | ||||||||
| Other income (expenses) | (24,575 | ) | (3,628 | ) | (47,245 | ) | (3,751 | ) | ||||||||
| NET LOSS | $ | (508,391 | ) | $ | (130,536 | ) | $ | (837,723 | ) | $ | (337,594 | ) | ||||
| Net loss per share – basic and diluted | $ | 0.01 | $ | – | $ | 0.01 | $ | 0.01 | ||||||||
| Weighted average shares outstanding – basic and diluted | 88,711,360 | 53,476,364 | 79,685,104 | 52,678,418 | ||||||||||||
| AURI, INC. | ||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| (Unaudited) | ||||||||
| Six Months Ended June 30, 2011 (Unaudited) |
Six Months Ended June 30, 2010 (Unaudited) |
|||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (837,723 | ) | $ | (337,594 | ) | ||
| Adjustments to reconcile net loss to cash used in operating activities | ||||||||
| Depreciation, amortization and other | 32,756 | 24,363 | ||||||
| Stock based compensation | 122,500 | 33,593 | ||||||
| Recovery of inventory reserve | 4,631 | 4,109 | ||||||
| Allowance for bad debt | 8,517 | – | ||||||
| Changes in: | ||||||||
| Accounts receivable | (34,360 | ) | 39,905 | |||||
| Due from factor | (52,627 | ) | (65,335 | ) | ||||
| Inventory | (103,392 | ) | (30,799 | ) | ||||
| Prepaid expenses and other current assets | (51,915 | ) | 9,530 | |||||
| Deferred finance fee | 18,778 | – | ||||||
| Accounts payable | 39,223 | (20,086 | ) | |||||
| Accrued expenses | 40,042 | (4,593 | ) | |||||
| Net cash used in operating activities | (813,570 | ) | (346,907 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Payments in connection with reverse merger | (49,192 | ) | – | |||||
| Cash paid for purchase of property and equipment | (5,617 | ) | (11,201 | ) | ||||
| Net cash used in investing activities | (54,809 | ) | (11,201 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from issuance of short-term note payable | 100,000 | – | ||||||
| Proceeds from common stock sales | 595,000 | 350,000 | ||||||
| Net cash provided by financing activities | 695,000 | 350,000 | ||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (173,379 | ) | (8,108 | ) | ||||
| CASH AND CASH EQUIVALENTS – BEGINNING | 406,439 | 22,931 | ||||||
| CASH AND CASH EQUIVALENTS – ENDING | $ | 233,060 | $ | 14,823 | ||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Cash paid for income taxes | $ | – | $ | – | ||||
| Cash paid for interest | $ | – | $ | – | ||||
| NON-CASH INVESTING ACTIVITIES: | ||||||||
| Assumption of liabilities acquired in reverse merger | $ | 10,115 | $ | – | ||||
| Conversion of convertible note into common stock | $ | 500,000 | $ | – | ||||
To view this StockGuru Spotlight, please visit: http://stockguru.com/category/latest-spotlights/
To get free alerts on this and other similar stocks, please register here:
What is the StockGuru Spotlight?
Many companies covered in The StockGuru Spotlight have positive increases in both volume and share price. While this is not true in all cases, StockGuru strives to cover companies in The StockGuru Spotlight that are worth of our readers’ attention.
StockGuru looks for potential break-out candidates in The StockGuru Spotlight. Many of these companies have had recent news and appear to be getting the attention of investors. StockGuru does not typically feature companies in The StockGuru Spotlight that are compensating StockGuru for this coverage. There are times when StockGuru covers a stock in The StockGuru Spotlight that had previously compensated Stockguru. Where that is the case, a proper disclosure is included below. StockGuru and its partners, employees and writers never hold shares, short positions, warrants or any other current position in a stock featured in The StockGuru Spotlight.
To feature a company in The StockGuru Spotlight please contact the Publisher at [email protected]. If our reader is a key person for a publicly traded company, StockGuru can consider that company for either a StockGuru Spotlight or a StockGuru Profile. Please contact the StockGuru Publisher John Pentony at this email address: [email protected].
Stockguru.com (“SG”) provides its members with the latest news, press releases, and trade alerts for all the companies highlighted on the site StockGuru.com. SG utilizes information believed to be reliable herein prepared all material. The information contained herein is not guaranteed by SG to be accurate, and should not be considered to be all-inclusive. The owner, publisher, editor and their associates are not responsible for errors and omissions. SG encourages readers and investors to supplement the information in these reports with independent research and other professional advice. All information on featured companies is provided by the companies profiled, or is available from public sources and SG makes no representations, warranties or guarantees as to the accuracy or completeness of the disclosure by the profiled companies or the information contained herein. The companies that are discussed in this opinion have not approved the statements made in this opinion. This opinion contains forward-looking statements that involve risks and uncertainties. This material is for informational purposes only and should not be construed as an offer or solicitation of an offer to buy or sell securities. SG is not a licensed broker, broker dealer, market maker, investment banker, investment advisor, analyst or underwriter. Please consult a broker before purchasing or selling any securities viewed on http://www.Stockguru.com or mentioned herein.
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected”, “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and SG undertakes no obligation to update such statements. StockGuru is occasionally compensated for coverage. When this is the case, SG clearly indicates this with a disclosure of all compensation received in the past and present. Additionally SG also discloses any anticipated compensation in the future. Compensation is typically in cash. Sometimes a company pays SG in restricted shares. Pentony Enterprise and its associated companies does not take free trading shares for any reason at anytime. StockGuru is not a registered investment adviser or a broker-dealer. StockGuru makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk.
John Pentony, Publisher, Stockguru.com
Tel: +1 469 252 3031
e-mail: [email protected]