Boomer Naturals Provides Fourth Quarter and Full Year Fiscal 2020 Results and Business Update
Generates Fiscal Fourth Quarter Ended July 31, 2020 Revenue of $9.8 million
Expect to Generate Revenue in Range of $26 to $29 million for the Fiscal First Quarter of 2021
Company Expects to Generate Positive Operating Income for the Fiscal First Quarter of 2021
LAS VEGAS--(BUSINESS WIRE)-- Boomer Naturals (the “Company”) (OTC: BOMH), a health and wellness company, today provided a business update on the Company’s operations in conjunction with the filing of its form 10-K for the full year ended July 31, 2020.
Mike Quaid, the Company’s Chief Executive Officer, stated, “Our company has successfully expanded into the Personal Protective Equipment category in response to the urgent need for these products and our unique access to manufacturing capacity in Vietnam. PPE is a natural extension of our established health and wellness product lines. Based on this expansion, we made the strategic decision to have an initial increase in advertising in the fourth quarter to highlight our superior PPE offerings which increased advertising expenses in the fiscal fourth quarter. This initial advertising blitz helped establish our brand and we believe has us very well positioned to achieve revenue in the range of $26 to $29 million in the fiscal first quarter of 2021 and generate positive operating income. The response from customers, wholesalers and retailers has been tremendous and we believe has us very well positioned for continued growth in both lines of our business. We expect the advertising spend going forward will dramatically decrease compared to the fourth quarter of fiscal 2020."
Fiscal Fourth Quarter 2020 and Recent Accomplishments:
Boomer Naturals Launches PPE Division
- In April 2020, the Company expanded its health and wellness offerings to include personal protection equipment (PPE), featuring its doctor-recommended, W.H.O. compliant, three-layer cotton/polyester reusable face mask enhanced with nano-silver technology. The Company offers a full range of personal health products including: hand sanitizer, safety gloves, nano-silver gaiters, single use masks, ear savers, face shields, and safety glasses. Product demand has exceeded expectations and the Company has accordingly experienced significant sales growth.
- Boomer Naturals began direct shipment of its flagship PPE products to a national pharmacy chain with over 8,000 locations and has had many repeat orders. In addition it has shipped product to a leading insurance company.
Boomer Naturals Healthy Living Continues to Expand Distribution and Awareness
- Boomer Naturals’ flagship Boomer Botanics products which come in a variety of sizes, flavors, and applications including tinctures, gummies, pain relief products (e.g., roll-ons and creams), have seen sales continue to grow during the COVID-19 pandemic. These products can be found online at boomernaturals.com. The Company also produces the Tommy Bahama+Boomer Naturals co-branded collection of wellness products that are available nationwide at Tommy Bahama retail locations and tommybahamawellness.com.
Boomer Naturals Enhances Supply Chain Capabilities
- Boomer Naturals fortifies its PPE product sourcing in Vietnam. The Company’s leadership team enjoys long-standing, personal relationships in Vietnam, a country with robust manufacturing capabilities and provides a reliable supply source.
- The Company secures exclusive supply agreements with its primary face mask manufacturers for the North American market and expects to expand this relationship to provide additional products to the company’s leading national pharmacy chain.
- The Company expands its warehouse footprint to accommodate increased order volumes. Warehouse capacity has tripled since April 2020 and now stands at 30,000 square feet.
Boomer Naturals Grows eCommerce Business
- More than 250,000 orders have been processed for year-to-date across the Company’s three consumer-facing websites: www.boomernaturals.com, www.tommybahamawellness.com, and www.boomerfacemasks.com.
- The Company developed and aired promotional/educational content on national television, radio and social media platforms to educate consumers and increase overall brand awareness. This direct-to-consumer interaction is expected to generate significant online sales through the Boomer Naturals website and through its brick and mortar partners.
Fourth Fiscal Quarter of 2020 Financial Results
Revenue for the fiscal fourth quarter of 2020 was $9.8 million compared to $68,000 in the fiscal fourth quarter of 2019. The improvement in revenue is primarily the result of the strategic decision by management to launch PPE products during the fourth quarter of 2020.
Gross margin for the fiscal fourth quarter of 2020 was 70%, compared to last year’s fiscal fourth quarter gross margin of 62%. The increase in gross margin was primarily due to the increase in revenue during the current year from expanding the Company’s offerings to face coverings and other products within Personal Protective Equipment category, as well as sales, retail and wholesale income from customers that purchased our Boomer Botanics wellness products.
Operating Expenses increased to $17 million for the fiscal fourth quarter of 2020 compared to $606,000 for the same period last year. The change was primarily driven by the strategic decision to increase advertising and marketing to $12.7 million for only this quarter, compared to $101,000 in the same period last year. This will be a one-time increase in advertising and will dramatically decrease going forward.
Operating loss for the fourth quarter of 2020 increased to a loss of $10.2 million as compared to a loss of $565,000 for the fourth quarter of 2019. This increase in loss is principally attributable to the increase in advertising and marketing expenses.
As of July 31, 2020, the Company had approximately $4.2 million of cash, and approximately $3.6 million of inventory on its balance sheet. Boomer has financed operations primarily from either borrowing from the Company’s line of credit or from related parties and the issuance of our securities. As of July 31, 2020 net cash provided by financing activities was $9,458,722.
Full Fiscal Year of 2020 Financial Results
Our revenue during the year ended July 31, 2020 was $11.5 million coming from PPE products, sales, retail, and wholesale income from customers that purchased our wellness products, compared to $67,675 from these revenue sources for the same period one year ago. We expect the revenue we receive from PPE to increase meaningfully in the near future and expect wellness products to continue to grow from current levels.
Overall, operating expenses increased for the year ended July 31, 2020, to the amount of $22.7 million as compared to $606 thousand for the same period ended 2019 as the Company ramped up operations. The increase was primarily due to a strategic decision to increase advertising and marketing related to the initial launch of the Company’s PPE products. The Company also increased its payroll for additional employees, general and administrative expense due to increased payroll and administrative expenses resulting from the Company’s growth. We expect a decrease in advertising and marketing expenses during the first quarter of 2021.
The Company had $15.6 million in net loss for the year ended July 31, 2020 compared to a net loss of $564 thousand for the year ended July 31, 2019.
The Company expects to generate fiscal first quarter 2021 ending October 31, 2021 revenue in the range of $26 to $29 million.
The Company expects to generate positive operating income in the fiscal first quarter of 2021 ending October 31, 2021.
About Boomer Naturals
Boomer Naturals is a wholly-owned subsidiary of Boomer Holdings Inc., a publicly traded company (OTC: BOMH). Boomer Naturals is a full-service wellness company that provides products and services that enhance your well-being and increase your quality of life. Boomer Naturals has two divisions, Healthy Living and Personal Protection Equipment. Healthy Living’s flagship product, Boomer Botanics, is an all-natural botanical blend that helps the body function at its prime. Boomer Naturals’ Healthy Living products are designed to balance the body and help decrease symptoms associated with physical, mental, and emotional health challenges. Product lines include Boomer Botanics, Golf Botanics, Pet Botanics, Tommy Bahama+Boomer Botanics, SKIN Sunscreen, and medical-grade skin care products. Boomer Naturals Personal Protection Equipment offers consumers and businesses PPE of the highest quality with industry-leading reliability. The PPE division’s flagship product, Boomer Nano-Silver Reusable Protective Cloth Face Masks, are America’s best-selling consumer face masks. Boomer Naturals’ products are available online at BoomerNaturals.com, BoomerNaturalsWholesale.com, CVS.com, and TommyBahamaWellness.com. Boomer Naturals’ products are also available at the Boomer Naturals retail store, CVS retail locations, Tommy Bahama retail locations, and resorts and golf shops across the country. For more information, please visit www.boomernaturals.com.
Forward Looking Statements
Statements in this document contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on many assumptions and estimates and are not guarantees of future performance. These statements may involve 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 future results, performance or achievements expressed or implied by such forward-looking statements. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, except as required by securities laws. Our actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation, economic, political, regulatory, capital markets and other external conditions and other factors beyond the Company's control, risks related to public health crises such as the global pandemic associated with the coronavirus (COVID-19), and those set forth as "Risk Factors" in our filings with the Securities and Exchange Commission ("SEC"). There may be other factors not mentioned above or included in the Company's SEC filings that may cause actual results to differ materially from those projected in any forward-looking statement.
Source: Boomer Naturals
Released November 9, 2020