Gross Profit Margins Improve to 43.2% for the 2014 Second Quarter as Compared to 36.8% for the 2014 First Quarter
MIAMI, FL–(Marketwired – Aug 11, 2014) – Vaporin, Inc. (OTCQB: VAPO), a distributor and marketer of electronic cigarettes, vaporizers and e-liquids products, today announced its financial results for the second quarter and six month period ending June 30, 2014.
Financial Highlights for the 2014 Three and Six Month Periods:
- Revenue for the first six months of 2014 totaled $602,000;
- Revenue for the second quarter of 2014 increased 130% to $419,000 as compared to $182,000 for the first quarter of 2014;
- Growth sequentially was driven predominantly by an increase in convenience store distribution which increased over 300% and online sales which increased 10X;
- Gross profit margins improved to 43.2% for the second quarter of 2014 as compared to 36.8% for the first quarter of 2014;
- Gross profit margin improvement was driven by preferred product pricing, product volume increase and direct to consumer sales via online marketing.
“We are extremely pleased with our 2014 second quarter sales growth and margin expansion as we continue to focus our strategy on building distribution of our vaporizers through brick and mortar retailers, online promotion and vending machines. During the quarter our c-store distribution tripled and internet sales increased tenfold.” Scott Frohman, Chief Executive Officer of Vaporin, continued, “According to Bonnie Herzog, Senior Beverage and Tobacco Analyst at Wells Fargo Securities, the vapors, tanks and mods industry has grown to $1.1 billion of the current $2.5 billion total addressable market for alternatives to combustible cigarettes. Additionally, vapor consumption is believed to surpass combustible cigarettes in the next decade. Vaporizers offer a better quality and consumer experience, stronger batteries and coils, a more satisfying hit, and the ability to mix and match flavors. We have established ourselves within this burgeoning industry with a growing brand, distribution, multiple revenue streams and a superior product base. We anticipate the traction we have gained thus far in 2014 to continue throughout the remainder of the year and heading into 2015.”
Operational Highlights during the First Half of 2014:
- Entered into the medical cannabis industry through an exclusive distribution agreement with Terra Tech Corp. (OTCQB: TRTC) to supply proprietary vaporizer products for resale throughout their cannabis dispensary network in California, Colorado, Washington and Oregon;
- Signed an exclusive distribution agreement with Seaga Manufacturing, Inc. for the marketing and sale of goods through a unique, innovative vending solution, the Vapestation;
- Deployed its first electronic cigarette vending machine during the second quarter of 2014;
- Secured exclusive supply agreement with ChromaDex®, an innovative natural products company that discovers, acquires, develops and commercializes proprietary-based ingredient technologies, for the development of NIAGEN™ and PURENERGY™, novel ingredients with multiple energy and health benefits;
- James J. Martin has been appointed as Chief Financial Officer of the Company; and,
- Completion of merger, name change and trading under new stock symbol “VAPO”.
About Vaporin, Inc.
Vaporin is a distributor and marketer of electronic cigarettes, vaporizers, and e-liquids products. Vaporin’s innovative technology offers the look, feel and taste of traditional cigarettes without any tar, tobacco, smoke and odor. As an alternative to traditional cigarettes, Vaporin is offered in a variety of disposable and rechargeable starter kits and flavors. The unique Vaping Pens product line and Made-In-USA E-Liquid is what makes Vaporin one of the emerging brands in the market. Vaporin is not just an alternative to traditional smoking, but a lifestyle. For more information please visit, www.vaporin.com.
Cautionary Note Regarding Forward Looking Statements
This press release contains forward-looking statements including statements regarding the continued growth of our business. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Important factors that could cause actual results to differ from those in the forward-looking statements include the results of our marketing efforts including our online initiative, competition from other e-cig. companies and the major tobacco companies and new regulations which affect the distribution of these products. Further information on our risk factors is contained in our filings with the SEC, including the Form 10-K filed on March 27, 2014. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Chief Executive Officer
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