US: Boo Koo sees results drop during reshuffle
Boo Koo Holdings has posted a significant drop in net sales for its third quarter due to a lack of fluidity in its distribution changeover.
The energy drinks company said today (7 November) that net sales for the three months to the end of September plummeted 43% to US$2.4m.
Boo Koo maintained that Q3 operating expenses, amounting to $2.7m, would have been substantially lower had it not completed a reverse merger and private placement incurring administrative costs of $900,000 to complete the transactions.
While net sales were negatively impacted by the change in the altered distribution strategy, financial results, as measured by cash used in operations, improved "significantly" year-on-year, the company claimed.
The news follows confirmation of the planned departure of Boo Koo's president and CEO, Dan Lee, who is leaving the firm for personal reasons at the end of the year.
Several other staff changes have also been outlined as part of the company's move into the public sector.
Steven Solomon has been appointed to take over from Chuck Jarvie as executive chairman and newly hired David Hayes will take on the role of president of sales and marketing and chief customer officer. Jarvie will remain as an independent director of the company and Steve Ruffini, the company's CFO, has been given the added role of COO.
Operating loss for the period plummeted to $2.8m, compared to $1.2m a year earlier.
For the nine months of 2007 so far, net sales fell to $8.1m from $12.2m. Operating loss steadied somewhat, however, at $4.3m for the year so far.
"The 2007 year-to-date loss contains several non-cash charges, such as debt discount and amortisation of $1.5m as well as stock-based compensation and sales allowances totalling over $500,000, in addition to the non-recurring transaction costs", the company added.
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