Health & Fitness
Health and Fitness
Health and Fitness
Mon, May 17, 2010 San West, Inc. Reports Record Revenue for First Quarter 2010
SANTEE, CA--(Marketwire - May 17, 2010) - San West, Inc. (
Operational and Corporate Highlights
-- [ www.CountyImports.com ] introduced a new motorized scooter, a 300cc Chariot, with best-in-class power and unprecedented range targeted to the mass market. The 300cc Chariot attracts a full spectrum of riders and generates enough power to literally drive across the United States at speeds of 100 miles per hour with 80 mile per gallon efficiency. To complement the power and environmentally favorable performance, all 49cc-300cc Trikes sold by CountyImports.com -- including the 300cc Chariot -- are equipped with a fully automatic CVT power train and reverse-drive capabilities. -- The Company announced significant improvements to a number of key business metrics pertaining to efficiency of the online advertising strategy employed by partner website, [ www.CountyImports.com ]. The keyword marketing overhaul campaign, launched in early February and announced March 4, 2010, has rapidly transformed [ www.CountyImports.com ] into the leading online on and off-road vehicle (ORV) dealer with regard to "natural" or "organic" web traffic, driving a record flow of free, highly-targeted web traffic to the website, and in turn facilitating a 37% decrease in overall online advertising costs compared to both 2008 and 2009, the two most lucrative years in the website's history. -- San West and Buggy World awarded a custom Buggy World "Truggy" to Solana Beach resident Kim Thompson at the KSON 97.3 and 92.1 FM CountryFest on May 1, 2010 at the Lakeside Rodeo Grounds in Lakeside, Calif. -- The Company announced that management is now aggressively searching for a new Orange County, CA retail location to focus primarily on further accelerating sales of San West's burgeoning motorized scooter offerings, as well as its traditional selection of high performance buggies. San West, Inc. management is now in the final stages of negotiations with a number of prime locations and intends to announce an agreement within the next 30 to 90 days.
First Quarter Financial Results
The Company reported revenues for the first quarter of $493,615, an increase of 175.1% compared to revenue of $179,423 for the first quarter of 2009. This represents the highest sales for any first quarter in San West's history. Gross profit for the quarter was $135,492, or 27.4% gross profit margin, compared sequentially with gross profit margin of $111,641, or 22.3% for the fourth quarter of 2009 and compared to gross profit of $65,544 or 36.5% gross profit margin for the first quarter of 2009. Total operating expenses were $924,422, an increase compared to $215,547 for the three months ended March 31, 2009. The increase in expense is mainly due to the recognition of $642,175 in non-cash stock compensation primarily related to our new director, Jesse Gonzales, receiving five million shares of restricted common stock valued at $467,500 and other stock compensation expenses. Excluding stock compensation, SG&A was $282,267, or 31.0% higher than the first quarter of 2009. Net loss for the quarter was $(952,404), or ($0.01) per share, compared to a net loss of $160,154, or ($0.00) per share, for the first quarter last year.
"This was a strong start to what we believe will be a record 2010, including the highest sales volume in any first quarter in our company's history," commented Frank Drechsler, President and CEO of San West, Inc. "We exceeded our guidance for the first quarter of the year, a quarter that is typically seasonally lower than other periods, and our efforts to attract natural traffic to our online properties is continuing to result in higher conversion rates, more revenue per sales, and repeat customers. We continue to believe that as we execute our strategic plan, the advertising adjustments, combined with our search engine optimization and marketing strategies, will result in significant growth in our online revenues. In addition, our efforts to bolster our retail, brick-and-mortar presence in Southern California, should benefit our financial results as well."
Outlook
For the second quarter ended June 30, 2010, management expects revenue of at least $1 million, which would be the highest revenues in San West history.
Mr. Drechsler concluded, "San West and CountyImports.com management continue to be excited about the future. As we move into the seasonally stronger part of our fiscal year, coinciding with the start of the ORV season, we are well positioned as a recognized leader in the ORV industry. Our efforts to bolster our online properties and reduce our customer acquisition costs position us for success in the future, and we continue to believe 2010 will be a record year for San West."
About San West, Inc.
San West is an emerging leader in the on and off-road vehicle (ORV) industry and operator of the industry leading ORV portal, [ www.CountyImports.com ]. The Company's web properties have emerged as the established home for all facets of the ORV industry, including off-road buggies, scooters, ATVs, parts and accessories. San West's retail store locations in Southern California specialize in the design, manufacture, sales and repairs off-road buggies. Additionally, the retail and online stores provide aftermarket performance products and accessories for off-road buggies and other ORVs. Buggy repair services are sold and fulfilled at the Santee, California retail location. For further information about San West, Inc. visit [ www.CountyImports.com ], [ www.CountyImportParts.com ], and [ www.SanWestInc.com ].
Forward-Looking Statements
This release contains forward-looking statements, including, without limitation, statements concerning our business and possible or assumed future results of operations. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons including: our ability to continue as a going concern, adverse economic changes affecting markets we serve; competition in our markets and industry segments; our timing and the profitability of entering new markets; greater than expected costs, customer acceptance of our products or difficulties related to our integration of the businesses we may acquire; and other risks and uncertainties as may be detailed from time to time in our public announcements and SEC filings. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and our future results, levels of activity, performance or achievements may not meet these expectations. We do not intend to update any of the forward-looking statements after the date of this document to conform these statements to actual results or to changes in our expectations, except as required by law. There is no assurance that a definitive agreement will be completed.
San West, Inc. Consolidated Balance Sheets March 31, December 31, ASSETS 2010 2009 ------------ ------------ CURRENT ASSETS Cash $ 47,804 $ 50,659 Accounts receivable 6,694 840 Inventory (Note B) 232,501 287,921 Other current assets 36,765 33,897 ------------ ------------ Total current assets 323,764 373,317 Fixed assets (Note C) 130,226 130,226 Accumulated depreciation (37,434) (31,974) ------------ ------------ Net fixed assets 92,792 98,252 Deposits 12,599 12,599 Goodwill (Note D) 234,100 234,100 ------------ ------------ Total assets $ 663,255 $ 718,268 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Accounts payable (Note E) $ 725,169 $ 749,257 Other current liabilities 176,276 187,689 Floorplan notes payable (Note F) 108,679 117,962 Convertible promissory notes (Note G) 150,000 - Notes payable (Note H) 276,000 510,000 Subsidiary purchase-current portion (Note I) 29,000 32,292 ------------ ------------ Total current liabilities 1,465,124 1,597,200 Subsidiary purchase (Note I) 227,112 223,820 Loans from shareholder (Note J) 216,950 216,950 ------------ ------------ Total liabilities 1,909,186 2,037,970 Commitments and contingencies STOCKHOLDERS' DEFICIT (Note K) Preferred stock, no par value, 10,000,000 shares authorized; none issued and outstanding - - Common stock, no par value, 300,000,000 shares authorized; issued and outstanding 146,446,540 and 124,960,826 at March 31, 2010 and December 31, 2009, respectively. 3,032,743 2,028,648 Common stock payable 461,905 439,825 Accumulated deficit (4,740,579) (3,788,175) ------------ ------------ Total stockholders' deficit (1,245,931) (1,319,702) ------------ ------------ Total liabilities and shareholder's deficit $ 663,255 $ 718,268 ============ ============ The accompanying notes are an integral part of these financial statements
San West, Inc. Consolidated Statements of Operations (Unaudited) Three Months Ended March 31, ------------------------ 2010 2009 ----------- ----------- Revenue $ 493,615 $ 179,423 Cost of goods sold 358,123 113,879 ----------- ----------- Gross profit 135,492 65,544 Expenses Selling, general and administrative 924,442 215,547 ----------- ----------- Total expenses 924,442 215,547 Loss from operations (788,950) (150,003) Other income (expense) Other income 4 - Amortization of beneficial conversion feature (150,000) - Amortization of deferred financing costs (862) - Interest expense (12,596) (10,151) ----------- ----------- Total other income (expense) (163,454) (10,151) ----------- ----------- Net loss $ (952,404) $ (160,154) =========== =========== Net (loss) per common share basic $ (0.01) $ (0.00) Weighted average shares outstanding basic and diluted 134,487,651 76,307,556 =========== =========== The average shares listed below were not included in the computation of diluted losses per share because to do so would have been antidilutive for the periods presented: Convertible promissory notes 3,991,350 7,727,890 =========== =========== The accompanying notes are an integral part of these financial statements
