The OurPet's Company Reports 2014 First Quarter Results

           The OurPet's Company Reports 2014 First Quarter Results

PR Newswire

FAIRPORT HARBOR, Ohio, April 24, 2014

FAIRPORT HARBOR, Ohio, April 24, 2014 /PRNewswire/ --The OurPet's Company
(OTCBB: OPCO), (www.ourpets.com), a leading proprietary pet supply company,
today reported 2014 first quarter net revenue increased 3.5% to $5,214,471
from $5,040,645 for the same period last year. In addition to adverse weather
conditions, higher than budgeted costs related to entry into the private
label-value brand market and increased promotions contributed to a decline in
income from operations for the 2014 first quarter versus the prior year. Net
income was $134,427 for the 2014 first quarter compared to $223,601 a year
ago. Earnings per diluted share were $0.01 for the first quarter of 2014 and
2013.

The OurPet's Company Logo.

Dr. Steven Tsengas, Chairman and CEO, commented, "Our results for the 2014
first quarter were below expectations due to factors that had a temporary
adverse impact on financial performance. We remain optimistic that our 2014
full-year results will achieve record net revenue and record earnings per
share. The severe weather conditions we faced during the first three months
of 2014 have recently subsided which has also benefited consumer spending,
especially by customers at our largest accounts. We are accelerating plans to
implement the company's dual brand growth strategy during the remainder of
2014."

Dr. Tsengas added, "We have made substantial investments in the roll-out of
our dual brand strategy, which include increased business and product
development plus higher selling and marketing expenses in order to penetrate
key markets in the United States and overseas. Shipments of PetZone® branded
products to Food, Mass and Drug customers are expected later this quarter. We
further expanded our presence in this market with the addition of new
customers in the recently completed quarter. Sales of feline waste and odor
control products declined compared to the 2013 first quarter due to temporary
timing issues related to the launch of the expanded line of SmartScoop® ^
products. Branded products offered through E-Commerce continued to achieve
solid year-over-year sales gains. Interest from current and prospective
customers at last month's Global Pet Expo in new products and the company's
dual brand strategy further strengthen the outlook for 2014." 

2014 First Quarter Results

Net revenue increased 3.5% to $5,214,471 for the three months ended March 31,
2014, from $5,040,645 for the same period a year ago. Sales increases in the
Food Drug & Mass and E-Commerce markets were partly offset by decreased sales
of Pet Specialty products.

Gross profit increased 6.7% to $1,553,901 for the 2014 first quarter from
$1,456,371 a year ago. This $97,530 increase in gross profit was primarily
attributable to higher sales and lower fixed operating costs versus the 2013
first quarter. Bad weather, promotional sales and some higher than planned
costs to enter the private label value market were the principal factors that
adversely impacted gross profit for the 2014 first quarter compared to the
same period last year. Gross profit margin increased to 29.8% for the 2014
first quarter from 28.9% for the same quarter a year ago.

Income from operations was $240,936 for the 2014 first quarter versus $304,202
for the 2013 first quarter. This decrease was due to higher selling, general
and administrative (SG&A) expenses, which included costs related to the
roll-out of the company's dual brand product strategy.

Income before taxes was $215,527 for the 2014 first quarter versus $304,740
the prior year.

Income tax expense of approximately $81,000 for the 2014 first quarter was
similar to the same quarter last year. The company's book tax rate was 37.6%
for the three months ended March 31, 2014, compared to 26.6% for the same
period in 2013.

Net Income was $134,427 for the 2014 first quarter versus $233,601 for the
same period last year. Earnings per share were $0.01 for the first quarter of
2014 and 2013.

EBITDA for the first three months of 2014 was $403,761 compared to $508,805
for the same period a year ago. Depreciation and amortization expense was
$152,395 for the 2014 first quarter or $11,425 below the 2013 first quarter.
A reconciliation of EBITDA to GAAP Net Income is provided in an attachment to
the summary financial statements.

Investor Conference Call

The OurPet's Company has scheduled an investor conference call for Thursday,
April 24, 2014, at 4:30 pm. Eastern Time (ET). Dr. Steve Tsengas, Chairman
and CEO, and Scott Mendes, Chief Financial Officer, will discuss the company's
growth strategy and financial results followed by a question and answer
session. To participate in the conference call, individuals should dial (877)
485-3107. Phone lines will open at 4:20 p.m. ET. A digital replay of the
investor conference call will be available following the call on the company's
website: www.ourpets.com/investor/investors.html.

About OurPet's Company

The OurPet's Company designs, produces and markets a broad line of innovative,
trend-setting pet products and accessories in the United States and overseas.
The OurPet's Company has an extensive intellectual property portfolio of with
over 225 patents, which are either issued or in pending status. The Company's
websites include www.ourpets.com and www.petzonebrand.com. 

Certain of the matters set forth in this press release are forward-looking and
involve a number of risks and uncertainties. Among the factors that could
cause actual results to differ materially are the following: business
conditions; growth in the industry; general economic conditions; addition or
loss of significant customers; the loss of key personnel; product development;
competition; risks of doing business abroad; foreign government regulations;
fluctuations in foreign currency rates; rising costs for raw materials and
sources of supply that may be limited or unavailable from time to time; the
timing of orders booked; and the other risks that are described from time to
time in OurPet's SEC reports. For further information, contact:

CONTACTS               INVESTOR RELATIONS
OurPet's Company        InvestQuest, Inc.
Dr. Steven Tsengas, CEO Robert Lentz
(440) 343-6500, x111    (614) 876-1900



OURPET'S COMPANY AND SUBSIDIARIES
CONSOLIDATED OPERATING RESULTS
                                        For the Three Months Ended
                                        March 31,
                                        2014           2013
Net revenue                             $  5,214,471       $  5,040,645
Cost of goods sold                      3,660,570           3,584,274
 Gross profit on sales         1,553,901           1,456,371
Selling, general and administrative     1,312,965           1,152,169
expenses
 Income from operations        240,936             304,202
Other income                            (10,430)            (40,783)
Interest expense                        35,839              40,245
Income before taxes                     215,527             304,740
Income Tax expense                      81,100              81,139
Net Income                              $   134,427      $   223,601
Basic and Diluted Earnings Per Common
Share
 After Dividend Requirements For
Preferred
 Stock:
 Net Income                        $       0.01  $       0.01
Weighted average number of common
shares
 outstanding used to calculate       16,695,076          15,883,560
 basic earnings per share
Weighted average number of common and
 equivalent shares outstanding used   18,297,349          17,645,946
to
 calculate diluted earnings per share
OURPET'S COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
                                        March 31,           December 31,
                                        2014                2013
ASSETS
 Cash and equivalents                  $    91,650     $    57,975
 Receivables, net                      2,650,309           2,811,139
 Inventories, net                      6,922,298           5,876,724
 Prepaid expenses                      534,591             397,268
 Total current assets          10,198,848          9,143,106
LONG TERM ASSETS
 Property and equipment, net           1,990,727           1,891,209
 Amortizable intangible assets, net    362,373             370,850
 Intangible Assets                     461,000             461,000
 Goodwill                              67,511              67,511
 Deposits and Other assets             18,003              18,003
 Total long term assets       2,899,614           2,808,573
 Total assets                  $ 13,098,462        $ 11,951,679
LIABILITIES AND STOCKHOLDERS' EQUITY
 Notes payable                         $   100,000      $   100,000
 Current maturities of long-term debt  312,049             397,575
 Accounts payable                     2,097,738           1,169,925
 Accrued expenses                      507,438             861,010
 Total current liabilities     3,017,225           2,528,510
LONG TERM LIABILITIES
 Long-term debt - less current portion 670,378             721,389
above
 Revolving line of credit              2,415,032           1,833,032
 Deferred income taxes                 232,427             245,775
 Total long term liabilities   3,317,837           2,800,196
 Total liabilities             6,335,062           5,328,706
 Stockholders' Equity                  6,763,400           6,622,973
 Total liabilities and        $ 13,098,462        $ 11,951,679
stockholders' equity



OurPet's Company
EBITDA - Q1'14 vs. Q1'13
EBITDA                    Q1'14        Q1'13
Net Income                $ 134,427   $ 223,601
Interest expense          $  35,839  40,245
Tax Expense               $  81,100  81,139
Depreciation              $ 133,685   152,189
Amortization              $  18,710  11,631
 Total EBITDA          $ 403,761   $ 508,805
Stock Options expense     $   3,000 $   6,000
Warrants expense          $   3,000 $   3,000
 Total Adjusted EBITDA $ 409,761   $ 517,805

The above table reconciles the Company's disclosure of Net Income per GAAP
withthe non GAAP financial measure EBITDA (Earnings before Interest, Taxes,
Depreciation and Amortization.) As the investment community has often
requested the EBITDA calculation to help them evaluate performance,
Management has chosen to provide this disclosure. Although EBITDA is widely
used in the investment community as a benchmark to reflect operating
performance, financing capability and liquidity, it is not regarded as a
measure of operating performance and liquidity under generally accepted
accounting principles ("GAAP"). It also does not represent cash flows from
operating activities. In addition, the Company's EBITDA may not be comparable
to similar indicators provided by other companies. The Presentation of this
additional information is not meant to be considered in isolation or as a
substitute for net income (loss), or any component thereof, in accordance with
GAAP.



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SOURCE OurPet's Company

Website: http://www.ourpets.com
 
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