AeroGrow Reports First Quarter Financial Results

SOURCE:

AeroGrow International, Inc.

2008-08-07 08:08:00

AeroGrow Reports First Quarter Financial Results

AeroGrow Reports First Quarter Financial Results

Quarterly Revenues Increase 7% Over Prior Year to $6.7 Million

BOULDER, CO–(EMWNews – August 7, 2008) – AeroGrow International, Inc. (NASDAQ: AERO)

(“AeroGrow” or the “Company”), makers of the AeroGarden® line of indoor

gardening products, announced results for the quarter ended June 30, 2008.

For the quarter ended June 30, 2008, AeroGrow reported revenues of

approximately $6.7 million, an increase of 7% over the $6.3 million

reported for the prior year’s quarter ended June 30, 2007. For the quarter

ended June 30, 2008, AeroGrow reported a net loss of $2.8 million or $0.23

per share as compared to a net loss of $2.0 million for the quarter ended

June 30, 2007.

“As expected, our revenue growth slowed due to summer seasonality and a

reduction in wholesale orders as retailers sold through existing inventory

in preparation for the fall rollout of our new and expanded product lines,”

said Jerry Perkins, CEO of AeroGrow. “Our net loss was also in line with

our expectations, and up from last year due to increased G&A supporting a

far larger annual sales base. As we head into the fall quarter, we’re

running all factories at full capacity to support our rollout into

thousands of new retail storefronts in the next few months. Also

noteworthy is the 174% increase in our revenues from seed kits and

accessories year over year as we achieve increased levels of repeat sales

from customers adopting the AeroGarden as an ongoing part of their lives.”

The following table sets forth, as a percentage of sales, our quarterly

financial results for the three months ended June 30, 2008, and the three

months ended June 30, 2007:


                                                       Three months ended

                                                            June 30,

                                                      --------------------

                                                        2008       2007

                                                      ---------  ---------

Revenue

   Product sales - retail                                  39.3%      65.8%

   Product sales - direct to consumer                      49.7%      34.2%

   Product sales - international                           11.0%       0.0%

                                                      ---------  ---------

      Total sales                                         100.0%     100.0%



Operating expenses

   Cost of revenue                                         54.9%      56.9%

   Research and development                                10.8%       8.3%

   Sales and marketing                                     51.3%      46.5%

   General and administrative                              22.6%      20.0%

                                                      ---------  ---------

      Total operating expenses                            139.6%     131.7%

                                                      ---------  ---------



Other (income) expense, net                                 2.3%       0.5%



Loss from operations                                      -41.9%     -32.2%

                                                      =========  =========

Earnings Conference Call

AeroGrow will host a conference call today, Thursday, August 7, 2008, to

review operational results for the quarter ended June 30, 2008.

The conference call is scheduled for 12:00 PM ET. To participate in the

call, please dial:


       U.S. and Canada:  1 (888) 241-0558

       International:    1 (647) 427-3417

A replay of the call will be available within 12 hours of completion. You

will be able to access it for the following 30 days through the AeroGrow

website at www.aerogrow.com/investors or by phone until September 7, 2008.

To access the replay by phone, please dial:


       U.S. and Canada:  1 (800) 695-1018

       International:    1 (402) 220-1753

       Conference ID:    58135575


CONDENSED STATEMENT OF OPERATIONS

                                              Three months ended June 30,

                                              ----------------------------

                                                  2008           2007

                                              -------------  -------------

Revenue

  Product sales                               $   6,720,081  $   6,278,685



Operating expenses

  Cost of revenue                             $   3,686,823  $   3,575,276

  Research and development                          725,415        521,819

  Sales and marketing                             3,449,883      2,920,987

  General and administrative                      1,518,712      1,255,008

                                              -------------  -------------

  Total operating expenses                        9,380,833      8,273,090

                                              -------------  -------------



Loss from operations                             (2,660,752)    (1,994,405)



Other (income) expense, net

  Interest (income)                                  (1,050)       (37,859)

  Interest expense                                  157,647         66,184

  Loss on modification of debt                            -              -

  Registration rights penalty                             -              -

                                              -------------  -------------

  Total other (income) expense, net                 156,597         28,325

                                              -------------  -------------



Net loss                                      $  (2,817,349) $  (2,022,730)

                                              =============  =============



Net loss per share, basic and diluted         $       (0.23) $       (0.18)

                                              =============  =============



Weighted average number of common

 shares outstanding, basic and diluted           12,100,387     11,085,389

                                              =============  =============





CONDENSED BALANCE SHEETS

                                                                June 30,

                                                                  2008

                                                             -------------

ASSETS

Current assets

  Cash                                                       $     344,981

  Restricted cash                                                  473,275

  Accounts receivable, net                                       2,419,351

  Other receivable                                                 323,451

  Inventory                                                      4,951,647

  Prepaid expenses and other                                       730,137

                                                             -------------

Total current assets                                             9,242,842

Property and equipment, net                                      1,820,669

Other assets

  Intangible assets, net                                           132,910

  Deposits                                                         101,164

                                                             -------------

                                                                   234,074

                                                             -------------

Total Assets                                                 $  11,297,585

                                                             =============



LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

  Current portion - long term debt                           $   1,733,502

  Due to factor                                                          -

  Accounts payable                                               4,275,844

  Accrued expenses                                               2,145,248

  Customer deposits                                                244,857

  Deferred rent                                                     35,327

                                                             -------------

Total current liabilities                                        8,434,778

Long term debt                                                   1,214,507

Stockholders' equity

  Preferred stock                                                        -

  Common stock                                                      12,100

  Additional paid-in capital                                    44,081,632

  Accumulated (deficit)                                        (42,445,432)

                                                             -------------

Total Stockholders' Equity                                       1,648,300

                                                             -------------



Total Liabilities and Stockholders' Equity                   $  11,297,585

                                                             =============





SALES BY CHANNEL (Unaudited)

                                               Three months ended June 30,

                                              ----------------------------

                                                   2008          2007

                                              -------------  -------------

Product Revenues

  Product sales - retail                      $   2,642,575  $   4,129,853

  Product sales - direct to consumer              3,339,410      2,148,832

  Product sales - international                     738,096              -

                                              -------------  -------------

    Total sales                                   6,720,081      6,278,685



Product Revenues

  Product sales - retail                               39.3%          65.8%

  Product sales - direct to consumer                   49.7%          34.2%

  Product sales - international                        11.0%           0.0%

                                              -------------  -------------

    Total sales                                       100.0%         100.0%



SALES BY PRODUCT CATEGORY (Unaudited)

                                               Three months ended June 30,

                                              ----------------------------

                                                   2008          2007

                                              -------------  -------------

Product Revenues

  AeroGardens                                 $   4,983,416  $   5,643,885

  Seed kits and accessories                       1,736,665        634,800

                                              -------------  -------------

    Total sales                                   6,720,081      6,278,685



Product Revenues

  AeroGardens                                          74.2%          89.9%

  Seed kits and accessories                            25.8%          10.1%

                                              -------------  -------------

    Total sales                                       100.0%         100.0%

                                              -------------  -------------

About AeroGrow International, Inc.

Founded in 2002 in Boulder, Colorado, AeroGrow International, Inc. is

dedicated to the research, development and marketing of the AeroGarden®

line of indoor gardening products. AeroGardens feature dirt-free, aeroponic

technology, allowing anyone to grow farmer’s market fresh herbs, salad

greens, tomatoes, chili peppers, flowers and more, indoors, year-round, so

simply and easily that no green thumb is required. See www.aerogrow.com.

FORWARD-LOOKING STATEMENTS

“Safe Harbor” Statement under the Private Securities Litigation Reform Act

of 1995: Statements by Jerry Perkins, and/or the Company, statements

regarding growth of the AeroGarden product line, optimism related to the

business, expanding sales and other statements in this press release are

forward-looking statements within the meaning of the Securities Litigation

Reform Act of 1995. Such statements are based on current expectations,

estimates and projections about the Company’s business. Words such as

expects, anticipates, intends, plans, believes, sees, estimates and

variations of such words and similar expressions are intended to identify

such forward-looking statements. These statements are not guarantees of

future performance and involve certain risks and uncertainties that are

difficult to predict. Actual results could vary materially from the

description contained herein due to many factors including continued market

acceptance of the Company’s products or the need to raise additional

capital. In addition, actual results could vary materially based on changes

or slower growth in the kitchen garden appliance market; the potential

inability to realize expected benefits and synergies; domestic and

international business and economic conditions; changes in customer demand

or ordering patterns; changes in the competitive environment including

pricing pressures or technological changes; technological advances;

shortages of manufacturing capacity; future production variables impacting

excess inventory and other risk factors listed from time to time in the

Company’s Securities and Exchange Commission (SEC) filings under “risk

factors” and elsewhere. The forward-looking statements contained in this

press release speak only as of the date on which they are made, and the

Company does not undertake any obligation to update any forward-looking

statement to reflect events or circumstances after the date of this press

release.

CONTACTS:

Corporate
John Thompson
AeroGrow International, Inc.
(303) 444-7755

Investor
Budd Zuckerman
Genesis Select Corporation
(303) 415-0200

free cash grants, free grant money, free money, cash grants, scholarships, business grants, foundation grants, government grants, debt grants, consolidation, college tuition, financial aid, medical grants, personal grants, medical bills, unsecured loans, no interest loans, financing, loans, capital, non profit organizations

Major Newsire & Press Release Distribution with Basic Starting at only $19 and Complete OTCBB / Financial Distribution only $89

Get Unlimited Organic Website Traffic to your Website 
TheNFG.com now offers Organic Lead Generation & Traffic Solutions





























Leave a Reply

Your email address will not be published. Required fields are marked *

*