TOBACCO INTERNATIONAL

TI March 2016

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MARCH 2016 TOBACCO INTERNATIONAL 15 UNITED STATES Electronic Cigarettes International Group Reports Fourth Quarter and Full Year 2015 Financial Results golden, colorado—Electronic Cigarettes International Group, Ltd., the global mar- keter and distributor of electronic ciga- rettes and vapor products including FIN, Vapestick, Victory and VIP announced financial results on March 28 for both the fourth quarter and full year 2015. "In 2015, ECIG dramatically im- proved all major aspects of the business while eliminating numerous time con- suming distractions," said ECIG CEO Dan O'Neill. "Going forward, our focus will be keenly directed on profitable growth and improving cash flows through execution of the six major strategies." Among ECIG's 2015 highlights for the year, net sales increased 21 percent versus 2014 to $54.M, despite unfavor- able foreign exchange movements of $3.4M; gross profit more than doubled in 2015 reaching $30.5M versus $13.2M in 2014, a 131 percent increase; adjusted EBITDA was negative ($7.3M) in 2015 versus a negative ($37.2M) in 2014; in- ventory declined by $1.5M and accounts payable also decreased by $6.1M com- pared to December 31, 2014; and the company reported reduced days sales outstanding (DSO) from 28 days on September 30 to 20 days on December 31. For the abbreviated three-month pe- riod ending December 31, 2015, ECIG revenues increased by $941K, or seven percent, to $14.8M for the three-month period ended December 31, 2015 com- pared with $13.9M for the corresponding period ended December 31, 2014. Gross profit increased by $4.9M to $8.2M for the three-month period ended December 31, 2015 compared with $3.3M for the corresponding period ended December 31, 2014. Revenues increased by $9.5M, or 21 percent, to $54.2M for the 12-month period ended December 31, 2015 com- pared with $44.7M for the corresponding period ended December 31, 2014. Gross profit increased $17.2M, or 131 per- cent, to $30.5M for the 12-month peri- od ended December 31, 2015 compared with $13.2M for the corresponding period ended December 31, 2014. "With the contribution of the Denver-based finance and accounting department that ECIG hired in 2015, we have reduced DSO's from 28 days on September 30 to 20 days on December 31," said ECIG CFO Phil Anderson. "DSO's have fallen a further three days to 17 days as of February 29, 2016. Additionally, our accounting department recently discovered over $400K of sales from 2014, which had never been in- voiced. The company subsequently billed and collected the cash." ©2016 Essentra ESSENTIAL SOLUTIONS, DELIVERED DISCOVER MORE AT WWW.ESSENTRAFILTERS.COM SINGLE FILTER, TWICE THE FLAVOUR, ON DEMAND INTRODUCING THE NEW TWINSENSE ™ FILTER Reflecting consumer trends and providing innovative solutions for brand owners, our new TwinSense ™ filter offers a more engaging and interactive smoking experience with flavour delivered through two capsules in one filter tip. 64110_Tobacco_International_Twinsense_HP_170216_AH_Flightchecked.indd 1 17/02/2016 19:29 TI•1-2H•Essentra.indd 1 4/22/16 11:53 AM

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