VANCOUVER, Aug. 14 /PRNewswire-FirstCall/ -- Naturally Advanced Technologies Inc., (NAT, OTCBB: NADVF) a leading provider of sustainable, environmentally-friendly fibers and fabrics, today announced financial results for the three-month period ending June 30, 2006.
"We are continuing our good work in the commercialization development of our Crailar Fiber Technology with the Alberta Research Council in Edmonton," stated Jerry Kroll, CEO of Naturally Advanced Technologies. "As evidenced at our Annual General Meeting which was held at the ARC facility in Edmonton on July 11th, the people and resources that are being applied to this amazing product technology is nothing short of world class. There was not one person in attendance who did not recognize the financial impact that Crailar fiber will provide for NAT, and the economic spinoff it will have for Canada and in fact the world."
Research and development expenditures have increased from $51,000 in the first six months of 2005, to over $100,000 in the first six months of 2006. The company's cash position at the end of June 2006 is $981,900.00.
For the second quarter, sales, which represent revenue not yet from Crailar fiber but rather from the existing sustainable fabric HT Naturals business, were $99,883, down 67 percent compared to $303,754 in the year ago quarter. Net loss for the quarter ended June 30, 2006 was $347,353, or $0.02 per share. This compared to a net loss of $188,858, or $0.01 per share, for the quarter ended June 30, 2005. These results are primarily a result of a delay in the expected second quarter delivery of the new T-shirt production, which will be available for sale in the third quarter of 2006.
Ken Barker, COO, commented on the sales results for the quarter: "Our sales results in Q2 reflect our change in assortment planning and product development upgrade processes, which included a complete redefining of our raw materials and supply chain. The net result is a product assortment that is consumer centric, fiscally prudent, and value enhanced from a quality and design perspective. We will derive the benefit from these changes in Q3 and on into Q4, as our new product strategy comes on line. Sales results for Q3 will show strong double digit sales growth, and this trend will continue into Q4."
About Naturally Advanced Technologies Inc.
Naturally Advanced Technologies Inc. (NAT, OTCBB: NADVF), formerly Hemptown Clothing Inc., is a leading provider of sustainable, environmentally-friendly fibers and fabrics. Naturally Advanced Technologies is in the process of developing and patenting a revolutionary biotech enzyme fiber process named CRAILAR in collaboration with Canada's National Research Council and Alberta Research Council. CRAILAR is expected to enable the cost-effective production of these quality and conservation-based textiles and composites; therefore, management believes CRAILAR will significantly change production of fibers and composites. The company intends to license CRAILAR to partners in many industries including apparel; medical and hospitality textiles; upholstery; diversified industrials; and auto, marine and airplane parts. NAT was founded in 1995 in response to the growing demand for environmentally-friendly, socially responsible clothing. In its ten year history, NAT has shipped more than 500,000 garments reducing chemical use by 86,634 pounds and saving 452,232,264 gallons of fresh water. NAT's customers include the San Diego Zoo, Toyota, Universal Music and Volkswagen. NAT respects human rights of employees, the environmental impact of the company's operations and fiscal responsibility to its shareholders.
Safe Harbor Statement
This release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Exchange Act of 1934 and the provisions of the Private Securities Litigation Reform Act of 1995 and is subject to safe harbor created by these sections. Actual results may differ materially due to a number of risks, including, but not limited to, technological and operational challenges, needs for additional capital, changes in consumer preferences, risks associated with: market acceptance and technological changes; dependence on manufacturing and material supplies providers; international operations; and competition.
For more details on the NRC enzyme process, see: http://hemptown.com/sites/hemptown/files/NRCArticle.pdf
Naturally Advanced Technologies, Inc.
(formerly Hemptown Clothing Inc.)
Interim Consolidated Statements of Operations
Six Months Ended June 30, 2006 and June 30, 2005
(In US Dollars)
(unaudited)
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Three months ended June 30 Six months ended June 30
2006 2005 2006 2005
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Sales $ 99,883 $ 303,754 $ 385,076 $ 482,317
Cost of sales 83,768 208,588 298,807 330,183
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Gross profit 16,115 95,166 86,269 152,134
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Expenses
Advertising and
promotion 53,598 42,121 122,468 66,523
Consulting fees 8,559 3,660 8,559 8,024
Consulting fees -
stock-based
compensation 30,680 18,990 41,058 37,714
Contract labour 51,772 69,805 115,983 133,415
Depreciation 4,333 3,131 8,318 5,157
Insurance 6,399 4,464 13,123 5,883
Interest 17,452 14,190 31,657 31,885
Legal and accounting 46,164 35,943 81,095 54,501
Office and general 40,884 33,477 87,076 68,462
Rent 13,180 11,186 24,308 22,271
Research and
development 49,574 21,431 100,387 51,834
Salaries & benefits 74,446 52,900 155,686 102,442
Salaries & benefits
- stock based
compensation 16,031 - 47,702 -
Government grant,
net of fees
(Note 18) (37,952) (27,274) (37,952) (202,167)
Gain on settlement
of debt (Note 11) - - (12,095) -
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375,120 284,024 787,373 385,944
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Loss from operations (359,005) (188,858) (701,104) (233,810)
Minority Interest
(Note 4) 11,652 - 28,862 -
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Net loss for the
period -$ 347,353 -$ 188,858 -$ 672,242 -$ 233,810
Loss per share
basic and fully
diluted $ (0.02) $ (0.01) $ (0.04) $ (0.02)
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Weighted average
number of common
shares
outstanding 17,300,151 13,685,635 17,218,310 13,429,143
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Naturally Advanced Technologies, Inc.
(formerly Hemptown Clothing Inc.)
Consolidated Balance Sheets
(In US Dollars)
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June 30, December 31,
2006 2005
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(unaudited)
ASSETS
Current
Cash and cash equivalents $ 981,906 $ 1,260,939
Accounts receivable 166,693 162,576
Inventory 319,921 276,141
Prepaid expenses and other 122,929 75,128
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1,591,449 1,774,784
Property and Equipment (Note 8) 20,538 18,288
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$ 1,611,987 $ 1,793,072
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LIABILITIES
Current
Accounts payable and accrued liabilities 583,715 382,007
Due to related parties (Note 7) 133,139 30,449
Capital lease obligation, current portion 8,021 1,499
Note payable (Note 5) 100,000 100,000
Short term loan (Note 6) 19,819 29,467
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844,694 543,422
Note Payable (Note 5) 300,000 300,000
Long Term Debt (Note 9) 28,967 27,801
Capital Lease Obligation 3,969 12,452
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1,177,630 883,675
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Minority Interest (Note 4) 241,446 270,308
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COMMITMENTS (Note 12)
STOCKHOLDERS' EQUITY
Capital Stock (Note 10)
Authorized: 100,000,000 common shares without
par value
Issued and outstanding:
17,300,151 common shares
(December 31, 2005 - 16,811,815) 2,382,995 2,242,128
Additional Paid-in Capital 1,141,951 1,062,391
Accumulated Other Comprehensive Income 17,896 12,259
Deficit (3,349,931) (2,677,689)
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192,911 639,089
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$ 1,611,987 $ 1,793,072
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CONTACT: Investor Relations, Brian Gusko or Jerry Kroll,
