SAN FRANCISCO, April 15 /PRNewswire-FirstCall/ -- ECO2 Plastics, Inc., (BULLETIN BOARD: ECOO) , the eco-friendly recycling company that is changing the way plastics are recycled, today reported its 2007 year-end financial results in its 10-KSB filing. The Company reported revenues of $4.3 million for calendar year 2007 versus $61,000 during 2006. 2007 operating losses were $16 million versus $14.9 million during the prior year, with net losses of $32.6 million in 2007 versus $20.8 million for the prior year. Cash losses from operating activity were $7.2 million in 2007 versus $4.1 million for 2006.
"2007 was a transitional year for ECO2 Plastics," said Rod Rougelot, CEO of ECO2 Plastics. "We shifted from a development stage company to an operating entity and scaled our operations for commercial production. Equipment was tested for capacity constraints and reliability issues, while over 100 employees were hired and trained to operate the facility. The inefficiency of the ramp-up was exhibited in our 2007 numbers, but the hard work of our team has positioned the Company for a strong 2008."
In January 2008, the Company announced a mechanical problem that impacted the quality of material being produced. Production lines were reconfigured, which resolved the quality issues and the Company began shipments of prime quality flake again in late February.
During the first quarter of 2008, ECO2 completed the necessary FDA testing for the use of our product in the manufacture of food contact applications. Official test results were improved from those announced in Q4 2007. The Company's product now meets FDA standards for up to 100 percent inclusion in 12 categories of focus by the FDA. Our formal application has been filed with the FDA and we anticipate the approval process to take three to six months.
Additionally, the Company successfully converted all of its outstanding convertible debentures to equity during the first quarter of 2008. With a focus on growth, ECO2 is currently working on the second phase of its recapitalization effort and expects, by the end of the second quarter, that all short-term debt will be converted into equity, the equity balance will be positive and that there will be sufficient working capital to sustain the Company's rapid rate of growth.
"2008 will be a year of growth for ECO2 Plastics," Rougelot said, "Although Q1 and Q2 will still generate cash losses, we are well positioned to deliver approximately $20 million in revenue in 2008 with operating cash flow of over $3 million.
About ECO2 Plastics (http://www.eco2plastics.com/)
ECO2 Plastics, (BULLETIN BOARD: ECOO) , is a publicly traded company engaged in PET plastic recycling. The Company's patented process was developed through a research partnership with Honeywell FM&T and the US Department of Energy. ECO2 Plastics is the exclusive worldwide licensee of the patented and patent-pending technology. Headquartered in San Francisco, California, the Company operates a recycling plant in Riverbank, California, with another plant currently under development.
ECO2's approach sets it apart from competitors that deploy water-based recycling processes. Unlike other recyclers, ECO2's process eliminates the use of water, respects and preserves the environment, while delivering a high quality recycled plastic flake with comparably lower operating costs. ECO2 Plastics is the only recycling company that can claim that (i) its plastic recycling technology has a negligible impact on the environment and (ii) is distinguishable from existing technologies when it comes to water waste and chemical contamination.
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Cautionary Warning Regarding Forward-Looking Statements
"Forward-looking statements," as defined in the Private Securities Litigation Reform Act of 1995, may be included in this press release. These statements relate to future events and/or our future financial performance. These statements are only predictions and may differ materially from actual future events or results. ECO2 Plastics, Inc. disclaims any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments or otherwise. Please refer to the documents filed by ECO2 Plastics, Inc. with the Securities and Exchange Commission, which identify important risk factors that could cause actual results to differ from those contained in forward-looking statements, including, but not limited to risks associated with our ability to (i) increase revenues, (ii) obtain profitability, (iii) obtain additional financing, (iv) manage changes in general economic and business conditions (including in the environmental technology and plastic recycling industries), (v) react to actions of our competitors, (vi) develop new services and markets for our services and products, (vii) properly quantify the time and expense involved in such development activities, (viii) identify and manage risks in connection with acquisitions (ix) identify and capitalize upon the level of demand for and market acceptance of our services and products and (x) make any necessary changes to our business strategies.
