Pioneering Technology Reports Record 2015 Financial Results

2015

2014

2013

Revenue

$4,393,534

$2,924,472

$1,382,798

Gross Profit

$2,936,677

$1,756,789

$797,444

Expenses

$2,420,416

$2,736,978

$1,607,835

Net Income (Loss)

$140,976

$(1,183,915)

$(1,652,583)

Adjusted EBITDA

$652,641

$(464,249)

$(756,377)

●   

2015 revenue was approximately $4.4M as compared to $2.9M in 2014 and $1.4M in 2013 (a 79% compound annual growth rate over the three year period).

●   

Fourth quarter 2015 revenue was $1,182,800 versus $254,000 in 2014 and $190,000 in 2013.

●   

Gross margins continue to be strong at 67% in 2015 versus 60% in 2014 and 58% in 2013.

●   

Net income in fiscal 2015 was $140,976 versus losses in 2014 of ($1.2M) and ($1.7M) in 2013.

●   

Adjusted EBITDA in fiscal 2015 was $652,641, an increase of $1,116,890 versus 2014.

●   

Positive Adjusted EBITDA 7 of the last 8 quarters.

●   

Expenses in 2015 were approximately $2.4M, down approximately $300K versus 2014.

●   

significantly increasing revenue and cash flow;

●   

creating continued technology and brand awareness;

●   

working closely with key influencers to require temperature limiting technology for electric coil stoves as part of new industry standards that are expected to be introduced in 2016; and;

●   

reducing operating expenses while continuing to pursue opportunities to expand Pioneering's product offerings.

●   

growing awareness for Pioneering's products;

●   

the launch of two new products early in the year;

●   

new retail listings in both Canada and the US;

●   

the launch of a new ecommerce site; and

●   

securing new business to business distribution partnerships with some of North America's largest facility and multi-residential supply companies.

●   

Pioneering successfully commercialized two new products:

●   

SmartBurner, an easy to install consumer version of the Safe-T-element is having success in both the retail and business to business channels;

●   

RangeMinder, which helps prevent unattended cooking on gas and ceramic stovetops, is designed specifically for the consumer market.

●   

SmartBurner is now available to the general public through Home Hardware stores in Canada (approximately 1,400 stores). While Pioneering is pursuing new retail listings for SmartBurner and its other products, it has prioritized new and existing B2B multi-residential housing, institution and facility channel opportunities for the SmartBurner and Safe-T-sensor products as it believes that these channels are presently the most promising areas for increasing revenue and profit.

●   

In October 2015, Pioneering announced that Home Depot in the U.S. would begin making SmartBurner available to U.S. consumers through homedepot.com. This gives Pioneering access to the U.S. consumer market at a time when the U.S. Fire Service (Vision 20/20) is now emphasizing cooking fire safety in communities throughout the United States and needed a U.S. retail outlet to which it could direct consumers to purchase SmartBurner. This U.S. fire prevention initiative is expected to play a key role in fiscal 2016 and beyond in creating awareness in the consumer market for both the stovetop cooking fire problem and Pioneering's solution.

●   

RangeMinder is currently only available online. Pioneering plans to begin actively promoting it to consumers once its resources permit.

●   

Pioneering continued to work on large energy efficiency projects with industry heavyweights Johnson Controls and Siemens in the United States. These organizations continue to include the Safe-T-element as a key component of their overall energy efficiency contracts, both individually and in conjunction with the Department of Housing and Urban Development. In affordable housing channels Safe-T-element is a proven and preferred solution for energy performance contractors

●   

Pioneering opened up new channels for its products including private rental property management companies, REITs, hotels/motels, office towers and hospitals/medical facilities. Previous barriers to entry in some of these markets which existed for Safe-T-element (such as professional installation/cost and maintenance) no longer exist with SmartBurner, which is driving channel expansion and revenue growth.

●   

Pioneering signed vendor and distribution agreements with some of the largest B2B multi-residential, facility and institutional supply distributors in North America:

●   

STAPLES Advantage, a division of Staples Inc. and one of the largest facility suppliers in North America, listed and began to distribute the SmartBurner and Safe-T-sensor products in the U.S. Over the past several months Pioneering has trained over 200 sales representatives and Pioneering is now beginning to see significant sales activity in new and existing channels.

●   

HD Supply Canada began selling the SmartBurner product to their B2B customers throughout Canada. Success to date in Canada has resulted in HD Supply U.S. now selling the product to its customers in the United States. HD Supply was previously Home Depot's commercial supply division. It was acquired by a private equity company a number of years ago and continues to be one of the largest maintenance and facility supply companies in North America.

●   

In addition, large existing wholesale appliance supply partners (ALMO, The Brick Commercial, Leon's/Appliance Canada and others) who currently sell Safe-T-element to the multi-residential channel either as an aftermarket installation or preinstalled on new ranges will benefit from the addition of the SmartBurner to their overall offering. Pioneering believes this will help drive future growth.

●   

As a result of these developments Pioneering began making a strategic shift in 2015 away from a primarily direct sales model to a more comprehensive distributor/sales model. With the addition of distribution/sales partners Staples and HD Supply Canada, Pioneering now has hundreds of sales people selling its products into new and existing business to business channels. Pioneering expects this new business model will allow it to (i) drive substantial growth, (ii) avoid adding additional sales force related expenses, and (iii) focus on developing new and improved product solutions for the cooking fire problem and other related business building opportunities.

●   

A cooking fire prevention study commissioned by Vision 20/20 (funded by the Department of Homeland Security and the Federal Emergency Management Agency) was completed by Eastern Kentucky University's Fire & Safety Laboratory. The results of the study identified Pioneering's Safe-T-element and its temperature limiting control technology as the only technology tested that prevented stovetop cooking fires. The results of this study helped in part contribute to the pending industry and UL standard changes described below.

●   

The Association of Home Appliance Manufacturers , the Washington, D.C. based trade association representing the vast majority of kitchen range and cook top manufacturers, announced a plan to reduce unattended cooking fires, recognizing that recent technical advances related to electric coil ranges exist that will enable companies to mitigate the potential for unattended cooking fires. Changes to the UL standard for the manufacturing of all electric coiled stoves are expected to be introduced in early 2016. Pioneering's Safe-T-element and SmartBurner products with their temperature limiting control sensor technology are the only products available today that prevent stovetop cooking fires and should benefit from this change to the industry standard.