OurPet’s Company created quite the stir this morning when
the company reported a triple-digit increase in quarterly net income on an
impressive hike in revenues. While the company primarily attributes the growth
to stronger domestic and international sales partnerships, one can’t ignore
innovation as a considerable catalyst.
In recent years, the nation’s overall $73 billion pet
products industry has enjoyed robust growth driven by increasing e-commerce
purchases and an uptick in dog and cat ownership. The market is currently
dominated by PetSmart, Inc. (NASDAQ: PETM) (nearly 39%), which tallied
full-year 2014 revenues of $1.9 billion, and Petco (roughly 19%), which is
looking raise about $800 million in an IPO in the relatively near future,
according to Bloomberg Business. The two leaders are also reportedly in
discussion for a merger, but there’s plenty of room for an innovative player
like OurPet’s.
When OurPet’s jumped into the pet specialty business nearly
20 years ago, there was an obvious lack in product innovation and new product
development. It’s within this void that the company initially focused its
sights and has continued to excel. In the last five years, OurPet’s used this
focus as an anchor during its transition from a small to a medium-sized company.
Today, OurPet’s has an intellectual property portfolio featuring more than 160
individual patents.
The overarching ongoing capitalization strategy is to
execute the aggressive development of innovative products to successfully push
through adverse market conditions to achieve increases in revenue, margins and
net income.
By maintaining an active new product development program
built on these patents, and a proven history of churning out and bringing to
market evolutionary and revolutionary products, OurPet’s enjoys global sales
via specialty retailers, food, drug and mass chains, and e-commerce and
international channels. A look at the company’s third-quarter results
demonstrates the efficiency of this model.
OurPet’s this morning reported record third-quarter revenue
of $5.99 million, an increase of 7% from $5.60 million in revenues for the
comparable three months of 2014. Net income for the third quarter increased
428% to $410,450, or $0.02 diluted earnings per share, compared to $77,751, or
$0.00, for the year prior.
For comparison, in March, PetSmart reported a 6.0% increase
in fourth quarter 2015 sales and an increase of 8.7% increase non-GAAP net
income over the prior year.
Commenting on its impressive quarterly performance and
innovation behind the growth, Dr. Steven Tsengas, OurPet’s president and CEO,
stated, “We are pleased with our results for the third quarter in which we
achieved record net revenue, gross margins improving to 34%, and net income
from operations of almost 11% of sales. We continue to see strong sales growth
in the Pet Specialty channel driven by our cat toys and bowls/feeder lines.
E-commerce sales rebounded and grew 7% while the Food, Drug, Mass channel
slightly decreased; however, we anticipate improved sales as the conversion to
the Pet Zone brand is completed by year end… With the recent and anticipated
introduction of a significant number of new innovative products in all our
product categories, we are experiencing robust sales activity. Our Catty
Whack™, winner of the SuperZoo ‘Best New Cat Product’ award, is beginning to
ship and is receiving strong consumer reaction. We expect to release more
information on other major, trend-setting products over the next six months.”
In its news release this morning, OurPet’s alluded
confidence in its ability to maintain growth momentum moving forward. The
company continues to dig its heels into the innovation-thirsty pet industry to
capture its fair share of the market and deliver new products poised to take
the industry by storm.
For more information visit www.ourpets.com
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