Hispanica Announces First Quarter 2018 Results

NEW YORK, New York, Oct. 17, 2017 (GLOBE NEWSWIRE) -- Company Achieves Record Revenues of Over One Million in Sales for the First Quarter

/EIN News/ -- Hispanica International, Inc. (OTCQB: HISP) a brand accelerator company focused on proprietary brands in the beverage and snack industry, today announced results for its 2018 fiscal first quarter ended August 31, 2017.

 First Quarter 2018 Financial Highlights:

  • HISP surpassed over $1M in revenues for its first quarter of fiscal 2018.
  • HISP attained a 60% revenue increase from the comparable quarter a year ago (Q1 2018 vs Q1 2017).
  • Operating losses decreased by almost 70%.
  • Proprietary brands generated nearly 30% of revenues (up from 17% from last year's comparable quarter).
  • HISP will continue to grow sales of its proprietary brands by increasing distribution, both directly through its DSD operations, as well through other distributors and directly to chain retailers.
  • Existing shareholders Shircoo Inc. and JH Brech, LLC, increased their positions by financing the next stage of development with a new funding round.
  • HISP has initiated the process to remove convertible debt from its balance sheet.

Fiscal 2018 first quarter net sales were $1.03 million up from $649,411 in the comparable quarter in 2017 and net losses were ($529,244), compared to ($1.03) million in 2017. Operating losses for the quarter were $145,000 compared to $249,000 in the year ago period. In addition, operating expenses decreased by $322,000 during the three months ended August 31, 2017 as compared to the three months ended August 31, 2016.

The acquisition of Energy Source Distributors, Inc. (ESD) in July 2016 allowed HISP to expand distribution. Sales through the ESD subsidiary  increased by $196,000 during the three months ended August 31, 2017 as compared to the three months ended August 31, 2016. Sales through the HISP channel increased by $191,000 during the three months ended August 31, 2017 from the comparable period a year ago.

"In the first quarter, we hit a major milestone, surpassing $1M in revenues in one quarter, while reducing operating losses by 70%," said Fernando Oswaldo Leonzo, Chairman and CEO of Hispanica. "The investments from existing shareholders enable us to move forward without convertible debt and focus on growing our brands while making key acquisitions. Looking ahead, we expect to improve sales execution in the second quarter while maintaining our focus on fiscal discipline. We remain committed to our goal of continued revenue growth from organic operations, Improving our product mix as well as growing Hispanica’s portfolio of accretive assets.”
Hispanica anticipates closing the acquisition of Giant Beverage Company, Inc. of New York City during the second quarter, subject to the satisfaction of certain closing conditions.

For more information, please read the 10-Q filed with the SEC on October 16, 2017.

Hispanica International, Inc.
Condensed Consolidated Balance Sheets
             
    August 31,     May 31,  
    2017     2017  
    (Unaudited)        
             
ASSETS
Current Assets:            
Cash and cash equivalents   $ 249,834     $ 217,598  
Accounts receivable     153,553       160,306  
Inventory     308,070       293,207  
Total current assets     711,457       671,111  
                 
Other Assets:                
Equipment, net of accumulated depreciation of $19,508 and $14,508 at August 31 and May 31, 2017, respectively     55,492       60,492  
Customer list, net of accumulated amortization of $43,750 and 35,625 at August 31 and May 31, 2017, respectively     331,250       339,375  
Security deposits     5,245       5,245  
    $ 1,103,444     $ 1,076,223  
                 
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities                
Lines of credit   $ 22,583     $ 11,413  
Loans payable - related party     20,000       -  
Loans payable, net of unamortized deferred financing costs of $60,169 and $100,322 at August 31 and May 31, 2017, respectively     163,922       278,865  
Note payable, net of unamortized deferred financing costs of $75,833 and $129,208 at August 31 and May 31, 2017, respectively     284,881       229,506  
Convertible notes payable, net of unamortized deferred financing costs of $54,634 and $246,213 at August 31 and May 31, 2017, respectively     748,365       556,787  
Accounts payable and accrued expenses     1,063,978       719,193  
Total Current Liabilities     2,303,729       1,795,764  
                 
Commitments and contingencies                
                 
Stockholders' Deficiency:                
Series A Preferred stock, $0.001 par value; 10,000,000 shares authorized, 1,200,000 shares issued and outstanding     1,200       1,200  
Common stock, $0.001 par value; 100,000,000 shares authorized, 19,283,170 and 18,717,922 shares issued and outstanding at August 31 and May 31, 2017, respectively     19,282       18,717  
Additional paid in capital     3,103,056       3,055,121  
Accumulated deficit     (4,323,823 )     (3,794,579 )
      (1,200,285 )     (719,541 )
    $ 1,103,444     $ 1,076,223  

The accompanying notes are an integral part of these condensed consolidated financial statements.

                                                                                                               

Hispanica International, Inc.
Condensed Consolidated Statements of Operations
(Unaudtied)
       
    For the three months ended August 31,  
    2017     2016  
             
Sales, net   $ 1,036,044     $ 649,411  
Cost of goods sold     818,526       501,257  
Gross profit     217,518       148,154  
                 
Expenses:                
Officers' compensation     9,493       3,750  
Salaries and benefits     128,363       63,340  
Repairs and maintenance     25,452       4,210  
Professional fees     91,731       259,712  
Consultancy - share based compensation     48,500       336,176  
Advertising and promotion     1,333       759  
Travel     18,929       24,971  
Rent     11,363       13,064  
Depreciation and amortization     13,125       10,000  
Other     63,440       17,772  
      411,729       733,754  
                 
Loss before other income and expenses     (194,211 )     (585,600 )
                 
Other income and expenses                
Interest and financing costs     (335,033 )     (441,659 )
                 
Net loss   $ (529,244 )   $ (1,027,259 )
                 
Basic and diluted loss per share   $ (0.03 )   $ (0.07 )
                 
Basic and diluted weighted average number of shares outstanding     18,925,515       13,710,632  

The accompanying notes are an integral part of these condensed consolidated financial statements.


Hispanica International, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
     

For the three months ended August 31,
 
    2017     2016  
 

 

Cash Flows From Operating Activities
           
Net loss   $ (529,244 )   $ (1,027,259 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Stock based compensation     48,500       656,676  
Depreciation and amortization     13,125       10,000  
Interest and financing costs     287,105       169,152  
Changes in operating assets and liabilities:                
(Increase) decrease in:                
Accounts receivable     6,753       (262,661 )
Inventory     (14,863 )     (237,186 )
Prepaid expenses and other current assets     -       14,740  
Increase (decrease) in:                
Accounts payable and accrued expenses     344,785       396,172  
Customer advances     -       (20,880 )
      156,161       (301,246 )
                 
Cash Flows From Investing Activities                
Equipment acquired     -       (75,000 )
Customer list acquired     -       (375,000 )
      -       (450,000 )
                 
Cash Flows From Financing Activities                
Repayment of note payable     -       (18,500 )
Proceeds from loans payable, net of financing costs     -       364,820  
Repayment of loans payable     (155,095 )     (49,450 )
Repayment of convertible notes payable     -       (14,082 )
Proceeds from lines of credit, net of financing costs     25,088       557,000  
Payment of line of credit     (13,918 )        
Proceeds from loan payable - related party     20,000       -  
      (123,925 )     839,788  
                 
Net Increase in Cash and Cash Equivalents     32,236       88,542  
                 
Cash and Cash Equivalents - beginning     217,598       27,241  
                 
Cash and Cash Equivalents - end   $ 249,834     $ 115,783  
                 
Supplemental Disclosures of Cash Flow Information                
Cash paid for:                
Interest   $ -     $ 36,374  
                 
Noncash investing and financing activities:                
Conversion of debt to common stock and additional paid in capital   $ -     $ 27,500  
                 
Common stock and warrants issued for financing costs   $ -     $ 350,000  

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About Hispanica International, Inc.

Hispanic International, Inc. (HISP) is a public company founded in 2013.  Formed as an ethnic food and beverage company, HISP has leveraged innovation to re-shift its focus into a brand accelerator with the goal of expanding beyond ethnic flavors.  The HISP accelerator backs beverage/snack companies, which it can acquire, by building a proprietary distribution platform to enhance its own brands and position for mass market entry.

Based in New York, HISP plans to continue investing in companies focused primarily in the beverage sector, while adding snacks to their portfolio over time.  HISP will continue to focus on ethnic flavors, as well as health and wellness-related products, consumer snacking, grocery and health trends.  HISP will continue to accelerate beverage and snack companies at different stages, from start-ups to established brands.

HISP is also committed in building long-term relationships with its consumers by offering superior, high quality products at competitive prices.  HISP is headquartered in New York and currently has distribution operations in the New York City Tri-State region, Washington DC metro area, as well as in Los Angeles and the Northern California region.

For more information on Hispanica International, Inc. please visit http://www.hispanicadelights.com

SAFE HARBOR STATEMENT

Forward-Looking Statements: This release contains statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of Hispanica International, Inc. its directors or its officers with respect to, among other things: (i) financing plans; (ii) trends affecting its financial condition or results of operations; (iii) growth strategy and operating strategy.  The words “may,” “would,” “will,” “expect,” “estimate,” “can,” “believe,” “potential” and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements including those relating to the Company’s financing being adequate for the Company to close acquisitions, decrease indebtedness, being able to place its products in the retail stores, to launch its growth and expansion plans among others, are not guarantees of future performance and involve risks and uncertainties, many of which are beyond Hispanica International, Inc.’s ability to control, and actual results may differ materially from those projected in the forward-looking statements as a result of various factors.  No information in this press release should be construed in any way whatsoever as an indication of Hispanica’s future revenues, financial performance or stock price.   More information about the potential factors that could affect the business and financial results is and will be included in Hispanica International, Inc.’s filings with the Securities and Exchange Commission at www.sec.gov.

Investors and Corporate Relations
Please Contact: corporaterelations@hidainc.com 
info@hida.com
1(866) 928-5070

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