UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

Current Report Pursuant to Section 13 or 15(d) of

the Securities Act of 1934

Date of Report: February 11, 2009

(Date of earliest event reported)

 

 

OurPet’s Company

(Exact name of registrant as specified in its charter)

 

 

 

Colorado   000-31279   34-1480558

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(I.R.S. Employer

Identification Number)

1300 East Street, Fairport Harbor, OH 44077

(Address of principal executive offices including zip code)

440-354-6500

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02. Results of Operations and Financial Condition.

On February 11, 2009, the Company issued a press release and other financial information regarding its fourth quarter and year end results. The Press release and other financial information are attached hereto as Exhibit 99.

 

Item 9.01. Financial Statements and Exhibits.

 

  (d) Exhibits
  99 Company press release dated February 11, 2009 and other financial information

 

2


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: February 13, 2009   OurPet’s Company
  By:  

/s/ Steven Tsengas

    Steven Tsengas, President and
    Chief Executive Officer

 

3

EXHIBIT 99

 

LOGO

 

OurPet’s Company

1300 East Street

Fairport Harbor, OH 44077-5573, USA

(800) 565-2695 * Phone (440) 354-6500

Fax (440) 354-9129 * www.ourpets.com

FOR IMMEDIATE RELEASE

OurPet’s Company Reports 2008 Fourth-Quarter and Year-End Financial Results

• Record Fourth-Quarter and Year-End Sales

• 2008 Net Income Before Litigation Expense Up 61.1 Percent

• Company Announces 45 New Products at Global Pet Show

FAIRPORT HARBOR, OHIO—February 11, 2009—OurPet’s Company (OTC BB:OPCO), a growing designer, developer, producer and marketer of accessory and consumable pet products, today reported financial results for its fourth quarter and year ended December 31, 2008.

Revenues for the 2008 fourth quarter increased 15.7 percent to $3,161,243 from $2,731,273 for the same period a year ago. Gross margin, as a percent of sales for the 2008 fourth quarter, increased 0.8 percentage points to 26.8 percent from 26.0 percent in the 2007 fourth quarter. Income before litigation expense for the 2008 fourth quarter increased to $115,340, compared to $53,425 for the 2007 fourth quarter. Net income for the 2008 fourth quarter was $50,698, compared to a net loss of ($103,883) for the same period in 2007. Litigation expenses for the 2008 and 2007 fourth quarters were $64,642 and $157,308, respectively. Earnings, before interest, taxes, depreciation and amortization (EBITDA), for the 2008 fourth quarter, increased to $223,751, compared to $69,699 for the 2007 fourth quarter.

Revenues for 2008 increased 17.5 percent to $12,410,135 from $10,561,204 last year. For 2008, gross margin, as a percentage of sales increased 1.5 percentage points to 28.2 percent, compared to 26.7 percent for 2007. Income before litigation expenses for 2008 increased 61.1 percent to $594,785, compared to $369,267 for 2007. Net loss for 2008 was ($1,728,198), compared to net income of $186,886 for the same period in 2007. Litigation expenses for 2008 and 2007 were $2,322,983 and $182,381, respectively. EBITDA for 2008 decreased to ($1,054,486), compared to $827,935 for 2007.

Dr. Steven Tsengas, President and CEO, stated, “I am encouraged by our 2008 financial and operating results given the difficulties we faced throughout the year, as a result of the SmartScoop ® www.smartscoop.com litigation, higher raw material costs, inventory reductions by our customers and the downturn in the economy. The growth we experienced in sales and gross margins is a result of our dedicated employees, successful operating strategies, the innovation of our products, and growing consumer acceptance of our brands. For 2008, we added 125 new accounts, the most in the Company’s history – further enhancing our distribution.

“The positive decision by the International Trade Commission (“ITC”) in December 2008 vindicated the authenticity and innovation of OurPet’s SmartScoop Self-Cleaning Litter Box. We have submitted an appeal on the ITC’s decision that one of the eight patent claims in question did infringe on the Applica Incorporated patent and expect a decision by April 2009. Along with the appeal, we have proactively made a simple engineering change that eliminates the alleged


patent claim infringement. As a result of the positive decision by the ITC, we have filed a counterclaim against Applica and we are seeking (among other items) damages for the legal fees associated with defending against Applica’s lawsuits. For 2009, we are hopeful that our legal expenses will be significantly reduced, compared to 2008 levels.

“We are cautiously optimistic as we enter 2009 despite changing consumer preferences, poor retail conditions, and economic uncertainty. We will be attending the Global Pet Expo (“Global”), which will take place February 12-14 in Orlando, Florida. At Global, we will be introducing 45 new SKUs bringing OurPet’s total number of SKUs to over 400, compared to about 360 a year ago.

“Most importantly, we will be introducing our new Flappy ® www.flappydogtoys.com brand of dog toys, which will be on store shelves on May 1, 2009. We currently have a significant volume of firm orders for our Flappy products and are optimistic this brand will contribute meaningfully to 2009’s sales and earnings. In addition, we are relaunching our elevated dog feeders with new designs, brands, packaging and colors. This is the first time our elevated dog feeders have been updated since they were launched. We were very successful in 2008 with the relaunch and rebranding of our Play-N-Squeak ® www.playnsqueak.com brand and we will be launching 15 new Play-N-Squeak toys at Global.”

Dr. Tsengas concluded, “I am very pleased with the hard work, dedication, and innovation of OurPet’s employees, who have continually risen to the challenges we have faced and will continue to face in these difficult and uncertain economic times. We have developed a leading pet product company that is well positioned to grow and I am very optimistic about the future of the Company.”

About OurPet’s Company

OurPet's designs, produces and markets a broad line of innovative, high-quality accessory and consumable pet products in the U.S. and overseas. Investors and customers may visit www.ourpets.com for more information about the Company and its products.

Certain of the matters set forth in this press release are forward-looking and involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: business conditions and growth in the industry; general economic conditions; addition or loss of significant customers; the loss of key personnel; product development; competition; risks of doing business abroad; foreign government regulations; fluctuations in foreign rates; rising costs for raw materials and the unavailability of sources of supply; the timing of orders booked; and the other risks that are described from time to time in OurPet’s SEC reports.

 

CONTACT:       INVESTOR RELATIONS:
OurPet’s, Company    -or-    SM Berger & Company, Inc.
Dr. Steven Tsengas       Andrew Berger
(440) 354-6500 (Ext. 111)       (216) 464-6400

—Financial Results Follow—


OURPET'S COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

       For the Year Ended
December 31,
    For the Quarter Ended
December 31,
 
     2008     2007     2008     2007  

Net revenue

   $ 12,410,135     $ 10,561,204     $ 3,161,243     $ 2,731,273  

Cost of goods sold

     8,911,274       7,743,553       2,312,556       2,020,604  
                                

Gross profit on sales

     3,498,861       2,817,651       848,687       710,669  

Selling, general and administrative expenses

     (2,712,303 )     (2,283,585 )     (685,474 )     (614,128 )

Litigation expense

     (2,322,983 )     (182,381 )     (64,642 )     (157,308 )
                                

Income (loss) from operations

     (1,536,425 )     351,685       98,571       (60,767 )

Other income and expense—net

     1,577       4,941       765       2,871  

Interest expense

     (193,350 )     (169,740 )     (48,638 )     (45,987 )
                                

Net income (loss)

   $ (1,728,196 )   $ 186,886     $ 50,698     $ (103,883 )
                                

Basic and diluted earnings per common share after dividend requirements for Preferred Stock:

        

Net income

   $ (0.12 )   $ 0.01     $ —       $ —    
                                

Weighted average number of common and equivalent shares outstanding used to calculate basic and diluted earnings per share

     15,257,050       17,680,760       15,371,621       17,234,190  
                                


OURPET'S COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

 

       December 31,
       2008    2007

ASSETS

     

Cash and equivalents

   $ 363,573    $ 28,843

Receivables, net

     1,420,884      1,239,410

Inventories

     3,303,617      3,395,512

Prepaid expenses

     73,995      91,069
             

Total current assets

     5,162,069      4,754,834

Property and equipment, net

     2,076,550      2,309,529

Other

     339,367      337,967
             

Total assets

   $ 7,577,986    $ 7,402,330
             

LIABILITIES AND STOCKHOLDERS' EQUITY

     

Short-term borrowings and current maturities of long-term debt

   $ 2,044,581    $ 2,032,857

Accounts payable

     1,629,646      1,170,225

Accrued expenses

     290,732      122,813
             

Total current liabilities

     3,964,959      3,325,895

Long-term debt

     1,474,036      250,655

Stockholders’ Equity

     2,138,991      3,825,780
             

Total liabilities and stockholders’ equity

   $ 7,577,986    $ 7,402,330