MWW Automotive Reports Financial Results for Third Fiscal Quarter 2012
Reduces Operating Cost - Projects Return to Profitability by 2013
20 Aug, 2012, 09:30 ET
HOWELL, Mich., Aug. 20, 2012 /PRNewswire/ -- MWW Automotive Group (OTCQB: MWWC), a global design, engineering, and manufacturing firm serving some of the world's leading automotive and industrial manufacturers, today issued its financial report for the Third Fiscal Quarter 2012, ending on June 30, 2012. The full text of the Company's 10-Q Report can be reviewed on the Company's web site at www.mwwautomotive.com in the investor relations section, or at the SEC website www.sec.gov.
"As expected, our third quarter revenues for 2012 still do not appropriately reflect our current recovery mode status," states Michael Winzkowski, Chairman of Marketing Worldwide Corp. "As we have mentioned in our last press release, our team, led by our CEO Chuck Pinkerton, is meeting the recent changes in MWW's market and client roster head-on. Since the partial loss of our Toyota business, Chuck has made significant progress in securing new business, streamlining and expanding production, significantly reducing operating expenses throughout the Company and we have commenced with the production of several new automotive programs. Nevertheless, third quarter performance did not met our expectation yet, and at the end of the quarter we still had not reached the stage of revenue recovery that we had anticipated. On a month to month comparison though, we have seen good improvement of revenues in June and July over the two months before. We have been awarded several new projects in addition to our ongoing programs and believe that we now have a firmer grip on our new projects, expected revenues and the time lines involved. We expect our recovery and the associated financial performance improvement to take hold during the latter part of 2012 and beginning of 2013, with a return to profitability at the end of 2013, assuming sufficient and timely funding of current operations and start-up cost associated with newly awarded projects."
Chuck Pinkerton, CEO of MWW continues: "We are now in full production on the Mazda MX5, Ford Mustang and Ford F150 with revenues hitting in the first quarter of 2013 and are also in final pre-production for our industrial program. Unfortunately, our automotive and industrial partners' engineering and pre-production process and their commitment to producing only the highest quality products has been more complex and time consuming than initially anticipated by them. Consequently, this has delayed the original launch dates of several new automotive and industrial projects for MWW and distorted our First and Second Quarter financial results drastically. Once all awarded programs have commenced with production, we expect these programs to provide consistently increasing revenues for the months and years ahead. This should also allow us to avoid further constraining debt financing and reduce share dilution going forward. Consequently, and in combination with our radical cost down exercises, we should not only improve revenues, but also improve gross margins and return the Company to profitability towards the end of 2013.
"The entire MWW team is absolutely committed to making the rest of 2012 the beginning of the turn-around for MWW. We do expect that we will improve upon our second and third quarter performance beginning in the Fourth Quarter 2012 and the subsequent quarters ahead and to return to profitability during 2013."
Net revenues were $175,871 for the three months ended June 30, 2012. Our revenues decreased by $273,364 from the three months ended June 30, 2011. This decrease is attributable to the fact that some of the new programs that had already been awarded have been significantly delayed. We are re-focusing on our core business, have restructured certain divisions of the Company and accordingly had lower production output during this transitional period. The Company is now quoting again on numerous new paint projects and has commenced production with new programs for the 2012 and 2013 periods that are expected to provide continued revenue growth.
For the three months ended June 30, 2012, MWW's gross loss was $115,802 compared to gross profit of $78,766 for the three months ended June 30, 2011. MWW had significant "start-up" costs for new projects that have not been offset by revenues yet and did not recognize any profit from the re-evaluation of derivatives compared to the same period the year before. The primary components of cost of sales are direct labor and cost of parts and materials. The cost of parts and materials has been consistent from year to year.
Selling, general, and administrative expenses were $292,342 in 2012 compared to $359,580 during 2011. The decrease in costs is attributable to management's stringent efforts to reduce overhead costs throughout the Company. Management intends to keep costs low, so increasing product volume and revenue will result in improving profit margins and eventually net profits. Significant components of operating expenses consist of professional fees, salaries, and impairment losses.
Please review the full report on the Company's web site at www.mwwautomotive.com in the investor relations section, or at the SEC website www.sec.gov.
About MWW Automotive Group (MWW)
MWW is headquartered in Howell, Michigan, with a "Class A" painting-assembly-logistics facility in Baroda, Michigan for the production of high quality OE automotive and industrial products. The MWW Automotive Group (OTCQB: MWWC) delivers its accessory products via its "Class A" painting, assembly and logistics services directly to major global automobile manufacturers' Vehicle Processing Centers (VPC), Tier-1 Partners and/or assembly lines in the United States, Canada and Europe. MWW's industrial products are delivered directly to the manufacturers for installation in their facilities. Noted for its adherence to the highest quality standards and its advanced logistics capabilities, MWW products and services consistently meet and exceed customers' expectations and requirements. MWW provides substantial added value services for leading international automobile and industrial manufacturers such as Toyota, BMW, Chevrolet, Hyundai, Kia Motors, GM, Ford, ROUSH Performance, Deere and Whirlpool. For more information please visit www.mwwautomotive.com or e-mail [email protected].
Safe Harbor Statement: Certain statements in this press release that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use words such as "anticipate," "believe," "expect," "future," "may," "will," "would," "should," "plan," "projected," "intend," and similar expressions. Such forward-looking statements, involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. The Company's future operating results are dependent upon many factors, including but not limited to the Company's ability to: (i) obtain sufficient capital or a strategic business arrangement to fund its expansion plans; (ii) build the management and human resources and infrastructure necessary to support the growth of its business; (iii) competitive factors and developments beyond the Company's control; and (iv) other risk factors discussed in the Company's periodic filings with the Securities and Exchange Commission, which are available for review at www.sec.gov under "Search for Company Filings."
SOURCE MWW Automotive Group
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