REDHAWK ANNOUNCES FIRST
HALF FISCAL
2020 FINANCIAL
RESULTS
Recent Investments Support National Awareness Campaign and
Broaden Distribution
LAFAYETTE,
LA -- February 19,
2020 -- InvestorsHub NewsWire
-- RedHawk
Holdings Corp.
(OTC:
SNDD) ("RedHawk" or the "Company")
a
diversified holding company engaged in sales and
distribution
of medical devices, branded generic pharmaceutical
drugs, commercial
real estate investment and leasing, point
of entry full-body
security
systems, and
specialized financial services, announced today financial
results for
the three and six month periods of fiscal
2020,
ended December 31,
2019.
During the
six
month period ended December 31, 2019, RedHawk focused on identifying target customer
markets, building brand awareness
and
developing sub-contractor supply
chains.
During this six
month period, RedHawk made substantial financial investments it believed were necessary to build premier B2B and B2C platforms. These investments
included approximately $180,000 of start-up costs needed to implement new marketing strategies, develop new advertising and public relations
campaigns, and create new social media
and
sub-contractor
supply chain
platforms; start-up costs
totaling
approximately
$168,000 for new advisory fees and related non-recurring legal
fees;
approximately
$58,000 of engineering research and
development
costs
for
the
re-design of
the SANDD Pro™; and, approximately
$43,000 of introductory
sales
discounts offered to school systems
and law
enforcement agencies
in Texas,
Louisiana and
California.
Including
these start-up
costs,
research and development costs and introductory sales
discounts, RedHawk reported a net loss
from operations of approximately $604,000 on gross revenues of
approximately $112,000 for the six month period
ended
December 31, 2019. Gross profit margins remain
strong at approximately
80%, exclusive of
initial
introductory
discounts,
which will
gradually become unnecessary. This compares to
a
net
loss
from
operations of approximately $321,000
on gross revenues of approximately $96,000
for the same six
month period
ended December 31, 2018.
For the
second
quarter ended
December
31, 2019,
RedHawk reported a net loss from
operations of approximately $409,000
on gross revenues of approximately
$47,000. The net loss from operations
included approximately $75,000 of new advisory
and
consulting fees; approximately $95,000 of new marketing, advertising, social media
and
operating
costs; approximately
$35,000 of engineering research and
development
costs; and approximately
$28,000 of introductory
sales
discounts offered to school systems
and law enforcement
agencies in Texas, Louisiana and California.
This compares
to a
net
loss
from
operations of approximately
$213,000 on gross revenues of
approximately $48,000 for the same
three
month period ended
December 31, 2018.
Commenting
on the December 31, 2019 financial results, G. Darcy Klug,
RedHawk's Chairman and
Interim
Chief Executive
Officer,
said, "The results for the three and six month periods ended
December 31, 2019 are a reflection of the investment costs we believe were necessary to
implement
a
premier
B2B and
B2C multi-channel/multi-market
marketing strategy, develop a reliable supply chain
for
both
our
domestic and
international
suppliers and engage the administrative
support
team we believe is needed to execute on our business plan
to create national brand awareness
for
our
SANDD™ line of
products. These investment costs come at
a price. During the three and six month period ended December 31,
2019 we've invested into:
- Stellar endorsement agreements including:
- Dr. Drew
Pinsky
(commonly
known as
'Dr.
Drew"), National
Spokesperson
- Derek Theler,
American-born actor,
Juvenile
Diabetes Spokesperson
- Investor relations campaigns though PCG
Advisory,
Inc.
- Public relations and
advertising campaigns through
Valerie Allen
PR;
- Website development through Brand Partners Digital
Agency;
- Social media platform visibility - Facebook, Instagram,
Twitter and
LinkedIn;
- Paid search engine optimization
through
Singer Marketing
Solutions Inc.;
- Product placement television market exposure
through
Tandem Media
LLC.
We
are
beginning
to see positive results from
this
execution of our strategic
plan
to create national
brand awareness for SANDD™. We have now received initial trial orders from a number of law
enforcement
agencies around the country.
While there
is
no assurance
these
will result
in actual
orders, we have received expressions of interest
for the
possible
purchase of
both the
SANDD mini – FR™ needle incineration devices
and
the
newly designed
SANDD Pro™ needle incineration devices from various law enforcement agencies in Louisiana, Texas, California, Michigan,
Minnesota, Oregon and Alabama.
Expressions of
interest received from school
districts have also been encouraging.
While there
is
no
assurance
these
will result in
actual orders, we have received expressions of interest for
the possible purchase of the
SANDD mini – HP™ needle incineration
devices from schools in Texas, Louisiana,
Mississippi and California.
The list price of both the SANDD mini – FR™ and the SANDD mini –
HP™, with AC/DC power connections is $249.99. The list price for
the SANDD Pro™ is $449.99. Over time, we believe that the B2B
introductory discounts will gradually become unnecessary.
To
broaden the geographic and B2B reach of our five (5) dedicated
independent sales representatives
now
operating in Louisiana, Texas, Nevada and the Gulf
Coast, we recently partnered with
CKRX, a
Louisiana-based sales
organization. CKRX has eight (8) marketing representatives
located
in New York, New
Jersey, Connecticut, Massachusetts, Florida and
Utah,
who
market a variety of value savings programs
to
hospitals,
physicians,
pharmacies and clinics including a free point of sale discount on
both branded and generic prescriptions to an estimated
75,000
pharmacies. We believe further geographic expansion is
possible through our partnership with
CKRX," concluded Mr. Klug.
# # #
About RedHawk Holdings Corp.
RedHawk Holdings Corp.,
formerly Independence Energy Corp., is a diversified
holding company which, through its
subsidiaries, is engaged in the sales
and distribution of medical
devices, sales of
branded generic pharmaceutical
drugs, commercial real estate
investment and leasing,
sales of point of entry full-body security
systems, and specialized
financial services.
Through its medical products
business unit, the Company
sells the Sharps
and Needle Destruction
Device (SANDD™),
WoundClot Surgical - Advanced
Bleeding Control, and
the Carotid Artery Digital
Non-Contact Thermometer. Through our United
Kingdom based subsidiary,
we manufacture and market branded
generic pharmaceuticals.
RedHawk Energy holds
the exclusive U.S. manufacturing and
distribution rights for the Centri
Controlled Entry System, a unique,
closed cabinet, nominal dose transmission
full-body x-ray
scanner. http://www.redhawkholdingscorp.com
Cautionary Statement Regarding
Forward-Looking
Statements
This release may contain forward-looking
statements. Forward-looking statements are
all statements other than
statements of historical fact. Statements contained in
this release that are not
historical facts may be deemed
to be
forward-looking
statements. The words "anticipate," "may,"
"can," "plans," "believes," "estimates,"
"expects," "projects," "targets,"
"intends," "likely," "will," "should," "to
be," "potential" and any similar
expressions are intended to identify
those
assertions as
forward-looking
statements.
Investors are cautioned that forward-looking
statements are inherently uncertain. Actual
performance and results may differ
materially from that projected or
suggested herein due to
certain risks and uncertainties.
In evaluating
forward-looking statements, you should
consider the various factors which may cause
actual results to differ materially
from any forward-looking statements
including those listed in the "Risk
Factors" section of our latest 10-K
report. Further,
the Company may
make changes to its business plans that could or will
affect its results. Investors are
cautioned that the Company
will undertake no obligation to update any
forward-looking statements.
Company
Contact:
G. Darcy
Klug, Chairman,
CEO and CFO
(337)
269-5933
darcy.klug@redhawkholdingscorp.com
Investor
Relations:
Stephanie
Prince, Managing Director
PCG Advisory
(646) 762-4518
sprince@pcgadvisory.com
Media
Contact:
Valerie
Allen
Valerie Allen
Public Relations
(310)
382-7800
valerie@valerieallenpr.com
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