Totally Green Inc. (PINKSHEETS: TLGN) ("TG" or the "Company"), an
innovator in organic food waste processing and diversion, reported
results for the third quarter ended September 30, 2012.
Total revenue was $9,431 for the third quarter of 2012, compared
to $224,746 for third quarter in 2011. The decline in revenue is a
result of the shift from a "Unit Sales" model to a "Service as a
Solution" model, in which the Company's revenue is based on monthly
service fees and not sales.
Net loss was ($3,126,850) for the quarter. Of this loss,
($410,000) related to transaction closing costs related to the new
investment of $5,000,000 in the Company and ($2,255,439) relating
to the write-down of assets from discontinued operations and
marketing rights associated with non-core markets. The balance of
($461,411) is loss associated with other operating and ongoing
expenses of the Company.
Cash and cash equivalents totaled $1,456,850 at September 30,
2012. Total liabilities for the company are $227,130, which include
$160,900 relating to the purchase of equipment that has already
been installed on our customers' sites.
Q3 2012 Operational Highlights
During the quarter, the Company completed a transaction to
secure a $5 million equity investment and a $15 million equipment
finance line to support the growth of the business under its
previously announced Service as a Solution model. In conjunction
with the transaction, the Company has made changes to its
management team and board of directors. The equity injection was
used to pay down the Company's previous line of credit, cover
transaction costs and provide working capital to support the
expansion of the business.
The equity infusion and managerial changes were driven by a
refocusing of the strategy of the Company. Going forward, TG will
only offer the ORCA and its waste disposal services for a recurring
monthly fee on a contracted basis. This Service as a Solution model
is sold under long term agreements and includes the supply of our
proprietary organisms, maintenance and any repairs required to keep
the ORCA operational and ensure it is processing food waste at its
prescribed capacity.
The Company has also decided to suspend any allocation of
resources to its water bottle product at this time. As part of this
decision, the Company is negotiating the grant of an exclusive
license to the green bottle trademarks and any related intellectual
property. If this negotiation results in an agreement, the Company
will receive a royalty payment for all future sales of the green
bottle product while all expenses will be borne by the
licensee.
The Company's initial efforts have focused on the Toronto market
as we refine our processes to serve customers under the Service as
a Solution model before expanding across North America. The initial
results have been promising as we installed 13 units during the
third quarter. These unit installations are not yet generating
revenue as customers are still under the free service period
offered to allow them to experience the benefits of our service. We
are already receiving monthly service fees on 3 units that were
installed in the second quarter of 2012. Management anticipates
that all existing customers will begin paying their monthly service
fees during the fourth quarter of 2012. We believe these results
are promising given TG had 37 units in service throughout the
United States prior to the change in business model.
Management Commentary
"The Third Quarter of 2012 was highlighted by the equity
investment and shift to a Service as a Solution model for the ORCA.
The initial acceptance of our product in the Toronto market is
promising but considerable work remains to achieve our growth and
profit objectives," said Shawn Dym, CEO of Totally Green. "Our
service model has shown that we can create significant growth
potential with proper execution and focus."
"The Profit and Loss statement reflects the fact that we are in
the early stages of our business plan. We do not anticipate
profitability for some time as we continue to fund future expansion
into new markets. We have eliminated the Company's previous line of
credit and have sufficient cash on the balance sheet to fund the
execution of our business plan."
"All things considered, we are pleased with the transition to a
new operating model and hope to expand our service model in other
major centres in North America early in 2013."
About Totally Green Totally Green, Inc.
develops and markets the company's ORCA Green™ Machine. The ORCA
(Organic Refuse Conversion Alternative) machine allows for rapid
composting of most organic material in institutional and commercial
end-user applications, after which the liquid compost is disposed
of through the ordinary sewer system. The machine creates
meaningful cost savings for customers while diverting food waste
from landfills and reducing methane gas production. For more
information, please visit www.totallygreen.com.
Important Cautions Regarding Forward-Looking
Statements This press release contains "forward-looking
statements." Forward-looking statements are statements concerning
plans, objectives, goals, strategies, expectations, intentions,
projections, developments, future events, or performance,
underlying (expressed or implied) assumptions and other statements
that are other than historical facts. These forward-looking
statements are only predictions. No assurances can be given that
such predictions will prove correct. Actual events or results may
differ materially. Forward-looking statements should be read in
light of the cautionary statements and risks that include, but are
not limited to, the risks associated with a small company, our
comparatively limited financial resources, the uncertainty of
market trends, the competition faced from other current and future
technologies and the uncertainties of competitive pressures we
face. These or other risks could cause actual results to differ
materially from the future results indicated or implied in such
forward-looking statements. We undertake no obligation to update or
revise such statements.
TOTALLY GREEN INC.
BALANCE SHEETS
September December 31,
30, 2012 2011
Unaudited Unaudited
------------ ------------
ASSETS
CURRENT ASSETS
Cash & Cash Equivalents 1,431,849 99,816
Temporary Investments - Restricted 25,000 25,000
Trade Accounts Receivable, net 8,913 116,157
Accounts Receivable - Other -- 20,000
Prepaid Expenses -- 350,000
Inventory 54,301 222,824
------------ ------------
Total Current Assets 1,520,063 833,797
------------ ------------
PROPERTY & EQUIPMENT
Furniture and Fixtures -- 4,865
Machinery and Equipment 333,551 1,113,300
Accunulated Depreciation -- (1,071,138)
------------ ------------
Property and Equipment, net 333,551 47,027
------------ ------------
Intangible Assets, net -- 659,616
Prepaid Marketing Fees -- 1,050,050
Other Assets 22,459 13,527
Discontinued Operations - Assets -- 469,499
TOTAL ASSETS $ 1,876,073 $ 3,073,516
============ ============
September December 31,
30, 2012 2011
Unaudited Unaudited
------------ ------------
LIABILITIES AND EQUITY
Current Liabilities
Accounts Payable 198,496 219,511
Accrued Interest -- 76,928
Dividends Payable -- 128,000
Fees Payable -- 153,780
Other Liabilities 28,634 9,299
------------ ------------
Total Current Liabilities 227,130 587,518
------------ ------------
Fees Payable - Long-term -- 203,494
Related Party Line of Credit -- 1,850,000
------------ ------------
Total Liabilities 227,130 2,641,012
------------ ------------
EQUITY
Common Stock - $0.001 Par Value, 750,000,000
shares authorized 625,777,894 and
587,732,546 shares issued and outstanding 672,428 625,778
Preferred Stock:
Series A - $0.001 Par Value 1,900,000
shares authorized, issued and outstanding - 1,900
Series B - $0.001 Par Value 3,000 shares
authorized, issued and outstanding - 3
Series C - $0.001 Par Value 50,000 shares
authorized, issued and outstanding 50 --
Series E - $0.001 Par Value 12,000 shares
authorized, issued and outstanding 12 --
Series F - $0.001 Par Value 7,000 shares
authorized, issued and outstanding 7 --
Additional Paid in Capital:
Common Stock 5,549,104 4,715,373
Preferred Stock - Series A -- 55,100
Preferred Stock - Series B -- 1,149,997
Preferred Stock - Series C 4,499,950 --
Preferred Stock - Series E 573,052
Preferred Stock - Series F 191,017
Retained Earnings ( Deficit)
(9,836,677) (6,115,647)
------------ ------------
Total Equity 1,648,943 432,504
------------ ------------
TOTAL LIABILITIES and EQUITY $ 1,876,073 $ 3,073,516
============ ============
TOTALLY GREEN INC.
STATEMENT OF OPERATIONS
Jul - Sept Jul - Sept Jan - Sept Jan - Sept
2012 2011 2012 2011
---------- ---------- ---------- ----------
Net Sales 9,431 224,746 405,956 697,419
Cost of Goods Sold 169,100 128,192 400,610 364,502
---------- ---------- ---------- ----------
Gross Profit (159,669) 96,554 5,346 332,917
Operating Expenses
Selling, general and
administrative expenses 1,150,052 728,211 2,154,307 1,523,767
---------- ---------- ---------- ----------
Total Operating Expenses 1,150,052 728,211 2,154,307 1,523,767
---------- ---------- ---------- ----------
Operating Loss (1,309,721) (631,657) (2,148,961) (1,190,850)
---------- ---------- ---------- ----------
Other Incomes /(Expenses)
Other Income (523,505) 1,743 (357,749) 57,743
Loss on Investment (1,121,910) -- (1,121,910) --
Other Expenses (150,000) -- (150,000) --
Interest Expense (21,714) (3,415) (70,410) (10,216)
---------- ---------- ---------- ----------
Total Other Income /
(Expense) (1,817,129) (1,672) (1,700,069) 47,527
---------- ---------- ---------- ----------
Net Loss Attributable to
Common Stockholders (3,126,850) (633,329) (3,849,030) (1,143,323)
========== ========== ========== ==========
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Contact: Company Shawn Dym Chief Executive Officer
Totally Green, Inc. Tel 416-221-9066
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