April 25, 2016 – Toronto, Ontario – Delivra Corp. (TSXV: DVA – “Delivra” or the “Company”) is pleased to announce its financial results for the three and twelve months ended December 31, 2015.

Fiscal 2015 Developments

2015 was in many ways a foundational and transformational year for Delivra. The Company successfully executed on a range of strategic and operational initiatives across the breadth of its business, with a focus on short-term performance as well as building and positioning for continued growth and plan execution in 2016 and beyond. Significant areas of development included:

Sales, Distribution, and Branding:

  • nearly tripled revenues over 2014, based on growth in the Company’s flagship pain products
  • launched a national TV campaign focused on brand awareness and consumer education
  • entered and opened the Quebec market
  • successfully negotiated additional retailer listings to broaden distribution
  • climbed higher in category rankings
  • launched a new Canadian web store

Business Development

  • completed external consulting review of Delivra technology and preparation of strategic partnering matrix for targeting the pharma community on licensing opportunities
  • completed preliminary engagement of a select sample of pharma companies in regard to licensing opportunities, validating interest in the Delivra technology

Product Development

  • launched 100g “Value Size” Pain product with a selected vendor, then expanded to other vendors
  • successfully developed and achieved regulatory approval on US versions of flagship Pain and Nerve products
  • completed preliminary development and prepared regulatory filings for new OTC Sleep Cream
  • launched clinical trials on two OTC products
  • advanced pre-clinical work on two additional OTC products

Research & Development

  • continued development and expansion of the core transdermal delivery technology
  • broadened the range of natural and pharmaceutical molecules tested in analytical and pre-clinical environments
  • enhanced team and infrastructure
  • filed 8 provisional US patents

Operations

  • streamlined production, rationalized product mix and inventory
  • improved logistics efficiency and cost structure
  • modified form factors to reduce unit costs and increase production capacity

 Finance/Governance

  • enhanced quality and efficiency of accounting, reporting, and internal controls
  • raised over $4 million of additional capital
  • completed going-public transaction (“IPO”) on the TSX Venture Exchange
  • bolstered Board strength with the addition of three new directors, two in 2015 and one recently in 2016

“We are proud of the progress we made in 2015, across all aspects of the company, in terms of driving short-term growth while at the same time bolstering and solidifying our foundation for US market entry, pharma licensing, and long-term value creation through 2016 and beyond,” said Chris Schnarr, President of Delivra.  “We are blessed with an exceptional team and an exceptional technology, and we are excited to continue our work in realizing upon the abundant opportunity that lies before us.”

Results of Operations

Revenues

Revenue for the fourth quarter was up 271% against the prior comparable period, at $823,023 versus $221,723 in Q4 2014. Revenues for the year were $2,894,293, versus $1,052,629 in 2014, up 175%. The most significant growth driver was increased sales of the Company’s flagship Pain products, followed by increased sales of its Nerve Pain product. This growth was primarily driven by increased marketing and advertising expenditures, particularly during the first and fourth quarters of the year.

Gross Profit

Gross Profit for the fourth quarter was up 477% against the prior comparable period, at $614,262 versus $106,543 in Q4 2014, as a result of increased revenues and gross margins (75% in Q4 2015 versus 48% in Q4 2014). Gross Profit for the year was up 173% against the comparable prior period, at $1,989,047 versus $728,119 in 2014. Gross margin for both years was steady at 69%. The Company targets long-term gross margins between 65% and 70% for its business.

Operating Expenses

Operating expenses for the quarter were $2,577,568, up from $582,351 in the comparative quarter. The increase is most significantly attributable to share-based compensation directly related to the RTO ($654,500) and RTO listing fees ($883,315) associated with the Company’s going public transaction. These are non-recurring expenses. Operating expenses for the year were $5,381,051, up from $1,974,102 in 2014. The noted increases in share-based compensation and RTO listing fees were a significant contributor to the increase in operating expenses. The other factor was the alignment of expenditures with the Company’s major strategic initiatives. Specifically, higher marketing and selling costs associated with successful growth and brand-building investments in Canada, and increased R&D expenses associated with the Company’s continued product development and push towards technology licensing opportunities. G&A expenses in the quarter and the year were held relatively flat, increasingly only marginally over the comparable period.

The following table presents a summary of the Company’s Operating Expenses for the past two fiscal years:

2015 2014
General and administrative  $   1,056,026  $      973,510
Research and development (gross)  $   1,164,160  $      460,466
Research and development (net)  $      412,834 -$       23,584
Selling and marketing  $   2,002,192  $      874,345
Share-based compensation  $   1,026,684  $      149,831
Reverse take-over listing fees  $      883,315  $              –

Net Loss

The Net loss and comprehensive loss for the year was $3,487,061 versus $1,289,275 in the prior year. On a per share basis, the net loss was $0.11 for the year, versus $0.05 in 2014. The Net loss and comprehensive loss for the quarter was $1,992,626 versus $486,359 in the comparative period. On a per share basis, the net loss was $0.06 for the quarter, versus $0.02 in the comparative quarter. The increased loss results from the various factors discussed above.

Working Capital and Liquidity

As at December 31, 2015, current assets were $5,360,247, including cash and cash equivalents of $3,136,247. Against current liabilities of $1,016,201, this resulted in net working capital of $4,344,046. This compares to current assets of $2,225,804 and net working capital of $1,892,663 at December 31, 2014. The improved working capital position at December 31, 2015 was largely driven by equity and debt capital raised and increased business volumes during the period which generated higher accounts receivable and inventory positions.

ABOUT DELIVRA CORP.

Delivra Corp. is a developer of transdermal technologies for the delivery of pharmaceutical and natural molecules through the skin, rather than via pills. Delivra manufactures and sells a growing line of natural topical creams under the LivReliefTM brand, for conditions such as joint and muscle pain, nerve pain, varicose veins, wound healing, and sports performance. LivReliefTM products are available in pharmacies, grocery chains, and independent health food stores across Canada, and on-line at www.livrelief.com. In parallel with its consumer products business, Delivra also has a mandate to license its unique, proven, and patent-pending delivery platform to global pharmaceutical companies for the transdermal delivery of third party active ingredients to treat a broad range of conditions. Delivra is headquartered in Burlington, Ontario and has a research and development laboratory in Charlottetown, PEI.

The TSX Venture Exchange has neither approved nor disapproved the contents of this press release. Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.

Certain information in this press release may constitute forward-looking information. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Corporation assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Corporation. Additional information identifying risks and uncertainties is contained in the Corporation’s filings with the Canadian securities regulators, which filings are available at www.sedar.com.

For more information, please contact:

Investor Relations:
Nicole Marchand
416-428-3533
ir@delivrainc.com

 
Delivra Corp.:
Chris Schnarr, President and CFO
905-639-7878
cschnarr@delivrainc.com