875 South Industrial
• Parkway
• Heber
• Utah
• 84032
• USA
• www.diatect.com
Investor Contact: Frank N. Hawkins, Jr. or Julie Marshall · Hawk Associates Inc. · (305) 451-1888 · www.hawkassociates.com
Investor Contact: Frank N. Hawkins, Jr. or Julie Marshall · Hawk Associates Inc. · (305) 451-1888 · www.hawkassociates.com
Diatect Q2'08 Revenue up 51.6% to $633k. Six month revenueup 17% to $860k. Appoints Patrick Carr, a 30-year Sales and Marketing Executive as CEO.
Diatect believes its products have a clear advantage over the competition. The company says that Diatect ® and RESULTS brand of products are one the fastest-acting products in the market, requiring only minutes after application to see results. The products are odorless, safe for humans and other mammals, and leave no residual contamination. Diatect products are also versatile enough that they can be applied both in powder and liquid forms. Products are sold into the multi-billion dollar agriculture, commercial, industrial, organic food production and home and garden markets worldwide. The U.S. market for agricultural pesticides alone is estimated to exceed $320 billion.
Differentiators
NINE EPA-APPROVED LABELS
The company’s nine fully registered product labels from the U.S. Environmental Protection Agency grant federal clearance to manufacture, market and sell specified insect control products. EPA labels are difficult and expensive to obtain, but represent an invaluable asset for the marketing and sale of the products. Diatect believes its ability to obtain EPA labels is a validation of their product and a major competitive advantage for the company since they act as barriers for the entry into this market space.
The company’s product lines include:
1. DIATECT® V insect control for users requiring an organic certification. Controls all major pest problems without synthetic ingredients. State-certified for organic use in 30 states.
The Non-Toxic Technology
Diatect products are made from a combination of Pyrethrum and Diatomaceous Earth (DE), both officially labeled as less toxic than table salt. Pyrethrum, a lethal nerve irritant to insects refined from the African Daisy, paralyzes insects on contact. Once exposed to the natural environment, however, Pyretrhum decomposes into harmless by-products that do not accumulate in food, water, or soil.
DE, also known as Silicon Dioxide, is a nonpoisonous mineral derived from the dry beds of ancient freshwater lakes. It consists of sharp-edged microscopic blades and spikes that cut insects' skin and shells, damaging their watertight seal and thus dehydrating the animal. DE is EPA-labeled as Generally Recognized as Safe (GRAS) in food production, water and the environment, but the powder is lethal to insects. After Pyrethrum decomposes, DE persists, controlling possible future infestations.
Recent News
Diatect Q2’08 Revenue Increased By 51%
Diatect Appoints Patrick Carr As Chief Executive Officer
Chip Beck Signs Endorsement Deal With Diatect
Diatect Reports First Quarter 2008 Results
Diatect Appoints Dale Timothy White to Board of Directors
•Company requires infusions of capital to continue growth
•Competition by large, well-established and better-funded companies.
The Outlook Diatect has successfully completed a strategic restructuring and turn around, which involved a reevaluation and change to the company’s internal structure and a renewed sales effort. On January 2, 2008, Diatect filed all periodic and annual SEC financial reports required to bring the company to its current status with filings. This paves the way for Diatect to resume trading in the Over the Counter Bulletin Board, which the company expects will begin shortly.
As part of the restructuring, Diatect successfully cleared away old debts, recapitalized the company and began an aggressive push in new marketing activities and sales efforts. Diatect successfully settled litigation involving an involuntary Chapter 7 filing initiated by three note holders in June 2005. The three note holders have forgiven the notes and the interest associated with the notes, have returned stock that they held and made a contribution to the company’s legal costs. Diatect has also settled with other parties that had filed claims against the company. On September 2007, the company received notice of an SEC investigation. On February 2008 an initial ruling dismissed the SEC’s administrative proceedings.
For FY 2007, Diatect nearly doubled its year-overyear sales, up 95% from $1.03 mil. reported in FY’06 to $2 mil in FY’07. Gross profit for the year was $1.24 million, or 61.5% of sales, compared to a gross profit of $623,364 or 60.4% of sales for 2006. Loss from operations decreased 29.6% to $1.5 million in 2007 from $2.18 million in 2006. Net loss for FY 2007 was $1.16 million or $0.01 per diluted share, a 34.9% decrease from a net loss of $1.7 million or $0.01 pe diluted share in 2006.
Management believes that the financial data has demonstrated encouraging year over year growth in sales and improvement in Diatect's financial situation. Operational cost reduction is particularly of note. The increase in sales, management feels, points to Diatect's successful investments in its marketing and sales program. Diatect has outlined an ongoing initiatives to increase the presence of our RESULTS products in retail outlets and improve the distribution of the DIATECT® products domestically and internationally.
To improve corporate governance and prepare for a renewed marketing effort, Diatect has made a series of personnel appointments. Patrick Carr, a venteran marketer, was appointed CEO, and Robert Rudman took a CFO position, among other appointments to the board. Frank Sanchez has been appointed to The company has said that these are the beginnng of a series of strategic appointments to help Diatect assemble a board of advisors and qualified personnel to finish the restructuring and gear for growth.
For Q2'08, revenue was $633,934, an increase of 51.6% from $418,203 in the comparable quarter a year ago. Gross margin for the quarter was 79.6% and net loss was $704,622.
For the six months ended June 30, 2008, Diatect reported $1 mil. in sales, an increase of 17% from sales of $860,341 for the comparable period. Gross profit margin was 75.8%, and net loss was $1.4 mil. Management
CEO-
Patrick
Carr
President-
David
H.
Andrus
Chief Financial Officer-
Robert
Rudman
Director-
Francisco
Sanchez
Director-
Phil
Ellett
Director-
David
Carlile
Director-
Dale
Timothy "Tim"
White
