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Dogness Reports Fiscal Year 2021 Financial Results
  • Revenue Increases 26.9% YoY to $24.3 Million 
  • 81.4% YoY Increase in Sales of Intelligent Pet Products
  • Gross Margin Expands 282.8% YoY to $9.1 Million, with Gross Margin of 33.1% Compared to 9.0% a Year Ago
  • Comprehensive Income Increases to $6.2 million from a Loss of $10.3 million a Year Ago
  • EPS Grows to $0.05 per Basic and Diluted Share from a Loss of $0.33 per Basic and Diluted Share a Year Ago

DONGGUAN, China, Oct. 29, 2021 /PRNewswire/ -- Dogness (International) Corporation ("Dogness" or the "Company") (NASDAQ: DOGZ), a developer and manufacturer of a comprehensive line of Dogness-branded, OEM and private label pet products, today announced its unaudited financial results for the fiscal year ended June 30, 2021.

Silong Chen, Chairman and Chief Executive Officer of Dogness, commented, "We are pleased with our continued strong growth but know it would have been even stronger if not dampened by the ongoing global logistics crisis.  We simply cannot get products fast enough to sell.  With that said, we were still able to drive strong growth with a 26.9% increase in revenue for fiscal year 2021 compared to fiscal year 2020. We are even more pleased with our expansion in gross margin and profitability. The quality of our revenue also improved, with a nearly 163% increase in sales volume for our intelligent pet products in fiscal year 2021 compared to fiscal year 2020. We have been prioritizing this important long-term growth opportunity and strategically shifted our resources to produce and promote the sales of higher margin intelligent pet products across our integrated Smart Pet Ecosystem, which includes innovative App-controlled pet feeders, pet water fountains, and smart pet toys."

"We have been working to mitigate the impact of COVID-19 and the supply chain shortages by expanding our sales through popular large retail and online shopping platforms. At the same time, we continue to upgrade our production lines to improve production efficiencies and lower costs. As a result, we were able to reduce our selling price for traditional pet products to help our customers, while still maintaining a healthy profit margin. Overall, our strategy and expanded product lines have been well received by customers worldwide, as reflected in the double-digit growth we achieved in our international sales and the momentum for our intelligent pet products. We are optimistic in our outlook and will continue to execute as we drive revenue and profit growth to build value for shareholders."

Financial Results for the Fiscal Year Ended June 30, 2021

Revenue for the fiscal year ended June 30, 2021 increased 26.9% to $24.3 million from $19.2 million in the fiscal year ended June 30, 2020. The increase in revenue was primarily attributable to an 81.4% expansion in sales of Dogness' intelligent pet products, which are benefitting from high demand and a higher average selling price than the Company's traditional pet products.  Dogness has built an integrated sales platform across all channels, with major customers including Anyi Trading, Petco, Trendspark, PetSmart, Pet Value, Walmart, Target, IKEA, SimplyShe, Pets at Home, PETZL, and Petmate, and online shopping platforms, such as Amazon, Chewy.com, Boqii, Target.com, HomeDepot.com, Loews.com, Wayfair.com, JD, Tmall and Taobao, as well as live streaming sales platforms hosted by influencers.

During the fiscal year ended June 30, 2021, Dogness' total sales in international markets increased by approximately $1.2 million or approximately 13% from $10.6 million in fiscal 2020 to approximately $10.6 million in fiscal year 2021.

Cost of revenues decreased by approximately $1.6 million, or 9.6%, from approximately $16.8 million in fiscal 2020 to approximately $15.2 million in fiscal 2021. As a percentage of revenues, the cost of goods sold decreased by approximately 25.1 percentage points to 62.4% in fiscal 2021 from 87.5% in fiscal 2020. This was mainly because the Company continues to upgrade its production lines for both traditional and intelligent pet products to improve the productivity and lower the production costs.

Gross profit increased by approximately $6.8 million or 282.8%, to approximately $9.2 million in fiscal 2021 from approximately $2.4 million in fiscal 2020 primarily because the Company continues to upgrade its production lines for both traditional and intelligent pet products, which led to the improved productivity and lower the production costs. Overall gross profit margin was 37.6%, an increase of 25.1 percentage points, for the year ended June 30, 2021 as compared to 12.5% for the year ended June 30, 2020.

Comprehensive income was approximately $6.2 million or $0.05 per basic and diluted share for the fiscal year ended June 30, 2021, compared to a loss of $10.3 million or a loss of $0.33 per basic and diluted share for the fiscal year ended June 30, 2020.

The Company had a $5.5 million balance of cash and short-term investments as of June 30, 2021. This does not include approximately $4 million in gross proceeds from the Company's offering with institutional investors, which closed on July 19, 2021.

About Dogness

Dogness (International) Corporation was founded in 2003 from the belief that dogs and cats are important, well-loved family members. Through its smart products, hygiene products, health and wellness products, and leash products, Dogness' technology simplifies pet lifestyles and enhances the relationship between pets and pet caregivers. The Company ensures industry-leading quality through its fully integrated vertical supply chain and world-class research and development capabilities, which has resulted in over 200 patents and patents pending. Dogness products reach families worldwide through global chain stores and distributors. For more information, please visit: ir.dogness.com.  

Forward Looking Statements

No statement made in this press release should be interpreted as an offer to purchase or sell any security. Such an offer can only be made in accordance with the Securities Act of 1933, as amended, and applicable state securities laws. Certain statements in this press release concerning our future growth prospects are forward-looking statements regarding our future business expectations intended to qualify for the "safe harbor" under the Private Securities Litigation Reform Act of 1995, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding lingering effects of the Covid-19 pandemic on our customers' businesses and end purchasers' disposable income, our ability to raise capital on any particular terms, fulfillment of customer orders, fluctuations in earnings, fluctuations in foreign exchange rates, our ability to manage growth, our ability to realize revenue from expanded operation and acquired assets in China and the U.S., our ability to attract and retain highly skilled professionals, client concentration, industry segment concentration, reduced demand for technology in our key focus areas, our ability to successfully complete and integrate potential acquisitions, and unauthorized use of our intellectual property and general economic conditions affecting our industry. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings. These filings are available at www.sec.gov. Dogness may, from time to time, make additional written and oral forward-looking statements, including statements contained in the Company's filings with the Securities and Exchange Commission and our reports to shareholders. In addition, please note that any forward-looking statements contained herein are based on assumptions that we believe to be reasonable as of the date of this press release. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company unless it is required by law.

 

 

 

DOGNESS (INTERNATIONAL) CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)






2021



2020



2019




For the Years Ended June 30,




2021



2020



2019












Revenues- third party customers


$

23,112,435



$

18,261,707



$

25,887,948


Revenues – related parties



1,207,686




909,651




328,567


Total Revenues



24,320,121




19,171,358




26,216,515















Cost of revenues – third party customers



(14,501,166)




(16,146,856)




(16,583,904)


Cost of revenues – related parties



(663,742)




(633,132)




(202,606)


Total cost of revenues



(15,164,908)




(16,779,988)




(16,786,510)


Gross Profit



9,155,213




2,391,370




9,430,005















Operating expenses:













Selling expenses



1,815,771




2,336,229




2,101,403


General and administrative expenses



4,941,036




5,746,812




6,015,901


Research and development expenses



540,613




1,528,062




673,131


Loss from disposal of fixed assets



-




1,036,304




-


Impairment of fixed assets



-




281,680




-


Impairment loss of investment in equity investees



-




177,750




-


Total operating expenses



7,297,420




11,106,837




8,790,435















Income (loss) from operations



1,857,793




(8,715,467)




639,570















Other income (expenses):













Interest income (expense), net



(264,408)




15,560




616,878


Foreign exchange transaction gain (loss)



(228,260)




214,171




503,528


Other income (expenses), net



215,233




23,937




23,498


Rental income from related parties



354,968




89,411




-


Gain from disposition of a subsidiary



5,162




-




-


Total other income (expense)



82,695




343,079




1,143,904















Income (loss) before income taxes



1,940,488




(8,372,388)




1,783,474


Provision for income taxes



641,460




164,537




380,296


Net income (loss)



1,299,028




(8,536,925)




1,403,178


Less: net loss attributable to noncontrolling interest



(213,336)




(95,366)




(18,603)


Net income (loss) attributable to Dogness (International)
Corporation



1,512,364




(8,441,559)




1,421,781















Other comprehensive income (loss):













Foreign currency translation income (loss)



4,879,315




(1,896,934)




(2,010,170)


Comprehensive income (loss)



6,178,343




(10,433,859)




(606,992)


Less: comprehensive loss attributable to noncontrolling interest



(161,701)




(98,635)




(19,224)


Comprehensive income (loss) attributable to Dogness
(International) Corporation


$

6,340,044



$

(10,335,224)



$

(587,768)















Income (loss) earnings Per share













Basic


$

0.05



$

(0.33)



$

0.05


Diluted


$

0.05



$

(0.33)



$

0.05















Weighted Average Shares Outstanding













Basic



27,499,367




25,913,631




25,913,631


Diluted



27,554,811




25,913,631




25,941,606


  

 

 

DOGNESS (INTERNATIONAL) CORPORATION

CONSOLIDATED BALANCE SHEETS






2021



2020




As of June 30,




2021



2020


ASSETS







CURRENT ASSETS









Cash


$

4,912,442



$

1,266,873


Restricted cash 



23,312




-


Short-term investments



549,895




3,551,968


Accounts receivable from third-party customers, net



2,367,326




1,916,840


Accounts receivable – related parties



515,193




559,465


Inventories, net



4,203,163




2,860,700


Due from related parties



32,528




-


Prepayments and other current assets



1,662,272




1,471,612


Total current assets



14,266,131




11,627,458











Property, plant and equipment, net



69,876,039




43,533,512


Right-of-use lease assets



5,170,395




5,123,898


Intangible assets, net



2,223,285




2,104,803


Long-term investments in equity investees



1,703,900




1,046,360


Deferred tax assets



605,658




115,230


TOTAL ASSETS


$

93,845,408



$

63,551,261











LIABILITIES AND EQUITY









CURRENT LIABILITIES









Short-term bank loans


$

704,446



$

5,142,000


Current portion of long-term loan



796,416




-


Accounts payable



847,151




705,223


Accounts payable – related parties



350,199




305,215


Due to a related party



2,001,940




25,462


Advance from customers



209,508




152,299


Taxes payable



4,443,192




2,814,411


Accrued liabilities and other payable



11,737,680




1,452,408


Operating lease liabilities, current



171,803




172,716


Total current liabilities



21,262,335




10,769,734











Long term bank loan



6,557,608




73,300


Operating lease liabilities, non-current



1,123,060




1,200,299


TOTAL LIABILITIES



28,943,003




12,043,333











Commitments



-




-











EQUITY









Common stock, $0.002 par value, 100,0000,000 shares authorized,
29,624,814 and 25,913,631 issued and outstanding as of June 30,
2021 and 2020, respectively









Class A Common stock



41,111




33,689


Class B Common stock



18,138




18,138


Common stock









Additional paid-in capital



60,355,278




53,221,610


Statutory reserve



291,443




191,716


Retained earnings



4,628,708




3,216,071


Accumulated other comprehensive loss



(960,285)




(5,787,965)


Total Dogness (International) Corporation stockholders' equity



64,374,393




50,893,259











Noncontrolling interest



528,012




614,669


Total equity



64,902,405




51,507,928











TOTAL LIABILITIES AND EQUITY


$

93,845,408



$

63,551,261


 

 

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SOURCE Dogness International Corporation

David Pasquale, Global IR Partners, New York Office Phone: +1-914-337-8801, DOGZ@globalirpartners.com