SIOUX FALLS, SD -- (Marketwired) -- 05/27/14 -- Verity Corp (OTCQB: VRTY) (BERLIN: A2Q) (http://www.veritycorp.com), a vertically integrated sustainable agriculture company incorporating natural production technologies and non-GMO standards for the efficient production of healthy food, filed its 10-Q for the second quarter ended March 31, 2014.
Consolidated revenues were $366,598 and $690,897 for the three and six months ended March 31, 2014, as compared to $586,665 and $682,786 for the three and six months ended March 31, 2013. Revenues for the second quarter were down 37.5% during the quarter ended March 31, 2014 as compared to the quarter ended March 31, 2013 and were up 1% as compared to the six months ended March 31, 2013. The Company's gross profit margin increased from 32% of revenues to 56% of revenues during the quarter ended March 31, 2014 and increased from 40% to 54% for the six months ended March 31, 2014. The increase in gross margin is directly related to a concentration of higher margin items being sold during the year and lower margin items being eliminated in 2014.
Operating Expenses decreased $381,286 or 52% during the three months ended March 31, 2014 as compared to the three months ended March 31, 2013 and $172,775 or 16% for the six months ended March 31, 2014 as compared to the six months ended March 31, 2013. Verity was able to reduce consultant and management fees during the six months ended March 31, 2014.
Loss from operations for the three months ended March 31, 2014 was $143,916 as compared to $541,292 for the three months ended March 31, 2013 and was $532,964 for the 6 months ended March 31, 2014 as compared to $804,681 for the six months ended March 31, 2013. Verity is concentrating on increasing revenues at a profitable margin to cover operating expenses in the future.
On May 16, 2014, Verity terminated two contracts for deed that related to land and buildings in South Dakota and Georgia. The terminations removed $2,900,000 in long term debt along with the transfer of land and buildings back to Duane Spader. $232,000 of accrued interest was also eliminated with the termination of the contracts for deed. Total liabilities have been reduced by approximately $3,132,000
Richard Kamolvathin, President and CEO of Verity Corp, said, "We had three corporate goals to reach in the immediate term. Our management team identified that we needed to dramatically improve our balance sheet, introduce more proprietary products and build a foundation to scale our business. We have met all three goals. Long term debt has been reduced significantly. Our new proprietary products are generating new business. And our ability to ramp up revenues has been improved."
Kamolvathin noted, "We are particularly pleased to see that our shift to more proprietary products has resulted in a significant increase in gross profit margins."
"Verity has the technology and expertise to provide farmers with a comprehensive program to move to non-GMO food production. The market opportunity is there and we are well positioned to capitalize on consumers' and farmers' interest in healthy food," Kalmolvathin concluded.
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About Verity Corp (http://www.veritycorp.com/)
Verity Corp is an agricultural business company offering farmers a broad mix of products and services that focus on soil and crop health through the use of earth friendly crop inputs including proprietary biological media, the use of non-GMO seeds, and the use of revitalized water in all aspects of farming including livestock production. Verity's goal is to assist farmers in reducing their dependency of fertilizers, herbicides and pesticides, through the efficient application of Verity's solutions. Verity's proprietary agricultural techniques synthesize historically proven methodologies with advancements in technology.
Safe Harbor: Statements contained in this news release, other than those identifying historical facts, constitute "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 and the Safe Harbor provisions as contained in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relating to the Company's future expectations, including but not limited to revenues and earnings, technology efficacy, strategies and plans, are subject to safe harbors protection. Actual Company results and performance may be materially different from any future results, performance, strategies, plans, or achievements that may be expressed or implied by any such forward-looking statements. The Company disclaims any obligation to update or revise any forward-looking statements.