Delivra Announces 2015 Annual and Q4 Results - Seite 2

• 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.