Imagenetix Inc. Reports First Quarter Results

August 14, 2007

  • Net Sales Increase 21%
  • Gross Margins Improve 6%
  • EPS $(0.04) verse $(0.04)
  • Sees Significant Growth in Sales for Balance of Year

SAN DIEGO, Calif., Aug. 14 /PRNewswire-FirstCall/ -- Imagenetix, Inc. (OTC Bulletin Board: IAGX - News), today reported results for its first fiscal quarter ended June 30, 2007. Net sales increased 21% to $1,126,991 from the $931,569 reported for the same period of the prior fiscal year. Gross profit as a percent of sales increased to 52% from 46% in the same period of the prior fiscal year.

For the quarter the operating loss increased to $(664,143) from $(434,532). Included in the results for the period was $305,000 of non cash expenses associated with the issuance of warrants and stock options. In addition during the period $204,000 was paid for advertising to support the retail launch.

Net loss for the period was $(435,526) or $(0.04) per share compared to $(377,837) or $(0.04) per share for the same period in the prior fiscal year. As of June 30, 2007 the Company has cash and cash equivalents of $1,545,483.

Commenting on the results for the quarter Mr. William Spencer, Imagenetix's Chief Executive Officer said, "During the first quarter we have increased the number stores carrying our first branded product, Inflame Away(TM), to over 10,000. Towards the end of the quarter we began advertising to support our retail launch and have added another 1,000 stores which will begin to carry this product by the end of our second fiscal quarter. We are expecting to see a healthy increase in sales and margins as the retail launch accelerates."

Mr. Spencer added, "Currently, our branded products being sold at Costco Online include Inflame Away(TM), our pain relieving cream, and Moractives(TM), Daily Vegetables and Daily Fruits and Berries. We will begin the retail launch of Moractives(TM) before the end of 2007."

"In addition to our branded products we are making substantial progress in the private label area. We are also in negotiations with companies to develop programs to introduce our products world-wide. We are all very excited about the future for this Company. I expect to report continued sales increases for the remainder of our fiscal year."