Fuego Enterprises, Inc. Reports
2017 and 2018 Full Year Financial Results
Full Year 2018 Highlights:
●
Revenue increased
46.7% to $19.2 million
●
Gross Profit
increased 16.8% to $2.2 million
●
Provided over
100,000 travel visas to American citizens traveling to
Cuba
●
Invested $326,616
in new projects
Full Year 2017 Highlights:
●
Revenue of $13.1
million
●
Gross Profit of
$1.9 million
●
Invested $730,834
in new projects
MIAMI, October 11, 2019 – Fuego Enterprises, Inc.
(OTC: FUGI) (the “Company” or “Fuego”) is a
diversified holding company that focuses on strategic partnerships
and joint venture opportunities in developing and emerging markets.
Fuego also makes direct equity investments in a wide range of
industries and today reports its financial results for the years
ended December 31, 2017 and 2018.
Hugo
Cancio, President and Chief Executive Officer of Fuego, said
“Fuego’s strong financial growth in 2018 demonstrates
our unique expertise in operating in developing and emerging
markets; by leveraging our global network of relationships and our
experienced operators, we entered new markets in Europe and Asia,
and made significant development progress in our existing projects.
Going forward, we have our sights on navigating risk and volatility
to find the best long-term growth opportunities globally, and seek
to capitalize on current global economic and business conditions by
making investments in small-sized operating companies. As we look
to further diversify our operations, we will continue to make
opportunistic equity investments in industries where we have
operational experience and established networks, and will seek
joint venture and strategic partnership
opportunities.”
Additionally,
the Company announces that it will change its annual financial
reporting period from a fiscal year end of May 31 to a calendar
year end of December 31.
Interested
investors and shareholders can find quotes, market information, and
financial reports for Fuego Enterprises, Inc., which are filed with
the OTC Markets, at http://www.otcmarkets.com/stock/FUGI/quote.
FULL YEAR RESULTS
Revenue
Revenue
for the years ended December 31, 2017 and 2018 was $13,076,812 and
$19,180,022, respectively. The revenue increase of 46.7% or
$6,103,210 during 2018 compared to 2017 was a direct result of
increased tourist travel to Cuba from the U.S.
Gross Profit
Gross
profit for the years ended December 31, 2017 and 2018 was
$1,875,789 and $2,190,439, respectively. Gross margin for the year
ended December 31, 2018 was 11.4%, which represents a decrease of
2.9% compared to gross margin of 14.3% for year ended December 31,
2017. This decrease in gross margin was primarily due to an
increase in sales of lower margin services such as travel visas. In
general, the Company believes gross margins will remain under
downward pressure due to a variety of factors, including
competition and the sale of travel-related products and services
that inherently have low gross profit margins.
Selling, General, and Administrative Expense
Total
selling, general, and administrative expense was $1,794,135 in
2018, compared to $1,256,177 in 2017. The year-over-year growth in
selling, general, and administrative expense in 2018 of 42.8% or
$537,958 was driven primarily by increases in headcount-related
expenses, consulting services, and bank fees.
Net Income
Net
income for the years ended December 31, 2017 and 2018 was $619,612
and $396,305, respectively. There is no income tax provision for
the twelve months ended December 31, 2017 and 2018 due to net
operating losses for which there is no benefit currently
available.
Results
|
For the
Years Ended December 31,
|
|
|
|
|
|
|
|
Revenue
|
$13,076,812
|
$19,180,022
|
$6,103,210
|
46.7%
|
Cost
of Revenue
|
11,201,023
|
16,989,582
|
5,788,559
|
51.7%
|
Gross
Profit
|
1,875,789
|
2,190,439
|
314,651
|
16.8%
|
Operating
Expenses
|
1,256,177
|
1,794,135
|
537,958
|
42.8%
|
Net
Income
|
$619,612
|
$396,305
|
$(223,307)
|
-36.0%
|
Liquidity
The
Company’s cash totaled $616,541 and $471,945 at December 31,
2017 and 2018, respectively.
During
2018, Fuego generated $477,915 of cash from operating activities.
Cash used by investing activities of $816,616 consisted of (1) the
purchase of an office condominium for $490,000, and (2) investment
in new projects totaling $326,616. Cash provided by financing
activities totaled $194,106, which included a mortgage for the
purchase of an office condominium for $358,697, and was offset by
(1) the repayment of a $80,900 note issued to the Company by a
related party, and (2) a note from the Company to a related party
for $83,691.
During
2017, Fuego generated $550,362 of cash from operating activities.
Cash used by investment activities totaled $730,834, which
consisted of investment in new projects. Cash provided by financing
activities of $80,900 was related to proceeds from a note issued to
the Company by a related party.
Results
|
|
|
|
|
Assets
|
|
|
Current
Assets
|
$698,720
|
$521,142
|
Furniture
and Property, net
|
10,204
|
486,576
|
Investments
|
736,834
|
1,063,451
|
Other
Assets
|
6,319
|
83,691
|
Total
Assets
|
$1,452,077
|
$2,154,859
|
|
|
|
Liabilities
and Stockholders' Equity
|
|
|
|
|
|
Liabilities
|
|
|
Current
Liabilities
|
$-
|
$10,180
|
Mortgage
Payable
|
-
|
358,697
|
Other
Liabilities
|
80,900
|
-
|
Total
Liabilities
|
80,900
|
368,878
|
|
|
|
Stockholders'
Equity
|
1,371,177
|
1,785,982
|
|
|
|
Total
Liabilities and Stockholders' Equity
|
$1,452,077
|
$2,154,859
|
Activities
As
Fuego develops its commercial activities by leveraging its
management’s know-how and global relationships, the Company
continues to expand its brand and global reach.
Fuego
is actively involved in the following sectors through its
subsidiaries and affiliates:
●
Travel & Hospitality: Full-service
travel agency to worldwide destinations and hospitality operations
through OnCuba Travel, LLC.
●
Media & Entertainment: Print and
digital magazines and online news portal through OnCubaNews.com,
OnCuba Travel Magazine, and Art OnCuba Magazine.
●
Consumer Products & Promotional
Goods: Contract manufacturing and global distribution of
consumer goods through OCG, LLC.
●
Data Analytics: Independent provider of
economic and consumer behavior data in Cuba through IslaData,
LLC.
●
E-Commerce: Online marketplace for the
sale of Cuban products through Katapulk Marketplace,
LLC.
Outlook
Fuego
is currently seeking strategic partnerships and joint venture
opportunities, as well as direct equity investments in the
following industries, with a focus on developing and emerging
markets:
●
Travel &
Hospitality, including real estate;
●
Consumer Products
& Promotional Goods;
●
Infrastructure
& Telecommunications; and,
●
E-Commerce &
Big Data Solutions.
All
interested parties and potential opportunities are invited to
contact the Company below:
Ariel Machado
Vice
President & COO, Fuego Enterprises, Inc.
Ariel.Machado@FuegoEnterprisesInc.com
+1
(305) 602-0219 Office
--------------------------
More about Fuego Enterprises, Inc.
Fuego Enterprises, Inc. is a diversified holding company for
business opportunities in developing and emerging markets. Fuego
makes direct equity investments, launches new business initiatives,
and seeks strategic partnerships and joint venture opportunities in
the following industries: Travel & Hospitality, including real
estate; Consumer Products & Promotional Goods; Software &
Technology; Media & Entertainment; Infrastructure &
Telecommunications; and, E-Commerce & Big Data Solutions. For
more information, please visit
www.FuegoEnterprisesInc.com.
More about OnCuba Travel, LLC
OnCuba Travel LLC (“OCT”) is an IATAN-certified
full-service global travel agency based in Miami, Florida,
benefitting from relationships with airlines, hotel chains, and
cruise lines around the world. OCT offers comprehensive travel
programs to Cuba as a full-service agency with direct investments
and active management of hospitality properties in Cuba. For more
information, please visit www.OnCubaTravel.com.
More about OnCuba News
OnCuba News is among the most read media platforms covering Cuba,
in the world, with over 100 journalists and contributors providing
daily coverage on the Cuban economy, sports, culture, art, food,
health, fashion, and more, on a global level. Armed with
on-the-ground intelligence from its journalists and collaborators,
the OnCubaNews.com website reaches more than 600,000 readers per
month. Fuego’s media division maintains a permanent news
media bureau in Havana, Cuba. For more information, please visit
www.OnCubaNews.com.
More about OnCuba Travel Magazine and Art OnCuba
Magazine
OnCuba Travel Magazine and Art OnCuba Magazine are the only
magazines with cross-border publishing and distribution on both
sides of the Florida Straits: Havana and Miami. OnCuba Travel
Magazine offers a glimpse of Cuban culture and the Cuban people,
featuring original content and photography, and packed in an
easy-to-read format with cutting-edge design. For more information,
please visit and www.OnCubaTravel.com/magazines. Art OnCuba
Magazine is a benchmark of Cuban visual arts production, and brings
together everything related to artists, galleries, art centers,
museums, collections, foundations, and universities. For more
information, please visit www.ArtOnCuba.com.
More about OCG, LLC
OCG, LLC (“OCG”) is a wholly-owned subsidiary of Fuego
that licenses, produces, and distributes consumer products around
the world. OCG provides handcrafted souvenirs, destination-unique
promotional products, and made-to-order goods as a full-service
supplier of reliable, high-quality, and low-cost consumer items.
Examples include coffee mugs, ashtrays, t-shirts, postcards, and
more. OCG is led by an experienced executive in international
trade, logistics/fulfillment, pricing strategy, contract
manufacturing, and sales/marketing. OCG has agreements with the
leading global travel retailers (duty free stores, cruise lines,
etc.), and has ongoing operations in the U.S., Asia, Europe, and
the Caribbean. For more information, please visit
www.FuegoEnterprisesInc.com.
More about IslaData, LLC
IslaData LLC (“IslaData”) is an independent,
non-governmental provider of data mining, predictive analytics, and
text mining in the Cuban market. Headquartered in Havana, Cuba,
IslaData has been independently collecting data and processing
information on Cuban user behavior over the past six years from a
wide range of sources, in an effort to determine trends and predict
outcomes in specific Cuban market segments. For more information,
please visit www.IslaData.com.
More about Katapulk Marketplace, LLC
Katapulk Marketplace, LLC (“Katapulk”) is an online
marketplace and community for the sale of Cuban-made and
Cuban-themed products globally. Katapulk’s primary target
markets are the U.S. and China. Katapulk employs a team of experts
and enthusiasts who hand-pick its products, and also works with
several designers and artisans who serve as guest curators of the
marketplace’s collections. Katapulk receives every item
directly from the creators, artisans, designers, and private
manufacturers in Cuba, and guarantees the authenticity of every
product it sells. For more information, please visit
www.katapulk.com.
Safe Harbor Statement
This press release contains statements, which may constitute
forward-looking statements within the meaning of the Securities Act
of 1933 and the Securities Exchange Act of 1934, as amended by the
Private Securities Litigation Reform Act of 1995. Those statements
include statements regarding the intent, belief or current
expectations of Fuego Enterprises, Inc., members of their
management, and assumptions on which such statements are based.
Prospective investors are cautioned that any such forward-looking
statements are not guarantees of future performance and involve
risks and uncertainties, and that actual results may differ
materially from those contemplated by such forward-looking
statements.
Forward-Looking Statements
The information in this press release contains forward-looking
statements within the meaning of Section 21E of the Exchange Act.
All statements other than statements of historical fact made in
this press release are forward-looking. In particular, the
statements herein regarding industry prospects and future results
of operations or financial position are forward-looking statements.
The Company has based these forward-looking statements on its
current expectations and projections about future events. These
forward-looking statements can be identified by the use of words
such as “believes,” “estimates,”
“could,” “possibly,”
“probably,” “anticipates,”
“projects,” “expects,” “may,”
“will,” or “should” or other variations or
similar words. No assurances can be given that the future results
anticipated by the forward-looking statements will be achieved.
Forward-looking statements reflect management’s current
expectations and are inherently uncertain. Fuego’s actual
results may differ significantly from management’s
expectations.
Unless otherwise indicated, information in this press release
concerning economic conditions and Fuego’s industry is based
on information from independent industry analysts and publications,
as well as Fuego’s estimates. Except where otherwise noted,
Fuego’s estimates are derived from publicly-available
information released by third-party sources, as well as data from
Fuego’s internal research, and are based on such data and
Fuego’s knowledge of its industry, which Fuego believes to be
reasonable. None of the independent industry publication market
data cited in this report was prepared on Fuego’s behalf. The
markets for Fuego’s products may not grow at the rate
projected by market data, or at all. The failure of these markets
to grow at the projected rates may have a material adverse effect
on Fuego’s business and the market price of Fuego’s
securities. Furthermore, if any one or more of the assumptions
underlying the market data is later found to be incorrect, actual
results may differ from the projections based on these assumptions.
You should not place undue reliance on these forward-looking
statements.
The forward-looking statements made in this press release relate
only to events or information as of the date on which the
statements are made in this press release. Therefore, prospective
investors are cautioned that there can be no assurance that the
forward-looking statements included in this press release will
prove to be accurate and, accordingly, should not place undue
reliance on such statements. In light of the significant
uncertainties inherent to the forward-looking statements included
herein, the inclusion of such information should not be regarded as
a representation or warranty by Fuego or any other person that the
Company’s objectives and plans will be achieved in any
specified time frame, if at all. Fuego does not undertake any
obligation to update any such statements for any reason, even if
new information becomes available or other events
occur.