Botaneco Announces Revenues of Over $1 million for Q3 Financial Ended September 30

QUEBEC, Nov. 29, 2012 /CNW/ - Botaneco Corp. ("Botaneco" or the "Company") (TSXV: BOT), a leading natural specialty ingredients company providing key ingredients to the food and personal care industries is pleased to announce that the revenues for the quarter ending September 30, 2012 have exceeded $1 million per quarter for the first time since its inception. Revenue of $1,024,994 and $2,276,118 was recorded for the three and nine months ended September 30, 2012 respectively, representing increases of $648,828 (172%) and $1,051,445 (86%) over the comparable periods last year. These increased revenues are primarily attributable to the sales generated by Natunola Health Bioscience Inc. ("Natunola"), which was acquired on October 7, 2011, of $581,425 and $1,252,318 for the three and nine months ended September 30^th 2012 respectively.

Net losses of $798,908 and $2,387,351 were recorded for the three and nine months ended September 30, 2012 respectively, a decrease of $124,743 and $316,667 over the prior year. This reduced loss was attributable primarily to: (a) an increase in revenues and gross profit due to the acquisition of Natunola that occurred in October 2011; and (b) a reduction in G&A expenses occurring due to reduced employment costs.

Basic and diluted loss per share was $(0.01) and $(0.03) for the three and nine months ended September 30, 2012 compared to $(0.01) and $(0.03) seen in the previous year.

Selected Financial Information:

	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Revenue	$	1,024,994		$	376,166		$	2,276,118		$	1,224,673
Net loss for the period		(798,908)			(923,651)			(2,387,351)			(2,704,018)
Loss per common share (basic and diluted)		(0.01)			(0.01)			(0.03)			(0.03)
Gross profit (loss):
	Three months ended						Nine months ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Botaneco Corp	$	(115)		$	55,722		$	19,167		$	157,982
Botaneco Specialty		(37,125)			(15,745)			(91,985)			(158,701)
Natunola		279,524			-			506,413			-
	$	242,284		$	39,977		$	433,595		$	(809)

Gross profit within the Botaneco Corp segment (Dermylex®), decreased by $55,837 and $138,815 to $(115) and $19,167 for the three and nine months ended September 30, 2012 respectively, compared to the prior year. The reason for the decrease in Dermylex gross profit was the decrease in quantity of sales in 2012 as compared to 2011. During the quarter ended September 30, 2012, the Company discontinued the Dermylex® segment.

Gross loss within the Botaneco Specialty segment (Hydresia®) increased by $21,380 and decreased $66,716 to $(37,125) and $(91,985) in the three and nine months ended September 30, 2012 respectively, compared to $(15,745) and $(158,701) in 2011.  The sale of safflower seed during Q3 resulted in a gross loss of $73,692; excluding this amount, the Botaneco Specialty segment saw a gross profit of $36,567 in the three months to September 30, 2012 and a gross loss of $18,293 for the nine month period ended September 30, 2012.  This improvement is due to increased levels of sales and production in the three and nine months ended September 30, 2012 meaning that production facility costs were absorbed over a greater production quantity. The Company anticipates that as production levels increase to meet increased sales demand the production facility costs will be absorbed across greater production volumes resulting in increasing gross margins being recorded.

The Natunola segment which includes Vegelatum® Gel products and Flax proteins to supply the personal care market, and de-hulled flax products to supply the food and healthcare markets, saw a gross profit of $279,524 and $506,413 in the three and nine months ended September 30, 2012 with 2011 having no gross profit as the acquisition of Natunola by Botaneco Corp occurred on October 7, 2011.

Natunola entered into a contractual agreement with a multi-billion dollar international nutrition company. Under the terms of a renewable twelve-month partnership, Natunola works with this new partner to process and deliver approximately 3,000,000 pounds of flax per year.

Subsequent to the end of this quarter, the Company obtained a $300,000 operating line of credit from its Bank bearing interest at bank prime rate plus 2.5% and secured by a General Security Agreement. "With this new financing and new flax contract, the Company is on track regarding its restructuring plan" states Dr. Nam Fong Han, President & CEO, "The Company will continue to reduce the operating cost, continue to increase revenues and to focus on achieving profitability for its shareholders".

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

About the Company:

For more information regarding Botaneco Corp. please visit www.botanecocorp.com or www.sedar.com

SOURCE: Botaneco Corp.

Karyn Sheridan, CPA, CA
CFO
Botaneco Corp.
[phone]
[email protected]