NEW LONDON, CONN., April 12, 2011 (GLOBE NEWSWIRE) -- Evercel, Inc. (Pink Sheets: EVRC) today released a letter to shareholders that discusses the company's 2010 financial results:
Dear Fellow Shareholders:
Operations at Evercel in 2010 were extremely disappointing and unacceptable to us as managers and as shareholders. Our loss from operations was $530,742 and our net loss was $868,854 after interest charges and the write-off of the Stretch and Cover seller’s non-compete agreement which had been capitalized as part of the purchase price.
Our biggest problem is Stretch and Cover ("S-C"), a web based marketer of furniture slipcovers to consumers. S-C had an operating loss of $337,929 and a P & L loss of $658,359 after interest and the write-off. Almost every aspect of operations at S-C required substantial remedial work including the website, systems, fabrics, marketing and management. While there has been substantial improvement, many of the changes are still in process. We are now approaching breakeven operations and have confidence that S-C can be rebuilt and can become a contributor to Evercel.
New England Crab Company ("NECC") was slightly profitable in 2010. Its operation were affected by the continuing effects of the recession in the early part of the year followed by diminished supplies of raw crab (due to weather) in the second half. 2011 has started off well with reasonable levels of supply and demand including a backlog of export orders. We are concerned about our cost of supplies which is sensitive to fuel costs. Our ability to pass on these costs to our customers is limited.
Sontek Medical which markets a disposable valve used on patients with respirators had a good year and earned $142,281.
Financial tables are available at www.evercel.com.
Our principal investment, Zipcar, continues to grow. Zipcar has filed for an initial public offering of its shares. We have requested registration of a portion of the 1,428,571 shares we own. Information about Zipcar can be obtained through the filing which is available at www.sec.gov.
Despite the disappointments we have confidence that with the programs we have in place and our continuing efforts we will be able to substantially improve our results and look forward to updating you.
New London, Conn., based Evercel is a multi-industry company whose operations include crab processing for both fresh and frozen markets, sales of Swivel Y-valves used in the treatment of patients on respirators, and Stretch and Cover, Inc., an on-line retailer of slipcovers for household furniture. Evercel also has investments in Zipcar Inc. (car sharing), and Julia LLC (skin wrinkle reduction technology).