GlyEco Reports Second Quarter 2017 Results

(MENAFNEditorial)

• Total Revenues Increased 122% for the Quarter
• Organic Revenues Increased 25% for the Quarter
• 49% Improvement in Adjusted EBITDA for the Quarter

ROCK HILL, SC / ACCESSWIRE / August 14, 2017 / GlyEco, Inc. ("GlyEco" or the "Company") (OTC PINK: GLYE), a leading specialty chemical company, announced today the following financial results for the quarter ended June 30, 2017:

Quarter ended June 30, 2017 2016 Sales, net $ 2,918,097 $ 1,313,863 Gross profit (loss) $ 476,854 $ (66,604 ) Total operating expenses $ (1,154,498) $ (978,912) Loss from operations $ (677,644 ) $ (1,045,516 ) Net loss $ (902,226 ) $ (1,042,976 ) Adjusted EBITDA $ (331,191 ) $ (648,807 )

Commenting on the second quarter 2017 results, Ian Rhodes, President and Chief Executive Officer said, "The second quarter of 2017 marked the first full quarter of operations for our Company since the December 2016 business and asset acquisitions. Our second quarter 2017 financial results were positively impacted by the continued growth and further cost management efforts within our existing business. Total revenues and organic revenues increased significantly for the quarter and key measures of profitability, including gross margin and adjusted EBITDA also improved during the quarter. Our gross margin ratio increased to 16% from (5%) and our operating expense ratio decreased to 40% from 75%." Mr. Rhodes continued, "We have made meaningful progress during the first half of 2017 in reaching one of our key financial goals - positive quarterly adjusted EBITDA - and believe we are well positioned to achieve this goal in the second half of 2017."

Effective January 1, 2017, the Company has two segments, Consumer and Industrial. Presented below are the second quarter 2017 financial results for each segment as well as reconciling items to the consolidated results.

Consumer Industrial Inter Segment Eliminations Corporate Total Sales, net $ 1,647,263 $ 1,608,502 $ (337,668 ) $ - $ 2,918,097 Cost of goods sold 1,262,853 1,516,058 (337,668 ) - 2,441,243 Gross profit 384,410 92,444 - - 476,854 Total operating expenses 540,387 325,556 - 288,555 1,154,498 Loss from operations (155,977 ) (233,112 ) - (288,555 ) (677,644 ) Total other expenses (6,133 ) (30,923 ) - (186,329 ) (223,385 ) Loss before provision for income taxes $ (162,110 ) $ (264,035 ) $ - $ (474,884 ) $ (901,029 )

Second Quarter of 2017 Highlights

• Increased Revenues by $1,604,234 or 122%, from $1,313,863 for the three months ended June 30, 2016 to $2,918,097 for the three months ended June 30, 2017.

• Increased Consumer Revenues by $333,400 or 25%, from $1,313,863 for the three months ended June 30, 2016 to $1,647,263 for the three months ended June 30, 2017

• Increased Gross Profit (Loss) from $(66,604) for the three months ended June 30, 2016 to $476,854 for the three months ended June 30, 2017. All operating segments were Gross Profit positive for the quarter.

• Increased Adjusted EBITDA by $317,616 or 49%, from a loss of $(648,807) for the three months ended June 30, 2016 to a loss of $(331,191) for the three months ended June 30, 2017.

Second Quarter of 2017 Financial Review

The Company's sales for the quarter ended June 30, 2017, were $2.9 million compared to $1.3 million for the quarter ended June 30, 2016, representing an increase of $1.6 million, or approximately 122%. The increase in Net Sales was due to organic revenue growth of $333,000, or approximately 25%, and $1.3 million of sales related to the businesses and assets acquired in December 2016.

The Company reported a gross profit of $477,000 for the quarter ended June 30, 2017, compared to a gross loss of $(67,000) for the quarter ended June 30, 2016, representing a gross margin ratio of 16% compared to (5)%. The gross profit margin for the Consumer segment was positively impacted by increased sales and proportionately lower costs. The gross profit margin for the Industrial segment was negatively impacted by certain lower margin business. The Company is currently negotiating pricing changes to this lower margin business.

The Company reported operating expenses of $1.2 million for the quarter ended June 30, 2017, compared to $1 million for the quarter ended June 30, 2016, representing an operating expense ratio of 40% compared to 75%. Continued scaling of the business through increased sales positively impacted the operating expense ratio.

The Company reported an operating loss of $678,000 for the quarter ended June 30, 2017, compared to a $1 million operating loss for the quarter ended June 30, 2016.

The Company reported a net loss of $902,000 for the quarter ended June 30, 2017, compared to a net loss of $1 million for the quarter ended June 30, 2016.

The Company reported adjusted EBITDA of $(331,000) for the quarter ended June 30, 2017, compared to $(649,000) for the quarter ended June 30, 2016.

Business Update

Our West Virginia facility was on-line for the entire second quarter and we are now focused on sales opportunities and feedstock sourcing to increase the capacity utilization of this facility as we move into the second half of 2017.

We have substantially completed the buildout of our sales team, including at the regional and national levels, and expect increased revenues in the second half of 2017.

With our sales team and higher production capacity assets both in place, we are focused on scaling our business in such areas as operations and customer care to effectively support the expected sales growth in the second half of 2017.

Subsequent to the end of the quarter, the Company announced the closing of its rights offering, which occurred on August 4, 2017, and raised aggregate gross proceeds of approximately $2.29 million, including $670,000 in cash and $1.62 million in redemption of previously issued notes, from the sale of 28.6 million shares of common stock at a price of $0.08 per share. The Company plans to use the net proceeds for general working capital purposes.

The Company also repaid the remaining 8% promissory notes issued in December 2016 through a combination of shares of its common stock at a per share price of $0.08 and cash. The Company issued 2,754,500 shares in exchange for a total of $220,360 in principal and interest and repaid the balance in cash in the full amount of $52,467. As a result of these transactions, the previously issued 8% notes have been repaid in full.

About GlyEco, Inc.

GlyEco is a leading specialty chemical company, leveraging technology and innovation to focus on vertically integrated, eco-friendly manufacturing, customer service and distribution solutions. Our eight facilities, including the recently acquired 14-20 million gallons per year, ASTM E1177 EG-1, glycol re-distillation plant in West Virginia, deliver superior quality glycol products that meet or exceed ASTM quality standards, including a wide spectrum of ready to use antifreezes and additive packages for antifreeze/coolant, gas patch coolants and heat transfer fluid industries, throughout North America. Our team's extensive experience in the chemical field, including direct experience with reclamation of all types of glycols, gives us the ability to process a wide range of feedstock streams, formulate and produce unique products and has earned us an outstanding reputation in our markets.

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Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "believe," "expect," "anticipate," "plan," "potential," "continue," or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company's filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company's control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company's current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, except as required by federal securities laws.

Contact:

GlyEco, Inc.
Ian Rhodes
President and Chief Executive Officer

866-960-1539

GLYECO, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
June 30, 2017 and December 31, 2016

June 30, December 31, 2017 2016 (unaudited) ASSETS Current Assets Cash $ 77,590 $ 1,413,999 Cash & #8211; restricted 41,090 76,552 Accounts receivable, net 1,326,549 1,096,713 Prepaid expenses 372,454 340,899 Inventories 1,527,802 644,522 Total current assets 3,345,485 3,572,685 Property, plant and equipment, net 3,915,894 3,657,839 Other Assets Deposits 433,390 387,035 Goodwill 3,822,583 3,693,083 Other intangible assets, net 2,530,429 2,794,204 Total other assets 6,786,402 6,874,322 Total assets $ 14,047,781 $ 14,104,846 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable and accrued expenses $ 1,691,546 $ 961,010 Due to related parties - 6,191 Contingent acquisition consideration 1,786,113 1,821,575 Notes payable & #8211; current portion, net of debt discount 1,718,496 2,541,178 Capital lease obligations & #8211; current portion 354,735 6,838 Total current liabilities 5,550,890 5,336,792 Non-Current Liabilities Notes payable & #8211; non-current portion 2,919,069 2,963,640 Capital lease obligations & #8211; non-current portion 1,281,381 3,371 Total non-current liabilities 4,200,450 2,967,011 Total liabilities 9,751,340 8,303,803 Commitments and Contingencies Stockholders' Equity Preferred stock; 40,000,000 shares authorized; $0.0001 par value; no shares issued and outstanding as of June 30, 2017 and December 31, 2016 - - Common stock, 300,000,000 shares authorized; $0.0001 par value; 131,204,275 and 126,156,189 shares issued and outstanding as of June 30, 2017 and December 31, 2016, respectively 13,121 12,616 Additional paid-in capital 43,109,519 42,603,490 Accumulated deficit (38,826,199 ) (36,815,063 ) Total stockholders' equity 4,296,441 5,801,043 Total liabilities and stockholders' equity $ 14,047,781 $ 14,104,846

GLYECO, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
For the three and six months ended June 30, 2017 and 2016

Three months ended June 30, Six months ended June 30, 2017 2016 2017 2016 (unaudited) (unaudited) (unaudited) (unaudited) Sales, net $ 2,918,097 $ 1,313,863 $ 5,208,418 $ 2,756,761 Cost of goods sold 2,441,243 1,380,467 4,591,829 2,685,994 Gross profit (loss) 476,854 (66,604 ) 616,589 70,767 Operating expenses: Consulting fees 165,536 58,863 218,962 101,423 Share-based compensation 94,548 317,471 231,534 598,235 Salaries and wages 363,546 282,561 706,601 539,011 Legal and professional 187,740 43,124 348,731 141,897 General and administrative 343,128 276,893 700,341 536,381 Total operating expenses 1,154,498 978,912 2,206,169 1,916,947 Loss from operations (677,644 ) (1,045,516 ) (1,589,580 ) (1,846,180 ) Other (income) and expenses: Interest income - (165 ) - (218 ) Interest expense 223,385 7,366 419,603 11,978 Gain on settlement of note payable - (15,000 ) - (15,000 ) Total other (income) expense, net 223,385 (7,799 ) 419,603 (3,240 ) Loss before provision for income taxes (901,029 ) (1,037,717 ) (2,009,183 ) (1,842,940 ) Provision for income taxes 1,197 5,259 1,953 5,946 Net loss $ (902,226 ) $ (1,042,976 ) $ (2,011,136 ) $ (1,848,886 ) Basic and diluted loss per share $ (0.01 ) $ (0.01 ) $ (0.02 ) $ (0.02 ) Weighted average number of common shares outstanding - basic and diluted 128,876,960 112,772,095 127,583,831 99,679,783 GLYECO, INC. AND SUBSIDIARIES
Reconciliation of Adjusted EBITDA
For the three and six months ended June 30, 2017 and 2016

Three Months Ended June 30, 2017 2016 Net loss $ (902,226 ) $ (1,042,976 ) Interest expense, net 223,385 7,201 Gain on settlement of note payable - (15,000 ) Income tax expense 1,197 5,259 Depreciation and amortization 251,905 79,238 Share-based compensation 94,548 317,471 Adjusted EBITDA $ (331,191 ) $ (648,807 )

Six Months Ended June 30, 2017 2016 Net loss $ (2,011,136 ) $ (1,848,886 ) Interest expense, net 419,603 11,760 Gain on settlement of note payable - (15,000 ) Income tax expense 1,953 5,946 Depreciation and amortization 497,387 155,769 Share-based compensation 231,534 598,235 Adjusted EBITDA $ (860,659 ) $ (1,092,176 )

Presented above is the non-GAAP financial measure representing earnings before interest, taxes, depreciation, amortization and stock compensation (which we refer to as "Adjusted EBITDA") and the reconciliations of Adjusted EBITDA to net loss. Adjusted EBITDA should be viewed as supplemental to, and not as an alternative for, net income (loss) and cash flows from operations calculated in accordance with GAAP.

Adjusted EBITDA is used by our management as an additional measure of our Company's performance for purposes of business decision-making, including developing budgets, managing expenditures, and evaluating potential acquisitions or divestitures. Period-to-period comparisons of Adjusted EBITDA help our management identify additional trends in our Company's financial results that may not be shown solely by period-to-period comparisons of net income (loss) and cash flows from operations. In addition, we may use Adjusted EBITDA in the incentive compensation programs applicable to many of our employees in order to evaluate our Company's performance. Further, we believe that the presentation of Adjusted EBITDA is useful to investors in their analysis of our results and helps investors make comparisons between our company and other companies that may have different capital structures, different effective income tax rates and tax attributes, different capitalized asset values and/or different forms of employee compensation. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items, particularly those items that are recurring in nature. In order to compensate for those limitations, management also reviews the specific items that are excluded from Adjusted EBITDA, but included in net income (loss), as well as trends in those items.

SOURCE: GlyEco, Inc.

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