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Mace Security International, Inc. Reports Financial Results for the Three and Nine Months Ended September 30, 2012SOLON, Ohio --(Business Wire)-- Mace Security International, Inc. (OTC PINK: MACE) today announced financial results for the three and nine months ended September 30, 2012. "Mace saw a 30+% increase in revenues from personal defense and law enforcement operations," said John J. McCann, CEO and President. "We also experienced 10+% sales growth in our wholesale security monitoring operation which now serves more than 75,000 customers." To be better positioned for profitability in 2013, the firm also undertook a series of long-term cost cutting initiatives that will continue through the 4th quarter and into 2013. Specifically, the company experienced a one-time charge of ($500,000) in discontinued operations related to its car wash operations and approximately ($370,000) toward one-time severance, legal and moving expenses necessary to transform Mace's future footprint and structure. "To become the nation's recognized leader in security, safety and protection, Mace is reallocating resources to products, marketing and sales," McCann explained. "Over the next couple months we expect to announce new product initiatives, licensing partnerships and marketing campaigns that will enhance the value of the Mace brand." 2012 Third Quarter and Current Highlights
Financial Results, Three Months Ended September 30, 2012 and 2011 Revenues were approximately $3.4 million and $3.5 million for the three months ended September 30, 2012 and 2011, respectively.
Overall revenues within the security segment decreased $128,000, or 3.6%, in 2012 compared to 2011. This decrease is mainly attributed to a $568,000, or 53.7%, decrease in sales from electronic surveillance equipment operations offset by a $429,000, or 30.8%, increase in personal defense and law enforcement operations, and a slight increase of $10,000 or 0.9% in wholesale security monitoring operation. The decrease in surveillance equipment revenues is attributed to competition from Asian manufacturers, loss of a key customer, and the sale of IVS. Personal defense and law enforcement operations saw significant increased sales through consumer and international channels and a slight increase in the sporting goods channel. Revenues increased marginally in the wholesale security monitoring division.
Loss from continuing operations for the third quarter of 2012 was approximately $(700,000), or $(0.01) per share, compared to a loss from continuing operations of $(1.9) million, or $(0.04) per share, in the third quarter of 2011. The improvement is attributed to decreases in selling, general and administration ("SG&A") expenses of $891,000, or 32%, and an increase in gross profit of $251,000, or approximately 23%. Discontinued operations are comprised of the Company's car wash operations. The results of these operations are shown as discontinued operations for financial reporting purposes. These operations generated a loss of approximately $(504,000), or $(0.01) per share, and $(262,000), or $(0.01) per share, for the three months ended September 30, 2012 and 2011 respectfully. The $(504,000) loss in the third quarter of 2012, included expenses associated with a Lease Assignment and Release Agreement on one of the remaining car wash and lube facilities; and accrued expenses to further monitor and test two car wash locations. Net loss for the three months ended September 30, 2012 was approximately $(1.2) million, or $(0.02) per share, compared to a net loss of approximately $(2.1) million, or $(0.05) per share, for the three months ended September 30, 2011. Weighted average shares for computing loss per share for the three months ending September 30, 2012 and 2011 were 58,946,441 and 43,571,698 respectively. Financial Results, Nine Months Ended September 30, 2012 and 2011 Revenues were approximately $9.8 million and $10.6 million for the nine months ended September 30, 2012 and 2011, respectively.
Overall revenues, within the security segment, decreased $797,000 or 7.5%, in 2012 compared to 2011. This decrease is mainly attributed to a $2.3 million, or 57%, decrease in sales from electronic surveillance equipment operations offset by a $1.2 million, or 32%, increase in personal defense and law enforcement aerosol operation, and an increase of $340,000, or 12%, in wholesale security monitoring operation, which includes the acquisition of a monitoring center TCCI, on March 31, 2011.
Loss from continuing operations for the nine months ended September 30, 2012 was approximately $(1.9) million, or $(0.03) per share, compared to a loss from continuing operations of $(4.1) million, or $(0.17) per share, in the nine months ended September 30, 2011. The improvement is attributed to decreases in selling, general and administration ("SG&A") expenses of $1.8 million, or 26%, and an increase in gross profit of $189,000, or approximately 5%. Discontinued operations are comprised of the Company's car wash operations. The results for these operations are shown as discontinued operations for financial reporting purposes. These operations generated a loss of approximately $(576,000), or $(0.03) per share, for the nine months ended September 30, 2012 and a loss of $(296,000), or $(0.17) per share for the nine months ended September 30, 2011. Current year to date loss includes a cash payment of $275,000 and the transfer of certain inventories and equipment having an approximate book value of $70,000 as consideration to the landlord for the early release of the contractual lease agreement. Net loss for the nine months ended September 30, 2012 was approximately $(2.5) million, or $(0.03) per share, compared to a net loss of approximately $(4.4) million, or $(0.17) per share, for the nine months ended September 30, 2011. Weighted average shares for computing loss per share for the nine months ending September 30, 2012 and 2011 were 58,946,441 and 25,116,345 respectively. The Company's net book value was $15.1 million, or $0.26, at September 30, 2012. Mace had $18.5 million in total assets, including $5.9 million of cash and short-term investments at September 30, 2012.
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About Mace Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. When used in this press release, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "projected," "intend to" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks, known and unknown, and uncertainties, including but not limited to economic conditions, dependence on management, our ability to compete with competitors, dilution to shareholders, and limited capital resources. A discussion of factors that could materially adversely affect the Company's financial performance and cause actual results for future periods to differ materially from the statements expressed within this press release, and management's opinions, projections, forecasts, estimates and expectations are contained under the heading "Risk Factors" in Mace's SEC (News - Alert) filings, including its registration statements and its periodic reports on Form 10-K and Form 10-Q. This press release should also be read in conjunction with the financial statements and notes contained in Mace's annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.
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