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ZAGG Reports Third Quarter Financial ResultsSALT LAKE CITY --(Business Wire)-- ZAGG Incorporated (OTCBB:ZAGG) a leading provider of protective coverings and accessories for consumer electronics today reported earnings for the three and nine month period ended September 30, 2007. The Company reported net revenue of $1,437,408 and net loss of ($733,428), or ($0.04) per share, for the quarter ended September 30, 2007. In comparison, third quarter 2006 net revenue was $816,022 and net income of $15,556, or $0.00 per share. Third quarter net revenue increased $704,214, or 76%, from the same quarter last year, primarily due to strong demand for the Company's invisibleSHIELD(TM) product line. The net loss of ($733,428) includes non-cash expenses related to charges for the issuance of common stock to employees and key vendors prior to the adoption of the Company's ESOP plan. Net of these charges, net income would be $66,572. Robert G. Pedersen II, ZAGG president & CEO stated, "The third quarter is a glimpse of the kind of growth we plan to experience for many quarters to come, and I'm excited to be involved in such a fast moving company." He added, "We are now well poised to be able to manage this continued growth with a very solid infrastructure and are well positioned for a strong Q4 and fiscal 2008." About ZAGG Inc: ZAGG Inc designs, markets and sells protective coverings for consumer electronic and hand-held devices under the brand name invisibleSHIELD(TM), primarily in the United States and Europe. The patent-pending invisibleSHIELD(TM) is a protective, high-tech film covering, designed for iPods, laptops, cell phones, PDAs, watch faces, gaming devices, digital cameras, and other items. Currently, ZAGG offers over 1,500 designs with a lifetime replacement warranty through online channels, resellers, college bookstores, Mac stores and mall kiosks. Since inception, ZAGG has sold over 500,000 invisibleSHIELDs worldwide. The company plans to increase its product lines to offer electronic accessories, including an exclusive line for iPod, and an expanded array of invisibleSHIELD(TM) products for other industries. For more information please visit the company's web sites at www.ZAGG.com and www.invisibleSHIELD.com. ZAGG's full catalog of over 1,500 invisibleSHIELD designs, the RockStic(TM) speaker system, and line of iPod accessories is available on the primary website at www.invisibleshield.com. Special Note Regarding Forward Looking Statements: Statements contained in this release regarding our expectations concerning the fourth quarter, and any other statements that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All such statements are based upon information available to us as of November 14, 2007; and we disclaim any intention or obligation to update any such statements. Actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include losses of key personnel; lower than anticipated sales of our products; unexpected technical, manufacturing, or supply issues with our products; supply shortages impacting our suppliers; any inability to maintain a competitive cost structure; competition; any inability to maintain stringent quality assurance standards and customer satisfaction; difficulties in identifying and completing strategic opportunities to grow our business; intellectual property disputes; adverse final judgments in litigation; general economic and/or industry-specific conditions including significant changes in the landscape of our products' demand, pricing, or competition; and the other risks and uncertainties identified in the reports filed from time to time by ZAGG with the U.S. Securities and Exchange Commission, including ZAGG's most recent Annual Report on Form 10-KSB and Quarterly Reports on Form 10-QSB.
ZAGG Incorporated
Condensed Consolidated Statement of Operations
Three Months Ended Nine Months Ended
Sep 30, 2007 Sep 30, 2006 Sep 30, 2007 Sep 30, 2006
------------ ------------ ------------ ------------
Revenues $ 1,437,408 $ 816,022 $ 3,034,714 $ 1,978,533
Cost of revenues (299,027) (193,153) (689,858) (537,375)
------------ ------------ ------------ ------------
Gross profit 1,138,381 622,869 2,344,856 1,441,158
Expenses:
Selling, general
and
administrative 834,927 450,175 1,873,712 1,121,539
Compensation
expense related
to stock
issuance 800,000 - 800,000 -
Advertising and
marketing 227,624 108,388 467,410 269,689
Legal and
accounting 25,795 30,050 248,240 34,937
------------ ------------ ------------ ------------
Total expenses 1,888,346 588,613 3,389,362 1,426,165
Total other income
(expense), net 16,771 (18,700) (5,243) (11,740)
Net (loss) income
before benefit
(provision) for
income taxes (733,194) 15,556 (1,049,749) 3,253
Income tax
(expense) benefit (234) - (2,544) 13,464
------------ ------------ ------------ ------------
Net (loss) income (733,428) 15,556 (1,052,293) 16,717
Basic and diluted
net loss per
common share $ (0.04) $ 0.00 $ (0.07) $ (0.00)
============ ============ ============ ============
Weighted average
shares outstanding 17,631,495 10,000,000 16,131,123 10,033,333
------------ ------------ ------------ ------------
Condensed Consolidated Balance Sheets
As of As of
Sep 30, 2007 Dec 31, 2006
------------ ------------
Current assets $3,118,876 $ 791,320
Long-term assets 359,216 235,933
------------ ------------
Total assets $3,478,092 $1,027,253
Current liabilities $ 517,765 $ 870,793
Long-term liabilities 12,365 12,087
Stockholders' equity 2,947,962 144,373
------------ ------------
Total liabilities and stockholders' equity $3,478,092 $1,027,253
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