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Lifeloc Reports 2018 Full Year Results and DWAC/FAST Eligibility
[March 15, 2019]

Lifeloc Reports 2018 Full Year Results and DWAC/FAST Eligibility


Lifeloc Technologies, Inc. (OTC: LCTC), a global leader in the development and manufacturing of breath alcohol testing devices, has announced financial results for the 2018 fiscal year ended December 31, 2018.

2018 Financial Highlights

Lifeloc Technologies posted annual net revenue of $8.44 million resulting in 2018 after tax net income of $217 thousand, or $0.09 per diluted share. These results compare to net revenue of $7.99 million for 2017 full year, with net income of $15 thousand, or $0.01 per diluted share. Revenue for 2018 grew 6% over the prior year. Our balance sheet grew even stronger, with a growth in cash of $119 thousand and a debt reduction of $40 thousand.

This has been a transitional year for Lifeloc Technologies. In 2018 we made a significant investment in the upgrade of our enterprise resource planning (ERP) information infrastructure for improved efficiency and to handle a broadening product line. This has already contributed some sales growth through the upgraded e-Commerce portal. We are completing a multiyear R&D investment for the development of a completely new breathalyzer platform that will be introduced in 2019. And as these projects wind down, freed resources will be deployed to accelerating the development of our rapid drug detection based on the SpinDx™ technology, including a rapid, quantitative marijuana breathalyzer, as well as advancing our monitoring business, primarily through the Real-Time Alcohol Detection and Recognition (R.A.D.A.R.®) device.

Our vision is that Lifeloc becomes the world's leading company in real-time alcohol and drug abuse detection and monitoring. To that end, we continue to invest aggressively in research and development. This R&D investment amounted to over 13% of revenue for the year. Lifeloc is committed to bringing the most advanced alcohol breathalyzers, alcohol monitoring devices and marijuana breathalyzers to the market.

"We are glad to return to a year of growth, having achieved some modest revenue growth in 2018 through improving sales channels, even though there were no new product introductions this year," commented Dr. Wayne Willkomm, President and CEO. "2019 will be different, with a pipeline of new breathalyzer and affiliated launches which will deliver more performance and value to our customers."

In addition to operational investments, Lifeloc Technologies is pleased to announce that the Depository Trust Corporation (the "DTC") has approved its common stock for DWAC/FAST (News - Alert) transfer through the Company's Transfer Agent, Corporate Stock Transfer, Inc. This newly approved stock transfer capability will enable Lifeloc's shareholders to transfer their shares of Lifeloc stock electronically after buying or selling, without the extra cost and burden associated with the processing of physical share certificates.

DWAC/FAST transfer expedites the transaction process, while also eliminating the risks associated with the loss and replacement of physical share certificates. "We are pleased to facilitate easier trading for our shareholders," said Dr. Willkomm. "Not only does becoming DWAC/FAST eligible provide our existing shareholders with new efficiencies, but we hope for more liquidity and better valuation in the open market, allowing us to continue expanding our shareholder base," he added.

About Lifeloc Technologies

Lifeloc Technologies, Inc. (OTC: LCTC) is a trusted U.S. manufacturer of evidential breath alcohol testers and related training and supplies for Workplace, Law Enforcement, Corrections and International customers. Lifeloc stock trades over-the-counter under the symbol LCTC. We are a fully reporting Company with our SEC (News - Alert) filings available on our web site, www.lifeloc.com.

Forward Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve substantial risks and uncertainties that may cause actual results to differ materially from those indicated by the forward-looking statements. All forward-looking statements expressed or implied in this press release, including statements about our strategies, expectations about new and existing products, market demand, acceptance of new and existing products, technologies and opportunities, market size and growth, and return on investments in products and market, are based on information available to us on the date of this document, and we assume no obligation to update such forward-looking statements. Investors are strongly encouraged to review the section titled "Risk Factors" in our SEC filings.

R.A.D.A.R.® is a registered trademark of Lifeloc Technologies, Inc.

SpinDx™ is a trademark of Sandia Corporation.





 
LIFELOC TECHNOLOGIES, INC.
Balance Sheets
 

ASSETS

    December 31,
CURRENT ASSETS: 2018     2017  
Cash and cash equivalents $ 2,788,327 $ 2,669,455
Accounts receivable, net 675,136 593,326
Inventories, net 1,290,607 1,175,103
Income taxes receivable 90,629 121,401
Prepaid expenses and other 35,155   21,804  
Total current assets 4,879,854 4,581,089
 
PROPERTY AND EQUIPMENT, at cost:
Land 317,932 317,932
Building 1,928,795 1,928,795
Real-time Alcohol Detection And Recognition equipment and software 569,448 569,448
Production equipment and software 800,569 556,025
Training courses 432,375 432,375
Office equipment and software 241,836 204,282
Sales and marketing equipment 219,797 216,330
Research and development equipment and software 159,810 131,770
Less accumulated depreciation (1,649,203 ) (1,349,499 )
Total property and equipment, net 3,021,359 3,007,458
 
OTHER ASSETS:
Patents, net 158,147 177,244
Deposits and other 140,452 259,037
Deferred taxes 79,869   66,531  
Total other assets 378,468   502,812  
Total assets $ 8,279,681   $ 8,091,359  
 

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable $ 343,783 $ 297,096
Term loan payable, current portion 43,207 42,101
Customer deposits 19,265 48,763
Accrued expenses 250,912 264,290
Deferred revenue, current portion 44,218 53,137
Reserve for warranty expense 40,000   40,000  
Total current liabilities 741,385 745,387
 
TERM LOAN PAYABLE, net of current portion and
debt issuance costs 1,369,347 1,410,185
 
DEFERRED REVENUE, net of current portion 8,212 9,683
 
COMMITMENTS AND CONTINGENCIES
 
STOCKHOLDERS' EQUITY:
Common stock, no par value; 50,000,000 shares
authorized, 2,454,116 shares outstanding 4,597,646 4,580,177
Retained earnings 1,563,091   1,345,927  
Total stockholders' equity 6,160,737   5,926,104  
Total liabilities and stockholders' equity $ 8,279,681   $ 8,091,359  
 

 
LIFELOC TECHNOLOGIES, INC.
Statements of Income
     
Years Ended December 31,
REVENUES:   2018   2017  
Product sales $ 8,104,003 $ 7,629,474
Royalties 247,765 289,588
Rental income   85,886   71,676  
Total 8,437,654 7,990,738
 
COST OF SALES   4,628,403   4,277,874  
 
GROSS PROFIT 3,809,251 3,712,864
 
OPERATING EXPENSES:
Research and development 1,121,827 1,076,763
Sales and marketing 1,251,388 1,388,927
General and administrative   1,165,413   1,114,534  
Total   3,538,628   3,580,224  
 
OPERATING INCOME 270,623 132,640
 
OTHER INCOME (EXPENSE):
Interest income 25,624 6,824
Interest expense  

(61,650

)

(60,705

)

Total  

(36,026

)

(53,881

)

 
NET (News - Alert) INCOME BEFORE PROVISION FOR TAXES 234,597 78,759
 
(PROVISION FOR) FEDERAL AND STATE INCOME TAXES  

(17,433

)

(64,156

)

 
NET INCOME $ 217,164   $ 14,603  
 
NET INCOME PER SHARE, BASIC $ 0.09   $ 0.01  
 
NET INCOME PER SHARE, DILUTED $ 0.09   $ 0.01  
 
WEIGHTED AVERAGE SHARES, BASIC   2,454,116   2,454,116  
 
WEIGHTED AVERAGE SHARES, DILUTED   2,512,445   2,518,188  
 
 
LIFELOC TECHNOLOGIES, INC.
Statements of Cash Flows
       
Years Ended December 31,
CASH FLOWS FROM OPERATING ACTIVITIES: 2018   2017  
Net income $ 217,164 $ 14,603
Adjustments to reconcile net income to net cash
provided from (used in) operating activities-
Depreciation and amortization 416,896 288,017
Provision for doubtful accounts, net change (5,000 ) -
Provision for inventory obsolescence, net change 60,000 27,500
Deferred taxes, net change (13,338 ) 43,196
Reserve for warranty expense, net change - -
Stock based compensation expense related to
stock options 17,469 22,857
Changes in operating assets and liabilities-
Accounts receivable (76,810 ) (97,929 )
Inventories (175,504 ) (366,994 )
Income taxes receivable 30,772 (6,728 )
Prepaid expenses and other (13,351 ) 30,268
Deposits and other 118,585 (160,046 )
Accounts payable 46,687 12,506
Customer deposits (29,498 ) (2,848 )
Accrued expenses (13,378 ) 24,457
Deferred revenue (10,390 ) (10,128 )
Net cash provided from (used in)
operating activities 570,304 (181,269 )
 
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (402,147 ) (11,846 )
Cash paid for equipment and software acquired
in asset acquisition - (748,198 )
Cash paid for patents and patent applications acquired
in asset acquisition - (100,000 )
Patent filing expense (6,750 ) (17,217 )
Net cash (used in) investing activities (408,897 ) (877,261 )
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments made on term loan (42,535 ) (44,079 )
Net cash (used in) financing
activities (42,535 ) (44,079 )
 
NET INCREASE (DECREASE) IN CASH 118,872 (1,102,609 )
 
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 2,669,455   3,772,064  
 
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,788,327   $ 2,669,455  
 
SUPPLEMENTAL INFORMATION:
Cash paid for interest $ 58,847   $ 65,348  
 
Cash paid for income tax $ -   $ 40,096  
 


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