Mace Reports Strong Third Quarter 2016 Financial Results
- 2nd consecutive positive Net Income quarter vs. prior year losses
-
Highest revenue quarter in over 3 years led by growth in key
channels - Strongest quarterly Gross Profit and EBITDA in over 4 years
- Added 19 new accounts for the quarter, 65 for the year-to-date
-
Sale of surveillance business provides on-going royalty
opportunity
CLEVELAND–(BUSINESS WIRE)–$mace #FinancialResults–Mace Security International Inc. (OTCPINK: MACE) today announced
unaudited financial results for the third quarter and nine-month period
ended September 30, 2016.
“Strong sales to key domestic and international retailers and
distributors along with improved operational efficiencies allowed Mace
to post back-to-back profitable quarters.” said Richard Barone,
Chairman. “Management’s continued focus on growing the top line, while
reducing and managing costs in a restructured organization, has
positioned the company to deliver sustainable profitable growth for
investors.” Mr. Barone added.
Third Quarter/Nine Months 2016 Financial
Highlights
- Net revenue up 58.2% for quarter; up 33.8% year-to-date
- Gross profit up 81.9% for quarter; up 39.0% year-to-date
-
Key channels of distribution (sporting goods & consumer) net revenues
up 65.2% for the quarter; up 32.2% year-to-date -
International net revenues up 218.2% for the quarter; up 137.8%
year-to-date -
Selling, general and administrative expenses at 34.7% of net revenue,
down from 54.1% - Net income of $250,000 reported for the quarter
- EBITDA of $272,000 reported for the quarter
Select Consolidated Financial Results, Third Quarter Ended September 30, 2016 and 2015 |
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(in thousands): | ||||||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||||||
Sept 30, |
% of |
Sept 30, |
% of |
|||||||||||||||||||||
2016 | 2015 | $ Chg | % Chg | |||||||||||||||||||||
Net revenue | $ | 2,706 | 100.0 | % | $ | 1,710 | 100.0 | % | 996 | 58.2 | % | |||||||||||||
Gross profit | 1,166 | 43.1 | % | 641 | 37.5 | % | 525 | 81.9 | % | |||||||||||||||
Selling, general, and administrative expenses | 940 | 34.7 | % | 925 | 54.1 | % | 15 | 1.6 | % | |||||||||||||||
Operating income (loss) | 186 | 6.9 | % | (319 | ) | -18.7 | % | 505 | ||||||||||||||||
Net income (loss) | 250 | 9.2 | % | (335 | ) | -19.6 | % | 585 | ||||||||||||||||
Third Quarter 2016 Operational Highlights
All key channels experienced growth. In particular, International is up
218% for the quarter, and is becoming an increasing part of the sales
mix. The sporting goods channel also experienced growth, despite the
loss of a former major customer that completed its bankruptcy
liquidation earlier this year. The Company continued to broaden its
customer base, adding another 19 accounts in the third quarter across
consumer, tactical and sporting goods channels. “Retailers and
distributors see the power of the Mace Brand in the safety and security
business segment. This provides Mace with opportunities to continue its
top line growth”, said Mace President and CEO John J. McCann.
Mace® recently announced the November 2016 sale of its
surveillance business to SecureCheck LLC. The business was sold for a
modest amount of cash in excess of the September 30, 2016 net Assets
held for sale balance plus an on-going royalty revenue stream. “By
partnering with SecureCheck LLC, the Mace® brand will continue to
be seen and become advertised nationally. The Mace team can now better
focus on expanding the Company’s core business, add complimentary
product lines, and look for additional royalty opportunities featuring
the Mace Brand,” Mr. McCann added.
Conference Call
Mace® will conduct a conference call on Thursday, November 17,
2016 at 11:00 AM EDT, 8:00 AM PDT to discuss its financial and
operational performance for the quarter ended September 30, 2016. The
participant conference call number is (877) 719-8065, conference ID:
20895961. A full set of the consolidated financial statements are
available on the Mace website. Presentation materials for the conference
call will be available Thursday, November 17, on Mace’s website under
Investor Relations, Shareholder Transcripts & Presentations. A digital
recording of the teleconference will be available on the Mace website
within 24 hours of the teleconference.
About Mace Security International, Inc.
Mace Security International Inc. is a globally recognized leader in
personal safety and security. Based in Cleveland, Ohio, the Company has
spent more than 40 years designing, manufacturing, and distributing
consumer and tactical products for personal defense, security and
surveillance under its world-renowned Mace® Brand – the
original trusted brand of pepper spray products. The Company also offers
aerosol defense sprays and tactical products for law enforcement and
security professionals worldwide through its Mace® and
Take Down® brands.
Mace Security International distributes and supports Mace®
Brand products and services through mass-market retailers, wholesale
distributors, independent dealers, e-commerce marketers and installation
service providers. For more information, please visit www.mace.com.
Forward-Looking Statements
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.
Mace Security International, Inc. | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
(Amounts in thousands) |
||||||||
ASSETS | September 30, | December 31, | ||||||
2016 | 2015 | |||||||
Current assets: | (Unaudited) | |||||||
Cash and cash equivalents | $ | 380 | $ | 446 | ||||
Restricted cash | 60 | 60 | ||||||
Short-term investments | 2,134 | 2,142 | ||||||
Accounts receivable, net | 2,084 | 1,562 | ||||||
Inventories, net | 1,665 | 1,601 | ||||||
Prepaid expenses and other current assets | 861 | 779 | ||||||
Assets held for sale, net | 219 | 430 | ||||||
Total current assets | 7,403 | 7,020 | ||||||
Plant and equipment, net | 697 | 522 | ||||||
Other intangible assets | 685 | 685 | ||||||
Other assets | 785 | 1,034 | ||||||
Total assets | $ | 9,570 | $ | 9,261 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 337 | $ | 222 | ||||
Income taxes payable | 59 | 61 | ||||||
Accrued expenses and other current liabilities | 539 | 695 | ||||||
Total current liabilities | 935 | 978 | ||||||
Other liabilities | 24 | – | ||||||
Total stockholders’ equity | 8,611 | 8,283 | ||||||
Total liabilities and stockholders’ equity | $ | 9,570 | $ | 9,261 | ||||
Mace Security International, Inc. | ||||||||||
Condensed Consolidated Statements of Operations | ||||||||||
Three Months Ended September 30, 2016 and 2015 | ||||||||||
(Unaudited) | ||||||||||
(Amounts in thousands) |
||||||||||
Three Months Ended September 30, | ||||||||||
2016 | 2015 | |||||||||
Net revenue | $ | 2,706 | $ | 1,710 | ||||||
Cost of revenue | 1,540 | 1,069 | ||||||||
Gross profit | 1,166 | 641 | ||||||||
Selling, general, and administrative expenses | 940 | 925 | ||||||||
Depreciation | 40 | 35 | ||||||||
Operating income (loss) | 186 | (319 | ) | |||||||
Interest expense | (12 | ) | (13 | ) | ||||||
Interest income | 30 | 44 | ||||||||
Loss on sale of short-term investments | – | (3 | ) | |||||||
Income (loss) from continuing operations before income tax provision | 204 | (291 | ) | |||||||
Income tax provision | – | – | ||||||||
Income (loss) from continuing operations | 204 | (291 | ) | |||||||
Income (loss) from discontinued operations, net of tax | 46 | (44 | ) | |||||||
Net income (loss) | $ | 250 | $ | (335 | ) | |||||
Mace Security International, Inc. | ||||||||||
Condensed Consolidated Statements of Operations | ||||||||||
Nine Months Ended September 30, 2016 and 2015 | ||||||||||
(Unaudited) | ||||||||||
(Amounts in thousands) |
||||||||||
Nine Months Ended September 30, | ||||||||||
2016 | 2015 | |||||||||
Net revenue | $ | 6,816 | $ | 5,094 | ||||||
Cost of revenue | 3,994 | 3,064 | ||||||||
Gross profit | 2,822 | 2,030 | ||||||||
Selling, general, and administrative expenses | 2,772 | 2,816 | ||||||||
Depreciation | 116 | 107 | ||||||||
Operating loss | (66 | ) | (893 | ) | ||||||
Interest expense | (35 | ) | (38 | ) | ||||||
Interest income | 102 | 138 | ||||||||
Loss on sale of short-term investments | – | (19 | ) | |||||||
Other income | – | 312 | ||||||||
Income (loss) from continuing operations before income tax provision | 1 | (500 | ) | |||||||
Income tax provision | – | – | ||||||||
Income (loss) from continuing operations | 1 | (500 | ) | |||||||
Income (loss) from discontinued operations, net of tax | 129 | (77 | ) | |||||||
Net income (loss) | $ | 130 | $ | (577 | ) | |||||
Contacts
Mace Security International Inc.
John J. McCann
President and
Chief Executive Officer
440-424-5322
john@mace.com