Science & Technology
Science and Technology
Science and Technology
Wed, August 12, 2009 Law Enforcement Associates: Law Enforcement Associates Reports Record Second Quarter and Six-Month Financial Results; Year-to-D
RALEIGH, NC--(Marketwire - August 12, 2009) - Law Enforcement Associates Corporation (LEA) (
SELECTED HIGHLIGHTS:
-- Q2 operating income reported at $1.4 million; net income at $789,000, or $0.03 per share -- Year-to-date operating cash flow reaches $1.1 million -- Quoting and booking activity accelerating as stimulus funds reaching customers
Law Enforcement Associates Corporation (LEA) (
Second quarter revenue increased by approximately $5 million, or 267%, to a record $6.8 million from $1.8 million in last year's second quarter. The increase was attributable to strong shipping volume, a significant portion of which was associated with a record contract signed in the first quarter. Gross margin improved to 33% from 28% in the comparable year-ago quarter. Income from operations was $1.4 million, an improvement of $1.6 million when compared to a loss from operations of $171,000 in the second quarter a year ago. Net income was $789,000, or $0.03 per share, a positive swing of nearly $1.0 million when compared to a net loss of $167,000, or $0.01 per share, in the second quarter last year.
For the six-month period, revenue increased 123% to a record $8.5 million from $3.8 million in the 2008 six-month period. Gross margin was 31% versus 35% in the comparable period a year ago. Operating income was $1.3 million, an improvement of $1.4 million when compared to a loss from operations of $118,000 in the same period last year. Six-month net income was $692,000, or $0.03 per share, a positive swing of $840,000 when compared to a net loss of $148,000, or $0.01 per share, at the six-month mark last year.
"We have achieved the strongest six-month financial performance in Company history, and are positioned to deliver record revenue and profitability for our full-fiscal year as well," said Paul Feldman, president. "We've seen a marked improvement in sales activity during recent weeks, as the $4 billion in law enforcement funding from the American Recovery and Reinvestment Act has begun to reach our customers."
"There is a growing spectrum of new business opportunities emerging on the horizon, and we are taking aggressive action to capitalize on them," Feldman added. "Our increased investments in research and development should result in the launch of a key new product offering in the coming months. In addition, we are strengthening our business development efforts and strategic initiatives, and hope to announce details of some of these programs in the coming weeks."
In commenting on the 1.2 million shares of LEA redeemable common stock that became exercisable on August 1, 2009, Feldman said, "We are in discussions with the party holding these redeemable shares, and remain confident that we will be able to resolve the issue in a manner favorable to both the Company and the holder."
Paul Briggs, chief financial officer, said, "Our balance sheet as of June 30 reflects LEA's improving financial strength. Subsequent to the close of the quarter, we have added significantly to the Company's cash and working capital positions, and we remain free of any long-term debt."
About Law Enforcement Associates Corporation
LEA is a leading security and surveillance technology Company that manufactures and markets a diverse product line to the worldwide law enforcement, military, security and corrections markets. The Company's Audio Intelligence Devices (AID) division has been serving the law enforcement sector for more than 30 years and is one of the most respected names in the surveillance equipment industry. LEA's products are used by a wide variety of government and non-governmental agencies, as well as public and private companies. These include military bases, nuclear facilities, embassies, government installations, oil refineries, United Nations and NATO locations. LEA's products have been used at high-profile events such as the Summer & Winter Olympics, Super Bowl, U.S. Golf Championship, and the Democratic and Republican National Conventions. Its products include the Under Vehicle Inspection System (UVIS), EDK123 (Explosive Detection Kit), Bloodhound and Birddog GPS Tracking Systems, Graffiti Cam, Letter-bomb Visualizer Spray, and a wide variety of Audio & Video Surveillance Equipment. Headquartered in Raleigh, N.C., the Company has been featured in many industry publications and websites. For more information, please visit [ www.leacorp.com ].
Forward-Looking Information:
The statements in this news release contain forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that use words such as "believe," "anticipate," "estimate," "intend," "could," "plan," "expect," "project," "predict," "forecast," "outlook," "potential," "continue," "may," "future," "can," "enhance," and "should," or the negative of these, as well as similar expressions, can be used to identify forward-looking statements. Such forward-looking statements involve certain risks, assumptions and uncertainties, including the inability to generate and secure the necessary product sales, or the lack of acceptance of the Company's products by its customers. In each case actual results may differ materially from such forward-looking statements. The company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results (expressed or modified) will not be realized.
Law Enforcement Associates Corporation Consolidated Statement of Operations Three Months ended June 30, 2009 and June 30, 2008 June 30, June 30, 2009 2008 ----------- ----------- Revenues $ 6,786,665 $ 1,848,700 Cost of goods sold 4,568,594 1,327,259 ----------- ----------- Gross profit 2,218,071 521,441 ----------- ----------- Research and development 138,199 30,688 Operating expenses 683,538 662,238 ----------- ----------- Total operating expenses 821,737 692,926 ----------- ----------- Net income (loss) before other income (expenses) and income taxes 1,396,334 (171,485) ----------- ----------- Other income (expense) Loss on sale of assets (8,361) (43,666) Other income 7,504 - Interest income 25 308 Interest expense (111,113) (30,919) ----------- ----------- Total other income (expense) (111,945) (74,277) ----------- ----------- Net income (loss) before income taxes 1,284,389 (245,762) Income tax (expense) benefit (495,131) 78,824 ----------- ----------- Net income (loss) $ 789,258 $ (166,938) =========== =========== Net income (loss) per weighted average share, basic and diluted $ 0.03 $ (0.01) =========== =========== Weighted average number of shares, basic and diluted 25,782,436 25,782,436 =========== =========== Law Enforcement Associates Corporation Consolidated Statement of Operations Six Months ended June 30, 2009 and June 30, 2008 June 30, June 30, 2009 2008 ----------- ----------- Net sales $ 8,538,399 $ 3,828,359 Cost of sales 5,854,309 2,499,910 ----------- ----------- Gross profit 2,684,090 1,328,449 ----------- ----------- Research and development 176,099 39,892 Operating expenses 1,245,743 1,406,544 ----------- ----------- Total operating expenses 1,421,842 1,446,436 ----------- ----------- Net income (loss) before other income (expense) and income taxes 1,262,248 (117,987) ----------- ----------- Other income (expense) Loss on sale of assets (8,361) (43,666) Other income 10,338 6,606 Interest income 25 1,320 Interest expense (136,664) (62,045) ----------- ----------- Total other income (expense) (134,662) (97,785) ----------- ----------- Net income (loss) before income taxes 1,127,586 (215,772) Income tax (expense) benefit (435,546) 67,428 ----------- ----------- Net income (loss) $ 692,040 $ (148,344) =========== =========== Net income (loss) per weighted average share, basic and diluted $ 0.03 $ (0.01) =========== =========== Weighted average number of shares, basic and diluted 25,782,436 25,782,436 =========== =========== Law Enforcement Associates Corporation Consolidated Balance Sheets June 30, 2009 and December 31, 2008 June 30, December 2009 31, 2008 ASSETS (Unaudited) (Audited) ----------- ----------- CURRENT ASSETS Cash $ 734,550 $ 254,705 Trade accounts receivable (net of allowance for doubtful accounts of $30,000 and $30,000 at June 30, 2009 and December 31, 2008, respectively) 1,876,973 2,011,293 Accounts receivable - other 49,253 - Inventories 1,529,329 1,368,049 Prepaid expenses 49,837 45,629 Deferred tax asset - current 304,326 244,741 ----------- ----------- Total current assets 4,544,268 3,924,417 ----------- ----------- PROPERTY AND EQUIPMENT - net 158,620 170,027 ----------- ----------- OTHER NON-CURRENT ASSETS Intangibles - net 2,092,431 2,174,564 Assets held for sale 335,505 335,505 Deferred tax asset less current portion 565,995 820,425 ----------- ----------- Total non-current assets 2,993,931 3,330,494 ----------- ----------- Total assets $ 7,696,819 $ 7,424,938 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable $ 362,926 $ 331,451 Line of credit 439,450 1,038,809 Accrued expenses: Income taxes 240,702 - Compensation and payroll taxes 139,961 126,695 Profit sharing plan 29,994 76,769 Warranty provision 54,865 58,809 Other accrued expenses 65,392 97,205 Deferred expenses 56,336 104,628 Customer deposits 4,019 30,540 ----------- ----------- Total current liabilities, before shares subject to redemption 1,393,645 1,864,906 ----------- ----------- Common stock, subject to possible redemption, 1,200,000 shares, at redemption value 1,491,476 - Total current liabilities 2,885,121 1,864,906 ----------- ----------- Total liabilities 2,885,121 1,864,906 ----------- ----------- Commitments and contingencies Common stock, subject to possible redemption, 1,200,000 shares, at redemption value - 1,440,374 ----------- ----------- STOCKHOLDERS' EQUITY Common stock, $0.001 par value, 50,000,000 authorized, 25,782,436 issued and outstanding at June 30, 2009 and December 31, 2008 25,782 25,782 Treasury stock at cost, 595 shares of common stock held by the Company (625) (625) Paid in capital in excess of par 4,995,595 4,995,595 Retained earnings/(accumulated deficit) (209,054) (901,094) ----------- ----------- Total stockholders' equity 4,811,698 4,119,658 ----------- ----------- Total liabilities and stockholders' equity $ 7,696,819 $ 7,424,938 =========== ===========
