Mace Reports Fourth Quarter and Full-Year 2017 Financial Results
- Net sales up 10.3% for the year, $929k improvement over 2016
- Operating income of $94,000 for the year, $283,000 improvement over 2016
- EBITDA of $270,000 for the year, $323,000 improvement over 2016
- Adds 112 new accounts in 2017
- Strategic acquisitions expand revenues
CLEVELAND, Ohio – Mace Security International Inc. (OTCQX: MACE) today released audited financial results for the year ended December 31, 2017.
The Company is pleased to announce another year of growth in 2017. The Company has grown its top line sales through organic growth and strategic acquisitions during the past year while managing spending and operations to turn a profit at the same time. The Company in 2017 added 112 new accounts across all channels of commerce.
The acquisitions contributed in part to the Company finishing the year with $270,000 in positive EBITDA. Outgoing Chairman Richard Barone stated: “The work which was started over five years ago is paying off for the investors and the Company. Although we are pleased with the results we do see bigger and better things for the Company in the future.”
The Company additionally launched several new products and repositioned its self to compete in the ever evolving retail environment by implementing the following:
- Company added key staff to help it compete effectively in the growing e-commerce channel
- Added several new products in 2017
- Streamlined operations to serve its customers effectively and efficiently
- Made investments in advertising and branding to promote and protect the trademarks and the Company’s brands
The Company acknowledges and thanks former Board members Dan Perella and Carl Grassi for their contributions and hard work over the past several years with helping place the foundation for future success.
Fourth Quarter/ Full-Year 2017 Financial Highlights – Compared to 2016
- Net sales up 31.1% for quarter; up 10.3% year-to-date
- Gross profit up 64.9% for quarter; up 19.5% year-to-date
- EBITDA of $74,000 reported for the quarter; $270,000 year-to-date
Select Consolidated Financial Results, Fourth Quarter Ended December 31, 2017 and 2016
(in thousands):
| For the Three Months Ended | ||||||||||||||
| Dec 31, 2017 | % of Sales | Dec 31, | % of Sales | |||||||||||
| 2016 | $ Chg | |||||||||||||
| Net sales | $2,935 | 100.0% | $2,238 | 100.0% | 697 | |||||||||
| Gross profit | 1,423 | 48.5% | 863 | 38.6% | 560 | |||||||||
| Selling, general, and administrative expenses | 1,348 | 45.9% | 947 | 42.3% | 401 | |||||||||
| Operating income (loss) | 26 | 0.9% | (123) | (5.5%) | 149 | |||||||||
| Net income (loss) | (30) | (1.0%) | 120 | 5.4% | 150 | |||||||||
| EBITDA | 74 | 2.5% | (103) | (3.8%) | 177 | |||||||||
Fourth Quarter / Full Year 2017 Operational Highlights
The Company, by expanding its revenue base with the 2017 acquisitions of Washington Laboratories and Vigilant, was able to grow revenues by 10.3% despite a cyclical downturn in international sales and sluggish sales in the sporting goods channel in 2017. The acquisition of Washington Laboratories added stable top line growth. The increased production volume and automation derived from this acquisition increased overall profitability by lowering per unit costs. The Vigilant acquisition, and addition of David Happe to the Mace team, provided the Company with an instant vibrant e-commerce presence both domestically and internationally as well as the expertise to manage and grow this critical segment. “Mace was the perfect partner for me as they have the brand, the infrastructure and the tools to raise the ceiling on my goals and abilities” stated David Happe.
Conference Call
Mace® will conduct a conference call on Thursday, March 29, 2018 at 11:00 AM EDT, 8:00 AM PDT to discuss its financial and operational performance for the quarter and full-year ended December 31, 2017. The participant conference call number is (877) 719-8065, conference ID: 7699986.A full set of the consolidated financial statements are available on www.Mace.com. Recording of the teleconference will be available on the Mace website within 48 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 and manufacturing 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, and Vigilant® Brand alarms which is the world-wide leader and number one recognized brand in personal alarms.
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.
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Mace Security International, Inc.
Condensed Consolidated Balance Sheets
(Amounts in thousands)
| ASSETS | December 31, 2017 | December 31, 2016 | |
| Current assets: | |||
| Cash and cash equivalents | $662 | $970 | |
| Restricted cash
Short-term investments |
–
251 |
60
1,794 |
|
| Accounts receivable, net | 1,622 | 1,655 | |
| Inventories, net | 2,317 | 1,568 | |
| Notes receivable and other current assets | 1,143 | 952 | |
| Total current assets | 5,995 | 6,999 | |
| Property and equipment, net | 781 | 714 | |
| Goodwill | 771 | – | |
|
Intangible assets, net |
3,211 | 685 | |
| Notes receivable and other assets | 906 | 1,184 | |
| Total other assets | 4,888 | 1,869 | |
| Total assets | $11,664 | $9,582 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||
| Current liabilities: | |||
| Current portion of long-term debt | $427 | $- | |
| Accounts payable | 457 | 194 | |
| Income taxes payable | 62 | 60 | |
| Accrued expenses and other current liabilities | 633 | 518 | |
| Total current liabilities | 1,579 | 772 | |
| Long-term debt, net of current portion | 678 | – | |
| Other liabilities | 2 | 4 | |
| Total liabilities | 2,259 | 776 | |
| Total stockholders’ equity | 9,405 | 8,806 | |
| Total liabilities and stockholders’ equity | $11,664 | $9,582 |
Mace Security International, Inc.
Condensed Consolidated Statements of Operations
Three Months Ended December 31, 2017 and 2016
(Amounts in thousands)
| 2017 | 2016 | |||
|
Net sales |
$2,935 | $2,238 | ||
| Cost of revenue | 1,512 | 1,375 | ||
|
Gross profit |
1,423 |
863 |
||
| Selling, general, and administrative expenses | 1,348 | 947 | ||
| Depreciation | 49 | 39 | ||
| Operating income (loss) | 26 | (123) | ||
| Interest expense | (15) | (13) | ||
| Interest income | 25 | 34 | ||
| Loss on sale of short-term investments | (1) | (15) | ||
| Amortization of intangible assets | (63) | – | ||
| Other expense, net | – | (4) | ||
| Loss from continuing operations before income tax provision | (28) | (121) | ||
| Income tax (benefit) provision | 2 | (19) | ||
| Loss from continuing operations | (30) | (102) | ||
| Income from discontinued operations, net of tax | – | 222 | ||
| Net income (loss) | $(30) | $120 |
Mace Security International, Inc.
Condensed Consolidated Statements of Operations
Twelve Months Ended December 31, 2017 and 2016
(Audited)
(Amounts in thousands)
| 2017 | 2016 | |||
| Net sales | $9,983 | $9,054 | ||
| Cost of revenue | 5,580 | 5,369 | ||
| Gross profit | 4,403 | 3,685 | ||
| Selling, general, and administrative expenses | 4,121 | 3,719 | ||
| Depreciation | 188 | 155 | ||
| Operating income (loss) | 94 | (189) | ||
| Interest expense | (45) | (48) | ||
| Interest income | 96 | 136 | ||
| Loss on sale of short-term investments | (12) | (15) | ||
| Amortization of intangible assets | (174) | – | ||
| Other expense, net | – | (4) | ||
| Income (loss) from continuing operations before income tax provision | (41) | (120) | ||
| Income tax (benefit) provision | 2 | (19) | ||
| Loss from continuing operations | (43) | (101) | ||
| Income (loss) from discontinued operations, net of tax | (22) | 351 | ||
| Net income (loss) | $(65) | $250 |
Contact:
John J. McCann
President and Chief Executive Officer
440-424-5322