Mace Reports Second Quarter 2019 Financial Results
• Net sales for the quarter increased to $2,967,000 or 4.4% over same period in 2018
• Net loss of ($606,000) for the second quarter, which includes non-cash charges for a reserve of a customer receivable of $322,000 and charges for exit of the munitions business of $140,000, compared to net income of $41,000 for the same period in 2018. Net loss for the six months ended June 30, 2019 was ($1,462,000) compared to a net loss of ($293,000) for the same period in 2018
• EBITDA of ($481,000) and adjusted EBIDTA of ($5,000) for the second quarter
CLEVELAND, Ohio – Mace Security International Inc. (OTCQX: MACE) announces its unaudited financial results for the quarter ended June 30, 2019.
The Company is pleased to announce another quarter of revenue growth of 4.4% over the same period in 2018. The Company’s net loss in the quarter includes non-cash charges relating to a write-down of a customer receivable of $322,000, and charges to exit its less-lethal munitions business $140,000.
President and CEO Gary Medved commented: “We are pleased that the Company has seen another quarterly increase in net sales versus the prior year. After adjusting for the impact of the customer receivable reserve increase, we were able to hold SG&A as a percentage of revenue in line with the prior year, while continuing our investments in recruiting talent, eCommerce capabilities, and brand awareness. Many of the actions necessary thus far in 2019 are necessary to reposition Mace for improved future financial performance.”
Second Quarter/Year to Date 2019 Financial Highlights
• Net sales increased 4.4% for the three months ended June 30, 2019 over the same period least year, and 9% for the six months ended June 30, 2019 over the same period in 2018.
• Gross profit decreased $259,000 compared to the same quarter in 2018.
• Gross margin for the quarter declined from 43% to 32% (or 37% after adjusting for the Less-lethal munitions charge.). This decline was due to manufacturing labor and overhead variances in the quarter.
• After adjusting for the $322,000 increase in accounts receivable reserve, SG&A expenses for the three months ended June 30, 2019 were approximately equal to the same period from 2018.
Second Quarter 2019 Operational Highlights
• The Company made the decision to exit the less lethal munitions business, while continuing its popular Take-Down ® products for the law enforcement and tactical community. This decision is expected to free up over $20,000 per month to redeploy towards higher margin and faster growing products and channels.
• The Company is continuing to develop products, packaging, and image for the new KUROS! ® and USPS ® brands, which were announced at the July Investors Day at Mace headquarters.
• Mace.com was also upgraded to enhance its mobile features and make the site more user friendly.
Conference Call
Mace® will conduct a conference call on Thursday August 8, 2019 at 2 PM EDT, 11 AM PDT to discuss its financial and operational performance for the quarter.
Participant Toll-Free Dial-In Number: (877) 719-8065; Conference ID 9593103
International Toll Number (918) 398-4757
A full set of the consolidated financial statements will be available on www.Mace.com tomorrow morning prior to the company’s earnings call. A digital recording of the conference call will be available for replay two hours after the call’s completion. The date ranges the recording will be available are listed below. To access the recording, use the dial-in number listed below and the conference ID 6966839.
Encore dial-in number: (855) 859-2056 or (404) 537-3406
Encore dates: 08/08/2019 17:00 Eastern Time – 08/13/2019 23:59 Eastern Time
About Mace Security International, Inc.
Mace Security International Inc. is a globally recognized leader in personal safety products. Based in Cleveland, Ohio, the Company has spent more than 30 years designing and manufacturing consumer and tactical products for personal defense and security under its world-renowned Mace® Brand – the original trusted brand of pepper spray products. The Companies other leading brands include Tornado® Brand stun guns and pepper spray, and Vigilant® Brand alarms. The Company also offers aerosol defense sprays for law enforcement and security professionals worldwide through its Take Down® Brand.
Mace Security International, Inc. distributes and supports its products and services through mass-market retailers, wholesale distributors, independent dealers, e-commerce channels and through its website, 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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In this press release, the Company’s financial results and financial guidance are provided in accordance with accounting principles generally accepted in the United States (GAAP) and using certain non-GAAP financial measures. Management believes that presentation of operating results using non-GAAP financial measures provides useful supplemental information to investors and facilitates the analysis of the Company’s core operating results and comparison of operating results across reporting periods. Management also uses non-GAAP financial measures to establish budgets and to manage the Company’s business. A reconciliation of the GAAP financial results to non-GAAP financial results is included in the attached schedules.
Contacts:
Gary Medved
President and Chief Executive Officer
gmedved@mace.com
Mark Barrus
SVP and Chief Financial Officer
mbarrus@mace.com