-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, P/xbccho0WXagnseC3hcWlUm5Uj/mYmn/bffrAyG+PLZM75HDSVCt4XtY1akDERb AGPNNvWw8pSa1OrrZmHGZw== 0000950123-05-001373.txt : 20050209 0000950123-05-001373.hdr.sgml : 20050209 20050209124658 ACCESSION NUMBER: 0000950123-05-001373 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050208 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050209 DATE AS OF CHANGE: 20050209 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NAPCO SECURITY SYSTEMS INC CENTRAL INDEX KEY: 0000069633 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 112277818 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-10004 FILM NUMBER: 05587561 BUSINESS ADDRESS: STREET 1: 333 BAYVIEW AVE CITY: AMITYVILLE STATE: NY ZIP: 11701 BUSINESS PHONE: 5168429400 MAIL ADDRESS: STREET 1: 333 BAYVIEW AVE STREET 2: XXXXXXXXXXXXXXXXXXX CITY: AMITYVILLE STATE: NY ZIP: 11701 8-K 1 y05583e8vk.txt NAPCO SECURITY SYSTEMS, INC. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) February 8, 2005 NAPCO SECURITY SYSTEMS, INC. (Exact name of registrant as specified in charter) Delaware 0-10004 11-2277818 - --------------- ------------ ------------------- (State or other (Commission (IRS Employer jurisdiction of File Number) Identification No.) incorporation) 333 Bayview Avenue, Amityville, New York 11701 (Address of principal executive offices) Registrant's telephone number, including area code (631) 842-9400 Check the appropriate box below if the Form 8-K filing is intended to satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) INFORMATION TO BE INCLUDED IN THE REPORT ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On February 8, 2005, the registrant issued a press release to report results for the quarter and six months ended December 31, 2004. This press release is furnished as Exhibit 99.1. The information in this Current Report on Form 8-K, including the exhibits attached hereto, is furnished pursuant to Item 2.02 and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits: 99.1 Press Release issued by Napco Security Systems, Inc. dated February 8, 2005. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunder duly authorized. NAPCO SECURITY SYSTEMS, INC. ------------------------------------ (Registrant) Date: February 8, 2005 By: /s/ Kevin S. Buchel --------------------------------- Kevin S. Buchel Senior Vice President and Chief Financial Officer EX-99.1 2 y05583exv99w1.txt PRESS RELEASE "Exhibit 99.1" -------------- FOR IMMEDIATE RELEASE CONTACT: Richard L. Soloway, CEO Stephen D. Axelrod, CFA Kevin S. Buchel, Senior VP Andria Arena (Media) NAPCO Security Systems, Inc. Wolfe Axelrod Weinberger Assoc. LLC (631) 842-9400 ext. 120 (212) 370-4500; (212) 370-4505 fax steve@wolfeaxelrod.com NAPCO SECURITY SYSTEMS, INC. REPORTS RECORD BREAKING 2ND FISCAL QUARTER SALES AND STRONG PROFITS - Sales up 10% for Second Quarter, 20% for Six Months- - Net Income Up 20% for Second Quarter, 211% for Six Months-- -Strong Distributor Acceptance of Reallocation Strategy and Broad Product Portfolio Leads to Optimistic Outlook- AMITYVILLE, NEW YORK - FEBRUARY 8, 2005 - NAPCO Security Systems, Inc. (Nasdaq: NSSC) one of the world's leading suppliers of high performance electronic security equipment for over 30 years, announced today financial results for its second quarter and six months ended December 31, 2004. Net sales for the second quarter ended December 31, 2004 increased 10% to $16,019,000 from $14,629,000 reported for the same quarter a year earlier. Net income for the quarter increased 20% to $872,000 or $0.10 per diluted share compared to net income of $728,000, or $0.08 per diluted share, reported for the same year ago period. The increase in sales for the second quarter was due primarily to increased sales of the Company's Alarm Lock door locking and NAPCO burglar and fire alarm products. Net sales for the six months ended December 31, 2004 increased 20% to $29,459,000 from $24,464,000 reported for the six months ended December 31, 2003. Net income for the first half of fiscal 2004 increased 211% to $1,385,000, or $0.15 per diluted share, compared to net income of $446,000, or $0.05 per diluted share, for the same period a year earlier. Richard Soloway, Chairman and President, stated, "As evidenced by our strong sales in the first quarter of fiscal 2005, and subsequently extended through the second fiscal quarter, our business strategy of reallocating our burglar and fire alarm sales across our extensive national network of independent distributors has been well received and the revitalization of that segment of our business has taken hold." "Our independent distributor network has done an outstanding job of reaching out to an expanding list of security dealers who focus on residential, commercial, industrial and governmental security installations, resulting in increased acceptance and sales of NAPCO alarm products," noted Mr. Soloway. - More - "In addition," Mr. Soloway added, "NAPCO has shown major improvements in our financial metrics. In the past six months we have reduced our outstanding bank debt by approximately $4 million to $4.4 million and since December 31, 2003 by $9.2 million. Net cash provided by operating activities during this period was $5.1 million compared to $2.6 million a year ago." NAPCO has recently introduced its newest, expanded catalog (available on request) demonstrating once again NAPCO's commitment to its customer's need for state-of-the-art breakthrough security products and systems; a commitment that is met by devoting over $4 million annually to R&D. "As the second half of our fiscal year is historically our strongest, we can look forward with a great degree of confidence to reporting significant sales gains over the remainder of the fiscal year, and, since our bottom line is sensitive to volume, we can also expect a positive impact on net income and per share results. We look forward to reporting another very successful year," Mr. Soloway concluded. As of December 31, 2004, NAPCO's current ratio was 4.9-to-1, working capital stood at $28.7 million and long-term debt was $4.4 million with a long-term debt-to-equity ratio of 0.11-to-1. Inventory, which normally builds as NAPCO enters its strongest revenue quarters, has been carefully controlled and at calendar year end 2004 was $15.0 million compared to $17.5 million at December 31, 2003. Inventories normally increase after the first half in recognition of the anticipated cyclical increase in sales in the third and fourth fiscal quarters. EBITDA* (Earnings before interest, taxes, depreciation and amortization) has similarly improved during the six months ending December 31, 2004, almost doubling from last year to $2.8 million, compared to $1.5 million." ---------------------------------- NAPCO Security Systems, Inc. is one of the world's leading manufacturers of technologically advanced electronic security equipment including burglary and fire alarm systems, access control products and electronic locking devices. The Company's products, including those of Alarm Lock and Continental Instruments, feature some of the most popular and best-selling control panels, sensors, locking devices and access control systems. They are used in residential, commercial, institutional, industrial and governmental applications. NAPCO security products have earned a reputation for technical excellence, reliability and innovation, poising the Company for revenue growth in the rapidly expanding electronic security market, a market whose current size exceeds $25 billion. For additional information on NAPCO, please visit the Company's web site at www.napcosecurity.com. This press release contains forward-looking statements that involve numerous risks and uncertainties. Actual results, performance or achievements could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those set forth in the Company's filings with the Securities and Exchange Commission. * For the six months ended December 31, 2004 and 2003, respectively, EBITDA has been calculated by adding depreciation and amortization ($563,000 and $558,000) interest expense ($126,000 and $230,000) and provision for income taxes ($742,000 and $241,000) to net income ($1,385,000 and $446,000). - Tables to Follow - NAPCO SECURITY SYSTEMS, INC AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except share and per share data)
Three Months Ended Six Months Ended December 31, December 31, 2004 2003 2004 2003 --------- --------- -------- -------- Net sales $ 16,019 $ 14,629 $ 29,459 $ 24,464 Cost of sales 11,101 10,077 20,268 16,929 -------- -------- ------ ------ Gross profit 4,918 4,552 9,191 7,535 Selling, general and administrative expenses 3,468 3,305 6,840 6,582 ------- ------- ------- ------- Operating income 1,450 1,247 2,351 953 ------- ------- ------- -------- Interest expense, net 58 102 126 230 Other expense, net 55 24 98 36 --------- --------- --------- --------- 113 126 224 266 -------- -------- -------- -------- Income before provision for income taxes 1,337 1,121 2,127 687 Provision for income taxes 465 393 742 241 --------- --------- -------- -------- Net income $ 872 $ 728 $ 1,385 $ 446 ========== ========== ======== ========= Net income per share*: Basic $ 0.10 $ 0.09 $ 0.16 $ 0.06 ========== ========== ========== ========== Diluted $ 0.10 $ 0.08 $ 0.15 $ 0.05 ========== ========== ========== ========== Weighted average number of shares outstanding*: Basic 8,525,500 7,796,399 8,516,019 7,721,077 ========= ========= ========= ========= Diluted 9,104,098 8,865,430 9,035,422 8,288,747 ========= ========= ========= =========
* The 20% stock dividend declared on November 8, 2004, has been retroactively reflected in all 2003, share and per share data. - More - NAPCO SECURITY SYSTEMS, INC AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in thousands, except share data)
December 31, June 30, ASSETS 2004 2004 ------ ------- ------- CURRENT ASSETS Cash and cash equivalents $ 1,579 $ 796 Accounts receivable, less reserve for doubtful accounts of $320 and $355, respectively 17,094 19,927 Inventories 14,992 14,594 Prepaid expenses and other current assets 610 760 Deferred income taxes 1,763 1,763 ------- ------- Total Current Assets 36,038 37,840 Property, plant and equipment, net 8,937 8,987 Goodwill, net 9,686 9,686 Other assets 186 159 ------ ------ TOTAL ASSETS $54,847 $56,672 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY ------------------------------------ CURRENT LIABILITIES Current portion of long-term debt $ - $ 1,900 Accounts payable 4,759 3,789 Accrued expenses 789 963 Accrued salaries and wages 1,792 1,911 Accrued income taxes 4 285 ------------ ----------- Total Current Liabilities 7,344 8,848 Long-term debt, net of current portion 4,363 6,400 Accrued income taxes 2,520 2,243 Deferred income taxes 1,277 1,277 ---------- ---------- Total Liabilities 15,504 18,768 -------- -------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY* Common stock, par value $0.01 per share; 21,000,000 shares authorized, 8,544,710 and 8,503,670 shares issued and outstanding, respectively 85 85 Additional paid-in capital 11,435 11,381 Retained earnings 27,823 26,438 -------- -------- TOTAL STOCKHOLDERS' EQUITY 39,343 37,904 -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $54,847 $56,672 ========= =========
* The 20% stock dividend declared on November 8, 2004, has been retroactively reflected in Stockholders' Equity. ### -----END PRIVACY-ENHANCED MESSAGE-----