-----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, A+i9QQ4ukGeEyomN90WjEJYOIP9GuEwOIr+fx3KemZzwxOfc6S+jjouN0L5WcdkU xKLHPJrwJ8yW3iT05X1heQ== 0001157523-07-011139.txt : 20071113 0001157523-07-011139.hdr.sgml : 20071112 20071113061414 ACCESSION NUMBER: 0001157523-07-011139 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20071112 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071113 DATE AS OF CHANGE: 20071113 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: 071233941 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 a5544286.txt NAPCO SECURITY SYSTEMS, INC. 8-K 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) November 12, 2007 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 November 12, 2007, the registrant issued a press release to report results for the three months ended September 30, 2007. 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 (d) Exhibits: 99.1 Press Release issued by Napco Security Systems, Inc. dated November 12, 2007. 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: November 12, 2007 By: /s/ Kevin S. Buchel ------------------------------------ Kevin S. Buchel Senior Vice President and Chief Financial Officer EX-99.1 2 a5544286ex99_1.txt EXHIBIT 99.1 Exhibit 99.1 NAPCO Security Systems, Inc. Announces First Quarter Results - Sales Relatively Constant at $13.9 Million, EPS $0.02 - - First Quarter Results Historically Company's Weakest - Business Editors/Security Writers AMITYVILLE, N.Y.--(BUSINESS WIRE)--Nov. 12, 2007--NAPCO Security Systems, Inc., (Nasdaq: NSSC), one of the world's leading suppliers of high performance electronic security equipment for over 30 years, today announced financial results for its first quarter ended September 30, 2007. Net sales for the first quarter ended September 30, 2007 remained relatively constant at $13.9 million as compared to $14.0 million last year. Net income for the quarter decreased 61% to $374,000 or $0.02 per fully diluted share as compared to $952,000 or $0.05 per fully diluted share, for the same period a year ago. Sales for the quarter reflected minor increases in intrusion-related sales as offset by moderate decreases in the access control products. Gross Margins decreased to 37.0% in the current quarter as compared to 39.6% in the same quarter a year ago due primarily to lower production levels and an associated decrease in overhead absorption rates in the first three months of fiscal 2007 as compared to the same period in fiscal 2006. Selling, general and administrative expenses rose $328,000 or 8.2% primarily from costs associated with the International Security Conference (ISC) trade show that was held this past September in New York City. Last year, the ISC show in New York City was held during the second quarter of fiscal 2007. NEW PRODUCTS AND EXPANDED OFFERINGS NAPCO's R&D efforts resulted in the debut of many innovative and upgraded products, several of which met with great excitement and anticipation at the aforementioned ISC tradeshow in New York City: The introduction of new coded and code-free touchpads has expanded the NAPCO Freedom(TM) 64 burglar and fire alarm panels to enable the line to become the most versatile and advanced line of security systems in the industry. The user-friendly, installer-friendly system, now features choice of traditional numeric or codeless "talking" user interfaces, plus wireless and hardwire capability and expandability from 6 to 64 zones making them applicable and attractive for all small, medium and large security jobs. This broadened Freedom 64 line received a warm reception and security magazine editors likewise judged it to be among the best-of-show. Also popular was NAPCO's new and feature-rich ISeeVideo(TM) internet video surveillance system, that allows homeowners and business people to view live video or stored video "clips" of activities in their homes or businesses from a computer or internet-ready cell phone anywhere in the world. With this technology, you can virtually be in two places at the same time. Security companies will find this sharply-priced, all-inclusive system simple to install due to NAPCO's patent pending plug and play technology and the system, designed for both new systems and to retrofit any existing CCTV account, will provide NAPCO and its dealers with a new source of recurring monthly service revenue. Alarm Lock has expanded the applicability of its successful Trilogy(R) line with the DL1200 and P/DL1300 series of Narrow "stile" pushbutton and proximity card reading electronic door locks for installation on all types of glass and aluminum doors. These new locks round out the Trilogy (R) line of door locks, which are considered the leading line of electronic locks in the field, and are becoming a substitute for ordinary mechanical keylocks and locksets found on most doors. The Continental Access Group released the latest version CardAccess(R) 3000 enterprise-class software which adds advanced large scale capabilities including the supervision of up to 30,000 doors, Threat Level Management, Email/Pager Notification, and Multi Country/Location Holiday use as well as Visitor Management and Time & Attendance Accounting readily exportable for payroll processing. In addition, this new software version provides seamless integration to the NAPCO Gemini (TM) line of alarm panels and will facilitate more software license & upgrade purchases, including new "soft key" option. Richard Soloway, Chairman and President, stated, "Over the years, the first quarter has historically been our softest, with sales increasing in the second and third quarters and peaking in the fourth quarter. While I expect the sales to improve throughout the balance of fiscal 2008, I was also encouraged by the improvement shown this quarter in the intrusion sales. While this increase was a modest one, it was the first time since the fourth quarter of fiscal 2006 that we have seen an increase. We remain cautiously optimistic that this trend can continue going forward throughout fiscal 2008. "We are very confident," Mr. Soloway concluded, "that we have a wide and stable security platform in place with our NAPCO, Alarm Lock, and Continental product lines, distribution networks and manufacturing operations. In addition, our expectations for our newly introduced products and our deepening alliances with the largest alarm companies bodes well for a bright future. Our financial strength assures us that we will have the resources to take advantage of the opportunities that will enhance our growth prospects and increase shareholders' value. While inventory levels have once again increased primarily due to the level loading of the production in our factory in the Dominican Republic, we continue to believe that the fruits of our R & D efforts and subsequent investments we have made, will pay off in the near term and inventory levels will subsequently be reduced." NAPCO's balance sheet remains strong with working capital amounting to approximately $40 million and a current ratio of 5.1 to 1. EBITDA* (Earnings before interest, taxes, depreciation and amortization) for the first quarter amounted to approximately $1.1 million. About NAPCO Security Systems, Inc. NAPCO Security Systems, Inc. is one of the world's leading manufacturers of technologically advanced -electronic security equipment including intrusion and fire alarm systems, access control systems 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 products. 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 $30 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 three months ended September 30, 2007, EBITDA has been calculated by adding depreciation and amortization ($277,000), interest expense ($195,000) and provision for income taxes ($265,000) to net income ($374,000). NAPCO SECURITY SYSTEMS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited) (in thousands, except share and per share data) Three Months Ended September 30, ----------------------- 2007 2006 ----------- ----------- Net Sales $ 13,876 $ 14,029 Cost of Sales 8,747 8,470 ----------- ----------- Gross Profit 5,129 5,559 Selling, General and Administrative Expenses 4,326 3,998 ----------- ----------- Operating income 802 1,561 ----------- ----------- Interest Expense, net 195 90 Other Expense, net 7 4 ----------- ----------- Other expense 202 94 ----------- ----------- Income before minority interest and provision for income taxes 601 1,467 Minority interest in net loss of subsidiary, net 38 13 ----------- ----------- Income before provision for income taxes 639 1,480 Provision for income taxes 265 528 ----------- ----------- Net income $ 374 $ 952 =========== =========== Net income per share* Basic $ 0.02 $ 0.05 =========== =========== Diluted $ 0.02 $ 0.05 =========== =========== Weighted average number of shares outstanding* Basic 19,567,689 19,951,298 Diluted 20,157,065 20,807,264 NAPCO SECURITY SYSTEMS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS - ---------------------------------------------------------------------- (in thousands, except share and per share data) ASSETS - ----------------------------------------------- September 30, June 30, 2007 (unaudited) 2007 ------------- -------- Current Assets: Cash and cash equivalents $ 1,916 $ 1,748 Accounts receivable, less allowance for doubtful accounts 22,106 25,579 Inventories, net 23,120 21,342 Prepaid expenses and other current assets 1,155 1,171 Deferred income taxes 1,079 1,050 ------------- -------- Total current assets 49,376 50,890 Inventories-non-current, net 7,594 6,881 Property, Plant and Equipment, net 9,201 9,135 Goodwill 9,686 9,686 Other assets 264 193 ------------- -------- Total Assets $76,121 $76,785 ============= ======== LIABILITIES AND STOCKHOLDERS' EQUITY - ----------------------------------------------- Current Liabilities: Accounts payable $ 5,383 $ 5,045 Accrued expenses 1,726 1,638 Accrued salaries and wages 2,185 2,631 Accrued income taxes 332 96 ------------- -------- Total current liabilities 9,626 9,410 Long-term debt 10,900 10,900 Accrued income taxes 2,605 1,836 Deferred income taxes 1,010 1,235 Minority interest in subsidiary 147 147 ------------- -------- Total Liabilities 24,288 23,528 ------------- -------- Stockholders' Equity: Common stock, par value $.01 per share; 40,000,000 shares authorized, 20,090,313 shares issued and 19,434,477 and 19,665,141 shares outstanding, respectively 201 201 Additional paid-in-capital 13,205 13,147 Retained earnings 42,188 42,299 ------------- -------- 55,594 55,647 Less: Treasury Stock, at cost (655,836 and 425,172 shares, respectively) (3,761) (2,390) ------------- -------- Total Stockholders' equity 51,833 53,257 ------------- -------- Total Liabilities and Stockholders' Equity $76,121 $76,785 ============= ======== CONTACT: NAPCO Security Systems, Inc. Richard L. Soloway, CEO Kevin S. Buchel, Senior VP 631-842-9400 ext. 120 or Wolfe Axelrod Weinberger Assoc. LLC Donald Weinberger, 212-370-4500 212-370-4505 fax don@wolfeaxelrod.com -----END PRIVACY-ENHANCED MESSAGE-----