Vicon Industries, Inc. (NYSE American: VII), a global producer
video security solutions, today announced its financial results for
its third fiscal quarter ended June 30, 2017.
Vicon’s CEO John Badke said, "The Company’s results for the
quarter reflect decreased sales of our legacy product offerings in
line with expectations. While the Company launched an initial
version of its new Valerus video management system (VMS) platform
in January 2017, its full impact on our sales is not expected until
Valerus gains acceptance in the marketplace. We also recently
released our first major Valerus software upgrade, which includes
significant enhancements and added functions that should better
enable us to compete in our traditional enterprise level system
markets. The Company’s initial Valerus offering was targeted for
the more competitive mainstream video market, which requires time
to penetrate. Our enhanced offering will now allow us to better
compete on larger project business through our more traditional
sales channels. We are also scheduled to launch an entirely new and
enhanced camera line in the next few months to further solidify our
core product offerings. In preparation, we continue to ramp up our
sales and marketing activities to promote and meet anticipated
future demand for our new value added video system solutions. Our
Valerus installed base has steadily grown since its January
introduction, as its ease of use, openness and flexibility are
starting to attract attention in the market. Our new release should
bolster this momentum as it expands our enterprise level system
capabilities.
The Company also has an aggressive software development roadmap
for Valerus, which includes the release of a legacy VMS integration
gateway scheduled for early fiscal 2018. Very few companies are
able to launch an entirely new software platform that provides
backward compatible control over a legacy system. We think it is
important to provide a cost effective Valerus migration solution to
our vast legacy VMS installed base.
As previously announced, the Company entered into an investment
agreement with its secured lender to provide a $3 million
investment commitment pursuant to a proposed shareholder rights
offering. The Company recently filed a preliminary registration
statement with the SEC in connection with the proposed offering.
The proceeds of the offering would infuse needed operating capital
into the Company.”
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any state in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. The
rights offering, which is expected to be launched following the
effectiveness of the registration statement relating to the
offering, will be made only by means of a prospectus.
Third Quarter Fiscal 2017 Financial Results
Revenues for the third quarter of fiscal 2017 decreased 23% to
$7.4 million as compared to $9.5 million in the third quarter of
fiscal 2016. The $2.1 million decrease in the current quarter
included a $958,000, or 14%, decrease in sales in the Americas
market and a $1.2 million, or 46%, decrease in EMEA market sales.
Order intake for the current quarter decreased $2.0 million to $6.9
million as compared to $8.9 million in the third quarter of fiscal
2016. Revenues and order intake weakened across all market segments
due principally to a continuing reliance on an uncompetitive legacy
core product offering. While the Company launched an initial
version of its new Valerus video management system platform in
January 2017, its full market impact is not expected until Valerus
gains acceptance in the marketplace.
Gross profit margins were 38.5% for the third quarter of fiscal
2017 as compared to 40.0% for the third quarter of fiscal 2016.
Operating expenses for the third quarter of fiscal 2017 decreased
$504,000 to $4.1 million compared with $4.6 million in the third
quarter of fiscal 2016 due to previous quarter selling, general and
administrative cost reduction initiatives.
Net loss for the third quarter of fiscal 2017 was $1.4 million,
or $.15 per basic and diluted share, as compared to a net loss of
$843,000, or $.09 per basic and diluted share, in the third quarter
of fiscal 2016.
About Vicon
Vicon Industries, Inc. (NYSE American: VII) is a global producer
of video management systems and system components for use in
security, surveillance, safety and communication applications by a
broad range of end users. Vicon’s product line consists of various
elements of a video system, including video management software,
recorders and storage devices and capture devices (cameras).
Headquartered in Hauppauge, New York, the Company also has offices
in Yavne, Israel; the United Kingdom and San Juan Capistrano,
California. More information about Vicon, its products and services
is available at www.vicon-security.com.
Special Note Regarding Forward-looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements relating to our new product offerings
and our proposed fundraising activities. These forward-looking
statements are based on management's current expectations and are
subject to certain risks and uncertainties that could cause actual
results to differ materially from those set forth in or implied by
such forward looking statements. These risks and uncertainties
include, but are not limited to: our history of losses and negative
cash flows; our need for additional financing; market acceptance of
our products; our ability to manufacture and develop effective
products and solutions; indebtedness to our secured lender; current
and future economic conditions that may adversely affect our
business and customers; potential fluctuation of our revenues and
profitability from period to period which could result in our
failure to meet expectations; our ability to maintain adequate
levels of working capital; our ability to incentivize and retain
our current senior management team and continue to attract and
retain qualified scientific, technical and business personnel; our
ability to expand our product offerings or to develop other new
products and services; our ability to generate sales and profits
from current product offerings; rapid technological changes and new
technologies that could render certain of our products and services
to be obsolete; competitors with significantly greater financial
resources; introduction of new products and services by
competitors; challenges associated with expansion into new markets;
failure to stay in compliance with all applicable NYSE American
requirements that could result in a delisting of our common stock;
and, other factors discussed under the heading "Risk Factors"
contained in our Registration Statement on Form S-1 filed with the
Securities and Exchange Commission on August 7, 2017. All
information in this press release is as of the date of the release
and we undertake no duty to update this information unless required
by law.
-Financial Tables on Following Page-
Table of Operations Vicon Industries,
Inc. Condensed Statements of Operations
(Unaudited) Three Months Ended Nine
Months Ended June 30, June 30,
2017
2016
2017
2016
Net sales $ 7,382,000 $ 9,527,000 $ 19,991,000 $ 28,405,000 Gross
profit 2,844,000 3,808,000 7,662,000 10,718,000 Operating
expenses: Selling, general and administrative expense 2,887,000
3,333,000 8,369,000 10,989,000 Engineering and development expense
1,235,000 1,293,000 3,664,000 3,951,000 Goodwill and intangible
asset impairment — — — 6,016,000 Total
operating expenses 4,122,000 4,626,000 12,033,000 20,956,000
Operating loss (1,278,000 ) (818,000 ) (4,371,000 ) (10,238,000 )
Gain on sale of building — — — 785,000 Loss before
income taxes (1,397,000 ) (843,000 ) (4,603,000 ) (9,478,000 )
Income tax expense — — — —
Net loss $ (1,397,000 ) $ (843,000 ) $ (4,603,000 )
$ (9,478,000 )
Loss per
share:
Basic $ (.15 ) $ (.09 ) $ (.49 ) $ (1.01 ) Diluted $ (.15 ) $ (.09
) $ (.49 ) $ (1.01 )
Shares used in
computing loss per share:
Basic 9,348,000 9,344,000 9,348,000 9,339,000 Diluted 9,348,000
9,344,000 9,348,000 9,339,000
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version on businesswire.com: http://www.businesswire.com/news/home/20170814005791/en/
Vicon Investor RelationsCindy Schneider, (631)
650-6201IR@vicon-security.com
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