Koss Corp Releases Third Quarter Results
May 11 2017 - 5:15PM
Koss Corporation (NASDAQ:KOSS), the U.S. based high-fidelity
headphone company, has reported its third quarter results for the
quarter ended March 31, 2017.
Sales for the third quarter were $4,773,915,
which is a 20.5% decrease from sales of $6,002,059 for the same
three month period one year ago. The three month net loss was
$1,117,582, compared to net income of $869,686 for the third
quarter last year. Diluted and basic loss per common share
for the quarter was $0.15 compared to income per common share of
$0.12 for the three month period one year ago.
"Sales were weak in the quarter with continued
decrease in orders from distributors in Asia and Scandinavia as
well as lower demand for the OEM products in Asia. The lower
order volume is driven by distributors working off inventory levels
as well as the continued strength of the dollar," Michael J. Koss,
Chairman and CEO, told employees here today. "Earnings were
negatively impacted by the low export sales and a charge to
earnings to write down the inventory value on a group of
products."
In the three months ended March 31, 2017, a
valuation allowance was established against deferred tax assets
resulting in a charge of $444,000 to income tax expense. The
net income for the three months ended March 31, 2016 included the
benefit of settling a lawsuit.
Sales for the nine months ended March 31, 2017
decreased by 5.1% to $17,810,418 compared with $18,762,662 for the
same nine month period a year ago. Nine month net loss was
$893,259 compared to net income of $1,155,513 for the same nine
months last year. Diluted and basic loss per common share was
$0.12 for the nine months ended March 31, 2017, compared with
income of $0.16 for the same nine month period a year
ago.
In the first nine months, sales to the OEM
customer in Asia combined with improved sales to domestic
distributors partially offset the decline in sales to distributors
in Scandinavia, Asia and Africa. In the domestic market, Koss
also had increased sales through on-line retail.
"While traditional brick and mortar retail
continues to be a key component of our distribution, we are fully
aware of the sweeping changes happening in traditional retail that
will continue to have a negative impact on headphone offerings as
more retail outlets close stores," Koss continued. "Our direct to
consumer initiatives are designed to make our products easier to
access than ever before by using the on-line channels that
consumers around the world are choosing now more than ever."
Koss Corporation markets a complete line of
high-fidelity headphones, wireless Bluetooth® speakers, computer
headsets, telecommunications headsets, active noise canceling
headphones, wireless headphones, and compact disc recordings of
American Symphony Orchestras on the Koss Classics®
label.
This press release contains forward-looking statements. These
statements relate to future events or our future financial
performance. In some cases, you can identify forward-looking
statements by terminology such as "anticipates," "believes,"
"estimates," "expects," "intends," "plans," "may," "will,"
"should," "forecasts," "predicts," "potential," "continue," or the
negative of such terms and other comparable terminology.
These statements are based on currently available operating,
financial and competitive information and are subject to various
risks and uncertainties. Actual events or results may differ
materially. In evaluating forward-looking statements, you
should specifically consider various factors that may cause actual
results to vary from those contained in the forward-looking
statements, such as general economic conditions, in particular,
consumer demand for the Company's and its customers' products,
competitive and technological developments, foreign currency
fluctuations, and costs of operations. Shareholders,
potential investors and other readers are urged to consider these
factors carefully in evaluating the forward-looking statements and
are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements made herein are
only made as of the date of this press release and the Company
undertakes no obligation to publicly update such forward-looking
statements to reflect subsequent events or circumstances or new
information. In addition, such uncertainties and other
operational matters are discussed further in the Company's
quarterly and annual filings with the Securities and Exchange
Commission.
|
KOSS CORPORATIONCONDENSED
CONSOLIDATED STATEMENTS OF
INCOME(Unaudited) |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
March 31 |
|
March 31 |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net sales |
|
$ |
4,773,915 |
|
|
$ |
6,002,059 |
|
|
$ |
17,810,418 |
|
|
$ |
18,762,662 |
|
Cost of goods sold |
|
3,823,613 |
|
|
3,889,719 |
|
|
12,711,146 |
|
|
12,341,164 |
|
Gross profit |
|
950,302 |
|
|
2,112,340 |
|
|
5,099,272 |
|
|
6,421,498 |
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
|
1,965,698 |
|
|
2,105,740 |
|
|
5,728,860 |
|
|
5,860,601 |
|
Unauthorized
transaction related costs (recoveries), net |
|
39,663 |
|
|
(1,360,951 |
) |
|
73,759 |
|
|
(1,286,001 |
) |
Interest expense |
|
— |
|
|
— |
|
|
964 |
|
|
6,075 |
|
(Loss)
income before income tax provision |
|
(1,055,059 |
) |
|
1,367,551 |
|
|
(704,311 |
) |
|
1,840,823 |
|
|
|
|
|
|
|
|
|
|
Income tax
provision |
|
62,523 |
|
|
497,865 |
|
|
188,948 |
|
|
685,310 |
|
|
|
|
|
|
|
|
|
|
Net
(loss) income |
|
$ |
(1,117,582 |
) |
|
$ |
869,686 |
|
|
$ |
(893,259 |
) |
|
$ |
1,155,513 |
|
|
|
|
|
|
|
|
|
|
(Loss) income per
common share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.15 |
) |
|
$ |
0.12 |
|
|
$ |
(0.12 |
) |
|
$ |
0.16 |
|
Diluted |
|
$ |
(0.15 |
) |
|
$ |
0.12 |
|
|
$ |
(0.12 |
) |
|
$ |
0.16 |
|
CONTACT:
Michael J. Koss
Chairman & CEO
(414) 964-5000
mjkoss@koss.com
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