Synergx Systems Inc. (Nasdaq Small Cap: SYNX) Announces Second Quarter and Six Month Results
May 12 2006 - 5:00PM
PR Newswire (US)
SYOSSET, N.Y., May 12 /PRNewswire-FirstCall/ -- Synergx Systems
Inc. reported the following results for its second quarter and
six-month period ended March 31, 2006 and 2005: THREE MONTHS SIX
MONTHS 2006 2005 2006 2005 Revenues $4,371,000 $4,912,000
$8,612,000 $9,379,000 (Loss) Income Before Equity Investment and
Taxes (101,000) 88,000 (486,000) (153,000) (Loss) from Equity
Investment (17,000) (12,000) (42,000) (22,000) (Loss) Income Before
Taxes (118,000) 76,000 (528,000) (175,000) Net (Loss) Income
(74,000) 40,000 (321,000) (115,000) Diluted (Loss) Earnings per
Share ($.01) $.01 ($.06) ($.02) Weighted Average Common and
Potential Dilutive Common Shares Outstanding 5,210,950 5,216,424
5,201,639 5,151,324 The decrease in revenues during the three and
six month periods of 2006 was due to lower transit product
shipments due to reduced order position and the timing of releases
required by customers. The transit product line and management has
been re-tooled which has resulted in increased bidding activity
which should result in stronger order flow. In addition, revenues
for the first six months of our fiscal year reflect the low pattern
of sales in Dallas, Texas which gets the benefit of school work
during the third and fourth quarters. The decrease in income and
increase in loss before income taxes during the three and six
months ended March 31, 2006 is primarily due to the decrease in
gross profit caused by anticipated lower product revenue discussed
above. This decrease in product gross profit was mitigated by
higher service gross profit that resulted from increased service
revenue and a decrease in customer support staffing level. For the
six month period of 2006 selling, general, and administrated
expenses increased $168,000 or 6% and reflects $42,000 of cost
increases related to additional sales staff to develop and
strengthen our sales and marketing and is geared to support higher
product revenues, and from a $92,000 increase in recruitment costs
to obtain such personnel. There is a lag between the hiring of new
sales and marketing staff and the realization of billing
objectives. In particular, due to retirement and changes in markets
we have had to overhaul and upgrade our transit group. For the
three and six month periods of 2006 the Company also recorded a
loss of $17,000 and $42,000, respectively, on its equity in the
operating loss of Secure 724 LP. Management noted the Company is
aggressively marketing its products and services and has hired, and
continues to search for additional sales representatives and
possible acquisitions in order to maintain and increase revenues.
Synergx is engaged in the design, manufacture, marketing and
service of a variety of data communication products and systems
with applications in the fire alarm, life safety, security and
communication industries. For further information about Synergx
please go to our website at WWW.SYNERGXSYSTEMS.COM "Safe Harbor"
statement under the Private Securities Reform Act of 1995: This
release contains forward-looking statements, which reflect
management's current views of future events and operations. These
forward-looking statements are based on assumptions and external
factors, including assumptions relating to product pricing,
competitive market conditions, financial data, and other risks or
uncertainties detailed from time to time in the Company's filings
with the Securities and Exchange Commission. These forward-looking
statements represent the Company's judgment as of the date of this
release and any changes in the assumptions of external factors
could produce significantly different results. DATASOURCE: Synergx
Systems Inc. CONTACT: John Poserina, Chief Financial Officer,
+1-516-433-4700 Web site: http://www.synergxsystems.com/
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