Koss Corp. Releases Second Quarter Results
January 30 2018 - 5:15PM
Koss Corporation (NASDAQ:KOSS), the U.S. based high-fidelity
headphone company, has reported its second quarter results for the
quarter ended December 31, 2017.
Sales for the second quarter were $5,883,877,
which is a 12.02% decrease from sales of $6,687,797 for the same
three month period one year ago. The three month net loss was
$2,937,721, compared to net income of $140,112 for the second
quarter last year. Diluted and basic loss per common share
for the quarter was $0.40 compared to income per common share of
$0.02 for the three month period one year ago.
"With the reduced corporate tax rate in the new
tax law, we recorded a significant tax expense to write down
deferred tax assets to their future expected value at the new tax
rate in addition to increasing the valuation allowance for deferred
taxes," Michael J. Koss Chairman and CEO said today. "This
tax expense was approximately $3 million even though we had income
before taxes for both the December quarter and the first six
months."
Koss also explained that sales were off for the
quarter primarily due to a decline in sales to OEM accounts and a
large order to South America last year that was not repeated this
year. Sales to Europe were up with increased sales into
Scandinavia. Mass market sales in the US were higher with
better product placement than a year ago.
Sales for the six months ended December 31,
2017, decreased 8.3% from $13,036,503 in the same period last year
to $11,950,507 in the current year. The six month net loss was
$2,920,221 compared to net income of $224,323 for the same period
last year. Diluted and basic loss income was $0.40 for the six
months ended December 31, 2017 compared to income per common share
of $0.03 for the same six month period one year ago.
"Sales to OEM customers in Asia accounted for a
large portion of the decline in sales for the first six months
compared to last year." Koss continued, "Sales in the US were up
slightly due to increased sales in the mass market."
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 |
|
Six Months Ended |
|
|
December 31 |
|
December 31 |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net sales |
|
$ |
5,883,877 |
|
|
$ |
6,687,797 |
|
|
$ |
11,950,507 |
|
|
$ |
13,036,503 |
|
Cost of goods sold |
|
3,997,922 |
|
|
4,481,086 |
|
|
8,390,598 |
|
|
8,887,533 |
|
Gross profit |
|
1,885,955 |
|
|
2,206,711 |
|
|
3,559,909 |
|
|
4,148,970 |
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
|
1,800,304 |
|
|
1,987,391 |
|
|
3,448,010 |
|
|
3,763,162 |
|
Unauthorized
transaction related (recoveries) costs, net |
|
(1,771 |
) |
|
(3,404 |
) |
|
(16,180 |
) |
|
34,096 |
|
Interest expense |
|
2,526 |
|
|
118 |
|
|
5,218 |
|
|
964 |
|
Income
before income tax provision |
|
84,896 |
|
|
222,606 |
|
|
122,861 |
|
|
350,748 |
|
|
|
|
|
|
|
|
|
|
Income tax
provision |
|
3,022,617 |
|
|
82,494 |
|
|
3,043,082 |
|
|
126,425 |
|
|
|
|
|
|
|
|
|
|
Net
(loss) income |
|
$ |
(2,937,721 |
) |
|
$ |
140,112 |
|
|
$ |
(2,920,221 |
) |
|
$ |
224,323 |
|
|
|
|
|
|
|
|
|
|
(Loss) income per
common share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.40 |
) |
|
$ |
0.02 |
|
|
$ |
(0.40 |
) |
|
$ |
0.03 |
|
Diluted |
|
$ |
(0.40 |
) |
|
$ |
0.02 |
|
|
$ |
(0.40 |
) |
|
$ |
0.03 |
|
|
CONTACT:Michael J.
KossChairman & CEO(414)
964-5000mjkoss@koss.com
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