XPLR Xplore Technologies Corp (delisted)

Xplore Technologies Corp. (NASDAQ: XPLR) reported its results for the third quarter of its fiscal year 2016. For the three months ended December 31, 2015, Xplore reported revenue of $27,023,000, compared to $16,443,000 in reported revenue for the three months ended December 31, 2014, an increase of $10,580,000, or approximately 64%. For the nine months ended December 31, 2015, Xplore reported revenue of $79,919,000, compared to $32,232,000 in reported revenue for the nine months ended December 31, 2014, an increase of $47,687,000, or approximately 148%. This increase in revenue was due to revenue associated with the product line Xplore acquired in the April 17, 2015 acquisition of certain assets of Motion Computing, Inc. (the “Motion Acquisition”) for the three months ended December 31, 2015, as well as an increase in revenue associated with Xplore’s historical product line for the nine months ended December 31, 2015 of 44%.

Xplore’s reported gross profit increased to $8,842,000 (32.7% of revenue) for the quarter ended December 31, 2015, compared to reported gross profit of $5,874,000 (35.7% of revenue) for the quarter ended December 31, 2014. The increase in gross profit was attributable to the abovementioned increase in revenue. The decrease in gross profit percentage was primarily due to changes in product mix.

“We are very pleased with the revenue and gross profit in our 2016 fiscal year to date, and the most recent quarter,” said Mark Holleran, president and chief operating officer for Xplore. “While in same quarter in the prior year pent up demand for certain products resulted in better than expected revenue, we have nearly matched those revenues in the current quarter based upon regular demand. Our pipeline of opportunities in the market place is very robust and we are continuing to expand our customer base through multiple channels.”

Xplore’s reported operating expenses for the three months ended December 31, 2015 and 2014 were $7,575,000 and $3,425,000, respectively, representing an increase of $4,150,000, or approximately 121%. Reported operating expenses for the nine months ended December 31, 2015 and 2014 were $23,062,000 and $10,451,000, respectively, representing an increase of $12,611,000, or approximately 121%. These increases were predominately attributable to higher overhead expenses needed to support Xplore’s product line expansion from the Motion Acquisition. Overall, our operating expenses as a percentage of revenues has improved to 28.9% for the three quarters ended December 31, 2015, as compared to 32.4% of revenue for the three quarters ended December 31, 2014.

Xplore reported income from operations for the three months ended December 31, 2015 of $1,267,000, compared $2,449,000 for the prior year period. Xplore reported income from operations for the nine months ended December 31, 2015 of $2,039,000, compared to $754,000 for the prior year period. Xplore reported net income of $786,000 for the three months ended December 31, 2015, compared to $2,401,000 for the three months ended December 31, 2014, and reported net income of $640,000 and $683,000, for the nine months ended December 31, 2015 and 2014. These results were attributable to increased revenues and gross profits from the Motion Acquisition and historical product lines, and increased operating efficiencies and an overall increase in gross profits. Decreases from the third quarter results from the prior fiscal year are attributable to very large shipments made during that prior quarter to new and ongoing customers.

“We are excited about two quarters of running profitably after a business acquisition of such size that we completed in April 2015,” said Philip S. Sassower, chairman and chief executive officer for Xplore. “These results are exceeding management’s expectation, and form a foundation for future growth. We are very focused on continuing to deliver bottom line profits, and we continue to work on improvement through gross profit growth and finding additional integration benefits.”

Xplore will hold a conference call today at 4:30 p.m. ET to discuss its financial results for the second quarter ended December 31, 2015. Dial-in information for that conference call is included in Xplore’s press release dated January 27, 2016.

About Xplore Technologies®

Established in 1996, Xplore Technologies Corp. is the number two provider of rugged tablet PCs worldwide. With its recent acquisition of the Motion product line, the company now delivers the broadest range of rugged Windows and Android tablets available in the market. The company’s award-winning tablet PCs are among the most powerful and longest lasting in their class – able to withstand nearly any hazardous condition or environmental extreme – and are purpose-built for the unique workflow demands of critical industries including oil & gas, utilities, telecommunications, government, military, public safety, manufacturing, distribution and healthcare. Xplore's products are sold and serviced on a global basis across the Americas, Europe, Middle East, Africa, and Asia Pacific regions. For more information, visit the Xplore Technologies website at www.xploretech.com. Follow us on Twitter, Facebook, LinkedIn and YouTube.

Forward-Looking Statements

This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions are intended to identify forward-looking statements. Such statements reflect Xplore’s current views with respect to future events and are subject to risks and uncertainties. Many factors could cause actual results to differ materially from the statements made including those factors listed from time to time in filings made by Xplore with securities regulatory authorities under the heading “Risk Factors”. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. Xplore does not intend and does not assume any obligation to update these forward-looking statements.

          XPLORE TECHNOLOGIES CORP. Consolidated Balance Sheets (in thousands)   December 31,2015 March 31,2015 ASSETS (unaudited) CURRENT ASSETS: Cash and cash equivalents $ 6,035 $ 19,455 Accounts receivable, net 16,990 6,633 Inventory, net 13,787 7,883 Prepaid expenses and other current assets 470 315 Total current assets 37,282 34,286 Fixed assets, net 1,362 1,030 Intangible assets, net 1,857 — Goodwill 16,559 — $ 57,060 $ 35,316 LIABILITIES AND STOCKHOLDERS’ EQUITY LIABILITIES: Deferred revenue and warranty liabilities $ 4,986 $ 414 Accounts payable and accrued liabilities 15,368 4,594 Total current liabilities 20,354 5,008 Deferred revenue and non-current warranty liabilities 5,062 1,517 Total liabilities 25,416 6,525 Commitments and contingencies — — STOCKHOLDERS’ EQUITY: Preferred Stock, par value $0.001 per share; authorized 5,000; no shares issued — — Common Stock, par value $0.001 per share; authorized 15,000; shares issued 10,905 and 10,784, respectively 11 11 Additional paid-in capital 170,593 168,379 Accumulated deficit (138,960 ) (139,599 ) 31,644 28,791 $ 57,060 $ 35,316             XPLORE TECHNOLOGIES CORP. Consolidated Statements of Income (Loss)—Unaudited (in thousands of dollars, except share and per share amounts)   Three Months Ended Nine Months Ended December 31,2015     December 31,2014 December 31,2015     December 31,2014   Revenue $ 27,023 $ 16,443 $ 79,919 $ 32,232 Cost of revenue   18,181     10,569     54,818     21,027   Gross profit   8,842     5,874     25,101     11,205     Expenses: Sales, marketing and support 3,925 1,630 11,187 4,942 Product research, development and engineering 1,129 815 4,536 2,545   General administration   2,521     980     7,339     2,964     7,575     3,425     23,062     10,451   Income from operations   1,267     2,449     2,039     754     Other income (expense): Other (317 ) (7 ) (385 ) (8 ) Cost of integration (95 ) — (887 ) — Interest expense   —     (2 )   (58 )   (24 )   (412 )   (9 )   (1,330 )   (32 ) Income before income taxes 855 2,440 709 722 Income tax (expense)   (69 )   (39 )   (69 )   (39 ) Net income $ 786   $ 2,401   $ 640   $ 683    

Income per common share, primary

$ 0.07   $ 0.28   $ .06   $ 0.08    

Income per common share, fully diluted

$ 0.07   $ 0.28   $ .05   $ 0.08   Weighted average number of common shares outstanding, basic   10,883,933     8,473,140     10,828,375     8,451,928   Weighted average number of common shares outstanding, fully diluted   11,781,604     8,571,812     11,773,154     8,553,336               XPLORE TECHNOLOGIES CORP. Consolidated Statements of Cash Flows—Unaudited (in thousands of dollars, except share and per share amounts)  

 

Three Months EndedDecember 31, Nine Months EndedDecember 31, 2015     2014 2015     2014   CASH FLOWS FROM OPERATING ACTIVITIES: Cash provided by (used in) operations: Net income $ 786 $ 2,401 $ 640 $ 683 Items not affecting cash: Depreciation and amortization 498 253 1,313 689 Provision for doubtful accounts 24 1 48 3 Stock-based compensation expense 535 152 1,634 477 Equity issued in exchange for services — — — 2   Changes in operating assets and liabilities: Accounts receivable 1,415 (2,587 ) (3,021 ) (2,291 ) Inventory 822 1,323 (110 ) (2,388 ) Prepaid expenses and other current assets 142 (67 ) (184 ) 173 Accounts payable and accrued liabilities   (2,261 )   1,543     (5,234 )   1,041   Net cash provided by (used in) operating activities   1,961     3,019     (4,914 )   (1,611 )   CASH FLOWS FROM INVESTING ACTIVITIES: Net cash received in purchase transaction — — 653 — Change in vendor liabilities — — 16 — Additions to fixed assets   (228 )   (323 )   (657 )   (610 ) Net cash provided by (used in) investing activities   (228 )   (323 )   12     (610 )   CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from short-term borrowings — — 18,000 — Repayment of short-term indebtedness — — (27,098 ) — Net proceeds from issuance of Common Stock   415     43     580     185   Net cash provided by (used in) financing activities   415     43     (8,518 )   185     CHANGE IN CASH AND CASH EQUIVALENTS 2,148 2,739 (13,420 ) (2,036 ) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD   3,887     625     19,455     5,400   CASH AND CASH EQUIVALENTS, END OF PERIOD $ 6,035   $ 3,364   $ 6,035   $ 3,364     SUPPLEMENTAL DISCLOSURE OF CASHFLOWS: Payments for interest $ —   $ 7   $ 58   $ 8   Payments for income taxes $ 8   $ —   $ 8   $ 9    

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Media Inquiries:TrebleAaron De Lucia, 512-960-8222aaron@treblepr.comorInvestor Contact:Xplore Technologies Corp.Tom Wilkinson, 512-637-1162Chief Financial OfficerTWilkinson@XploreTech.com