Financial highlights for quarter and six months ended June 30, 2013
Net revenue declined to approximately $3.7 million in the second quarter of 2013, compared with approximately $4.1 million in the prior-year quarter. The 10% decrease in net revenue was primarily due to a decline in sales of rugged IT products when compared with the second quarter of 2012. The Company expects vehicle upfitting services revenue and rugged IT product sales to fluctuate from quarter to quarter, depending upon the size and timing of orders from law enforcement and other vehicle fleet operators.
Gross profit for the three months ended June 30, 2013 decreased to $665,146 in the three months ended June 30, 2013, compared with gross profit of $1,083,449 in the second quarter of 2012. The decrease was primarily due lower gross profit margins from rugged IT product and vehicle upfitting services.
The Company reported a net loss of $476,068, or $0.01 per share, in the most recent quarter, compared with net income of $126,535, or $0.00 per diluted share, in the year-earlier quarter. Management primarily attributes the decline in net income to higher salaries and related benefit programs associated with preparation for the Company’s assumption of its responsibilities under the Baltimore ATVES contract. Implementation of the program was temporarily suspended in accordance with the City of Baltimore’s decision to require additional testing and calibration of automated traffic enforcement equipment in order to assure that problems which occurred under the program’s previous vendor were effectively addressed.
For the six months ended June 30, 2013, net revenue declined to approximately $8.1 million, compared with approximately $8.2 million in the prior-year period. Gross profit for the first half of 2013 declined to $1,928,500, compared with gross profit of $2,154,985 in the corresponding period of the previous year.
The Company reported a net loss of $400,469, or $0.01 per share, for the first half of 2013, compared with net income of $249,845, or $0.01 per diluted share, in the year-earlier period.
About Brekford Corp.
Brekford Corp. has provided state-of-the art mobile technology and traffic safety solutions to municipalities, the U.S. military, various federal entities and other security and public safety agencies throughout the United States over the last ten years. Its services include automated traffic safety solutions and an end-to-end suite of mobile computer, video technology and equipment upfitting services. Brekford’s combination of upfitting services, cutting-edge technology, and automated traffic enforcement services offers a unique 360-degree solution for any organization, including homeland security and law enforcement agencies. Additional information about Brekford may be found online at www.brekford.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of that term in Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may differ materially from the results suggested by these forward-looking statements, for a number of reasons, including, but not limited to, market conditions, the cost and success of development activities and the ability to successfully manage growth. Readers are referred to the documents filed by Brekford Corp. with the SEC, specifically the Company’s most recent reports filed on Form 10-K and Forms 10-Q, which further identify important risks, trends and uncertainties which could cause actual results to differ materially from the forward-looking statements in this press release. The Company expressly disclaims any obligation to update any forward-looking statements.
| Brekford Corp. | |||||||||
| Condensed Statement of Operations | |||||||||
| ($000, except per-share figures) | |||||||||
| Three Months Ended | |||||||||
| 6/30/13 | 6/30/12 | ||||||||
| Net Revenue | $ | 3,668 | $ | 4,087 | |||||
| Gross Profit | 665 | 1,083 | |||||||
| Income (Loss) from Operations | (428 | ) | 164 | ||||||
| Total Other Expense | (48 | ) | (37 | ) | |||||
| Net Income (Loss) | $ | (476 | ) | $ | 127 | ||||
| Earnings Per Share – | |||||||||
| Basic and Diluted | $ | (0.01 | ) | $ | 0.00 | ||||
| Weighted Avg. Number of | |||||||||
| Shs. Outstanding – Basic | 44,274 | 44,194 | |||||||
| Weighted Avg. Number of | |||||||||
| Shs. Outstanding – Diluted | 44,274 | 47,133 | |||||||
| Brekford Corp. | |||||||||
| Condensed Statement of Operations | |||||||||
| ($000, except per-share figures) | |||||||||
| Six Months Ended | |||||||||
| 6/30/13 | 6/30/12 | ||||||||
| Net Revenue | $ | 8,062 | $ | 8,236 | |||||
| Gross Profit | 1,928 | 2,155 | |||||||
| Income (Loss) from Operations | (315 | ) | 324 | ||||||
| Total Other Expense | (85 | ) | (74 | ) | |||||
| Net Income (Loss) | $ | (400 | ) | $ | 250 | ||||
| Earnings Per Share – | |||||||||
| Basic and Diluted | $ | (0.01 | ) | $ | 0.01 | ||||
| Weighted Avg. Number of | |||||||||
| Shs. Outstanding – Basic | 44,265 | 44,026 | |||||||
| Weighted Avg. Number of | |||||||||
| Shs. Outstanding – Diluted | 44,265 | 47,195 | |||||||
—————————————————————————
| BALANCE SHEET ($000) | ||||||
| 6/30/13 | 12/31/12 | |||||
| Cash and Cash Equivalents | $ | 1,450 | $ | 1,415 | ||
| Current Assets | 7,142 | 6,593 | ||||
| Total Assets | 9,613 | 9,346 | ||||
| Current Liabilities | 6,896 | 5,426 | ||||
| Total Liabilities | 7,519 | 6,869 | ||||
| Stockholders’ Equity | $ | 2,094 | $ | 2,477 | ||
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