SOURCE: Electronic Control Security, Inc.

February 05, 2010 11:19 ET

Electronic Control Security, Inc. Announces Continuing Operating Profit for Second Quarter Fiscal 2010

CLIFTON, NJ--(Marketwire - February 5, 2010) -  Electronic Control Security, Inc. (OTCBB: EKCS) (ECSI), a leading provider of electronic security system technologies to the government and private sectors, announced its results of operations for the six months ended December 31, 2009.

Arthur Barchenko, President and CEO, stated, "We had net revenues of $1,635,704 for the six months ended December 31, 2009 compared to $2,438,190 for the corresponding six month period in 2008, a decrease of approximately 33%. The decrease is primarily attributable to a reduction in the release of task orders on in-house contracts for the U.S. Air Force and nuclear power stations received during the period. However, we see this trend reversing during the coming months based on current backlog and incoming orders."

Further, "Gross margins for the six months ended December 31, 2009 were 66% compared to 25% of revenue for the corresponding six month period in 2008. The increase in gross margins for the period in 2009 is primarily attributable to a continuing shift in the order mix of equipment sales and support services. We achieved a decrease in material cost while experiencing a marked increase in higher gross margin design and engineering support service billings. Our gross margins in fiscal 2010 continue to improve compared to those in fiscal 2009."

Mr. Barchenko then stated, "The selling, general and administrative expenses for the six months ended December 31, 2009 were $745,753 compared to $543,355 for the corresponding period in 2008. The increase is primarily attributable to a one-time write-off of a debt amounting to $259,316. Had the one-time write-off not been necessary, the SG&A would have decreased for both the six-month period and the quarter."

For the six months ended December 31, 2009, there was net income from operations of $234,577 compared to a loss of $(58,758) for the same period in 2008 due primarily to the receipt of higher gross margin orders and controlled selling, general and administrative expenses.

During the quarter ended December 31, 2009, the Company submitted proposals on major projects for Department of Defense facilities and numerous nuclear power stations in the United States, the Middle East and South Korea valued at approximately $2,250,000. These proposals are pending and awaiting approval, funding and award. We anticipate decisions relating to these proposals within the third quarter of fiscal 2010.

About ECSI

ECSI is a global leader in perimeter security and a quality provider to the Department of Defense, Department of Energy, nuclear power stations, and other large commercial-industrial complexes. The Company designs, manufactures and markets physical electronic security systems for high profile, high threat environments utilizing risk assessment and analysis to determine and address the security needs of its customers. Teaming agreements with major system integrators enable ECSI to support the installation and aftermarket of its products in the U.S. and overseas. ECSI is located at 790 Bloomfield Avenue, Bldg. C-1, Clifton, NJ 07012. Tel: 973-574-8555; Fax: 973-574-8562. For more information on ECSI and its customers, please visit

ECSI INTERNATIONAL, INC. SAFE HARBOR STATEMENT: This press release contains forward-looking statements that involve substantial uncertainties and risks. These forward-looking statements are based upon our current expectations, estimates and projections about our business and our industry and reflect our beliefs and assumptions based upon information available to us at the date of this release. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including but not limited to changes in economic conditions generally and in our industry specifically, changes in security technology, legislative or regulatory changes that affect us, the availability of working capital, timing of purchase orders, acceptance of company proposals, changes in costs and the availability of goods and services, the introduction of competing products, changes in our operating strategy or development plans, our ability to attract and retain qualified personnel, changes in our acquisition and capital expenditure plans, sufficiency of cash reserves and the risks and uncertainties discussed under the heading "RISK FACTORS" in Item 1 of our Annual Report on Form 10-K for the fiscal year ended June 30, 2009 and in our other filings with the Securities and Exchange Commission. We undertake no obligation to revise or update any forward-looking statement for any reason.

Contact Information

  • Contact:
    Natalie Schneider