SOURCE: Electronic Control Security, Inc.

November 16, 2009 10:02 ET

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

CLIFTON, NJ--(Marketwire - November 16, 2009) - 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 three months ended September 30, 2009.

Arthur Barchenko, President and CEO, stated, "We had net revenues of $390,657 for the three months ended September 30, 2009 compared to $825,516 for the corresponding three month period in 2008, a decrease of approximately 52.7%. The decrease is primarily attributable to a delay in the release of purchase orders in-house for the Department of Defense, United Nations and nuclear power stations amounting to approximately $4,950,000. Approximately $4,500,000 of these orders have now been released, and shipments should improve significantly in the second, third and fourth quarters of fiscal 2010."

Further, "Gross margins for the three months ended September 30, 2009 were 72.9% compared to 14.4% of revenue for the corresponding three month period in 2008. The increase in gross margins for the period in 2009 is primarily attributable to a change 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. We anticipate our gross margins in fiscal 2010 will continue to improve compared to those in fiscal 2009."

Mr. Barchenko then stated that the selling, general and administrative expenses for the three months ended September 30, 2009 were $227,316 compared to $218,610 for the corresponding period in 2008, an increase of less than 4%.

For the three months ended September 30, 2009, there was net income from operations of $12,440 compared to a loss of $(183,775) for the same period in 2008 due primarily to the more favorable order mix and higher gross margin support service billings.

The Company has submitted proposals valued at approximately $2,650,000 for Department of Defense facilities and certain nuclear power stations in the U.S. and Southeast Asia. The proposals are pending and awaiting approval, funding and award. The Company anticipates decisions relating to these proposals within the second and third quarters of fiscal 2010.


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.

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