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SOURCE: Franklin Wireless Corporation
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November 16, 2006 15:51 ET
Franklin Wireless Reports First Quarter 2007 Results
Rise in First Quarter Profit Due to New Product Launches and Increased Sales of Mobile Broadband USB Modems in USA and South American Markets
SAN DIEGO, CA -- (MARKET WIRE) -- November 16, 2006 -- Franklin Wireless Corp. (PINKSHEETS: FKLT)
posted its first quarter 2007 results on Nov 13, 2006. Franklin Wireless
shows rise in first quarter profit due to the launch of the CDU-550 in USA
and Mexico, and increase in sales of the CCU-550 mobile broadband USB
modems in South American markets.
The results were prepared in accordance with United States generally
accepted accounting principles.
Our net sales for the three months ended September 30, 2006 amounted to
$969,528, gross profit was $293,678, or 30.3% of revenue, operating
expenses were $199,264 and net income were $98,923, or basic earnings per
share of $0.0001. Our balance sheet remains satisfactory with $1.16
million of cash and cash equivalents.
Results for the first quarter of 2007, compared to the first quarter of
2006 are as follows:
Net sales increased by 1113.6% to $969,528 for the three months ended
September 30, 2006 from $79,890 for the same period of 2005. Gross profit
was 30.3% of net sales for the three months ended September 30, 2006,
compared to 78.1% for the same period in 2005. Selling, general, and
administrative expenses increased by 92.1% to $199,264 for the three months
ended September 30, 2006 from $103,734 for the same period of 2005. Net
income was $98,923, or basic earnings per share of $0.0001 for the three
months ended September 30, 2006, compared to a net loss of $77,946, or loss
per share of $0.0001, in the same period of 2005.
About Franklin Wireless
Franklin Wireless Corporation (PINKSHEETS: FKLT) designs, builds, and
markets broadband high speed data communication products. It offers third
generation wireless modules and modems. The company's wireless broadband
data products include wireless USB dongles, PC cards, embedded modules, and
stand-alone broadband modems used for high speed data services. It also
provides wireless solutions to electronic consumer product companies. The
company offers its products to various industries, including cellular
operators, government agencies, personal computer makers, and application
integrators, as well as computer/handheld computing industry, automotive
industry, and telemetry markets. It markets its products through original
equipment manufacturers (OEMs) and distributors, as well as directly to
operators and end users in the United States, Canada, South America, Asia,
and parts of Europe. The company was founded in 1984 and is headquartered
in San Diego, California. For more information about Franklin Wireless,
please visit www.fklt.com
FRANKLIN WIRELESS CORP.
Consolidated Statements of Operations
(Unaudited)
Three Months Ended
September 30,
2006 2005
Net sales $ 969,528 $ 79,890
Cost of goods sold 675,850 17,500
Gross profit 293,678 62,390
Operating expenses:
Selling, general, and
administrative 199,264 103,734
Research and development - 36,300
Total operating expenses 199,264 140,034
Income (Loss) from operations 94,414 (77,644)
Other income (expense):
Interest income 5,284 30
Other income 25 17
Other expenses - (349)
Total other income (expense), net 5,309 (302)
Net income (loss) before income
taxes 99,723 (77,946)
Provision for income taxes 800 -
Net income (loss) $ 98,923 $ (77,946)
Basic earnings (loss) per share $ 0.0001 $ (0.0001)
Diluted earnings (loss) per share $ 0.0001 $ (0.0001)
Weighted average common shares
outstanding - basic 796,958,771 793,040,050
Weighted average common shares
outstanding - diluted 796,958,771 793,040,050
See accompanying notes to unaudited consolidated financial statements.
FRANKLIN WIRELESS CORP.
Consolidated Balance Sheets
----------------------------
(Unaudited)
September 30, June 30,
2006 2006
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 1,161,618 $ 568,387
Inventory 197,250 -
Accounts receivable 244,352 1,750
------------- -------------
Total current assets 1,603,220 570,137
Property and equipment, net 12,439 12,715
Intangible assets, net 138,974 104,195
Other assets 4,452 4,452
------------- -------------
TOTAL ASSETS $ 1,759,085 $ 691,499
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 573,531 $ 585
Accrued liabilities 186,685 190,968
Other current liability 400,000 -
Notes payable to stockholders, current
portion 540,000 540,000
------------- -------------
Total current liabilities 1,700,216 731,553
------------- -------------
Stockholders’ equity
Common stock, no par value, authorized
900,000,000 shares and Preferred stock, no
par value, authorized 10,000,000 shares;
Common stock issued and outstanding -
882,040,050 as of September 30, 2006 and
June 30, 2006, and no Preferred stock
issued and outstanding - -
Additional paid-in capital 4,629,393 4,629,393
Stock subscription receivable (17,395) (17,395)
Accumulated deficit (4,553,129) (4,652,052)
------------- -------------
Total stockholders’ equity (deficit) 58,869 (40,054)
------------- -------------
Total liabilities and stockholders’ equity $ 1,759,085 $ 691,499
============= =============
See accompanying notes to unaudited consolidated financial statements.
FRANKLIN WIRELESS CORP.
Consolidated Statements of Cash Flows
(Unaudited)
----------------------------
Three Months Ended
September 30,
----------------------------
2006 2005
------------- -------------
CASH FLOWS FROM OPERATIONS ACTIVITIES:
Net Income (loss) $ 98,923 $ (77,946)
Adjustments to reconcile net income (loss)
to net cash provided by operating
activities:
Depreciation 1,436 1,550
Amortization of intangible assets 19,001 11,250
Increase (decrease) in cash due to change
in:
Accounts receivable (242,602) (800)
Inventory (197,250)
Intangible assets (53,780) -
Accounts payable 572,946 80,001
Accrued liabilities (4,283) 10,250
------------- -------------
Net cash provided by operating activities 194,391 24,305
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,160) -
------------- -------------
Net cash used in investing activities (1,160) -
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment received for future stock issuance 400,000 -
------------- -------------
Net cash provided by financing activities 400,000 -
------------- -------------
Net increase in cash and cash equivalents 593,231 24,305
Cash and cash equivalents, beginning of
period 568,387 39,542
------------- -------------
Cash and cash equivalents, end of period $ 1,161,618 $ 63,847
============= =============
Supplemental disclosure of cash flow
information:
Cash paid during the year for:
Interest $ - $ -
Income taxes $ - $ -
See accompanying notes to unaudited consolidated financial statements.