MILWAUKEE, WI--(Marketwire - Apr 20, 2011) - Koss Corporation (NASDAQ: KOSS), the U.S.
based high-fidelity stereophone company, has reported its results for the
third quarter ending March 31, 2011. Sales for the third quarter were
$8,419,663 compared to $8,654,630 for the same three month period one year
ago, a 3% decrease. Net income increased to $640,962, compared to $293,167
for the third quarter last year. Diluted earnings per share were $0.09
compared with $0.04 one year ago.
Sales for the nine months ending March 31, 2011 trended down by 4% to
$31,252,603 compared with $32,485,330 for the same nine month period a year
ago. Nine month net income rose to $2,585,934 compared to a loss of
$3,148,775 for the same nine months of 2010. Diluted earnings per share
were $0.35 compared with loss per share of $0.43 one year ago.
"We continue to observe soft re-orders from our largest domestic U.S.
retailers," Michael J. Koss, President and CEO, said. "Year over year, we
can track the drop in sales to a single account that we landed in 2010 and
their initial opening order to stock their shelves. We did not land a
similar account of that magnitude during this year's third quarter."
Koss went on to note that Europe was continuing to make a solid
contribution and hoped that the trend would continue for the balance of the
fiscal year. He also noted that the Company was beginning to feel the
effects of rising prices for raw materials driven by the weakness of the
dollar and soaring energy costs.
"Our gross margins for the quarter actually strengthened," Koss said. "This
is the result of a strong customer mix and model mix that helped cover
increases in freight and energy. But it is clear that inflation is
beginning to put pressure on our product costs and we have been working
diligently to respond to the coming threat."
The Company will pay a dividend of $0.06 cents per share on July 15, 2011,
to shareholders of record on June 30, 2011.
Koss Corporation markets a complete line of high-fidelity stereophones,
speaker-phones, computer headsets, telecommunications headsets, active
noise canceling stereophones, wireless stereophones, and compact disc
recordings of American Symphony Orchestras on the Koss Classics label.
This press release contains forward-looking statements. These statements
relate to future events or our future financial performance. In some
cases, you can identify forward-looking statements by terminology such as
"may," "will," "should," "forecasts," "expects," "plans," "anticipates,"
"believes," "estimates," "predicts," "potential," or "continue" or the
negative of such terms and other comparable terminology. These statements
are only predictions. Actual events or results may differ materially. In
evaluating forward-looking statements, you should specifically consider
various factors that may cause actual results to vary from those contained
in the forward-looking statements, such as general economic conditions, in
particular, consumer demand for the Company's and its customers' products,
competitive and technological developments, foreign currency fluctuations,
and costs of operations. Shareholders, potential investors and other
readers are urged to consider these factors carefully in evaluating the
forward-looking statements and are cautioned not to place undue reliance on
such forward-looking statements. The forward-looking statements made
herein are only made as of the date of this press release and the Company
undertakes no obligation to publicly update such forward-looking statements
to reflect subsequent events or circumstances. In addition, such
uncertainties and other operational matters are discussed further in the
Company's quarterly and annual filings with the Securities and Exchange
Commission.
KOSS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Nine Months
-------------------------- --------------------------
Period Ended March 2011 2010 2011 2010
31, ------------ ------------ ------------ ------------
Net sales $ 8,419,663 $ 8,654,630 $ 31,252,603 $ 32,485,330
Cost of goods sold 5,026,193 5,376,392 18,286,561 18,613,704
------------ ------------ ------------ ------------
Gross profit 3,393,470 3,278,238 12,966,042 13,871,626
------------ ------------ ------------ ------------
Operating Expenses:
Selling, general
and
administrative
expense 2,705,534 2,370,021 8,398,963 7,600,954
Unauthorized
transactions - - - 10,286,988
Unauthorized
transaction
related costs
and recoveries,
net (376,544) 310,547 94,640 550,547
------------ ------------ ------------ ------------
Total Operating
Expenses 2,328,990 2,680,568 8,493,603 18,438,489
------------ ------------ ------------ ------------
Income (loss) from
operations 1,064,480 597,670 4,472,439 (4,566,863)
Other Income
(Expense)
Interest income 13,192 22 13,216 35
Interest expense (109,725) (131,632) (321,733) (309,607)
------------ ------------ ------------ ------------
Total Other
Expense, net (96,533) (131,610) (308,517) (309,572)
------------ ------------ ------------ ------------
Income (loss)
before income tax
provision
(benefit) 967,947 466,060 4,163,922 (4,876,435)
Income tax
provision
(benefit) 326,985 172,893 1,577,988 (1,727,660)
------------ ------------ ------------ ------------
Net income
(loss) $ 640,962 $ 293,167 $ 2,585,934 $ (3,148,775)
============ ============ ============ ============
Earnings (loss) per
common share:
Basic $ 0.09 $ 0.04 $ 0.35 $ (0.43)
Diluted $ 0.09 $ 0.04 $ 0.35 $ (0.43)
============ ============ ============ ============
Dividends per
common share $ 0.06 $ 0.06 $ 0.18 $ 0.185
============ ============ ============ ============