SOURCE: VERSUS TECHNOLOGY, INC.

RTLS, RFID, patient flow, asset tracking, real-time location, locating, workflow automation

February 25, 2010 16:31 ET

Versus Technology Announces First Quarter Results

TRAVERSE CITY, MI--(Marketwire - February 25, 2010) - Versus Technology, Inc. (PINKSHEETS: VSTI) ("Versus" or the "Company") announced revenues of $1,793,000 for the fiscal quarter ended January 31, 2010, an 11% increase over revenues of $1,613,000 for the same period in 2009.

This represents the third consecutive quarter of revenue growth and the second consecutive profitable quarter for the company. These trends are the result of the growth in the Company's healthcare solutions business. Versus' quarterly revenues can vary significantly depending upon the timing of delivery of major customer projects. Accordingly, the revenues reported in any one quarter are not necessarily indicative of what full year results will be.

Gross profits as a percentage of revenues were 68.0% for the quarter compared to 75.8% for the same period in 2009. The lower gross profit percentage in the quarter is attributable to large hardware orders related to new system implementations. Operating expenses other than cost of revenues for the quarter were 62.1% of revenues compared to 73.8% of revenues for the quarter ended January 31, 2009.

Versus reported pre-tax net income of $105,000 for the quarter, compared to pre-tax net income of $37,000 for the same period in 2009.

For additional information, please refer to the attached unaudited consolidated financial statements.

About Versus Technology, Inc.

Versus Technology, Inc. is the leader in the development and sale of context-aware real-time location systems (RTLS) used for enterprise patient tracking, bed management and asset tracking to improve patient flow and caregiver/patient communications in hospitals, clinics and long-term care facilities. Versus also develops dual infrared and Active RFID tags and other location tracking hardware to make locating systems more precise, security systems more intelligent, nurse call systems automatic, and hospital asset tracking systems more efficient. Indoor positioning through Versus' RTLS enhances existing hospital software and patient care systems with real-time, reliable bed-level location information. The patented Versus IR and Active RFID patient and asset tracking system is exclusively endorsed by the American Hospital Association and is a key component of their Patient Flow Platform -- which includes a select group of vendors that provide proven solutions to enhance patient flow and improve patient safety. (www.versustech.com) (PINKSHEETS: VSTI)

Safe Harbor Provision

This document may contain forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. These statements fall within the meaning of forward-looking information as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of important risks and uncertainties that could cause actual results to differ materially including, but not limited to, economic, competitive, governmental, and technological factors affecting the Company's markets and market growth rates, products and their rate of commercialization, services, prices and adequacy of financing, and other factors. The Company undertakes no obligation to update, amend, or clarify forward-looking statements, whether because of new information, future events, or otherwise.

REPORT OF MANAGEMENT

The accompanying consolidated balance sheets of Versus Technology, Inc. and Subsidiary as of January 31, 2010, and October 31, 2009, and the related consolidated statements of income and cash flows for the three-month periods ended January 31, 2010 and 2009, have been prepared by management.

Management has elected to omit the statement of shareholders' equity and substantially all of the footnote disclosures required by accounting principles generally accepted in the United States. If the omitted statement and disclosures were included in the financial statements, they might influence the user's conclusions about the Company's financial position, results of operations, and cash flows. Accordingly, these financial statements are not designed for those who are not informed about such matters.

The reader should refer to the Versus Technology, Inc. 2009 Annual Report which is available at www.versustech.com for further details regarding the Company's financial position at October 31, 2009.

                                                       Joseph E. Winowiecki
                                                    Chief Financial Officer

February 25, 2010



 
                  VERSUS TECHNOLOGY, INC. AND SUBSIDIARY                   
                        Consolidated Balance Sheets                        
                                (Unaudited)                                

                                                    -----------------------          
                                                     31-Jan-10   31-Oct-09
                                                    ----------- -----------
Assets
Current assets
   Cash and cash equivalents                        $ 1,311,000 $ 1,301,000
   Accounts receivable                                1,392,000   1,322,000
   Inventories                                          585,000     669,000
   Prepaid expenses and other current assets            125,000     176,000
                                                    ----------- -----------

Total current assets                                  3,413,000   3,468,000
                                                    ----------- -----------

Property and equipment
   Machinery and equipment                              432,000     429,000
   Furniture and fixtures                                88,000     100,000
   Leasehold improvements                               421,000     421,000
                                                    ----------- -----------

                                                        941,000     950,000
   Less accumulated depreciation                        655,000     657,000
                                                    ----------- -----------

Net property and equipment                              286,000     293,000

Goodwill                                              1,533,000   1,533,000

Other noncurrent assets                                  72,000      57,000
                                                    ----------- -----------

Total assets                                        $ 5,304,000 $ 5,351,000
                                                    =========== ===========

See accompanying report of management.




                  VERSUS TECHNOLOGY, INC. AND SUBSIDIARY                   
                        Consolidated Balance Sheets                        
                                (Unaudited)                                
                                                                           
                                                  ------------------------ 
                                                   31-Jan-10    31-Oct-09
                                                  -----------  ----------- 
Liabilities and shareholders' equity

Current Liabilities
   Accounts payable                               $   299,000  $   455,000
   Accrued expenses                                   276,000      366,000
   Deferred revenue                                   344,000      409,000
                                                  -----------  ----------- 

Total liabilities (all current)                       919,000    1,230,000 
                                                  -----------  ----------- 

Shareholders' equity
   Common stock $0.01 par value; 120,000,000
    shares authorized; 98,274,325 and 95,325,325
    issued and outstanding                            983,000      953,000 
   Additional paid-in capital                      42,929,000   42,800,000
   Accumulated deficit                            (39,527,000) (39,632,000)
                                                  -----------  ----------- 

Total shareholders' equity                          4,385,000    4,121,000
                                                  -----------  ----------- 

Total liabilities and shareholders' equity        $ 5,304,000  $ 5,351,000
                                                  ===========  =========== 

See accompanying report of management.




                  VERSUS TECHNOLOGY, INC. AND SUBSIDIARY                   
                    Consolidated Statements of Income                      
                                (Unaudited)                                
          
                                                     Three Months Ended
                                                        January 31,
                                                      2010         2009
                                                  -----------  ------------
Revenues                                          $ 1,793,000  $  1,613,000

Operating Expenses
   Cost of revenues                                   574,000       391,000
   Research and development                           175,000       164,000
   Sales and marketing                                698,000       766,000
   General and administrative                         241,000       260,000
                                                  -----------  ------------

Total Operating Expenses                            1,688,000     1,581,000

Income From Operations                                105,000        32,000
                                                  -----------  ------------

Other Income (Expense)
   Interest income                                      2,000         5,000
   Net foreign currency transaction gain (loss)        (2,000)            -
                                                  -----------  ------------

Total Other Income (Expense)                                -         5,000
                                                  -----------  ------------

Net Income                                        $   105,000  $     37,000
                                                  ===========  ============

Basic and Diluted Net
 Income Per Share                                 $         -  $          -
                                                  ===========  ============

See accompanying report of management.




                  VERSUS TECHNOLOGY, INC. AND SUBSIDIARY                   
                  Consolidated Statements of Cash Flows                    
                                (Unaudited)                                

                                                     Three Months Ended
                                                        January 31,
                                                      2010         2009
                                                  -----------  ----------- 
Cash flows from Operating Activities
   Net income                                     $   105,000  $    37,000
   Adjustments to reconcile net income to net
    cash (used in) provided by operating
    activities:
     Depreciation                                      16,000       16,000
     Amortization                                       1,000            -
     Non-cash equity based compensation                30,000       26,000
   Changes in operating assets and liabilities:
     Accounts receivable                              (68,000)     164,000
     Inventories                                       83,000       57,000
     Prepaid expenses and other current assets         50,000        2,000
     Accounts payable                                (156,000)      22,000
     Accrued expenses                                 (90,000)     (79,000)
     Deferred revenues                                (65,000)      22,000
                                                  -----------  ----------- 

Net cash (used in) provided by operating
 activities                                           (94,000)     267,000
                                                  -----------  ----------- 

Cash flows from investing activities
   Additions to property and equipment                 (9,000)      (1,000)
   Increase in other noncurrent assets                (16,000)           -
                                                  -----------  ----------- 

Net cash used in investing activities                 (25,000)      (1,000)
                                                  -----------  ----------- 

Cash flows from financing activities
   Issuance of common stock                           129,000            -
                                                  -----------  ----------- 

Net cash provided by financing activities             129,000            -
                                                  -----------  ----------- 

Net Increase in Cash and Cash Equivalents              10,000      266,000

Cash and Cash Equivalents, at the beginning
 of the period                                      1,301,000    1,709,000 
                                                  -----------  ----------- 

Cash and Cash Equivalents, at the end of
 the period                                       $ 1,311,000  $ 1,975,000
                                                  ===========  =========== 

See accompanying report of management.

Contact Information

  • Investors/Analysts contact:
    Joseph E. Winowiecki
    Chief Financial Officer

    Media contact:
    Stephanie Bertschy
    Director of Marketing
    Versus Technology, Inc.
    (231) 946-5868