Press Release:
SPY Inc. Reports Financial Results for the Quarter Ended June 30, 2012
Aug 13, 2012 (Marketwire via COMTEX) –SPY Inc. (OTCBB: XSPY) today announced financial results for the quarter ended June 30, 2012.
Total net sales increased by $0.5 million, or 5%, to $9.5 million for the quarter ended June 30, 2012, compared with total net sales of $9.0 million for the quarter ended June 30, 2011. Total net sales increased by $1.9 million, or 13%, to $17.6 million for the six months ended June 30, 2012, compared with total net sales of $15.7 million for the six months ended June 30, 2011.
Sales of our core SPY® brand products increased by $1.1 million, or 13%, to $9.3 million for the quarter ended June 30, 2012, compared with core SPY® brand sales of $8.2 million during the quarter ended June 30, 2011. Other sales were $0.2 million during the quarter ended June 30, 2012, consisting of licensed brand products which are no longer a focus of the Company, compared with licensed product sales of $0.8 million during the quarter ended June 30, 2011.
Sales of our core SPY® brand products increased by $2.5 million, or 17%, to $17.2 million for the six months ended June 30, 2012, compared with core SPY® brand sales of $14.7 million during the six months ended June 30, 2011. Other sales were $0.4 million during the six months ended June 30, 2012, consisting of licensed brand products which are no longer a focus of the Company, compared with licensed product sales of $1.0 million during the six months ended June 30, 2011.
“We are once again pleased to have achieved another quarter with nice growth, making it our 5th consecutive quarter of year over year growth of our core SPY® brand products which we believe demonstrates the strength of our SPY® brand,” said Michael Marckx, President and CEO.
We incurred a net loss of $1.6 million during the quarter ended June 30, 2012, compared to a net loss of $3.0 million during the quarter ended June 30, 2011. The reduced loss during the quarter ended June 30, 2012 was primarily due to lower general and administrative expenses, offset by increased sales and marketing expenses related to our SPY® brand products. In addition, 2011 included other operating expense of $2.0 million substantially all related to the decision to not make any more purchases of licensed products.
In August 2012, we increased our borrowing capacity by increasing the maximum principal amount available to us under one of our credit facilities with Costa Brava by $3.0 million (from $7.0 million to $10.0 million), thereby increasing the aggregate maximum principal amount under all credit facilities from Costa Brava from $14.0 million to $17.0 million (excluding deferred interest). We also extended the due dates of both of our credit facilities with Costa Brava to become April 1, 2014.
The results of our operations, liquidity and capital resources during and as of the quarter ended June 30, 2012 and 2011, respectively, are more fully discussed in our Form 10-Q for the quarter ended June 30, 2012.
SPY Inc.:
We design, market and distribute premium products for hard core participants in action sports, motorsports, snow sports, cycling and multi-sports markets, which embrace their attendant lifestyle subcultures, crossing over into more mainstream fashion, music and entertainment markets. We believe a principal strength is our ability to create distinctive products for active people within the youthful demographics of these subcultures. Our principal products — sunglasses, goggles and prescription frames — are marketed under the SPY® brand. During 2011 and 2010, we also designed, manufactured and sold eyewear under the O’Neill®, Melodies by MJB® and Margaritaville® brands and in 2011, we decided to cease any new purchase orders of additional inventory for these licensed eyewear brands and do not expect any significant sales from these brands in the future.
