The following excerpt is from the company's SEC filing.
HACKENSACK, N.J. August 14, 2015 Emerson Radio Corp. (NYSE MKT: MSN) today reported financial results for its first quarter ended June 30, 2015.
Net product sales for the first quarter of fiscal 2016 were $18.3 million, as compared to $24.8 million for the first quarter of fiscal 2015, a decrease of $6.5 million, or 26.4%. The lower year-over-year net product sales were principally driven by a $6.4 million, or 26.3%, decrease in net sales of houseware products, which was the result of lower year-over-year net sales of microwave ovens, driven mainly by product discontinuations by the Companys key custome rs and the effects of the 2014/2015 Los Angeles/Long Beach port strike, partially offset by increases in net sales of compact refrigeration and wine products. Net sales of audio products for the first quarter of fiscal 2016 were down $0.2 million, or 28.8%, resulting from decreased net sales of the Companys clock radio and portable audio product offerings, driven by competitive activity in the space. Due primarily to the aforementioned product discontinuations, the Company expects its net product sales for the second quarter and full year of fiscal 2016 to continue to decrease as compared to the second quarter and full year of fiscal 2015, respectively.
Licensing revenue for the first quarter of fiscal 2016 was $1.2 million, as compared to $1.1 million in the first quarter of fiscal 2015, an increase of $0.1 million, or 11.3%, principally due to the execution during the second quarter of fiscal 2015 of a licensing agreement renewal with one of the Companys non-strategic licensees.
As a result of the foregoing factors, net revenues for the first quarter of fiscal 2016 were $19.5 million, a decrease of $6.4 million, or 24.8%, as compared to first quarter fiscal 2015 net revenues of $25.9 million.
Operating income for the first quarter of fiscal 2016 was $0.1 million, a decrease of $0.7 million, or 85.7%, from operating income of $0.8 million for the first quarter of fiscal 2015 due to the lower year-over-year net product sales and higher year-over-year cost of sales as a percentage of sales, partly offset by a $0.1 million, or 4.4%, decrease in year-over year SG&A expenses.
Net income for the first quarter of fiscal 2016 was $0.1 million as compared to $0.7 million for the first quarter of fiscal 2015, a decrease of $0.6 million, or 81.4%, due primarily to the year-over-year decrease in operating income. Diluted earnings per share for the first quarter of fiscal year 2016 were $0.00, as compared to $0.02 for the first quarter of fiscal year 2015, a decrease of $0.02 per diluted share, or 100.0%.
Duncan Hon, Chief Executive Officer of Emerson Radio, commented Our first quarter fiscal 2016 net income declined significantly as compared to the prior year due primarily to lower net product sales and lower margins on those product sales, driven by product discontinuations by the Companys key customers and the effects of the 2014/2015 Los Angeles/Long Beach port strike. We also continue to experience intense competition, including downward pricing pressure, within all of our product categories. The Company continues to seek to implement pricing, product strategy initiatives and licensing opportunities to improve the Companys results of operations, although there can be no assurance that such initiatives will be successfully implemented or have the desired effects on the Companys results of operations and financial condition.
About Emerson Radio Corp.
Emerson Radio Corp. (NYSE MKT: MSN), incorporated in 1994, is headquartered in Hackensack, N.J. The Company designs, sources, imports and markets a variety of houseware and consumer electronic products, and licenses its trademarks to others on a worldwide basis for a variety of products. For more information, please visit Emerson Radios web site at www.emersonradio.com.
Forward Looking Statements
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect managements current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations
reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, including the risk factors detailed in the Companys reports as filed with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this news release.
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)
Three Months Ended
Costs and expenses:
Cost of sales
Other operating costs and expenses
Selling, general and administrative expenses
Interest income, net
Income before income taxes
Provision for income taxes
Basic net income per share:
Diluted net income per share:
Weighted average shares outstanding:
CONSOLIDATED BALANCE SHEETS
(In thousands except share data)
Cash and cash equivalents
Short term investments
Trade accounts receivable, net
Prepaid expenses and other current assets
Deferred tax assets
Total Current Assets
Property, plant, and equipment, net
Total Non-current Assets
LIABILITIES AND SHAREHOLDERS EQUITY
Accounts payable and other current liabilities
Due to affiliates
Income tax payable
Total Current Liabilities
Long-term income tax payable
Total Non-current Liabilities
Series A Preferred shares 10,000,000 shares authorized; 3,677 shares issued and outstanding; liquidation preference of $3,677,000
Common shares $0.01 par value, 75,000,000 shares authorized; 52,965,797 shares issued and 27,129,832 shares outstanding at June 30, 2015 and March 31, 2015, respectively
Additional paid-in capital
Treasury stock, at cost (25,835,965 shares)
Total Shareholders Equity
Total Liabilities and Shareholders Equity
The above information was disclosed in a filing to the SEC. To see this filing in its entirety, click here.
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Submission of Matters to a Vote of Security - March 27, 2018