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| 8-K - CURRENT REPORT - IRONCLAD PERFORMANCE WEAR CORP | ironclad_8k-030211.htm |
Exhibit 99.1
Ironclad Performance Wear Reports Fourth Quarter and Fiscal Year 2010 Results
Company Reports Record Sales, Continued Growth and Positive Earnings For 2010
LOS ANGELES, CA – March 2, 2011 – Ironclad Performance Wear Corporation (ICPW:OB), the recognized leader in high-performance task-specific work gloves and apparel, announced today financial results for the fourth quarter and fiscal year ended December 31, 2010.
Fourth Quarter 2010 Results
The Company reported net sales for the fourth quarter of 2010 of $5.70 million, an increase of 28.7% percent from the fourth quarter 2009 of $4.43 million.
Gross profit increased 19.7% to $2.04 million, or 35.7% of net sales, compared to $1.70 million, or 38.4% of net sales in the fourth quarter of 2009.
Operating expenses as a percent of net sales decreased to 24.4%, or $1.39 million, compared to 36.5% of net sales, or $1.62 million during the same period last year.
Net income from operations increased 662% to $647,692 compared to $84,970 during the same period in 2009. This continuing improvement in net income from operations reflects the increasing financial strength and discipline of the Company, and its ability to execute consistently on its business plan.
“As evidenced by Ironclad’s financial results, the fourth quarter was exceptional on all fronts – sales, margins and profitability” said Scott Jarus, Chairman and CEO of Ironclad. “Several new opportunities came to fruition during the quarter, including the introduction of Ironclad’s Snap-on branded gloves in Costco and two national automotive parts stores. We also saw significant sales growth with our existing customer base across all market segments, industrial and retail/consumer”.
Fiscal 2010 Year-End Results
Full-year net sales for 2010 were $15.0 million, representing a 10.1% increase from the 2009 net sales of $13.6 million.
Gross profit increased 14.6% to $5.9 million, or 39.5% of net sales in 2010, compared to $5.2 million, or 37.9% of net sales for full-year 2009.
Operating expenses as a percent of net sales decreased to 36.3%, or $5.4 million, compared to 42.4% of net sales, or $5.8 million for full-year 2009.
Net Income from operations increased 179% to $479,169 compared to a net loss from operations of $609,037 for fiscal year 2009.
Net Income for 2010 increased to $365,577, representing more than a $1 million improvement when compared to a net loss of $709,742 in the prior year. As a result, the Company had positive earnings per share of $0.01.
Mr. Jarus added, “As I expressed last year at this time, 2010 marked a very significant inflection point for Ironclad. The Company took advantage of many new opportunities which, when combined with a strong business discipline, enabled us to exceed expectations on every level. The foundation established in 2010 provides an excellent launching point for exceptional performance in 2011 and beyond”.
Guidance for 2011
Ironclad expects that its Net Sales for 2011 will increase by 10% to 12%, EBITDA, including non-cash stock option expense (Earnings Before Interest, Taxes, Depreciation, Amortization and ASC 718 stock option expense) will grow, and earnings per share will marginally increase. This guidance is based upon organic growth only, and does not contemplate any acquisition opportunities which, if identified and concluded, are expected to be accretive to this 2011 guidance on both a Net Sales and Net Income basis.
Mr. Jarus concluded, “Our financial results for 2010 demonstrate that the Company has the ability to leverage its brand, products and expertise for continued growth and success in the future. There are very significant market opportunities ahead for the Company, including Ironclad’s entry into the outdoor sporting goods market through the introduction of Realtree branded gloves; the further expansion of the Snap-on branded gloves into new distribution channels; and the continued strong growth of Ironclad’s SMU program. In addition, we expect our most technical gloves, such as the KONG (oil & gas) glove line, to experience continued market expansion around the world.”
Conference Call
Ironclad Performance Wear will hold a conference call to discuss 2010 financial results on Wednesday, March 2nd, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). To participate in the conference call, interested parties should dial (877) 941-1427 ten minutes prior to the call. International callers should dial 1+ (480) 629-9664. If you are unable to participate in the live call, a replay will be available from March 2nd at 7:30 p.m. Eastern Time through 11:59 p.m. Eastern Time on March 16, 2011. To access the replay, dial (877) 870-5176 (passcode: 4415932). International callers should dial 1+ (858) 384-5517 and use the same passcode.
In addition, the conference call will also be broadcast live over the Internet and can be accessed at www.ironclad.com. For those unable to participate during the live broadcast, the Webcast will be archived on this site through March 16, 2011.
The Company's financial results will be posted online at www.ironclad.com once they are publicly released.
About Ironclad Performance Wear Corporation
Ironclad Performance Wear is a leader in high-performance task-specific work gloves and apparel. It created the performance work glove category in 1998, and continues to leverage its leadership position in the safety, construction and industrial markets through the design, development and distribution of specialized task-specific gloves for industries such as oil & gas extraction; automotive; and police, fire, first-responder and military. Ironclad engineers and manufactures its products with a focus on innovation, design, advanced material science and durability. Ironclad's gloves and apparel are available through industrial suppliers, hardware stores, home centers, lumber yards, and sporting goods retailers nationwide; and through authorized distributors in North America, Europe, Australia and Asia.
Built Tough for the Industrial Athlete™
For more information on Ironclad, please visit the Company's Website at www.ironclad.com.
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Information about Forward-Looking Statements
This release contains "forward-looking statements" that include information relating to future events and future financial and operating performance. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: fluctuations in demand for Ironclad's products, the introduction of new products, Ironclad's ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of Ironclad's liquidity and financial strength to support its growth, and other information that may be detailed from time-to-time in Ironclad's filings with the United States Securities and Exchange Commission. Examples of such forward looking statements in this release include statements regarding guidance about and achievement of financial goals and exceptional performance for 2011, increasing interest and sales of Ironclad’s products, market opportunities presented by new products and/or customers and Ironclad’s profitability in 2011. For a more detailed description of the risk factors and uncertainties affecting Ironclad, please refer to the Company's recent Securities and Exchange Commission filings, which are available at www.sec.gov. Ironclad undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Contacts
Scott Jarus, CEO
scottj@ironclad.com
(310) 643-7800 x120
Lorna Miller, Media Relations
lornam@ironclad.com
(310) 496-0930
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Ironclad Performance Wear Corp.
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CONSOLIDATED BALANCE SHEETS
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December 31, 2010
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December 31, 2009
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ASSETS
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Current Assets
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Cash and cash equivalents
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$ | 1,067,437 | $ | 712,552 | ||||
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Accounts receivable net of allowance for doubtful accounts of $130,000 and $114,000
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776,943 | 1,171,014 | ||||||
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Due from Factor
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1,968,764 | 320,169 | ||||||
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Inventory net of reserve of $220,000 and $132,000
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3,268,189 | 3,516,190 | ||||||
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Deposits on Inventory
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1,033,982 | 286,384 | ||||||
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Prepaid and other
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119,931 | 130,382 | ||||||
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Total current assets
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8,235,246 | 6,136,691 | ||||||
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Property, Plant and equipment
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Computer equipment and software
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390,525 | 212,360 | ||||||
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Vehicle
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43,680 | 43,680 | ||||||
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Office equipment and furniture
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193,034 | 138,256 | ||||||
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Leasehold improvements
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39,694 | 38,594 | ||||||
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Less: accumulated amortization
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(406,909 | ) | (335,317 | ) | ||||
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Total property, plant and equipment
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260,024 | 97,573 | ||||||
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Trademarks, net of accumulated amortization of $24,762 and $19,008
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109,958 | 101,727 | ||||||
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Deposits
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11,354 | 11,354 | ||||||
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Total Assets
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$ | 8,616,582 | $ | 6,347,345 | ||||
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LIABILITIES & STOCKHOLDERS' EQUITY
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Current Liabilities
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Accounts payable and accrued expenses
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$ | 2,526,103 | $ | 1,483,018 | ||||
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Line of credit
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1,776,388 | 1,237,961 | ||||||
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Total current liabilities
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4,302,491 | 2,720,979 | ||||||
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Long Term Liabilities
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Fair value of warrant liability
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- | 5,383 | ||||||
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Total Liabilities
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4,302,491 | 2,726,362 | ||||||
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Stockholder's Equity
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Common stock, $.001 par value; 172,744,750 million shares
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authorized; 72,951,185 shares issued and outstanding
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72,951 | 72,951 | ||||||
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Additional paid In capital
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18,232,713 | 17,905,182 | ||||||
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Accumulated deficit
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(13,991,573 | ) | (14,357,150 | ) | ||||
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Total Stockholders' Equity
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4,314,091 | 3,620,983 | ||||||
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Total Liabilities & Stockholders' Equity
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$ | 8,616,582 | $ | 6,347,345 | ||||
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Ironclad Performance Wear Corp.
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CONSOLIDATED STATEMENTS OF OPERATIONS
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Three Months Ended
December 31, 2010
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Three Months Ended
December 31, 2009
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Twelve Months Ended
December 31, 2010
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Twelve Months Ended
December 31, 2009
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REVENUES
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Net sales
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$ | 5,696,859 | $ | 4,427,033 | $ | 14,999,181 | $ | 13,625,272 | ||||||||
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COST OF SALES
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Cost of sales
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3,661,180 | 2,726,285 | 9,078,793 | 8,460,249 | ||||||||||||
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GROSS PROFIT
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2,035,679 | 1,700,748 | 5,920,388 | 5,165,023 | ||||||||||||
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OPERATING EXPENSES
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General and administrative
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505,355 | 730,024 | 2,072,465 | 2,372,566 | ||||||||||||
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Sales and marketing
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601,373 | 659,631 | 2,301,669 | 2,468,336 | ||||||||||||
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Research and development
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68,911 | 51,409 | 311,088 | 249,967 | ||||||||||||
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Purchasing, warehousing and distribution
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193,146 | 154,611 | 678,650 | 595,279 | ||||||||||||
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Depreciation and amortization
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19,202 | 20,102 | 77,347 | 87,912 | ||||||||||||
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Total Operating Expenses
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1,387,987 | 1,615,777 | 5,441,219 | 5,774,060 | ||||||||||||
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INCOME (LOSS) FROM OPERATIONS
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647,692 | 84,970 | 479,169 | (609,037 | ) | |||||||||||
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OTHER INCOME (EXPENSE)
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Interest expense
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(30,485 | ) | (23,488 | ) | (90,883 | ) | (84,863 | ) | ||||||||
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Interest income
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32 | 52 | 73 | 525 | ||||||||||||
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Change in fair value of warrant liability
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- | - | - | - | ||||||||||||
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Other income(expense), net
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(20,099 | ) | (429 | ) | (19,525 | ) | (11,135 | ) | ||||||||
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Unrealized gain (loss) on financings activities
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- | (203 | ) | (1,929 | ) | (3,286 | ) | |||||||||
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Loss on disposition of equipment
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- | - | - | (480 | ) | |||||||||||
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Total Other Income(Expense), Net
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(50,552 | ) | (24,068 | ) | (112,264 | ) | (99,239 | ) | ||||||||
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NET INCOME (LOSS) BEFORE INCOME TAXES
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597,140 | 60,902 | 366,905 | (708,276 | ) | |||||||||||
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PROVISION FOR (BENEFIT FROM) INCOME TAXES
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- | - | 1,328 | 1,466 | ||||||||||||
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NET INCOME (LOSS)
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$ | 597,140 | $ | 60,902 | $ | 365,577 | $ | (709,742 | ) | |||||||
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NET INCOME (LOSS) PER COMMON SHARE
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Basic
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$ | 0.01 | $ | 0.00 | $ | 0.01 | $ | (0.01 | ) | |||||||
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Diluted
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$ | 0.01 | $ | 0.00 | $ | 0.00 | $ | (0.01 | ) | |||||||
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
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Basic
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72,951,185 | 72,951,185 | 72,951,185 | 69,977,713 | ||||||||||||
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Diluted
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81,343,673 | 82,960,589 | 81,343,673 | 79,987,117 | ||||||||||||
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