Attached files
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| 8-K - CURRENT REPORT - MINIM, INC. | zmtp_8k.htm |
Exhibit 99.1
Zoom Telephonics Reports 43% Sales Increase and Positive Net Income
for the Third Quarter of 2017
Boston, MA, October 31,
2017 – Zoom Telephonics,
Inc. (“Zoom”) (OTCQB: ZMTP), a leading producer of
cable modems and other communication products, today reported
financial results for the third quarter ended September 30, 2017
(“Q3 2017”). Zoom reported net sales of $8.58 million
for Q3 2017, up 43.3% from $5.99 million for Q3 2016. The strong
growth in sales was primarily due to increased sales of Motorola
brand cable modems and gateways through U.S. retailers. Zoom has
the exclusive worldwide license to the Motorola brand for cable
modems and gateways and a number of other product categories
relating to Internet access.
Gross
profit was $3.07 million or 35.7% of net sales in Q3 2017, versus
$1.93 million or 32.1% of net sales in Q3 2016. The significant
increase in gross profit was primarily due to increased
sales.
Operating expenses were
$2.65 million or 30.9% of net sales in Q3 2017 compared to $2.18
million or 36.4% of net sales in Q3 2016. Selling expenses increased $339 thousand to $1.8
million in Q3 2017 due primarily to increases in Motorola trademark
royalty costs, advertising expenses, and freight expenses. General
and administrative expenses increased $29 thousand to $383 thousand
from Q3 2016 to Q3 2017. Research and development expenses
increased $104 thousand to $457 thousand from Q3 2016 to Q3 2017
due primarily to higher product certification
costs.
Zoom
reported net income of $377 thousand or $0.02 per diluted share for
Q3 2017, compared to a net loss of $244 thousand or $0.02 per
diluted share for Q3 2016, with the significant improvement due to
higher sales, higher gross margins, and lower operating expenses as
a percentage of sales.
For
the first nine months of 2017, Zoom reported net sales of $20.6
million, up 62.0% from $12.7 million in the first nine months of
2016 due to continued growth in Motorola brand cable modem sales.
Gross profit increased 76.6% from $4.0 million, or 31.2% of sales,
to $7.0 million, or 34.0% of sales.
Total
operating expenses for the first nine months of 2017 increased
33.0% to $7.9 million or 38.2% of sales from $5.9 million or 46.6%
of sales for the first nine months of 2016. Selling expenses
increased 51.7% from $3.5 million or 27.7% of sales, to $5.3
million or 26.0% of sales, due primarily to increased advertising
costs, Motorola royalty payments, and freight expenses. General and
administrative expenses declined 6.7% from $1.24 million or 9.7% of
sales to $1.15 million or 5.6% of sales, due primarily to lower
personnel, legal, and audit costs, partially offset by increased
consulting expenses. Research and development expenses increased
18.4% from $1.15 million or 9.1% of sales to $1.37 million or 6.7%
of sales, due primarily to increased certification and outside
consultant costs.
Zoom
reported a net loss of $0.98 million, or a loss of $0.07 per
diluted share, for the first nine months of 2017, compared to a net
loss of $1.9 million or a loss of $0.14 per diluted share, for
first nine months of 2016. The primary reason for the decrease in
net loss was increased sales and the resulting increase in gross
profit.
As
of September 30, 2017 Zoom had $0.6 million drawn on a $3.0 million
line of credit, working capital of $2.9 million, and a current
ratio of 1.5.
“This
was a breakthrough quarter, with a substantial increase in sales
and gross profit providing significant positive net income,”
said Frank Manning, Zoom’s President and CEO. “I am
proud of the way our Zoom team has executed with the Motorola
brand. We have designed and produced great products, sold them
through top retailers, and supported our customers with skill and
care from the USA. The result is strong sales, positive customer
reviews, and increased market share. We plan to continue this
approach with cable modems, and to bring the Motorola brand to new
product areas including DSL modems and gateways, routers, MoCA
adapters, and cellular products. This is a big opportunity, and we
will continue to work hard to earn the support of our customers,
business associates, and investors.”
Conference Call
Zoom
has scheduled a conference call for Tuesday, October 31 at 9:00
a.m. Eastern Time. You may access the conference call by dialing
(866) 393-7958 if you are in the USA, and international callers may
dial (706) 643-5255. The conference ID is 9695697. A slide
presentation will accompany management’s remarks and may be
accessed five minutes before the conference call at
www.zoomtel.com/SQ317. Shortly after the conference call a
recording of the call will be available on Zoom’s
website.
About Zoom Telephonics
Zoom Telephonics, Inc. designs, produces, markets,
and supports communication products under the Motorola and Zoom
brands. The Company’s worldwide licensing agreement with
Motorola includes cable modems and gateways, DSL modems and
gateways, cellular modems and routers and sensors, range extenders,
home powerline network products, and MoCA adapters. For more
information about Zoom and its products, please visit
www.zoomtel.com
or www.motorolanetwork.com.
MOTOROLA
and the Stylized M Logo are trademarks or registered trademarks of
Motorola Trademark Holdings, LLC and are used under
license.
###
Forward Looking Statements
This release contains forward-looking information relating to
Zoom’s plans, expectations, and intentions. Actual results
may be materially different from expectations as a result of known
and unknown risks, including: the potential need for additional
funding which Zoom may be unable to obtain; declining demand for
certain of Zoom’s products; delays, unanticipated costs,
interruptions or other uncertainties associated with Zoom’s
production and shipping; Zoom’s reliance on several key
outsourcing partners; uncertainty of key customers’ plans and
orders; risks relating to product certifications; Zoom’s
dependence on key employees; uncertainty of new product
development, including certification and overall project delays,
budget overruns, and the risk that newly introduced products may
contain undetected errors or defects or otherwise not perform as
anticipated; costs and senior management distractions due to
patent-related matters; and other risks set forth in Zoom’s
filings with the Securities and Exchange Commission. Zoom cautions
readers not to place undue reliance upon any such forward-looking
statements, which speak only as of the date made. Zoom expressly
disclaims any obligation or undertaking to release publicly any
updates or revisions to any such statements to reflect any change
in Zoom’s expectations or any change in events, conditions or
circumstance on which any such statement is based.
Investor Relations Contact:
John Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)
Phone: 203-972-9200
jnesbett@institutionalms.com
ZOOM TELEPHONICS, INC.
Condensed Consolidated Balance Sheets
In thousands
(Unaudited)
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|
9/30/17
|
12/31/16
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|
ASSETS
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|
|
|
|
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Current assets:
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|
|
|
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Cash
|
$91
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$180
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|
Accounts
receivable, net
|
2,104
|
2,498
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Inventories,
net
|
5,307
|
4,927
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Prepaid
expenses and other
|
936
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652
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Total
current assets
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8,438
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8,257
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Property and equipment, net
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187
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176
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Other assets
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399
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589
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Total
assets
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$9,024
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$9,022
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current liabilities:
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Bank
debt
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$595
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$1,307
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Accounts
payable
|
3,762
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2,502
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Accrued
expenses
|
1,214
|
1,052
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|
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Total
current liabilities
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5,571
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4,861
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Total
liabilities
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5,571
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4,861
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Stockholders’ equity:
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Common
stock and additional paid-in capital
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40,313
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40,041
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Retained
earnings (accumulated deficit)
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(36,860)
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(35,880)
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Total
stockholders’ equity
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3,453
|
4,161
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|
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Total
liabilities and stockholders’ equity
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$9,024
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$9,022
|
ZOOM TELEPHONICS, INC.
Condensed Consolidated Statements of Operations
In thousands, except for per share data
(Unaudited)
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Three Months Ended
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Nine Months Ended
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||
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9/30/17
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9/30/16
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9/30/17
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9/30/16
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Net sales
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$8,582
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$5,990
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$20,556
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$12,688
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Cost of goods sold
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5,516
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4,065
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13,561
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8,728
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Gross
profit
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3,066
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1,925
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6,995
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3,960
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Operating expenses:
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|
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Selling
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1,813
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1,474
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5,341
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3,520
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General
and administrative
|
383
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354
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1,154
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1,236
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Research
and development
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457
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353
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1,368
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1,155
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Total
operating expenses
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2,653
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2,181
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7,863
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5,911
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Operating
income (loss)
|
413
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(256)
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(868)
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(1,951)
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Other income (expense), net
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(31)
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14
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(98)
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10
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Income
(loss) before income taxes
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382
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(242)
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(966)
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(1,941)
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Income tax expense (benefit)
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5
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2
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14
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3
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Net
income (loss)
|
$377
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$(244)
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$(980)
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$(1,944)
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Earnings (loss) per share:
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Basic
Earnings (loss) per share
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$0.03
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$(0.02)
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$(0.07)
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$(0.14)
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Diluted
Earnings (loss) per share
|
$0.02
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$(0.02)
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$(0.07)
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$(0.14)
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Weighted average number of shares outstanding:
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Basic
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14,953
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13,877
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14,851
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13,723
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Diluted
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16,419
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13,877
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14,851
|
13,723
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