Blue Holdings, Inc. Reports First Quarter 2006 Financial Results.COMMERCE, Calif. -- Blue Holdings, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :BLUE): --Listed in April on The NASDAQ Capital Market Originally called the NASDAQ Small Cap Market, NASDAQ announced a name change to the NASDAQ Capital Market on September 27, 2005. [1] The NASDAQ Capital Market exists for securities of smaller, less-capitalized companies (small caps) that do not qualify for under ticker ticker An automated quotation system on which security transactions are reported after they occur on an exchange floor. Even though the newer systems are electronic and no longer actually tick, the name of the old mechanical device has stuck. "BLUE" --Net sales increased 137% to $11.9 million --Net income increased 46% to $0.68 million Blue Holdings, Inc. (NASDAQ:BLUE), a designer, manufacturer and distributor of high-end high-end adj. Informal 1. Appealing to sophisticated and discerning customers: a high-end department store; high-end video equipment. 2. fashion jeans and denim apparel, today announced financial results for the three months ended March 31, 2006. Three Months Ended March 31, 2006 Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the first quarter of 2006 were $11.9 million, a 137% increase over the $5.0 million reported in the prior year period. Sales in the quarter consisted of 44.5% from the Taverniti So Jeans Taverniti So Jeans is a sportswear collection from Jimmy Taverniti, who also sells Taverniti Couture. Known for his garment-dying and stonewashing techniques. Taverniti, has focused on jeans, T-shirts, sweatshirts, sweatpants ans stretch silk tops. brand, 39.5% from Antik Denim and 16% from Yanuk. Net income for the quarter was $0.68 million versus net income of $0.47 million for the first quarter of 2005. Basic and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $0.03 on 26,057,200 weighted average shares outstanding versus $0.02 on the same number of shares for the first quarter of 2005. Blue Holdings' gross profit increased to $5.9 million in the first quarter of 2006 compared to $1.7 million in the prior year period. First quarter gross margins increased to 50.1% from 33.2% in the prior year period. The Company expects to maintain approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. a 50% gross margin in the future. Selling, distribution and administrative expenses were $4.6 million in the quarter, up from $1.2 million in the prior year period. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , as a percentage of sales, increased to 38.7% as compared to 23.9% in the prior year period. The operating expenses include design and sales-related expenses such as purchases of sample fabric, freight, advertising, commissions, travel and trade show costs. The increase was primarily a result of significant expenses incurred in connection with trade shows and the related travel costs. These types of expenses are not expected to be incurred in the second quarter. "We continued to make excellent progress in the first quarter. In April, our stock became listed on The NASDAQ Capital Markets under the ticker BLUE, signifying Signifyin' (slang) is an African-American rhetorical device featuring indirect communication or persuasion and the creating of new meanings for old words and signs. Signifying, in this sense, includes repetition and difference, implication and association, combining words and further evidence of our commitment and focus on increasing shareholder value. We successfully launched our kids business, and signed a letter of intent with Global Fashion Group to distribute all our brands throughout Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . Additionally, we continued
to see strong product sell-throughs, in particular from our Taverniti
and Antik brands. We expect our business to accelerate in the second
half of the year and are excited to continue to diligently dil·i·gent adj. Marked by persevering, painstaking effort. See Synonyms at busy. [Middle English, from Old French, from Latin d execute our strategic plan," said Paul Paul, 1901–64, king of the Hellenes (1947–64), brother and successor of George II. He married (1938) Princess Frederika of Brunswick. During Paul's reign Greece followed a pro-Western policy, and the Cyprus question was temporarily resolved. Guez, Blue Holdings' Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . 2006 Outlook The Company expects 2006 net sales to be in the range of $60 million to $70 million, consistent with its prior outlook. The Company also expects gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. to remain at approximately 50%. Conference Call Blue Holdings, Inc. will host a conference call today, May 11, 2006 at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). The call will be hosted by Paul Guez, the Company's President and Chief Executive Officer, and Patrick Chow, the Company's Chief Financial Officer. The call will be open to all interested investors through a live audio Web broadcast via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.blueholdings.com. For those who are not available to listen to the live broadcast, the call will be archived on Blue Holdings' investor website for 90 days. About Blue Holdings, Inc. Blue Holdings, Inc., directly and through its wholly-owned subsidiary, Antik Denim, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , designs, develops, manufactures, markets, distributes and sells high-end fashion jeans, apparel, and accessories with a western flair under the "Antik Denim", "Yanuk", "Taverniti So Jeans", and "U" brands, both in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and internationally. Blue Holdings currently sells men's and women's styles and is in the process of launching a children's line. Antik Denim and Yanuk jeans are made from high-quality fabrics milled in the United States, Japan, Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. and Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. , and are processed with cutting-edge treatments and finishes. Blue Holdings' concepts, designs, embellishments, patent-pending pockets and great attention to detail and quality give it a competitive advantage in the high-end fashion jeans market. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Except for historical information contained herein, the statements in this release are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Examples of forward-looking statements contained in this press release include statements related to Blue Holdings' anticipated results in 2006. Forward-looking statements are inherently unreliable and actual results may differ materially. Factors which could cause actual results to differ materially from these forward-looking statements include such factors as may be detailed from time to time in Blue Holdings' filings with the United States Securities and Exchange Commission. Blue Holdings undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Blue Holdings Inc. (formerly known as Marine Jet Technology Corp.)
and subsidiaries
Condensed Consolidated Statements of Operations (unaudited)
For the three months ended March 31, 2006 and 2005
Three Months Three Months
Ended Ended
March 31, March 31,
2006 2005
------------ -----------
(Unaudited) (Unaudited)
Net sales $11,877,879 $5,009,433
Cost of goods sold 5,928,616 3,346,819
------------ -----------
Gross profit 5,949,263 1,662,614
Selling, distribution & administrative
expenses 4,600,407 1,195,765
------------ -----------
Income before interest expense and provision
for income taxes 1,348,856 466,849
Interest expense 171,313 0
------------ -----------
Income before provision for income taxes 1,177,543 466,849
Provision for income taxes 497,367 800
------------ -----------
Net income $680,176 $466,049
============ ===========
Earnings per common share - Basic and diluted $0.03 $0.02
============ ===========
Weighted average shares outstanding - Basic
and diluted 26,057,200 26,057,200
============ ===========
Blue Holdings Inc. (formerly known as Marine Jet Technology Corp.)
and Subsidiaries
Condensed Consolidated Balance Sheets
As of March 31, 2006 and December 31, 2005
ASSETS March 31, December 31,
2006 2005
------------ ------------
(Unaudited) (Audited)
Current assets:
Cash $105,931 $228,127
Due from factor, net of reserves of
$49,674 and $96,849, respectively 1,265,399 693,474
Accounts receivable, net of reserves of
$531,596 and $484,421, respectively:
- Purchased by factor with recourse 4,705,701 4,287,163
- Others 159,759 2,504
Due from related parties - 15,974
Inventories 12,077,440 9,925,162
Deferred income taxes 654,997 492,574
Prepaid expenses and other current assets 295,851 351,919
------------ ------------
Total current assets 19,265,078 15,996,897
Deferred income taxes 1,647,004 1,671,135
Property and equipment, less accumulated
depreciation 354,128 198,927
------------ ------------
Total assets $21,266,210 $17,866,959
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank overdraft $539,329 $616,020
Accounts payable 3,427,355 2,911,598
Short-term borrowings 6,643,138 4,583,936
Due to related parties 803,063 469,186
Income taxes payable 596,953 650,468
Accrued expenses and other current
liabilities 425,114 599,166
------------ ------------
Total current liabilities 12,434,952 9,830,374
------------ ------------
Stockholders' equity
Common Stock $0.001 par value,
authorized 75,000,000 shares,
26,057,200 shares issued and
outstanding 26,057 26,057
Additional paid-in capital 5,111,249 4,996,752
Retained earnings 3,693,952 3,013,776
------------ ------------
Total stockholders' equity 8,831,258 8,036,585
------------ ------------
Total liabilities and stockholders' equity $21,266,210 $17,866,959
============ ============
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