Brass Eagle Announces Record Fourth Quarter Results and Significantly Exceeds Wall Street Estimates.ROGERS, Ark.--(BUSINESS WIRE)--Feb. 10, 1999--Brass Eagle Inc. (Nasdaq:XTRM XTRM Extreme ) the worldwide leader in the manufacturing, marketing and distribution of paintball paintball Sports medicine A sport in which marble-sized gelatin capsules filled with a nontoxic dye are shot at speeds of 300 kph/200 mph Warning: products today reported record results for the fourth quarter and fiscal year ended December 31, 1998. 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 increased 84.8% to $26,467,000 for the fourth quarter ended December 31, 1998, from $14,325,000 for the same period last year. Net income for the three months ended December 31, 1998 increased 95.2% to $3,056,000, or $0.40 per share on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, from $1,565,000 or $0.25 per diluted share earned in the fourth quarter of 1997. For the year ended December 31, 1998 net sales increased 107.9% to $75,149,000 from $36,139,000 for the same period last year. Net income was up 125.4% to $8,195,000 or $1.07 per share on a fully-diluted basis for the year ended December 31, 1998 compared to $3,636,000 or $0.64 per diluted share for the year ended December 31, 1997. Included in 1998 earnings were $667,000 or $0.05 per share of start-up Start-up The earliest stage of a new business venture. expenses related to the new paintball manufacturing plant in Neosho, MO. Excluding this expense, diluted earnings for the year would have been $1.12 per share. Lynn Scott Lynn Scott (born June 23, 1977 in Turpin, Oklahoma) is a former American football safety for the Dallas Cowboys of the NFL. He was signed by the Cowboys in 2001 as an undrafted free agent out of Northwestern Oklahoma State University. , the Company's President 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. , stated, "We are extremely pleased with our fourth quarter and year-end results. Once again, we significantly outperformed both internal and external expectations. The better than expected results in sales, net income, and operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before were primarily a result of higher reorders throughout the holiday selling season. As we stated last quarter, we went into the fourth quarter with higher inventory levels to support a substantial amount of promotional orders scheduled to begin shipping in October. We were prepared for reorders from the retailers who had strong sales due to promotions. Additionally, during the quarter, we launched our National Network Cable television advertising campaign on ESPN ESPN Entertainment and Sports Programming Network , ESPN2 and MTV MTV in full Music Television U.S. cable television network, established in 1980 to present videos of musicians and singers performing new rock music. MTV won a wide following among rock-music fans worldwide and greatly affected the popular-music business. to much fanfare, and were named Wal-Mart Vendor of the Year in the General Sporting Goods Noun 1. sporting goods - sports equipment sold as a commodity commodity, trade good, good - articles of commerce sports equipment - equipment needed to participate in a particular sport category." Mr. Scott concluded, "We remain extremely enthusiastic about our business and the potential for continued growth. The acquisition of CM Support Inc., which we announced in January, has allowed us to increase our product selection and expand our distribution channels. Going forward, we will continue to look for underdeveloped un·der·de·vel·oped adj. Not adequately or normally developed; immature. brands and products to further strengthen our product offering. Moreover, we remain excited about retail sales reflecting continued growth in the popularity of the sport." Paintball appeals to a wide demographic, in particular the youth market which represents 66 million individuals and $500 billion in spending power The power of legislatures to tax and spend. Spending power is conferred to state and federal legislatures through their constitution. Judicial Review of legislative spending varies from state to state, but the law of federal spending informs courts in all states. , according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Company. Brass Eagle is unique in providing a full line of paintball markers  This article or section needs copy editing for grammar, style, cohesion, tone and/or spelling.You can assist by [ editing it] now. and accessory accessory, in criminal law, a person who, though not present at the commission of a crime, becomes a participator in the crime either before or after the fact of commission. products from beginner through competition level. The Company is the dominant supplier of products for this rapidly growing sport. For more information, please call Chad Chad (chăd, chäd), Fr. Tchad, officially Republic of Chad, republic (2005 est. pop. 9,826,000), 495,752 sq mi (1,284,000 sq km), N central Africa. Jacobs, Integrated Corporate Relations, Inc., at 203-222-9013 or send faxes to 203-222-9372. Following: Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Statements of Operation Condensed Balance Sheets -0-
BRASS EAGLE INC.
CONDENSED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
QUARTER ENDED YEAR ENDED
DECEMBER 31, 1998 DECEMBER 31, 1998
----------------------- -----------------------
1998 1997 1998 1997
---- ---- ---- ----
NET SALES $ 26,467 $ 14,325 $ 75,149 $ 36,139
COST OF SALES 17,934 10,161 49,253 24,800
----------- ----------- ----------- -----------
GROSS PROFIT 8,533 4,164 25,896 11,339
OPERATING EXPENSES 3,480 1,639 12,806 5,277
----------- ----------- ----------- -----------
OPERATING INCOME 5,053 2,525 13,090 6,062
INTEREST INCOME /
(EXPENSE) 38 12 338 (169)
----------- ----------- ----------- -----------
INCOME BEFORE INCOME
TAXES 5,091 2,537 13,428 5,893
PROVISION FOR INCOME
TAXES 2,035 972 5,233 2,257
----------- ----------- ----------- -----------
NET INCOME $ 3,056 $ 1,565 $ 8,195 $ 3,636
=========== =========== =========== ===========
EARNINGS PER SHARE
PRO FORMA DILUTED $ 0.40 $ 0.20 $ 1.07 $ 0.47
DILUTED 0.40 0.25 1.07 0.64
PRO FORMA BASIC 0.42 0.27 1.13 0.69
BASIC 0.42 0.28 1.13 0.75
WEIGHTED AVERAGE SHARES
OUTSTANDING
PRO FORMA DILUTED 7,664,976 7,652,824 (a) 7,671,945 7,656,831
DILUTED 7,664,976 6,289,762 7,671,945 5,670,004
PRO FORMA BASIC 7,241,815 5,861,870 (a) 7,239,092 5,238,294
BASIC 7,241,815 5,606,656 7,239,092 4,860,368
(a) Pro forma diluted and pro forma basic earnings per share has been
presented in order to compare diluted and basic earnings per
share for 1998 to 1997, considering the additional shares,
including overallotments, issued in the Initial Public Offering
in November 1997.
BRASS EAGLE INC.
CONDENSED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
DECEMBER 31, DECEMBER 31,
1998 1997
------- -------
ASSETS
CURRENT ASSETS
CASH & INVESTMENTS $ 6,836 $13,163
ACCOUNTS RECEIVABLE, NET 18,271 12,242
INVENTORIES 5,607 3,584
PREPAID EXPENSES AND OTHER
CURRENT ASSETS 2,829 3,240
------- -------
TOTAL CURRENT ASSETS 33,543 32,229
PROPERTY AND EQUIPMENT, NET 5,337 1,334
OTHER ASSETS
INTANGIBLE ASSETS, NET 2,550 2,666
------- -------
$41,430 $36,229
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
CURRENT MATURITIES OF LONG-TERM DEBT $ 0 $ 698
ACCOUNTS PAYABLE AND ACCRUED EXPENSES 6,943 6,274
DUE TO AFFILIATE 0 2,737
------- -------
TOTAL CURRENT LIABILITIES 6,943 9,709
DEFERRED INCOME TAXES 213 365
STOCKHOLDERS' EQUITY 34,274 26,155
$41,430 $36,229
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