Command Security Reports Third Fiscal Quarter Results.Business Editors LAGRANGEVILLE, N.Y.--(BUSINESS WIRE)--Feb. 13, 2004 -- Breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations Results -- Revenues Increase 8.6% from Prior Quarter -- Reduced G & A Expense from Prior Year quarter Command Security Corporation (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :CMMD CMMD Ceramic Metal Matrix Diaphragm CMMD Command ) announced today its results for the third fiscal quarter ended December 31, 2003. For the quarter and nine months, the company reported net income of $25,134 and $137,364 respectively. Due to the federalization of the pre-board screening business in November 2002, revenues for the quarter ending December 31, 2003 decreased by 1.7% to $20.6 million from the $21.0 million reported in the same period of the prior fiscal year. Excluding the pre-board screening revenues lost to federalization, revenue would have increased by 14.3% for the quarter, primarily related to additional revenue from the Aviation division from non-screening services and additional revenue in the Guard division reflecting revenue from strike-related work in California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). . Revenue for the quarter ending December 31, 2003 increased by 8.6% from the previous quarter marking the third consecutive quarter of revenue growth for the Company. For the nine-month period ending December 31, 2003 revenue decreased by 26.8% to $56.2 million from the $76.7 million reported in the same period of the prior fiscal year. Revenue for the nine-month period increased by $6.8 million or 13.7% excluding the pre-board screening revenues reported in last year's revenues. Gross profit for the quarter ending December 31, 2003 decreased to $2.8 million or 13.59% of revenue from the $3.6 million or 17.24% of revenue for the same period the previous year. Gross profit margins 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. were adversely affected by the loss, due to federalization of pre-board screening activities which also impacted our unemployment rates. The Company's overall cost of workers compensation coverage was also adversely impacted by an unusually large claim. For the nine-months ending December 31, 2003, the gross profit decreased to $8.5 million (15.22% of revenue) from $16.7 million or 21.74% of revenue. General and administrative expense as a percentage of revenue for the quarter ending December 31, 2003 decreased to 13.29% from the 14.95% incurred in the same period of the prior fiscal year. Commenting on the results of the quarter William C. Vassell, Chairman and President of Command, said "We continue to make good progress adding new business particularly in our Aviation Division. In addition we have stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. revenue in our Guard Division after reduction over the past few years as we cancelled contacts that had unacceptable margin. We also have continued to maintain control of our general and administrative expenses. Unfortunately our results are still impacted by the federalization of our pre-board screening activities. We have been significantly impacted by an increase in unemployment rates as a result of the termination of many employees formerly engaged in these activities. We view this as a short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. aberration in the rebuilding of a substantial and profitable security company." As part of the legislation that was passed in relation to the September 11 tragedy a restriction was placed on companies with a significant foreign ownership (defined as greater than 25%) from providing services on many security contracts in the US. This would include those issued by the Department of Homeland Security Noun 1. Department of Homeland Security - the federal department that administers all matters relating to homeland security Homeland Security executive department - a federal department in the executive branch of the government of the United States , as well as US airports when they have the right to opt out from federalization which is expected in November 2004. For this reason the Board of Reliance Security Group plc (a UK support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services Company with a significant ownership interest in Command) has concluded that it is in the best interest of both Command and Reliance to sell its interest in Command in a private transaction. Reliance has instructed its advisors in the US to assist with the sale of its investment. A number of parties and financial institutions have expressed interest. Mr. Vassell added, "We are investing approximately $200,000 per year supporting our attempt to secure contracts from the Department of Homeland Security and other government departments. In addition, with our experience and reputation in the Aviation division we believe that we will be a leading contender, beginning in November 2004, to secure screening contracts as airports are expected to opt out of the federal programs. Reliance deciding to sell its interest in Command will help the Company to move forward on these fronts. We are assisting Reliance in these efforts and hope that a transaction will be concluded in due course."
COMMAND SECURITY CORPORATION
Three Months Ended Nine Month Ended
December 31, December 31
2003 2002 2003 2002
---- ---- ---- ----
Revenue $20,609,953 $20,969,586 $56,167,214 $76,710,839
Operating profit 149,210 316,847 508,022 5,236,371
Net Income 25,134 232,176 137,364 3,538,520
Preferred stock
dividends (40,673) (40,674) (122,021) (406,742)
-------- -------- --------- ---------
Net income/(loss)
applicable to common
stockholders $(15,539) $ 191,502 $15,343 $3,131,778
========== ========= ========= =========
Net Income/(loss) per
common Share
Basic $0.00 $0.03 $0.00 $0.50
========= ========= ========= =========
Diluted $ N/A $0.03 $0.00 $0.46
========= ========= ========= =========
Weighted average number
of common shares outstanding
Basic 6,287,343 6,287,343 6,287,343 6,287,343
========= ========= ========= =========
Diluted N/A 7,601,970 6,333,565 7,749,783
========= ========= ========= =========
About Command Command Security Corporation provides security services Security services are state institutions for the provision of intelligence, primarily of a strategic nature, but also including protective security intelligence. Examples include the Security Service (MI5) and the Secret Intelligence Service (MI6) in the United Kingdom, and the through company-owned offices in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , New Jersey, California, Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , Connecticut Connecticut, state, United States Connecticut (kənĕt`ĭkət), southernmost of the New England states of the NE United States. It is bordered by Massachusetts (N), Rhode Island (E), Long Island Sound (S), and New York (W). , Florida, Massachusetts Florida is a town in Berkshire County, Massachusetts, United States. It is part of the Pittsfield, Massachusetts Metropolitan Statistical Area. The population was 676 at the 2000 census. , Pennsylvania, Maryland and Oregon. Statements in this press release other than statements of historical fact are "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. ." Such statements are subject to certain risks and uncertainties including the demand for the Company's services, litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , labor market labor market A place where labor is exchanged for wages; an LM is defined by geography, education and technical expertise, occupation, licensure or certification requirements, and job experience , and other risk factors identified from time to time in the Company's filings with the Securities and Exchange Commission that could cause actual results to differ materially from any forward looking statements. These forward-looking statements represent the Company's judgment as of the date of this release. The Company disclaims, however, any intent or obligation to update these forward-looking statements. For more information concerning the Company, please refer to its website at www.commandsecurity.com and to the Edgar website www.sec.gov/edgar.shtml. |
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