DSI Toys Announces Record Second Quarter Results.HOUSTON--(BUSINESS WIRE)--September 9, 1997--DSI Toys, Inc. (Nasdaq: DSIT) today announced results for the second quarter and six months ended July 31, 1997. 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 35% to $24.4 million, compared to net sales of $18.1 million in the second quarter ended July 31, 1996. Gross profit was $7.2 million, a 54% increase from $4.6 million in the same period last year. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. increased 31% to $2.9 million in the recently completed period from $2.2 million in last year's second quarter. Income before extraordinary items increased 63% to $1.7 million, or $0.30 per share, based on 5,555,000 weighted average shares outstanding. This compares to last year's second quarter net income of $1.0 million, or $0.28 per share, based on 3,714,000 weighted average shares outstanding. This year's second quarter net income was $1.2 million, or $0.22 per share, after deducting extraordinary items, consisting of the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of $480,000 of debt issuance cost (net of tax) as a result of debt repayment using the proceeds of the recent initial public offering. For the first six months of fiscal 1997, net sales increased 33% to $31.8 million, compared to net sales of $24.0 million in the first six months of fiscal 1996. Gross profit was $9.9 million, a 44% increase from $6.9 million in the same period last year. Operating income increased 57% to $2.6 million in the first six months of fiscal 1997, compared to $1.6 million in last year's first six months. Income before extraordinary items increased 271% to $1.2 million, or $0.26 per share, based on 4,542,000 weighted average shares outstanding. This compares to last year's first six month net income of $0.3 million, or $0.09 per share, based on 3,607,000 weighted average shares outstanding. This year s first six months net income was $0.7 million, or $0.16 per share, after deducting extraordinary items. M.D. Davis, Chairman and Chief Executive Officer of DSI (Dynamic Systems Initiative) An umbrella term for a suite of Microsoft products that help manage the Windows environment in large enterprises. DSI was introduced in 2003. stated, "We are pleased with the results of the second quarter and first six months of our fiscal year. Sales have been particularly strong in the core juvenile audio category, and our year-over-year sales increases in all major categories can mainly be attributed to the success of our new products." Mr. Davis concluded, "As we begin the second half of the year, we are pleased with the initial sell-in to our retail customers. Our advertising campaign has recently begun and we are encouraged by recent retail sales reports for the products being advertised. Accordingly, we continue to believe that results for the fiscal year as a whole will be as planned. However, as we have previously stated, we may continue to experience some shifting of expected sales among fiscal quarters, as our customers strategies and buying patterns evolve." DSI Toys, Inc. designs, manufactures, markets and distributes high quality, value-priced toys and children s consumer electronics. The Company s core product categories are juvenile audio products (including walkie-talkies, pre-school audio products, pre-teen audio products and musical toys), girls' toys (including dolls, play sets and accessories) and boys' toys (including radio control vehicles, action figures and western and military action toys). 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. Statement Under 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: Statements in this press release that are not historical facts, including statements about plans and expectations regarding products and opportunities, demand and acceptance of new and existing products and future financial results may be forward-looking. Forward- looking statements involve risks and uncertainties which may cause the Company s actual results in future periods to differ materially from those expressed. These uncertainties and risks include changing consumer preferences, lack of success of new products, loss of the Company s customers, competition, and other factors discussed from time to time in the Company s filings with the Securities and Exchange Commission. -0-
DSI Toys, Inc.
Consolidated Statements of Operations
Three Months Ended July 31, Six Months Ended July 31,
1997 1996 1997 1996
(Unaudited) (Unaudited)
Net sales $24,382,678 $18,097,350 $31,810,385 $23,952,980
Costs of
goods sold 17,184,400 13,435,756 21,888,309 17,050,947
Gross profit 7,198,278 4,661,594 9,922,076 6,902,033
Selling,
general and
administrative
expenses 4,326,968 2,474,351 7,344,663 5,260,379
Operating
income 2,871,310 2,187,243 2,577,413 1,641,654
Interest
expense 295,068 607,795 872,014 1,187,607
Other income (46,059) (10,441) (166,007) (35,385)
Income before
income taxes 2,622,301 1,589,889 1,871,406 489,432
Provision for
income taxes 944,028 562,571 673,707 166,407
Income before
extraordinary
items 1,678,273 1,027,318 1,197,699 323,025
Extraordinary
items
(net of tax) (480,754) -- (480,754) --
Net income $1,197,519 $1,027,318 $716,945 $323,025
Earnings per
share before
extraordinary
items $ 0.30 $ 0.28 $ 0.26 $ 0.09
Earnings per
share $ 0.22 $ 0.28 $ 0.16 $ 0.09
Weighted
average shares
outstanding 5,554,561 3,713,713 4,541,919 3,606,857
-0-
DSI Toys, Inc. 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. Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. July 31, January 31, 1997 1997 (Unaudited) ASSETS Current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. : Cash $2,131,062 $1,651,992 Accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying , net 14,181,681 4,219,942 Inventories 8,304,491 4,615,087 Other current assets Other Current Assets A balance sheet item that includes the value of non-cash assets due within one year. Notes: Examples are things like prepaid expenses and accounts receivable. 3,277,298 2,487,621 Total current assets 27,894,532 12,974,642 Property and equipment, net 1,506,669 1,190,498 Other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. 1,274,123 2,138,761 Total assets $ 30,675,324 $16,303,901 LIABILITIES AND SHAREHOLDERS EQUITY Current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. : Accounts payable and accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. liabilities $13,785,362 $7,247,254 Other current liabilities Other Current Liabilities A balance sheet entry used by companies to group together current liabilities that are not assigned to common liabilities such as debt obligations or accounts payable. 3,416,998 3,107,000 Total current liabilities 17,202,360 10,354,254 Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. 4,498,000 15,372,108 Total liabilities 21,700,360 25,726,362 Shareholders equity (deficit): Common stock, 20,000,000 shares authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: ;8,719,000 shares issued; 6,000,000 shares outstanding 87,190 62,190 Additional paid-in capital additional paid-in capital Stockholder contributions that are in excess of a stock's stated or par value. For example, if a firm issues stock with a par value of $1 per share but sells the stock to investors at $10 per share, the firm's financial statements 21,082,528 3,443,093 Warrants 102,500 100,000 Retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. 10,340,295 9,623,350 Cumulative translation adjustment 23,043 9,498 31,635,556 13,238,131 Less:treasury stock, 2,719,000 shares, at cost (22,660,592) (22,660,592) Total shareholders equity (deficit) 8,974,964 (9,422,461) Total liabilities & shareholders equity $30,675,324 $16,303,901 -0- CONTACT: DSI TOYS, INC. J. Russell Denson Executive Vice President and CFO See Chief Financial Officer. 713/365-9900 ext. 112 |
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