[LANGER LOGO]
CONTACT: W. Gray Hudkins
Chief Operating Officer
(631) 667-1200, ext. 226
Joseph P. Ciavarella
Vice President and
Chief Financial Officer
(631) 667-1200, ext. 233
FOR IMMEDIATE RELEASE
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LANGER, INC. REPORTS 3RD QUARTER RESULTS
WARREN B. KANDERS APPOINTED CHAIRMAN OF THE BOARD OF DIRECTORS
W. GRAY HUDKINS JOINS AS PERMANENT CHIEF OPERATING OFFICER
Deer Park, New York - November 15, 2004- Langer, Inc. (NASDAQ:GAIT,
"Langer" or the "Company") today announced financial results for the third
quarter ended September 30, 2004. Langer also announced that Mr. Warren B.
Kanders has been appointed as Chairman of the Board of Directors and that W.
Gray Hudkins, previously appointed as Acting Chief Operating Officer, has joined
the Company as the permanent Chief Operating Officer.
Reporting its operating results, Langer announced net sales for the
three months ended September 30, 2004 of $6,285,384 compared to net sales of
$6,332,684, or a 1% decline, for the comparable prior year period. Net sales for
the nine months ended September 30, 2004 were $18,596,823, or a 2% increase
compared to net sales of $18,282,606 for the prior comparable period in 2003.
Net income for the three months ended September 30, 2004 was $43,868 or $.01 per
fully diluted share, as compared to the year-ago level of $49,469, or $.01 per
fully diluted share. For the nine months ended September 30, 2004, Langer
reported a net loss of $97,729, or $.02 per fully diluted share, as compared to
a net loss of $182,311 or $.04 per fully diluted share for the comparable period
in 2003.
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For the third quarter, the Company's gross profit margin increased to
36.3% versus 35.0% for the comparable prior year period. The gross profit margin
for the nine months ended September 30, 2004 increased to 35.7% versus 34.5% for
the comparable prior year period. Gross profit margin increases were primarily
attributable to manufacturing efficiency improvements, including decreased labor
costs and lower production overhead expenses.
Selling expenses for the third quarter were $790,038, or 12.6% of net
sales, as compared to $783,423, or 12.4% of net sales, for the comparable prior
year period. Selling expenses for the nine months ended September 30, 2004 were
$2,384,172 or 12.8% of net sales compared to $2,333,850, also 12.8% of net
sales, for comparable prior year period. Selling expenses as a percentage of
sales remained constant as a result of cost controls related to sales and
marketing activities.
General and administrative expenses for the third quarter were
approximately $1,259,016, or 20.0% of net sales, compared to $1,206,363, or
19.0% of net sales, for prior year. General and administrative expenses
year-to-date were $3,777,039, or 20.3% of net sales, versus $3,565,550, or 19.5%
of net sales, for the comparable prior year period. General and administrative
expenses increased slightly due to Sarbanes-Oxley compliance costs as well as
investments in our operating infrastructure.
Andrew H. Meyers, Langer's President and Chief Executive Officer, said,
"Our pricing initiatives and cost containment measures are beginning to show
positive results as we continue to pursue margin enhancement opportunities to
enhance future financial results."
Langer also announced that Warren B. Kanders has joined the Board of
Directors of Langer and been appointed Chairman. Mr. Kanders became the
controlling stockholder of Langer in connection with the change of control
transaction in February 2001.
Commenting on the appointment of Mr. Kanders as Chairman, Mr. Meyers
said, "We are thrilled to have Warren join the Board as Chairman. Since 2001
when we initially invested in Langer, Warren has provided significant strategic
advice and guidance to management. Warren brings to Langer extensive experience
investing in and building public companies through acquisition programs and we
are pleased to have him increase his involvement in the Company as we embark on
this next phase of our growth."
Mr. Kanders said of his appointment as Chairman of the Board, "We
believe the Silipos acquisition marked a significant step in the development of
the Company as it increases our product offerings, improves our distribution
capabilities, and provides scale that is important to continue our development
as a platform for future acquisitions. I look forward to working with the Langer
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management team to grow the Company's business through our stated strategy of
growth both organically as well as through targeted acquisitions."
Langer, Inc., together with its wholly owned subsidiary Silipos Inc.,
is a leading provider of high quality medical products targeting the orthopedic,
orthotic and prosthetic markets. In addition, the Company offers a diverse line
of skincare products for the medical and therapeutic markets. The Company sells
its products primarily in the U.S. and Canada as well as in more than 30 other
countries to national, regional, international and independent medical
distributors and directly to healthcare professionals. Langer is based in Deer
Park, New York and has additional manufacturing facilities in Niagara Falls, NY,
Brea, California, Montreal, Canada, Stoke-on-Trent, UK as well as sales and
marketing offices in Toronto, Canada and New York, New York.
Certain matters discussed in this press release constitute
forward-looking statements that involve risks and uncertainties that could cause
actual results to differ materially from those projected. The Company may use
words such as "anticipates," "believes," "plans," "expects," "intends," "future"
and similar expressions to identify forward-looking statements. These risks and
uncertainties are described in the Company's filings with the Securities and
Exchange Commission, including the Company's Registration Statement on Form S-
3, its 2003 Form 10-K and most recently filed Form 10-Qs and Form 8-Ks.
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LANGER, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
2004 2003 2004 2003
--------------- --------------- ---------------- -----------------
Net sales $ 6,285,384 $ 6,332,684 $ 18,596,823 $ 18,282,606
Cost of sales 4,007,133 4,113,520 11,957,703 11,981,180
--------------- --------------- ---------------- -----------------
Gross profit 2,278,251 2,219,164 6,639,120 6,301,426
Selling expenses 790,038 783,423 2,384,172 2,333,850
General and administrative expenses 1,259,016 1,206,363 3,777,039 3,564,550
--------------- --------------- ---------------- -----------------
Operating income 229,197 229,378 477,909 403,026
--------------- --------------- ---------------- -----------------
Other income (expense):
Interest income 47,347 33,462 135,715 111,235
Interest expense (196,689) (205,725) (602,860) (628,606)
Other 2,013 30,454 4,507 58,684
--------------- --------------- ---------------- -----------------
Other expenses, net (147,329) (141,809) (462,638) (458,687)
--------------- --------------- ---------------- -----------------
Income (loss) before provision for income taxes 81,868 87,569 15,271 (55,661)
Provision for income taxes 38,000 38,100 113,000 126,650
--------------- --------------- ---------------- -----------------
Net income (loss) $ 43,868 $ 49,469 $ (97,729) $ (182,311)
=============== =============== ================ =================
Weighted average number of common shares used
in computation of net income
(loss) per share:
Basic 4,380,851 4,377,255 4,380,707 4,372,525
=============== =============== ================ =================
Diluted 4,748,812 4,625,874 4,380,707 4,372,525
=============== =============== ================ =================
Net income (loss) per common share:
Basic $ .01 $ .01 $ (.02) $ (.04)
=============== =============== ================ =================
Diluted $ .01 $ .01 $ (.02) $ (.04)
=============== =============== ================ =================
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