Exhibit 99
The Middleton Doll Company Reports First Quarter Results
HARTLAND, Wis.--(BUSINESS WIRE)--May 14, 2007--The Middleton Doll
Company (OTCBB: DOLL) today reported results for the first quarter
ended March 31, 2007.
First Quarter Highlights
-- The company reported a net loss of $847,675 or $0.23 per
diluted share for the first quarter of 2007, compared to a net
loss of $1,131,583 or $0.30 per diluted share for the first
quarter of 2006.
-- The consumer products segment reported a net loss of $743,997
for the first quarter of 2007, compared to a net loss of
$1,003,923 for the first quarter of 2006.
-- The financial services segment reported net income of $40,328
for the first quarter of 2007, compared to net income of
$98,615 for the first quarter of 2006.
Operations Review
"In the first quarter of 2007, we continued to move forward with
repositioning the company to increase shareholder value over the long
term. Our strategies include turning around the decline in revenues in
the consumer products segment by developing new products and marketing
strategies, continuing to liquidate the financial services segment and
reducing operating expenses," said Salvatore L. Bando, president and
chief executive officer of The Middleton Doll Company.
Bando said the consumer products segment introduced several new
products in the first quarter and significantly reduced operating
expenses. "Operating expenses decreased 16% in the first quarter,
compared to the same quarter last year. Beginning this quarter,
corporate operating expenses are now included in the consumer products
segment instead of in the financial services segment. Excluding the
additional corporate expenses, consumer products segment expenses
decreased even more significantly," said Bando.
"Last fall, we introduced our new 'PlayBabies' line. The consumer
response to these new dolls has exceeded our expectations, and the
momentum continued in the first quarter. This collection features a
series of 13 lifelike, affordable play dolls that provides a playmate
for each stage of a young girl's early development. In mid-May, we
will expand the collection to 28 dolls, adding a variety of skin tones
and additional boy and newborn dolls," said Ken Werner, president of
consumer products for The Middleton Doll Company.
"On April 9, we launched our exciting new line of dolls named
'Middleton NOW.' Everything related to this line is new - from the
modern looks and trendy accessories of the dolls themselves, to the
catalog, pricing and packaging," said Werner. "Our goal was to create
collector-quality dolls, safety tested for ages three and up, that can
be a special friend for today's young girls, with the contemporary
looks and accessories they love. The NOW collection was launched with
15 dolls, and will be expanded with the introduction of new dolls each
quarter. The NOW collection adds a fresh new look and a contemporary
new product category to the Middleton Doll brand."
Werner said the NOW line differs from the company's
well-established Artist Studio Collection(TM) line in that the dolls
are for both play and display and are produced as an open run, rather
than in limited editions for collectors. Dolls in the NOW line are
priced between $85 and $125, while Artist Studio Collection(TM) dolls
range from $150 to $300.
Werner said the company also launched a new line of furniture and
accessories designed for all of the dolls in the Middleton Doll line.
The color-coordinated furniture line includes cribs, beds, bedding,
tables, chairs and wall decor. "The accessories enhance the play
experience of our dolls, while providing additional revenue sources
for the company," said Werner.
"As part of the strategy to broaden the appeal of our dolls, we
have added ten new artists who are experienced in designing and
sculpting realistic dolls that reflect the lifestyles of today's young
girls. We have also begun to transition our established Artist Studio
Collection(TM) to these new artists. The first new Artist Studio
Collection(TM) dolls by artists Pat Moulton and Michelle Fagan were
launched in February 2007, with more to follow throughout the year.
The response from collectors to the new dolls has been very positive,"
said Werner.
"In the financial services segment, we have only one building
remaining to be sold. This property, a specialized food manufacturing
facility, is listed with a commercial realtor. The loan portfolio
currently consists of four non-accruing loans and a loan loss reserve
established during 2006," said Craig Bald, chief financial officer of
The Middleton Doll Company.
As previously stated, the proceeds from the sale of the financial
services assets were used to pay-off all of the company's existing
debt, fund the operations of the consumer products segment and to
partially redeem outstanding shares of the company's preferred stock.
The Middleton Doll Company currently operates in two segments,
consumer products and financial services. The company's consumer
products segment is comprised of Lee Middleton Original Dolls, Inc., a
designer and marketer of lifelike collectible and play dolls, and
License Products, Inc., which does business as FirsTime Manufactory, a
designer and marketer of clocks and home decor products that are sold
to major national retailers. The company's financial services segment
is comprised primarily of the remaining assets of the lending and real
estate leasing business of its former subsidiary, Bando McGlocklin
Small Business Lending Corporation, now owned by Lee Middleton
Original Dolls. Beginning on January 4, 2006, the financial services
segment began selling substantially all of its loans, loan
participations and leased real estate properties. The company does not
intend to continue in the financial services segment after the
remaining financial services segment's assets are sold.
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements, which may be based upon beliefs,
expectations and assumptions of the company's management and on
information currently available to management, are generally
identifiable by the use of words such as "believe," "expect,"
"anticipate," "plan," "intend," "estimate," "may," "will," "would,"
"could," "should," or other similar expressions. Additionally, all
statements in this document, including forward-looking statements,
speak only as of the date they are made, and the company undertakes no
obligation to update any statement in light of new information or
future events. A number of factors, many of which are beyond the
ability of the company to control or predict, could cause actual
results to differ materially from those in its forward-looking
statements. These factors include: the degree of success of the
strategy to reduce expenses and to increase revenue in the consumer
products segment; the declining demand for collectible dolls in the
consumer products segment; our ability to provide the necessary cash
to meet operating and working capital requirements beyond 2007; and
the timing of sales and the selling prices of the remaining assets of
the financial services segment.
The Middleton Doll Company news releases are available on-line 24
hours a day at: http://www.middletondollcompany.com
The Middleton Doll Company
(OTCBB:DOLL)
(Unaudited)
Three months ended
---------------------------
March 31,
---------------------------
2007 2006
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STATEMENTS OF OPERATIONS BY SEGMENT
- ------------------------------------------
Consumer Products:
Net sales $2,177,551 $2,579,050
Cost of sales 1,556,705 1,934,756
------------- -------------
Gross profit 620,846 644,294
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Other expenses (income):
Operating expenses 1,424,471 1,689,702
Other expense (income) (59,628) (41,485)
------------- -------------
Total other expenses 1,364,843 1,648,217
------------- -------------
Net consumer products segment loss $(743,997) $(1,003,923)
============= =============
Financial Services:
Net rental/interest income:
Interest on loans $1,013 $215,045
Rental income 45,855 308,662
Interest expense - (239,880)
Loss on early extinguishment of
indebtedness - (289,034)
------------- -------------
Total net rental/interest income
(loss) 46,868 (5,207)
------------- -------------
Other income:
Other income 5,574 8,596
Gain on sale of property - 459,374
------------- -------------
Total other income 5,574 467,970
------------- -------------
Other expenses:
Depreciation expense on leased
properties 9,820 57,458
Other operating expenses 2,294 306,690
Income tax expense - -
------------- -------------
Total other expenses $12,114 $364,148
------------- -------------
Net financial services segment income $40,328 $98,615
============= =============
Total Company:
Net income (loss):
Consumer Products $(743,997) $(1,003,923)
Financial Services 40,328 98,615
Preferred stock dividends (139,156) (226,275)
Preferred stock redemption expense (4,850) -
------------- -------------
Net loss applicable to common
shareholders $(847,675) $(1,131,583)
============= =============
Basic loss per common share $(0.23) $(0.30)
============= =============
Diluted loss per common share $(0.23) $(0.30)
============= =============
Average shares outstanding - Basic and
diluted 3,727,589 3,727,589
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CONTACT: The Middleton Doll Company
Craig Bald, (262) 369-8163