Exhibit 99.1
Mace Security International Reports Financial Results for the First
Quarter of 2007
MOUNT LAUREL, N.J.--(BUSINESS WIRE)--July 9, 2007--Mace Security
International, Inc. ("Mace" or the "Company") (Nasdaq Global:MACE), a
manufacturer of electronic surveillance, security and personal defense
products, and an owner and operator of car and truck wash facilities,
today announced results for the first quarter ended March 31, 2007.
Financial Results
The net loss for the first quarter of 2007 was $658,000, or
$(0.04) per share, compared to a loss of $966,000 or $(0.06) per share
for the first quarter of 2006.
Total revenues for the quarter ended March 31, 2007 were $11.6
million compared to $13.3 million for the same period in 2006. The
decrease in revenues was primarily due to a decrease in revenues from
the Security Segment of approximately $1.1 million, or 16.7%, in the
first quarter of 2007 compared to the first quarter of 2006. The
change in revenues within the Security Segment was principally due to
a decrease in sales of our consumer direct electronic surveillance and
machine vision camera and video conferencing equipment in Texas and
our professional electronic surveillance operation in Florida. The
decrease in sales in our professional electronic surveillance
operation was partially a result of sales of discontinued and
refurbished products at lower prices, the inability of some of Mace's
vendors to supply high volume products in a timely manner, and the
impact on operations and management of the Florida embezzlement
investigation. This decrease in sales was partially offset by growth
in revenues in our personal defense and law enforcement aerosol
operations. Car wash and detailing revenues decreased from $5.1
million in the first quarter of 2006 to $4.7 million in the first
quarter of 2007, a decrease of $0.4 million, or 8.5%. This decrease
was primarily the result of the sale of car washes and reduced
volumes.
Gross profit as a percentage of revenues was approximately 24.0%
for the first quarter of 2007 and 26.6% for the first quarter of 2006.
Gross profit percentage for 2007 was comprised of 26% for the Security
Segment and 23% for the Car and Truck Wash Segment while, for 2006,
this percentage was comprised of 30% for the Security Segment and 24%
for the Car and Truck Wash Segment. The decrease in the Security
Segment gross profit was due to the decrease in revenues noted above,
a change in customer and product mix, an increase in sales of
discontinued products at reduced margins and increased staffing costs.
The decrease in the Car and Truck Wash gross profit percentage was
principally a result of reduced volumes.
Selling, general and administrative ("SG&A") expenses for the
first quarter of 2007 increased by $309,000 over the same period in
2006. The increase in SG&A costs is primarily the result of the growth
in infrastructure in the Security Segment, which added an additional
$77,000 of SG&A costs in 2007; an increase in advertising costs in the
Car and Truck Wash Segment of $28,000; and $132,000 of legal fees
relating to the ongoing immigration investigation. As previously
disclosed, the Company determined that the former divisional
controller of the Florida Security division embezzled funds from the
Company. Included in the 2007 SG&A expenses is a charge of $99,000
representing the amount of funds embezzled during the quarter ended
March 31, 2007.
Operating loss for the first quarter of 2007 was $1.8 million
compared to $730,000 in the first quarter of 2006. The increase in the
operating loss was principally the result of the decrease in gross
profit of $754,000, and the increase in SG&A costs of $309,000, as
noted above.
Discontinued operations includes the Company's Arizona car wash
region, the truck washes, and certain car wash sites in the Northeast
region. The results of operations for these regions are shown as
discontinued operations for financial reporting purposes. These
operations generated income of approximately $1.3 million in the first
quarter of 2007, $1.2 million of which was from gains on the sales of
car wash sites.
The Company's net book value was $56.1 million, or $3.67 per
share, at March 31, 2007. In addition, Mace had $86 million in total
assets, including $13.9 million of cash and short-term investments at
March 31, 2007. The Company's current cash and short term investments
total approximately $20 million.
Mace will conduct a conference call on Friday, July 13, 2007 at
11:00 AM EDT. The toll free conference call number is (888) 751-6352,
and the international conference call number is (706) 902-1438,
conference ID: 10900. There will be access to a tape recording of the
teleconference by calling (800) 642-1687 and entering the conference
ID: 10900. This will be available after the teleconference from 5:00
PM EDT, Friday, July 13, 2007 through 5:00 PM EDT, Friday, July 27,
2007. In addition, a live web cast of the conference call will be
available online at www.mace.com. A recording of the teleconference
will also be available on the Company's website through July 31, 2007.
Mace Security International, Inc. is a manufacturer of electronic
surveillance, security and personal defense products, and an owner and
operator of car and truck wash facilities. Additional information
about Mace is available at www.mace.com.
Certain statements and information included in this press release
constitute "forward-looking statements" within the meaning of the
Federal Private Securities Litigation Reform Act of 1995. When used in
this press release, the words or phrases "will likely result", "are
expected to", "will continue", "is anticipated", "estimate",
"projected", "intend to" or similar expressions are intended to
identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements are
subject to certain risks, known and unknown, and uncertainties,
including but not limited to economic conditions, dependence on
management, dilution to shareholders, limited capital resources, the
effects of weather on the demand for car care services, the effects of
rapid growth on Mace and the ability of management to effectively
respond to that growth, our ability to achieve operating synergies,
our ability to compete against established competitors, regulatory
matters, the effects of competition, and our ability to obtain
additional financing. Such factors could materially adversely affect
Mace's financial performance and could cause Mace's actual results for
future periods to differ materially from any opinions or statements
expressed within this press release. Additional discussion of factors
that could cause actual results to differ materially from management's
projections, forecasts, estimates and expectations are contained under
the heading "Risk Factors" in Mace's SEC filings, including its
registration statements and its periodic reports on Form 10-K and Form
10-Q. This press release should be read in conjunction with the
financial statements and notes contained in Mace's annual reports on
Form 10-K and quarterly reports on Form 10-Q.
Mace Security International, Inc. and Subsidiaries
Consolidated Statements of Operations
(in thousands, except share and per share information)
(Unaudited)
Three Months Ended
March 31,
---------------------
2007 2006
Revenues
Car wash and detailing services $4,687 $5,122
Lube and other automotive services 805 800
Fuel and merchandise sales 654 828
Security sales 5,435 6,527
---------- ----------
11,581 13,277
Cost of revenues
Car wash and detailing services 3,542 3,797
Lube and other automotive services 634 617
Fuel and merchandise sales 575 736
Security sales 4,047 4,590
---------- ----------
8,798 9,740
Selling, general and administrative expenses 4,187 3,878
Depreciation and amortization 399 389
---------- ----------
Operating loss (1,803) (730)
Interest expense, net (254) (257)
Other income 138 79
---------- ----------
Loss from continuing operations before income
taxes (1,919) (908)
Income tax expense 25 39
---------- ----------
Loss from continuing operations (1,944) (947)
Income (loss) from discontinued operations, net
of tax 1,286 (19)
---------- ----------
Net loss $(658) $(966)
========== ==========
Per share of common stock (basic and diluted):
Loss from continuing operations $(0.13) $(0.06)
Income (loss) from discontinued operations, net
of tax 0.09 -
---------- ----------
Net loss $(0.04) $(0.06)
========== ==========
Weighted average shares outstanding
Basic 15,275,382 15,272,882
Diluted 15,275,382 15,272,882
CONTACT: Mace Security International, Inc.
Investor Relations:
Eduardo Nieves, Jr., 954-449-1313
www.mace.com