Attached files
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| 8-K - CURRENT REPORT - MINIM, INC. | zmtp_8k.htm |
EXHIBIT 99.1
Zoom Telephonics Reports 2018 First Quarter Financial
Results
Highlighted by a 62% Increase in Net Sales, Gross Margin Expansion,
and Profitability
Company to Host Conference Call on Thursday, May 3, 2018 at 5:00
p.m. ET
Boston, MA, May 3, 2018 –
Zoom Telephonics, Inc. (“Zoom”) (OTCQB: ZMTP) (the
“Company”), a leading producer of cable modems and
other communication products, today reported financial results for
its 2018 first quarter ended March 31, 2018.
2018 First Quarter Financial Highlights (comparisons to prior
year’s period)
●
Net
sales increased 62.0% to $8.3 million due to the strength of
Zoom’s Motorola brand products;
●
Gross
margin improved to 39.4% from 33.7%; and
●
Net
income was approximately $359,000 or $0.02 per share, compared to a
net loss of $1.1 million or $0.07 per share
Management Commentary
Frank Manning, Zoom’s President and CEO, commented on the
quarter, “We were pleased to report dramatic organic growth,
fueled primarily by increased sales of our Motorola brand cable
modems and gateways products. Zoom is continuing to grow market
share as a result of customers choosing our Motorola products based
on strong retail sales channels, product quality, favorable
customer reviews, and value. This year we will introduce exciting
new Motorola cable modem/routers as well as launch new Motorola
routers, DSL and MoCA products, cellular modems, and cellular
sensors. Our balance sheet remains solid, and we are excited about
our prospects and future growth in the US as well other
countries.”
2018 First Quarter Financial Review
The Company reported an increase in net sales of 62.0% to $8.3
million for the first quarter ended March 31, 2018, up from $5.1
million for the first quarter ended March 31, 2017.
Gross profit was $3.3 million, or 39.4% of net sales, in the 2018
first quarter, as compared to $1.7 million, or 33.7% of net sales,
for the same period of 2017. The increase in gross profit was
primarily due to an increase in sales of Motorola brand cable
modems and gateways, which are higher margin products for the
Company.
Operating expenses were $2.9 million, or 34.9% of net sales, in the
2018 first quarter, compared to $2.8 million, or 54.1% of net
sales, in the same period of 2017. Selling expenses increased
approximately $208,000 to $2.1 million for the 2018 first quarter,
primarily due to increases in Motorola trademark royalty costs and
in advertising expenses. General and administrative expenses
slightly increased for the 2018 first quarter to $448,000
attributable to additional sales tax expense, which was largely
offset by decreases in stock compensation expense. Research and
development expenses were $410,000 for the 2018 first quarter,
compared to $508,000 in the same period of 2017, as a result of
decreases in certification expenses and in contracted app
development costs.
1
Zoom reported net income of $359,000, or $0.02 per share, for the
2018 first quarter compared to a net loss of $1.1 million, or $0.07
per share, in the same period of 2017. The significant improvement
in profitability was due to higher sales, improved gross profit
margin, and lower operating expenses as a percentage of
sales.
Balance Sheet Highlights
At March 31, 2018, Zoom had $423,000 in cash, $50,000 drawn on a
$3.0 million line of credit, working capital of $3.2 million, a
current ratio of 1.5, and no long-term debt.
|
(in thousands except for percentages)
|
3/31/2018
|
12/31/2017
|
% Changed
|
|
Cash
|
$423
|
$229
|
84.6%
|
|
Total Current
Assets
|
$9,212
|
$8,239
|
11.8%
|
|
Total
Assets
|
$9,726
|
$8,793
|
10.6%
|
|
Total Current
Liabilities
|
$6,009
|
$5,621
|
6.9%
|
|
Working
Capital
|
$3,203
|
$2,618
|
22.3%
|
|
Stockholders’
Equity
|
$3,717
|
$3,172
|
17.2%
|
Conference Call Details
Date/Time:
Thursday, May 3, 2018 – 5:00 p.m. ET
Participant
Dial-In Numbers:
(United
States): 866-393-7958
(International):
706-643-5255
Conference
ID 1999214
To
access the call, please dial-in approximately five minutes before
the start time and, when asked, provide the operator with the
conference ID 1999214. An accompanying slide presentation will be
available in .pdf format via the “Investor Relations”
section of Zoom Telephonics’ website at www.zoomtel.com/SQ118 shortly
before the call.
About Zoom Telephonics
Zoom Telephonics, Inc. designs, produces, markets, and supports
cable modems and other communication products. The Company’s
worldwide Motorola license agreement includes cable modems and
gateways, DSL modems and gateways, cellular modems and routers and
sensors, and other Internet and network products. For more
information about Zoom and its products, please visit
www.zoomtel.com/investor
and www.motorolanetwork.com.
MOTOROLA and the Stylized M Logo are trademarks or registered
trademarks of Motorola Trademark Holdings, LLC and are used under
license.
2
Forward Looking Statements
This release contains forward-looking information relating to
Zoom’s plans, expectations, and intentions. Actual results
may be materially different from expectations as a result of known
and unknown risks, including: the potential need for additional
funding which Zoom may be unable to obtain; declining demand for
certain of Zoom’s products; delays, unanticipated costs,
interruptions or other uncertainties associated with Zoom’s
production and shipping; Zoom’s reliance on several key
outsourcing partners; uncertainty of key customers’ plans and
orders; risks relating to product certifications; Zoom’s
dependence on key employees; uncertainty of new product
development, including certification and overall project delays,
budget overruns, and the risk that newly introduced products may
contain undetected errors or defects or otherwise not perform as
anticipated; costs and senior management distractions due to
patent-related matters; and other risks set forth in Zoom’s
filings with the Securities and Exchange Commission. Zoom cautions
readers not to place undue reliance upon any such forward-looking
statements, which speak only as of the date made. Zoom expressly
disclaims any obligation or undertaking to release publicly any
updates or revisions to any such statements to reflect any change
in Zoom’s expectations or any change in events, conditions or
circumstance on which any such statement is based.
Investor Relations Contact:
Adam Prior, Senior Vice-President
The Equity Group Inc.
Phone: 212-836-9606
Email: aprior@equityny.com
3
ZOOM TELEPHONICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ended March 31, 2018 and 2017
(in thousands, except per share
data)
|
|
Three Months Ended
|
|
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3/31/18
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3/31/17
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|
|
|
|
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Net sales
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$8,337
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$5,146
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|
Cost of goods sold
|
5,056
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3,412
|
|
|
|
|
|
Gross
profit
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3,281
|
1,734
|
|
|
|
|
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Operating expenses:
|
|
|
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Selling
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2,055
|
1,847
|
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General
and administrative
|
448
|
431
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Research
and development
|
410
|
508
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Total
operating expenses
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2,913
|
2,786
|
|
|
|
|
|
Operating profit (loss)
|
368
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(1,052)
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|
|
|
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Other income (expense), net
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(6)
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(37)
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|
|
|
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Income (loss) before income taxes
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362
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(1,089)
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|
|
|
|
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Income tax expense (benefit)
|
3
|
––
|
|
|
|
|
|
Net
income (loss)
|
$359
|
$(1,089)
|
|
|
|
|
|
Earnings (loss) per share:
|
|
|
|
Basic
Earnings (loss) per share
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$0.02
|
$(0.07)
|
|
Diluted
Earnings (loss) per share
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$0.02
|
$(0.07)
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|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding:
|
|
|
|
Basic
|
15,727
|
14,782
|
|
Diluted
|
16,511
|
14,782
|
4
ZOOM TELEPHONICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in thousands, except share data)
|
|
03/31/18
|
12/31/17
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
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Cash
|
$423
|
$229
|
|
Accounts
receivable, net
|
2,344
|
2,230
|
|
Inventories,
net
|
5,380
|
5,202
|
|
Prepaid
expenses and other
|
1,065
|
578
|
|
|
|
|
|
Total
current assets
|
9,212
|
8,239
|
|
|
|
|
|
Property and equipment, net
|
152
|
162
|
|
|
|
|
|
Other assets
|
362
|
392
|
|
|
|
|
|
Total
assets
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$9,726
|
$8,793
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
Bank
debt
|
$50
|
$90
|
|
Accounts
payable
|
3,759
|
3,527
|
|
Accrued
sales tax
|
950
|
831
|
|
Accrued
other expenses
|
1,250
|
1,173
|
|
|
|
|
|
Total
current liabilities
|
6,009
|
5,621
|
|
|
|
|
|
Total
liabilities
|
6,009
|
5,621
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
|
|
Common
stock and additional paid-in capital
|
40,604
|
40,418
|
|
Retained
earnings (accumulated deficit)
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(36,887)
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(37,246)
|
|
|
|
|
|
Total
stockholders’ equity
|
3,717
|
3,172
|
|
|
|
|
|
Total
liabilities and stockholders’ equity
|
$9,726
|
$8,793
|
5