Executive Contact:
Richard Vasek
Chief Financial Officer Rockford Corporation (480) 517-3169
Tempe, Arizona, April 2, 2012--Rockford Corporation (OTC
Pink: ROFO.PK)
today announced financial results for the three and twelve
months ended December 31,
2011.
Net income for the three months ended December 31, 2011 was
$1.1 million, compared to $0.2 million for the same period in
2010. Net income for the year ended December 31, 2011 was
$5.3 million, compared to $2.7 million for the same period
in
2010.
Net sales for the three months ended December 31, 2011,
increased 11.9% to
$13.0 million compared to net sales of $11.7 million for the
same period in 2010. Net sales for the year ended December
31, 2011, increased 12.2% to $60.8 million compared to net
sales of $54.2 million for the same period in 2010. The
increase in net sales for the three and twelve month period
was primarily due to increases in Rockford's core aftermarket
and international sales channels. OEM royalty revenue for the
year ended December 31, 2011, was $2.7 million compared to
$2.9 million for the same period in
2010.
As a percent of net sales, gross margin for the three months
ended December 31,
2011 increased to 39.9% compared to 36.4% for the same period
in 2010. As a percent of net sales, gross margin for the year
ended December 31, 2011 increased to 38.8%
compared to 36.8% for the same period in 2010. The increase
in gross margin percentage was primarily due to lower product
returns and freight costs as a percent of sales.
Operating expenses for the three months ended December 31,
2011, were relatively flat at $4.2 million compared to $4.1
million for the same period in 2010. Operating expenses for
the year ended December 31, 2011, increased 6.6% to $18.3
million compared to $17.2 million for the same period in
2010. The increase in operating expenses for the year
compared to the prior year was primarily due to higher sales
and marketing expenses.
William R. Jackson, Rockford's Chief Executive Officer and
President, commented, "We are pleased with our 4th quarter
and full year results for 2011. The overall car audio market
was challenging in 2011. However, our brand portfolio
performed quite well and we were able to show growth in all
of our distribution channels. The entire team at Rockford did
a terrific job in 2011."
Mr. Jackson observed: "The strength of the Rockford Fosgate
brand and product mix continues to grow. In 2011 we launched
several key new products that focused on better vehicle
integration and increased applications. The market response
to these products has been excellent. The new Punch BRT
amplifiers have allowed consumers to install better
performing audio into motorcycles, ATV's, compact cars and
marine applications. In addition, the new line of Punch
Subwoofers has re-set the bar for high performance bass
response. Throughout 2011 we focused on working with our
dealers to increase our brand presence and drive consumers to
retail stores. Our Soundlab promotional vehicles traveled the
United States exposing consumers and audio
enthusiasts to the Rockford Fosgate experience."
Mr. Jackson stated: "Our other brands, Renegade, Lightning
Audio, BRAX and Helix continued to grow throughout 2011. We
were able to add a significant number of new dealers and
reach new customers."
Mr. Jackson noted: "In January 2012, we exhibited our new
product offerings at the Palms Hotel in Las Vegas at the time
of the International Consumer Electronics Show. This
introduction included over 80 new products. The dealer and
international distributor attendance was improved over 2011.
Many of our retailers and distributors
were optimistic about 2012 and very excited about our new
products. Over 90% of all our new products are shipping and
have been well received in the marketplace."
Mr. Jackson commented: "We have several new marketing
campaigns in play for
2012. I am pleased to announce that Rockford Fosgate will be
the exclusive car audio sponsor for the 2012 Van's Warped
Concert Tour. This is a 41 city concert tour visiting the US
and Canada. The tour kicks off June 16th and ends August 5th.
Our Rockford Fosgate Soundlab vehicle will be traveling with
the tour and available for demonstration at all of the
events. In addition, we have several new endorsement and
sponsorship programs launching, including the Hart and
Huntington Supercross team, Ryan Sipes - professional
Supercross racer, Cameron Dollar - MMA fighter, Paul Tracy -
race car driver, Casey Currie - Lucas Oil off road racer and
Andrew Pierce - amateur motocross champion."
Mr. Jackson continued: "On March 28th, Rockford became the
exclusive mobile electronics distributor for Sanctiond Car
Care products. Sanctiond is a brand developed by legendary
artist and tattoo icon "Mister Cartoon". The brand targets
the urban consumer and features proprietary packaging and
formulas. We are excited about the opportunity. The Sanctiond
brand aligns perfectly with Rockford and offers our retailers
an opportunity to expand into a new category. The Sanctiond
brand will only be available at select specialist auto parts
stores and Rockford Fosgate dealers."
Mr. Jackson concluded: "In summary, we feel good about our
2011 performance. We continue to be cautiously optimistic
about the future and committed to growing our brands with our
partners."
Rockford's cash provided by operations was $5.8 million for
the year ended December 31, 2011 as compared to $3.4 million
during the comparable period in 2010. Net income of $5.3
million was the primary source of cash from operations and an
increase in inventory of $2.5 million was the primary use of
cash from operations.
Rockford's asset-based credit facility with Wells Fargo
Capital Financial continues to have the terms described in
Rockford's annual report for the year ended December 31,
2010. Under the agreement, pricing options based on LIBOR
rates are
available to Rockford. The interest rate was approximately
4.6% at December 31, 2011. As of December 31, 2011, Rockford
was in compliance with all applicable covenants. Availability
under the credit facility at December 31, 2011 was
approximately $8.7 million. Rockford had no borrowings under
the facility as of December 31, 2011.
Rockford anticipates, based on its operating plans and cash
flow forecast, that cash flow from operations for 2012 and
2013, and available borrowings under its credit facility,
will be adequate to meet Rockford's requirements for current
capital expenditures, working capital and interest payments
for the next twelve months.
Rockford also announced it expects to report increased
profits and revenues for the three months ended March 31,
2012 compared to the same period in 2011. Revenues are
expected to be in the range of approximately $20.5 million to
$21.5 million for the first quarter of 2012, an increase of
approximately 24% to 30% compared to revenues of
$16.6 million in the first quarter of 2011. Net income is
expected to increase by a significantly larger percentage
than the increase in revenues.
Rockford announced on January 25, 2012, that its Board of Directors approved a program to purchase up to 765,000 shares, or approximately 10%, of Rockford's Common Stock in the open market or through privately negotiated transactions. From January 25, 2012, to date Rockford has repurchased approximately 146,000 shares under this stock buyback program. After these repurchases Rockford has approximately 7.5 million shares outstanding. The program will expire on March 31, 2013, but may be suspended or discontinued at any time.
About Rockford Corporation
Setting the standard for excellence in the audio industry,
the Rockford Corporation markets and distributes
high-performance audio systems for the mobile audio
aftermarket and OEM market. Headquartered in Tempe, Arizona,
Rockford
Corporation distributes its products under six brands:
Rockford Fosgate®, Rockford Acoustic Design®, Lightning
Audio®, Brax™, Helix™ and Renegade®. For more information,
please visit: www.rockfordfosgate.com
, www.rockfordacousticdesign.com
, www.lightningaudio.com
, www.braxhifi.com , www.helixhifi.comand
www.renegadecaraudio.com
,
We make forward-looking statements in this press release
including but not limited to statements about our results of
operations. These statements may be identified by the use of
forward-looking terminology such as "may," "will," "believe,"
"expect," "anticipate," "estimate," "continue," or other
similar words.
Forward-looking statements are subject to many risks and
uncertainties. Rockford cautions you not to place undue
reliance on these forward-looking statements, which speak
only as of the date on which they are made. Actual results
may differ materially from those anticipated in our
forward-looking statements. Rockford disclaims any obligation
or undertaking to update these forward-looking statements to
reflect changes in our expectations or changes in events,
conditions, or circumstances on which our expectations are
based.
When considering our forward-looking statements, you should
keep in mind the risk factors discussed in our press releases
and earnings reports, as well as the risk factors generally
applicable to a small business such as ours. We particularly
call your attention to the risk factors and other cautionary
statements identified on our investor relations
web-site, http://www.rockfordcorp.com/RiskFactorstitled "Risk Factors That May Affect Rockford's
Operating Results, Business Prospects and Stock Price" (the
"Risk Disclosure"). We updated the Risk Disclosure as of
March 31, 2011. Our business is subject to the risk factors
noted in the Risk Disclosure, other risk factors identified
above and other risk factors we have not anticipated or
discussed. These risk factors could
cause our actual results to differ significantly from those
anticipated in our forward- looking statements.
Rockford Corporation
Condensed Consolidated Statements of Operations (unaudited)
For the Three and Twelve Months Ended December 31, 2011 and 2010 ($000s omitted except per share amounts)
Three months ended
December 31,Twelve months ended
December 31, 2011 2010 2011 2010Net sales $ 13,039 $ 11,658 $ 60,847 $ 54,231
Cost of goods sold | 7,830 | 7,414 | 37,221 | 34,251 | ||||
Gross profit | 5,209 | 4,244 | 23,626 | 19,980 | ||||
Operating expenses: | ||||||||
Sales and marketing | 1,989 | 1,906 | 9,427 | 7,972 | ||||
General and administrative | 1,669 | 1,687 | 6,913 | 7,196 | ||||
Research and development | 510 | 489 | 1,956 | 1,993 | ||||
Total operating expenses | 4,168 | 4,082 | 18,296 | 17,161 | ||||
Operating income | 1,041 | 162 | 5,330 | 2,819 | ||||
Interest and other expense, net | - | 26 | 77 | 177 | ||||
Income before income taxes | 1,041 | 136 | 5,253 | 2,642 | ||||
Income tax benefit | (68) | (71) | (68) | (71) | ||||
Net income | $ 1,109 | $ 207 | $ 5,321 | $ 2,713 | ||||
Net income per common share: Basic | $ 0.14 | $ 0.02 | $ 0.64 | $ 0.32 | ||||
Diluted | $ 0.12 | $ 0.02 | $ 0.58 | $ 0.30 | ||||
Weighted average shares: Basic | 8,071 | 8,627 | 8,351 | 8,593 | ||||
Diluted | 8,968 | 9,366 | 9,230 | 9,170 | ||||
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Rockford Corporation
Condensed Consolidated Balance Sheets (unaudited) At December 31, 2011 and 2010
(In thousands)
ASSETS
December 31, December 31,
2011 2010
Current assets:
Cash $ 1,762 $ - Accounts receivable, net 9,659 8,684
Inventories 8,031 5,818
Prepaid expenses and other current assets 473547
Total current assets 19,925 15,049
Property and equipment, net 1,370 1,525
Other assets 220262
Total assets $ 21,515$ 16,836
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 6,800 $ 4,262
Accrued salaries and incentives 921 785
Accrued warranty and returns 450 546
Accrued customer programs 644 651
Other accrued liabilities 1,549 1,403
Asset based credit facility -1,509
Total current liabilities 10,364 9,156
Other long-term liabilities 26109
Total liabilities 10,390 9,265
Shareholders' equity:
Common stock | 96 | 96 |
Additional paid-in-capital | 39,038 | 38,867 |
Retained deficit | (24,760) | (30,081) |
Treasury stock | (3,249) | (1,311) |
Total shareholders' equity | 11,125 | 7,571 |
Total liabilities and shareholders' equity | $ 21,515 | $ 16,836 |
distributed by | This press release was issued by Rockford Corporation and was initially posted at http://www.rockfordcorp.com/Documents/Q42011PressReleaseFinal.pdf . It was distributed, unedited and unaltered, by noodls on 2012-04-02 18:48:03 PM. The issuer is solely responsible for the accuracy of the information contained therein. |