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HAUPPAUGE, N.Y.--(BUSINESS WIRE)--Hauppauge Digital Inc. (NASDAQ: HAUP), a leading developer of digital video TV and data broadcast receiver products for personal computers, today reported financial results for the fourth fiscal quarter and year ended September 30, 2009.
FOURTH QUARTER RESULTS
Net sales were $16.3 million for the fourth quarter of fiscal 2009, an increase of approximately 3.4% from the $15.7 million reported for the previous year’s fiscal fourth quarter.
The Company incurred a net loss of $1,551,256 for the fourth fiscal quarter ended September 30, 2009, compared to a net loss of $2,908,536 for the fourth fiscal quarter ended September 30, 2008. Net loss per share for the fourth fiscal quarter ended September 30, 2009 was $0.15 on a basic and diluted basis, compared to a net loss per share of $0.29 on a basic and diluted basis for the fourth fiscal quarter ended September 30, 2008.
FISCAL YEAR RESULTS
Net sales were $59.3 million for the fiscal year ended September 30, 2009 compared to $89.7 million for the fiscal year ended September 30, 2008, a decrease of approximately 34%.
The Company incurred a net loss of $7,143,021 for the fiscal year ended September 30, 2009, compared to a net loss of $3,088,189 for the fiscal year ended September 30, 2008. Net loss per share for the fiscal year ended September 30, 2009 was $0.71 on a basic and diluted basis, compared to net loss per share of $0.31 on a basic and diluted basis for the fiscal year ended September 30, 2008.
DISCUSSION OF RESULTS
Ken Plotkin, Hauppauge’s Chief Executive Officer stated, “Contributing to the sales decline for the fiscal year were weak sales in Europe, especially in key markets such as Germany and the UK, plus the strengthening of the U.S. dollar against the euro, the closing of Circuit City and a decline in sales of our TV tuner products to personal computer manufacturers. On the positive side, we saw growth in the sales of our TV tuner products in North America and an increase in our gross profit margins due to a favorable mix of products.”
“During fiscal 2009 we completed the integration of the former Pinnacle PCTV product line, acquired on December 24, 2008 from Avid Technologies, Inc. We established a new subsidiary called PCTV Systems SARL, to continue the development of PCTV products. While the integration of this complementary product line was accomplished before the end of our fiscal year, an inventory overhang of PCTV products in the retail sales channel in Europe caused a drag on our sales for the first six months of calendar 2009. With most of this inventory liquidated by the end of fiscal 2009, we anticipate sales of PCTV Systems product to accelerate.”
“Excluding expenses related to the PCTV Systems acquisition and operations, expenses for the fiscal year declined by about $2.8 million compared to fiscal 2008. While we cut expenses, we are cognizant of the fact that we need to continue to maintain our product development programs and other critical parts of our infrastructure for the Company to be well positioned when the global economic conditions improve.”
“In October 2009 Microsoft launched their new consumer operating system, Windows 7. Windows 7 gives live TV, received through a TV tuner card, a prominent spot in the Windows 7 Media Center application. Most of our new product development efforts over the last twelve months have been aimed at Windows 7.”
“With the completion of PCTV Systems integration, the continuing push in new product development at our three R&D facilities, the introduction of Windows 7, the positive sales trends we saw for domestic retail sales in fiscal 2009 and the expense reductions we made in fiscal 2009, we believe Hauppauge is well positioned in both sales channels and our product pipeline to take advantage of the new opportunities created by a recovering global economy.”
ABOUT HAUPPAUGE DIGITAL
Hauppauge Digital, Inc. is a leading developer of analog and digital TV receiver products for the personal computer market. Through its Hauppauge Computer Works, Inc. and Hauppauge Digital Europe SARL subsidiaries, the Company designs and develops analog and digital TV receivers that allow PC users to watch television on their PC screen in a resizable window and enable the recording of TV shows to a hard disk, digital video editing, video conferencing, receiving of digital TV transmissions, and the display of digital media stored on a computer to a TV set via a home network. The Company is headquartered in Hauppauge, New York, with administrative offices in Luxembourg, Ireland and Singapore, sales offices in Germany, London, Paris, The Netherlands, Sweden, Italy, Spain, Singapore, Taiwan, and California and research and development centers in Hauppauge, New York, Taipei, Taiwan and Braunschweig, Germany. The Company’s Internet web site can be found at http://www.hauppauge.com.
This press release contains forward-looking statements as that term is defined in the federal securities laws. The events described in forward-looking statements contained in this press release may not occur. Generally these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated benefits from acquisitions to be made by us, or projections involving anticipated revenues, earnings or other aspects of our operating results. The words "may," "will," "expect," "believe," "anticipate," "project," "plan," "intend," "estimate," and "continue," and their opposites and similar expressions are intended to identify forward-looking statements. We caution you that these statements are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences (including, but not limited to, those set forth in our public reports filed with the Securities and Exchange Commission including, but not limited to our Form 10-K for the year ended September 30, 2009 and our Form 10-Q’s for the quarters ended December 31, 2008, March 31, 2009 and June 30,2009, many of which are beyond our control, that may influence the accuracy of the statements and the projections upon which the statements are based. Our actual results, performance and achievements could differ materially from those expressed or implied in these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether from new information, future events or otherwise.
HAUPPAUGE DIGITAL INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended September 30,
2009 2008 Net sales $16,255,305 $15,725,144 Cost of sales 12,252,897 13,371,281 Gross profit 4,002,408 2,353,863 Selling, general and administrative expenses 4,462,487 4,652,396 Research & development expenses 1,185,534 1,024,361 Loss from operations (1,645,613) (3,322,894) Other income (expense): Interest income 2,885 15,356 Interest expense (13,079) - Foreign currency 1,551 992 Total other income (expense) (8,643) 16,348 Loss before tax provision (benefit) (1,654,256) (3,306,546) Income tax (benefit) (103,000) (398,010) Net loss ($1,551,256) ($2,908,536) Net loss per share-basic and diluted ($0.15) ($0.29) Weighted average shares-basic and diluted 10,054,062 10,024,770HAUPPAUGE DIGITAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Twelve months ended September 30,
2009 2008 Net sales $59,344,538 $89,701,028 Cost of sales 46,557,904 72,019,046 Gross profit 12,786,634 17,681,982 Selling, general and administrative expenses 16,117,590 17,152,848 Research & development expenses 4,421,935 3,883,747 Loss from operations (7,752,891) (3,354,613) Other income: Interest income 14,217 43,989 Interest expense (62,557) - Foreign currency 670,760 (15,138) Total other income 622,420 28,851 Loss before tax provision (benefit) (7,130,471) (3,325,762) Income tax provision (benefit) 12,550 (237,573) Net loss ($7,143,021) ($3,088,189) Net loss per share-basic and diluted ($0.71) ($0.31) Weighted average shares-basic and diluted 10,045,449 9,969,939
HAUPPAUGE DIGITAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30,
September 30, 2009 2008 Assets: Current Assets: Cash and cash equivalents $8,368,342 $14,191,721 Accounts receivables, net of various allowances 9,770,584 6,932,400 Other non trade receivables 4,116,392 2,316,057 Inventories 8,616,800 12,236,166 Deferred tax asset current 1,297,574 1,133,073 Prepaid expenses and other current assets 928,680 1,093,406 Total current assets 33,098,372 37,902,823 Intangible assets, net 4,696,102 - Property, plant and equipment, net 757,488 769,288 Security deposits and other non current assets 108,088 102,227 Deferred tax asset non current 887,611 887,611 $39,547,661 $39,661,949 Liabilities and Stockholders’ Equity : Current Liabilities: Accounts payable$12,478,625
$10,406,836
Accrued expenses –fees 5,753,546 5,604,485 Accrued expenses 8,131,263 4,603,858 Note payable 625,045 - Income taxes payable 224,316 58,234 Total current liabilities 27,212,795 20,673,413 Stockholders' Equity Common stock $.01 par value; 25,000,000 shares authorized 10,814,042 and 10,784,717 issued, respectively 108,140 107,847 Additional paid-in capital 17,276,651 16,709,201 Retained earnings 795,674 7,938,695 Accumulated other comprehensive loss (3,441,262) (3,362,870) Treasury Stock, at cost, 759,579 shares (2,404,337) (2,404,337) Total stockholders' equity 12,334,866 18,988,536 $39,547,661 $39,661,949
