Q3 2008 Highlights:
-- Net income of $0.02 per share in Q3 2008 compared to net loss of ($0.02) per share in Q3 2007
-- Net income excluding non-cash equity compensation and divested businesses was $0.03 per share in Q3 2008 compared to net loss of ($0.00) per share in Q3 2007
-- Book value increases to $1.22 per share at September 30, 2008
SCOTTSDALE, Ariz.--(BUSINESS WIRE)--
iGo, Inc. (Nasdaq: IGOI), a leading provider of innovative
portable power and computing solutions, today reported financial
results for the third quarter ended September 30, 2008. Total revenue
was $20.1 million in the third quarter of 2008, compared with revenue
of $19.0 million in the third quarter of 2007.
Excluding revenues related to business lines divested during and
subsequent to the end of the first quarter of 2007 (handheld and
expansion/docking), total revenues were $18.1 million in the third
quarter of 2008, compared to $17.1 million in the same quarter of the
prior year. According to Generally Accepted Accounting Principles in
the United States (U.S. GAAP), iGo must consolidate the operating
results of Mission Technology Group, the acquirer of the Company's
expansion/docking business, into its financial results until such time
as the Company's financial interest in the performance of Mission
Technology Group no longer meets the criteria for consolidation.
Net income was $649,000, or $0.02 per share, in the third quarter
of 2008, compared with a net loss of $760,000, or ($0.02) per share,
in the same quarter of the prior year.
Excluding non-cash compensation expense and the operating results
of the divested businesses, net income was $1.1 million, or $0.03 per
share, in the third quarter of 2008, compared to a net loss of
$155,000, or ($0.00) per share, in the third quarter of 2007. A
detailed reconciliation of GAAP to non-GAAP financial results is
provided in the financial tables at the end of this release.
Michael D. Heil, President and Chief Executive Officer of iGo,
commented, "We are executing well on our growth strategies and
generated double-digit increases in sales of both high- and low-power
chargers during the third quarter. We are seeing steady progress in
driving sales growth through all of our key channels, including
retail, private label, and wireless carrier. The solid sales growth
and tight expense control helped deliver a strong improvement in
profitability."
Third Quarter Product Area Highlights
-- Unit sales of universal chargers for high-power mobile
electronic (ME) devices, such as portable computers, were
approximately 322,000 units in the third quarter of 2008.
-- Unit sales of universal chargers for low-power ME devices,
such as mobile phones, PDAs, MP3 players and digital cameras,
were approximately 787,000 units in the third quarter of 2008.
-- Revenue from the sale of power products for high-power ME
devices was $11.8 million in the third quarter of 2008, an
increase of 10.5% from $10.7 million in the same period of the
prior year. An increase in sales through the retail and
private label channels of $2.7 million more than offset a
decline in sales through the OEM channel of $1.6 million.
-- Revenue from the sale of power products for low-power ME
devices was $6.3 million in the third quarter of 2008, an
increase of 10.4% from $5.7 million in the same period of the
prior year.
Financial Highlights
Gross margin was 30.6% in the third quarter of 2008, compared to
30.0% in the third quarter of 2007. Excluding the operations of the
divested businesses, gross margin was 28.3% in the third quarter of
2008, compared to 28.0% in the third quarter of 2007.
Total operating expenses in the third quarter of 2008 were $5.6
million, compared with $6.8 million in the third quarter of 2007.
Excluding non-cash equity compensation expense and the operations of
the divested businesses, operating expenses were $4.3 million in the
third quarter of 2008, or 23.9% of revenue (excluding revenue from
divested businesses), compared to $5.3 million in the third quarter of
2007, or 31.2% of revenue (excluding revenue from divested
businesses). The decline in operating expenses as a percentage of
revenue reflects the impact of the lower cost structure following the
restructuring actions taken during 2007.
Excluding assets of the divested businesses, the Company's balance
sheet remained strong with $26.0 million in cash, cash equivalents,
and short-term investments at September 30, 2008. The Company
continued to have no long-term debt and had a book value per share of
$1.22 based on 31.9 million common shares issued and outstanding at
September 30, 2008.
Outlook
The Company has elected not to provide U.S. GAAP-based financial
guidance for the fourth quarter of 2008 because Mission Technology
Group does not prepare financial forecasts. However, Mission
Technology Group's revenue and operating results for the fourth
quarter of 2008 are not expected to be more or less significant to the
Company's consolidated financial results than they were for the third
quarter of 2008.
On a non-GAAP basis, which excludes revenue from divested
businesses, the Company believes that revenue will range from $17
million to $18 million in the fourth quarter of 2008. The Company also
believes that net income, excluding the operating results of divested
businesses and non-cash equity compensation, will range from $0.00 to
$0.01 per share.
Mr. Heil commented on the Company's outlook, "We are steadily
adding new accounts as our sales pipeline matures and we gain traction
with our new approach of bundling chargers and interchangeable tips in
the same package for particular retailers. During the fourth quarter,
we are launching new programs with Dixon's Group in Europe, Wal-Mart
Canada, and Hudson News and ZoomSystems in the United States, among
others. We expect these new programs will help offset the seasonal
decline in revenues that we typically experience after holiday season
orders are shipped in the third quarter. As our distribution continues
to expand, we believe we are creating a foundation for sustainable
growth in revenue and earnings."
Non-GAAP Financial Measures
Although the Company consolidates the operating results of Mission
Technology Group, the acquirer of its docking/expansion business, for
accounting purposes under U.S. GAAP, the Company believes that the
discussion of operating results excluding the handheld and
expansion/docking lines of business and non-cash equity compensation
allows management and investors to evaluate and compare the Company's
operating performance on a more meaningful and consistent manner. In
addition, management uses these measures internally for evaluation of
the performance of the business, including the allocation of
resources. These non-GAAP financial measures should be considered in
addition to, not as a substitute for, or superior to, measures of
financial performance in accordance with GAAP.
About iGo, Inc.
iGo, Inc., based in Scottsdale, Arizona, is a developer of
universal chargers for laptop computers and mobile electronic devices
(e.g., mobile phones, PDAs, digital cameras, etc.) and creator of the
patented iGo(R) intelligent tip technology. iGo offers a full line of
AC, DC and combination AC/DC chargers for laptop computers and
low-power mobile electronic devices. All of these chargers leverage
iGo's intelligent tip technology, which enables one charger to
power/charge hundreds of brands and thousands of models of mobile
electronic devices through the use of interchangeable tips.
iGo's products are available at www.iGo.com as well as through
leading resellers and retailers. For additional information call
480-596-0061, or visit www.igo.com.
iGo is a registered trademark of iGo, Inc. All other trademarks or
registered trademarks are the property of their respective owners.
This press release contains "forward-looking statements" within
the meaning of Section 21E of the Securities Exchange Act of 1934. The
words "believe," "expect," "anticipate," "should," and other similar
statements of expectations identify forward-looking statements.
Forward-looking statements in this press release include expectations
regarding the Company's financial performance in the fourth quarter of
2008; the expectation that Mission Technology Group's revenue and
operating results for the fourth quarter of 2008 will not be more or
less significant to the Company's consolidated financial results than
they were for the third quarter of 2008; the expectation that revenue
from new programs with Dixon's Group, Hudson News, and ZoomSystems
will offset the seasonal decline in revenues the Company typically
experiences in the fourth quarter; and the belief that the Company is
creating a foundation for sustainable growth in revenue and earnings.
These forward-looking statements are based largely on management's
expectations and involve known and unknown risks, uncertainties and
other factors, which may cause the Company's actual results,
performance or achievements, or industry results, to be materially
different from any future results, performance or achievements
expressed or implied by these forward-looking statements. Risks that
could cause results to differ materially from those expressed in these
forward-looking statements include, among others, the loss of, and
failure to replace, any significant customers; the inability of the
Company's new sales and marketing strategy to generate broader
consumer awareness, increased adoption rates, or impact sell-through
rates at the retail and wireless carrier level; the timing and success
of product development efforts and new product introductions,
including internal development projects as well as those being pursued
with strategic partners; the timing and success of product
developments, introductions and pricing of competitors; the timing of
substantial customer orders; the availability of qualified personnel;
the availability and performance of suppliers and subcontractors; the
ability to expand and protect the Company's proprietary rights and
intellectual property; the successful resolution of unanticipated and
pending litigation matters; market demand and industry and general
economic or business conditions; and other factors to which this press
release refers. Additionally, other factors that could cause actual
results to differ materially from those set forth in, contemplated by,
or underlying these forward-looking statements are included in the
Company's Annual Report on Form 10-K for the year ended December 31,
2007 under the heading "Risk Factors." In light of these risks and
uncertainties, the forward-looking statements contained in this press
release may not prove to be accurate. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements, or any facts, events, or circumstances after the date
hereof that may bear upon forward-looking statements. Additionally,
the Company does not undertake any responsibility to update you on the
occurrence of unanticipated events which may cause actual results to
differ from those expressed or implied by these forward-looking
statements.
iGo, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(000's except per share data)
(unaudited)
Three months ended Nine months ended
September 30, September 30,
------------------ ------------------
2008 2007 2008 2007
--------- -------- -------- ---------
Net revenue $20,091 $19,039 $57,583 $ 57,410
Gross profit 6,145 5,705 17,127 13,231
Selling, engineering and
administrative expenses 5,612 6,791 18,305 23,697
--------- -------- -------- ---------
Income (loss) from
operations 533 (1,086) (1,178) (10,466)
Interest income (expense), net 190 291 668 847
Gain on disposal of assets and
other income, net 136 95 397 2,235
Litigation settlement income - - 672 -
--------- -------- -------- ---------
Income (loss) before minority
interest 859 (700) 559 (7,384)
Minority interest (210) (60) (210) (187)
--------- -------- -------- ---------
Net income (loss) $ 649 $ (760) $ 349 $ (7,571)
========= ======== ======== =========
Net loss per share -- basic and
diluted
Basic $ 0.02 $ (0.02) $ 0.01 $ (0.24)
Diluted $ 0.02 $ (0.02) $ 0.01 $ (0.24)
Weighted avg common shares
outstanding -- basic and
diluted
Basic 31,881 31,391 31,745 31,568
Diluted 34,482 31,391 34,350 31,568
iGo, Inc. and Subsidiaries
Selected Other Data
(unaudited)
Reconciliation of non-GAAP Financial Measure - Operating results by
product line to net income (loss) before non-cash equity compensation
by product line:
Three months ended
September 30, 2008
Power,
Keyboards Expansion
& &
Corporate Handheld Total
---------- --------- --------
Net revenue $18,077 $ 2,014 $20,091
Gross profit 5,116 1,029 6,145
Selling, engineering and administrative
expenses 4,855 757 5,612
---------- --------- --------
Income (loss) from operations 261 272 533
Interest income (expense), net 186 4 190
Other income (expense), net 110 26 136
---------- --------- --------
Income (loss) before minority interest 557 302 859
Minority interest - (210) (210)
---------- --------- --------
Net income (loss) 557 92 649
Non-cash equity compensation 529 - 529
---------- --------- --------
Net income (loss) as adjusted $ 1,086 $ 92 $ 1,178
========== ========= ========
Net income (loss) per share as adjusted $ 0.03 $ 0.00 $ 0.03
Weighted avg common shares outstanding
-- diluted: 34,482 34,482 34,482
Three months ended
September 30, 2007
Power,
Keyboards Expansion
& &
Corporate Handheld Total
---------- --------- --------
Net revenue $17,128 $ 1,911 $19,039
Gross profit 4,799 906 5,705
Selling, engineering and administrative
expenses 6,031 760 6,791
---------- --------- --------
Income (loss) from operations (1,232) 146 (1,086)
Interest income (expense), net 281 10 291
Other income (expense), net 106 (11) 95
---------- --------- --------
Income (loss) before minority interest (845) 145 (700)
Minority interest - (60) (60)
---------- --------- --------
Net income (loss) (845) 85 (760)
Non-cash equity compensation 690 - 690
---------- --------- --------
Net income (loss) as adjusted $ (155) $ 85 $ (70)
========== ========= ========
Net income (loss) per share as adjusted $ (0.00) $ 0.00 $ (0.00)
Weighted avg common shares outstanding --
diluted: 31,391 31,391 31,391
iGo, Inc. and Subsidiaries
Selected Other Data Continued
(unaudited)
Reconciliation of non-GAAP Financial Measure - Selling, engineering
and administrative expenses by product line to selling, engineering
and administrative expenses before non-cash equity compensation by
product line:
Three months ended
September 30, 2008
Power,
Keyboards Expansion
& &
Corporate Handheld Total
---------- --------- -------
Selling, engineering and
administrative expenses $4,855 $757 $5,612
Non-cash equity compensation (529) - (529)
---------- --------- -------
Selling, engineering and
administrative expenses as adjusted $4,326 $757 $5,083
========== ========= =======
Three months ended
September 30, 2007
Power,
Keyboards Expansion
& &
Corporate Handheld Total
---------- --------- -------
Selling, engineering and administrative
expenses $6,031 $760 $6,791
Non-cash equity compensation (690) - (690)
----------- --------- -------
Selling, engineering and administrative
expenses as adjusted $5,341 $760 $6,101
=========== ========= =======
This information is being provided because management believes these
are key metrics to the investment community and assist in the
understanding and analysis of operating performance. Operating
results by product line and corresponding net income (loss) before
non-cash equity compensation by product line; and selling,
engineering and administrative expenses by product line and
corresponding selling, engineering and administrative expenses before
non-cash equity compensation should be considered in addition to, not
as a substitute for, or superior to, measures of financial
performance in accordance with GAAP.
iGo, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(000's)
(unaudited)
September 30, December 31,
2008 2007
------------- ------------
ASSETS
Cash and cash equivalents $19,595 $15,908
Short-term investments 7,116 9,026
Accounts receivable, net 16,261 16,924
Inventories 4,017 7,406
Prepaid expenses and
other current assets 486 445
------------- ------------
Total current
assets 47,475 49,709
Long-term investments - -
Other assets, net 3,208 4,441
------------- ------------
Total assets $50,683 $54,150
============= ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $11,026 $16,311
Minority interest 594 384
------------- ------------
Total
liabilities 11,620 16,695
Total stockholders'
equity 39,063 37,455
------------- ------------
Total
liabilities
and
stockholders'
equity $50,683 $54,150
============= ============
iGo, Inc. and Subsidiaries
Selected Other Data
(unaudited)
Reconciliation of non-GAAP Financial Measure - Balance sheet excluding
accounts of Mission Technology Group.
September 30, 2008
------------------------------------------
Mission
iGo Tech Eliminations Consolidated
------- ------- ------------ ------------
ASSETS
Cash and cash equivalents $18,894 $ 701 $ - $19,595
Short-term investments 7,116 - - 7,116
Accounts receivable, net 15,753 567 (59) 16,261
Inventories 3,299 950 (232) 4,017
Prepaid expenses and other
current assets 388 98 - 486
------- ------ ----------- ------------
Total current
assets 45,450 2,316 (291) 47,475
Long-term investments - - - -
Other assets, net 3,913 1,449 (2,154) 3,208
------- ------ ----------- ------------
Total assets $49,363 $3,765 $(2,445) $50,682
======= ====== =========== ============
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities $10,340 $ 745 $ (59) $11,026
Minority interest 594 2,500 (2,500) 594
------- ------ ----------- ------------
Total
liabilities 10,934 3,245 (2,559) 11,620
Total stockholders' equity 38,429 520 114 39,063
------- ------ ----------- ------------
Total
liabilities
and
stockholders'
equity $49,363 $3,765 $(2,445) $50,683
======= ====== =========== ============
Reconciliation of non-GAAP Financial Measure - Cash, cash equivalents
and investments excluding accounts of Mission Technology Group.
Cash and cash equivalents $18,894 $ 701 $ - $19,595
Short-term investments 7,116 - - 7,116
------- ------ ----------- ------------
Total cash,
cash
equivalents,
short-term
investments $26,010 $ 701 $ - $26,711
======= ====== =========== ============
This information is being provided because management believes these
are key metrics to the investment community and assist in the
understanding and analysis of financial position. Balance sheet
excluding the accounts of Mission Technology Group and related
eliminations and cash, cash equivalents, and investments excluding
the accounts of Mission Technology Group should be considered in
addition to, not as a substitute for, or superior to, measures of
financial position in accordance with GAAP.
Source: iGo, Inc.
