Ironclad Performance Wear Reports Fourth Quarter and Fiscal Year 2015 Results

09 Mar, 2016, 16:15 ET from Ironclad Performance Wear Corporation

FARMERS BRANCH, Texas, March 9, 2016 /PRNewswire/ -- Ironclad Performance Wear Corporation (OTCQB: ICPW), the recognized leader in high-performance task-specific work gloves, reported financial results for the fourth quarter and fiscal year ended December 31, 2015.

Fourth Quarter 2015 Results
The Company reported Net Sales for the fourth quarter of 2015 of $8.42 million, a decrease of 8.0% from the fourth quarter total of $9.15 million for 2014.  The revenue decrease was primarily attributable to lower shipments made to two of the Company's largest distributors primarily selling to the oil & gas and mining industries.  These distributors are located both in the U.S. and abroad.

Gross Profit was $2.82 million, or 33.5% of Net Sales in the fourth quarter of 2015, compared to $3.19 million, or 34.8% of Net Sales in the fourth quarter of 2014.  The decrease in gross profit is primarily attributable to the reduction in Net Sales and the mix of business.

Operating Expenses in the fourth quarter were $2.55 million or 30.3% of Net Sales, as compared to $1.91 million or 20.9% of Net Sales, during the same period last year.  Approximately 2/3 of the increase was attributable to investment in staffing and related expenses to execute the transition of the Grainger business as well as the expansion of our new Canadian distributor. The other third was due to litigation that we initiated against a distributor of our product, unfavorably impacting Operating Expenses.

Income from Operations in the fourth quarter was $0.26 million or 3.1% as compared to $1.28 million or 13.9% during the same period in 2014. 

Net Income for the fourth quarter was $0.24 million, or $0.00 per share, as compared to $2.11 million, or $0.03 per share, in the same period last year. 

The Company recorded a deferred tax benefit of $0 in 2015 and $760,000 in 2014.

Fiscal 2015 Year-End Results
Full-year Net Sales for 2015 were $23.6 million, representing a 2.9% decrease from 2014 Net Sales of $24.3 million.

Gross Profit was $8.28 million or 35.1% of Net Sales in 2015, as compared to $8.17 million, or 33.6% of Net Sales for full-year 2014.   The increase in gross profit is primarily attributable to a better mix of business, less promotional sales and the result of our supply chain efforts.

Operating Expenses were $8.42 million or 35.7%, of Net Sales, as compared to $8.06 million or 33.2% of Net Sales, for the full-year 2014.  The increase was primarily attributable to investment spend to land and execute the increased Grainger business as well as the expansion of our customer base. In addition, costs of litigation that we initiated against a distributor of our product, unfavorably impacted Operating Expenses.

Loss from Operations was ($145,808) for 2015 as compared to Income from Operations of $108,701 for fiscal year 2014.

Net Loss for 2015 was ($231,315), or $0.00 per share, as compared to Net Income of $934,319 or $0.01 per share, in the prior year.

The Company reduced its deferred tax valuation allowance by 0% and 28% thereby recognizing $0 and $760,000 in tax benefits in 2015 and 2014, respectively.

Jeff Cordes, Chief Executive Officer of Ironclad commented; "The 4th quarter results announced today are not what we had anticipated. They are disappointing for all of us after building momentum for the prior two quarters.  We are not immune to changes in our core markets and as we stated in our Q4 2014 earnings release "We remind our investors that timing of orders from Ironclad's customers may cause variability in quarterly results".

It is important to recognize that during the 4th quarter of 2015 the Company recorded sales to new customers of more than $3.0 million.  Those increases were offset by lower sales to just two major distributors of the Company. One distributor is the focus of litigation that Ironclad is pursuing against them. The other is a long time distributor that is adjusting stocks to deal with a difficult but improving home market.  The increased sales to new customers came in new product lines including Vibram and EXO.  Given the serious declines of business across oil and gas, the fact of our new business wins is very good news.

The increased SG&A is simply the result of two factors, the aforementioned litigation and our preparation for the highly anticipated launch of our new business with Grainger. We are committed to Grainger and have built a team and infrastructure to support them. We are already seeing the results from these investments in Q1 2016.

While not the ending to 2015 we desired to report to our shareholders, the efforts made in 2015 with new customers, new products, and new distributors, all investments in our future, have already begun to bear fruit in 2016."

Conference Call
Ironclad Performance Wear will hold a conference call to discuss 2015 financial results on Wednesday, March 9th, at 3:30 p.m. Central Time (4:30 p.m. Eastern Time).  To participate in the conference call, interested parties should dial:

Date: March 9th, 2016
Time: 4:30 p.m. Eastern Time (3:30 p.m. Central Time)
Domestic Dial-In Number: 1-888-428-9490
International Dial-In Number: 1-719-325-2495
Conference ID Number: 4173951

The conference call will be broadcast simultaneously and available for replay at: http://public.viavid.com/index.php?id=118401 and also via the landing page of the Company's Website at www.ironcladinvestor.com.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

Replay Dial-In Numbers:
TOLL-FREE   1-877-870-5176
TOLL/INTERNATIONAL   1-858-384-5517
From:  03/09/16 at 7:30 pm Eastern Time
To:    04/09/16 at 11:59 pm Eastern Time
Replay Pin Number:  4173951

The Company's financial results will be posted online at www.ironcladinvestor.com once they are publicly released.

In addition, the conference call will also be broadcast live over the Internet and can be accessed at www.ironclad.com. For those unable to participate during the live broadcast, the Webcast will be archived on this site through March 19, 2016.

The Company's financial results will be posted online at www.ironclad.com once they are publicly released.

About Ironclad Performance Wear Corporation
Ironclad Performance Wear is a leader in high-performance task-specific work gloves.  It created the performance work glove category in 1998, and continues to leverage its leadership position in the safety, construction and industrial markets through the design, development and distribution of specialized task-specific gloves for industries such as oil & gas extraction; automotive; and police, fire, first-responder and military. Ironclad engineers and manufactures its products with a focus on innovation, design, advanced material science and durability. Ironclad's gloves and apparel are available through industrial suppliers, hardware stores, home centers, lumber yards, and sporting goods retailers nationwide; and through authorized distributors in North America, Europe, Australia and Asia.

Built Tough for the Industrial Athlete™

For more information on Ironclad, please visit the Company's Website at www.ironclad.com.

Information about Forward-Looking Statements
This release contains "forward-looking statements" that include information relating to future events and future financial and operating performance. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: fluctuations in demand for Ironclad's products, the introduction of new products, Ironclad's ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of Ironclad's liquidity and financial strength to support its growth, and other information that may be detailed from time-to-time in Ironclad's filings with the United States Securities and Exchange Commission. Examples of such forward looking statements in this release include statements regarding strengthening partner relationships, additional markets for Ironclad's products and Ironclad's growth in 2016.  For a more detailed description of the risk factors and uncertainties affecting Ironclad, please refer to the Company's recent Securities and Exchange Commission filings, which are available at www.sec.gov. Ironclad undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact
William Aisenberg, CFO
Bill.Aisenberg@ironclad.com 
(972) 996-5664

 

IRONCLAD PERFORMANCE WEAR CORPORATION
CONSOLIDATED BALANCE SHEETS


ASSETS









December 31, 2015


December 31, 2014









  CURRENT ASSETS




     Cash and cash equivalents

$                  276,981


$                  340,903

     Accounts receivable net of allowance for doubtful accounts of $30,000 and $30,000

8,857,768


6,283,032

     Inventory net of reserve of $547,800 and $547,800

6,681,715


7,123,654

     Deposits on inventory 

171,593


661,744

     Prepaid and other

610,417


566,022

     Deferred tax asset - current

404,000


183,000





        Total Current Assets

17,002,474


15,158,355





  PROPERTY AND EQUIPMENT




     Computer equipment and software

622,264


507,640

     Furniture and equipment

308,398


255,085

     Leasehold improvements

174,298


169,904

        Less: accumulated depreciation

(767,047)


(641,953)





        Total Property and Equipment, Net

337,913


290,676





  OTHER ASSETS




     Trademarks and patents net of accumulated amortization of $68,094 and $58,560

125,895


135,064

     Deposits

21,306


21,306

     Deferred tax asset - long term

1,428,000


1,649,000





   Total Other Assets

1,575,201


1,805,370





        TOTAL ASSETS

$            18,915,588


$            17,254,401





LIABILITIES & STOCKHOLDERS' EQUITY




  CURRENT LIABILITIES




     Accounts payable and accrued expenses

$               3,358,724


$               2,589,623

     Line of credit

3,224,780


2,586,034





        Total Current Liabilities

6,583,504


5,175,657





  Total Liabilities

6,583,504


5,175,657





  STOCKHOLDER'S EQUITY




     Common stock, $0.001 par value, 172,744,750 shares authorized, 82,937,309 and 80,808,629 shares issued and outstanding at December 31, 2015 and December 31, 2014, respectively







82,937


80,808

     Capital in excess of par value

20,776,012


20,293,486

     Accumulated deficit

(8,526,865)


(8,295,550)





     Total Stockholders' Equity

12,332,084


12,078,744





TOTAL LIABILITIES & STOCKHOLDERS' EQUITY

$            18,915,588


$            17,254,401

 

Ironclad Performance Wear Corp.

CONSOLIDATED STATEMENTS OF OPERATIONS






Three Months Ended


Twelve Months Ended



December 31, 2015


December 31, 2014


December 31, 2015


December 31, 2014



















REVENUES









Net sales

$               8,421,860


$               9,157,164


$            23,582,019


$            24,283,552










COST OF SALES









Cost of sales

5,603,071


5,965,923


15,303,597


16,114,336










GROSS PROFIT

2,818,789


3,191,241


8,278,422


8,169,216










EXPENSES









General and administrative

1,067,289


779,370


3,311,254


3,372,235


Sales and marketing

880,660


664,396


3,120,131


2,717,491


Research and development

190,623


152,219


670,590


543,375


Purchasing, warehousing and distribution

382,290


283,531


1,187,628


1,303,818


Depreciation and amortization

34,762


34,837


134,627


123,596











Total Operating Expenses

2,555,624


1,914,353


8,424,230


8,060,515










(LOSS) INCOME FROM OPERATIONS

263,165


1,276,888


(145,808)


108,701










OTHER INCOME (EXPENSE)









Interest expense

(25,769)


(15,673)


(91,404)


(25,288)


Interest income

7


7


28


28


Other income, net

-


-


-


131


Gain on disposition of equipment

-


-


-


1,802











Other Income (Expense), Net

(25,762)


(15,666)


(91,376)


(23,327)










NET INCOME BEFORE BENEFITS FROM INCOME TAXES

237,403


1,261,222


(237,184)


85,374










Benefit from income taxes - current

5,869


88,945


5,869


88,945

Deferred income tax benefit - reversal of valuation allowance

-


760,000


-


760,000










NET INCOME (LOSS)

$                  243,272


$               2,110,167


$                (231,315)


$                  934,319










NET INCOME (LOSS) PER COMMON SHARE









Basic

$0.00


$0.03


($0.00)


$0.01


Diluted

$0.00


$0.02


($0.00)


$0.01










WEIGHTED AVERAGE COMMON SHARES









OUTSTANDING









Basic

82,937,309


80,808,629


81,819,809


78,438,557


Diluted

93,844,508


91,657,474


81,819,809


89,287,402

 

SOURCE Ironclad Performance Wear Corporation



RELATED LINKS

http://www.ironclad.com