Leatt Corp Reports Second Quarter And First Half Results

QUARTER REVENUE HIGHER BY 25%, 2015 PROFIT VS 2014 LOSS; CASH UP NEARLY $500,000 SINCE DECEMBER 31

Aug 13, 2015, 08:00 ET from Leatt Corporation

CAPE TOWN, South Africa, Aug. 13, 2015 /PRNewswire/ -- Leatt Corporation (OTCQB: LEAT) today announced its financial results for the second quarter and six months ended June 30, 2015.  Leatt Corporation develops and markets protective equipment and ancillary products for all forms of sports, especially extreme high-velocity sports.  All financial numbers are in US dollars.

Second Quarter 2015 Financial Performance
Revenue for the second quarter of 2015 was $5.2 million, up 25 percent year-to-year, with net income of $423,937 or $0.08 per share, compared to revenue of $4.2 million with a net loss of $29,834 or $0.01 loss per share for the second quarter of 2014. 

CEO Sean Macdonald commented, "The second quarter was very strong for Leatt Corp., partly due to our shipment of additional new products and the continued growth of our body armor sales.  We saw a rewarding uptake on our new Airflex protective glove range, which we began shipping during the second quarter. Although neck brace sales were slightly down during the period, this decrease was more than offset by the continued growth of our body armor sales, which grew by 75 percent year-to-year.  The body armor category includes the C-Frame knee brace that was first shipped in 2014, and which continues to find larger audiences and market share.  C-Frame knee brace sales also had a positive impact on our gross profit margins, which remained steady at 55 percent, year-to-year, despite the increase in body armor sales which have historically generated lower margins. Despite this increase in revenue, operating expenditures decreased by $134,035 year-to-year. Research and development and G&A expense were both down, as were professional fees."

Chairman, Dr. Christopher James Leatt added, "We are very happy with initial sales of our new Airflex protective glove range that is constructed of ultrathin nanofibers for maximum flexibility and strength, with the addition of injected protective materials to protect knuckles, thumbs and fingers. We believe that our gloves are the first in the downhill bicycle and motocross market that incorporates engineered protection. Meanwhile, we are still evaluating the C-Frame knee brace as an adjunct to medical procedures and diagnoses."

Six Months 2015 Financial Performance
Revenue for the six months ended June 30, 2015 was $9.2 million, an increase of 20 percent compared to the first six months of 2014.  Net income was $478,042 or $0.09 per share, compared to a net loss of $370,720 or $0.07 loss per share for the first half of 2014.

The Company's cash balance was $1.2 million at June 30, 2015, up rewardingly from the $724,000 reported for December 31, 2014.  The current ratio at June 30, 2015 was just below 5:1, stronger than the 3:1 at the end of 2014.  The Company has no long-term debt.

Business Outlook
Mr. Macdonald said, "The strategy to broaden our product lines, add new categories, and appeal to new sports seems to be working as we hoped it would.  The next step for us will be shipping of the first Leatt helmets, which we expect will happen during the second half of 2015.  We are looking forward to this first shipment as the helmet market is the largest segment of the worldwide market for protective sporting gear, and extends from high-velocity sports through a variety of team sports, amateur and professional.  Worldwide concern for the long term implications of concussions and blows to the head have made the helmet market even more prominent for parents, educators and athletes.  We believe that our reputation for excellence and the broad recognition of our brand as the protective gear technological leader should stand us in good stead with helmets.  Our first helmet shipments will be our full face motocross and bicycling helmets."

Conference Call:
The Company will host a conference call at 11:00 am Eastern Time on August 13, 2015, to discuss the second quarter 2015 results.

Participants should dial in to the call ten minutes before the scheduled time, using the following numbers: 1-888-348-8777 (USA) or +1-412-902-4245 (international) to access the call.

Audio Webcast: 
There will also be a simultaneous live webcast through the Company's website, www.leatt-corp.com. Participants should register on the website approximately ten minutes prior to the start of the webcast.

Replay: 
An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-877-870-5176 (USA) or +1-858-384-5517 (international) and using passcode 10070717.

For those unable to attend the call, a recording of the live webcast will be archived shortly following the event for 30 days on the Company's website.

About Leatt Corporation: 
Leatt Corporation develops personal protective equipment and ancillary products for all forms of sports, especially extreme motor sports. The Leatt-Brace® is an award-winning neck brace system considered the gold standard for neck protection for anyone wearing a crash helmet as a form of protection. It was designed for participants in extreme sports or riding motorcycles, bicycles, mountain bicycles, all-terrain vehicles, snowmobiles and other vehicles.  For more information, visit: www.leatt-corp.com | http://www.leatt.com/.

Forward-looking Statements
This press release may contain forward-looking statements regarding Leatt Corporation (the "Company") within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.  All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding: the likelihood that the Company will see increased revenue in connection with sales of its new knee brace and gloves; the significance of the Company's shipment of the new helmets and the likelihood that helmet sales will benefit from the market acceptance of other Leatt branded products; the financial outlook of the Company and the likelihood that demand for the Company's innovative new products will continue to increase through 2015; the general ability of the Company to achieve its commercial objectives, including its exploration of the new knee brace as a medical devices; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects," "anticipates," "seeks," "should," "could," "intends," or "projects" or similar expressions, and involve known and unknown risks and uncertainties. These statements are based upon the Company's current expectations and speak only as of the date hereof. Any indication of the merits of a claim does not necessarily mean the claim will prevail at trial or otherwise. Financial performance in one period does not necessarily mean continued or better performance in the future. The Company's actual results in any endeavor may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, which factors or uncertainties may be beyond our ability to foresee or control. Other risk factors include the status of the Company's common stock as a "penny stock" and those listed in other reports posted on The OTC Markets Group, Inc.

Contacts

DresnerAllenCaron 
Michael Mason (investors)
michaelm@allencaron.com
(212) 691-8087

Len Hall (Media)
len@allencaron.com
(949) 474-4300

-- Financial Tables Follow --

 

LEATT CORPORATION

CONSOLIDATED BALANCE SHEETS











ASSETS








June 30, 2015


December 31, 2014



Unaudited


Audited

Current Assets





  Cash and cash equivalents


$   1,218,963


$                724,707

  Short-term investments


58,161


58,153

  Accounts receivable


2,192,500


4,239,298

  Inventory


3,448,808


3,403,854

  Payments in advance


450,554


345,406

  Income tax refunds receivable


299


25,299

  Deferred tax asset


108,000


108,000

  Prepaid expenses and other current assets


769,100


994,003

    Total current assets


8,246,385


9,898,720






Property and equipment, net 


855,855


995,537






Other Assets





  Other receivables


150,000


210,000

  Deposits


17,693


17,980

  Intangible assets


76,848


81,323

   Total other assets


244,541


309,303






Total Assets


$   9,346,781


$           11,203,560






LIABILITIES AND STOCKHOLDERS' EQUITY






Current Liabilities





   Accounts payable and accrued expenses


$   1,077,310


$             2,980,885

   Income taxes payable


320,000


331,000

   Short term loan, net of finance charges


260,372


626,129

      Total current liabilities


1,657,682


3,938,014






Deferred tax liabilities


88,192


88,468






Commitments and contingencies










Stockholders' Equity





   Preferred stock, $.001 par value, 1,120,000 shares authorized, 120,000 shares issued and outstanding


3,000


3,000

   Common stock, $.001 par value, 28,000,000 shares authorized, 5,231,823 and 5,200,623 shares issued and outstanding as of June 30, 2015 and December 31, 2014


130,040


130,008

   Additional paid - in capital


7,346,782


7,314,136

   Accumulated other comprehensive loss


(465,322)


(378,431)

   Retained earnings 


586,407


108,365

      Total stockholders' equity


7,600,907


7,177,078






Total Liabilities and Stockholders' Equity


$   9,346,781


$           11,203,560

 

LEATT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)





















Three Months Ended


Six Months Ended



June 30


June 30



2015


2014


2015


2014



Unaudited


Unaudited


Unaudited


 Unaudited 










Revenues


$ 5,193,056


$ 4,167,394


$ 9,214,511


$ 7,690,869










Cost of Revenues


2,361,827


1,858,390


4,206,022


3,486,164










Gross Profit


2,831,229


2,309,004


5,008,489


4,204,705










Product Royalty Income


20,668


50,448


72,201


71,263










Operating Expenses









   Salaries and wages


542,467


576,177


1,148,645


1,103,223

   Commissions and consulting expenses


151,468


141,234


337,376


307,251

   Professional fees 


246,392


280,466


461,165


614,522

   Advertising and marketing


363,313


389,659


624,755


675,053

   Office rent and expenses


62,543


61,867


123,051


121,985

   Research and development costs


293,666


333,035


586,383


614,327

   Bad debt expense 


19,461


223


19,461


22,295

   General and administrative expenses


489,116


541,284


914,332


1,046,238

   Depreciation 


91,473


69,989


184,276


147,508

       Total operating expenses


2,259,899


2,393,934


4,399,444


4,652,402










Income (Loss) from Operations


591,998


(34,482)


681,246


(376,434)










Other Income









   Interest and other income, net


7,539


4,528


7,981


5,594

      Total other income 


7,539


4,528


7,981


5,594










Income (Loss) Before Income Taxes


599,537


(29,954)


689,227


(370,840)










Income Taxes


175,600


(120)


211,185


(120)










Net Income (Loss) Available to Common Shareholders


$    423,937


$    (29,834)


$    478,042


$  (370,720)










Net Income (Loss) per Common Share









   Basic


$          0.08


$        (0.01)


$          0.09


$        (0.07)

   Diluted


$          0.08


$        (0.01)


$          0.09


$        (0.07)










Weighted Average Number of Common Shares Outstanding









   Basic


5,201,663


5,200,623


5,201,143


5,200,623

   Diluted


5,476,017


5,200,623


5,475,497


5,200,623










Comprehensive Income (Loss)









    Net Income (Loss)


$    423,937


$    (29,834)


$    478,042


$  (370,720)

   Other comprehensive income (loss), net of $0 and $0 deferred income taxes in 2015 and 2014









       Foreign currency translation 


(40,422)


3,884


(86,891)


9,055










       Total Comprehensive Income (Loss)


$    383,515


$    (25,950)


$    391,151


$  (361,665)

 

SOURCE Leatt Corporation



RELATED LINKS

http://www.leatt-corp.com