2014

Singing Machine Announces 1st Quarter Earnings Release

FORT LAUDERDALE, Fla., Aug. 9, 2012 /PRNewswire/ -- The Singing Machine Company, Inc.  ("Singing Machine" or the "Company") (OTCBB: SMDM) announces the results for its first fiscal quarter ended June 30, 2012.

The Company announced net sales of approximately $1.76 million in the first quarter which is almost identical to the $1.78 million reported for the same period last year. The lack of change in net sales is attributable to the highly seasonal nature of karaoke sales. The Company reported gross margin of approximately 25.2% as compared to approximately 24% reported for the quarter ended June 30, 2011.  Due to the slight increase in gross margin, the Company reported a slightly smaller 1st quarter loss of approximately $480,000 as compared to a net loss of approximately $508,000 in the same period last year.

Gary Atkinson, CEO, commented, "Despite our normal, slow seasonal start to the fiscal year, we're confident we can continue the momentum generated from last fiscal year. We're currently preparing all of our fall shipments to start shipping soon and we're hopeful for another strong holiday season." Atkinson added, "Expect to see Singing Machine on the shelves of some new retailers this holiday season."

About The Singing Machine
Incorporated in 1982, The Singing Machine Company develops and distributes a full line of consumer-oriented karaoke machines and music under The Singing MachineTM, SMDigital™, SoundX™, and Sound X Kids™ and other brand names.  The first to provide karaoke systems for home entertainment in the United States, The Singing Machine sells its products in North America, Europe and Australia. The Singing Machine is also the first to offer digital music downloads for play on home karaoke machines. See www.singingmachine.com for more details.

Forward-Looking Statements
This press release contains forward‑looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward‑looking statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by management and include, but are not limited to statements about our financial statements for the fiscal year ended March 31, 2012.  You should review our risk factors in our SEC filings which are incorporated herein by reference.  Such forward‑looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward‑looking statement to reflect events or circumstances after the date of this release.

(Financial statements attached)

The Singing Machine Company, Inc. and Subsidiaries


CONSOLIDATED BALANCE SHEETS 








June 30, 2012


 March 31, 2012 





 (Unaudited) 


 (Audited) 


Assets


Current Assets







Cash and cash equivalents

$

303,420

$

267,465



Accounts receivable, net of allowances of $177,947 and      







   $168,554, respectively


799,934


785,490



Due from related party - Starlight Consumer Electronics USA, Inc.


4,574


36,036



Due from related party - Starlight Electronics USA, Inc.


116,286


58,536



Due from related party - Cosmo Communications Canada, Ltd


39,565


68,291



Inventories, net


3,587,715


4,008,392



Prepaid expenses and other current assets


43,434


53,233



         Total Current Assets


4,894,928


5,277,443









Property and Equipment,net


306,709


296,222


Other Non-Current Assets


159,956


159,674



          Total Assets

$

5,361,593

$

5,733,339









Liabilities and Shareholders' Deficit


Current Liabilities







Accounts payable

$

1,545,382

$

1,303,395



Due to related party - Starlight Marketing Development, Ltd.


1,924,431


1,924,431



Due to related party - Ram Light Management, Ltd.


1,683,247


1,683,247



Due to related party - Starlight R&D, Ltd.


422,106


416,026



Due to related party - Cosmo Communications USA, Inc.


230,626


226,747



Due to related party - Starlight Electronics Co., Ltd.


153,944


103,545



Due to related parties - Other Starlight Group Companies


3,534


3,534



Accrued expenses


207,472


168,156



Obligations to clients for returns and allowances


166,072


242,379



Warranty provisions


61,481


219,760



        Total Current Liabilities


6,398,295


6,291,220










        Total Liabilities


6,398,295


6,291,220









Shareholders'  Deficit







Preferred stock, $1.00 par value; 1,000,000 shares authorized, no   







  shares issued and outstanding


-


-



Common stock, Class A, $0.01 par value;  100,000 shares 







  authorized; no shares issued and outstanding


-


-



Common stock, $0.01 par value;  100,000,000 shares authorized;   







  37,960,794 and 37,960,794 shares issued and outstanding, respectively


379,607


379,607



Additional paid-in capital


19,142,740


19,141,098



Accumulated deficit


(20,559,049)


(20,078,586)



        Total Shareholders' Deficit


(1,036,702)


(557,881)



        Total Liabilities and Shareholders' Deficit

$

5,361,593

$

5,733,339









The accompanying notes are an integral part of these consolidated financial statements.









 

 

The Singing Machine Company, Inc. and Subsidiaries


CONSOLIDATED STATEMENTS OF OPERATIONS 


(Unaudited)

























For Three Months Ended






June 30, 2012


June 30, 2011




















Net Sales



$              1,762,705


$              1,788,046











Cost of Goods Sold


1,318,627


1,359,503











Gross Profit


444,078


428,543











Operating Expenses







Selling expenses


248,648


348,676



General and administrative expenses


643,118


555,612



Depreciation and amortization


32,775


32,078


Total Operating Expenses


924,541


936,366











Loss  from Operations


(480,463)


(507,823)











Other Expenses







Interest expense


-


(94)











Loss before provision for income taxes


(480,463)


(507,917)











Provision for  income taxes


-


-











Net Loss




$                (480,463)


$                (507,917)











Loss per Common Share







Basic  and Diluted


$                     (0.01)


$                     (0.01)











Weighted Average Common and Common 







Equivalent Shares:







Basic and Diluted


37,960,794


37,835,793











The accompanying notes are an integral part of these consolidated financial statements.

 

 

The Singing Machine Company, Inc. and Subsidiaries


CONSOLIDATED STATEMENTS OF CASH FLOWS


(Unaudited)







For Three Months Ended






June 30, 2012


June 30, 2011




















Cash flows from operating activities







 Net Loss 

$

(480,463)

$

(507,917)



 Adjustments to reconcile net loss to net cash and cash 







 equivalents provided by operating activities: 








 Depreciation and amortization 


32,775


32,078




 Change in inventory reserve 


(40,709)


1,004




 Change in allowance for bad debts 


2,143


(6,039)




 Stock compensation 


1,642


7,092




 Warranty provisions 


(158,279)


(80,690)



 Changes in assets and liabilities: 







   (Increase) Decrease in: 








 Accounts receivable 


(16,587)


359,502




 Inventories 


461,386


39,267




 Prepaid expenses and other current assets 


9,799


18,605




 Other non-current assets 


(282)


-



   Increase (Decrease) in: 








 Accounts payable  


241,987


479,543




 Net due to related parties 


62,796


(258,182)




 Accrued expenses 


39,316


(8,833)




 Obligations to clients for returns and allowances 


(76,307)


87,388





 Net cash provided by operating activities 


79,217


162,818


 Cash flows from investing activities 







 Purchase of property and equipment 


(43,262)


(77,301)





 Net cash used in investing activities 


(43,262)


(77,301)


 Cash flows from financing activities 







 Payments on long-term financing obligation 


-


(4,547)





 Net cash used in financing activities 


-


(4,547)


 Change in cash and cash equivalents 


35,955


80,970











 Cash and cash equivalents at beginning of period 


267,465


674,712


 Cash and cash equivalents at end of period 

$

303,420

$

755,682











 Supplemental Disclosures of Cash Flow Information: 







 Cash paid for Interest 

$

-

$

94




















 The accompanying notes are an integral part of these consolidated financial statements. 




 

SOURCE The Singing Machine Company, Inc.



RELATED LINKS
http://www.singingmachine.com

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