Mace Reports Third Quarter 2015 Financial Results

  • Results for quarter down due to timing of customer shipments; up
    year-to-date
  • Adds 20 new accounts during the quarter
  • On track to deliver profitable growth in the near term

CLEVELAND–(BUSINESS WIRE)–Mace Security International Inc. (OTCPINK: MACE) today announced
unaudited financial results for the third quarter and nine-month period
ended September 30, 2015. As a result of the timing of customer
shipments, which will we be recognized in the fourth quarter of 2015,
the company’s financial results for the quarter are down from those
reported in the third quarter of 2014. On a nine-month basis, the
company continues to deliver strong growth from a year ago.

“While the year-to-year quarterly comparison would suggest otherwise, we
continued to build positive momentum for the company with strong demand
across our product lines from existing and new customers,” said Richard
Barone, chairman. “As evidenced by our year-to-date results, we remain
on track to deliver sustainable, profitable growth for investors in the
near term.”

Third Quarter/Nine Months 2015 Financial
Highlights

  • Net revenue down 9.9% for quarter; up 6.1% year-to-date
  • Gross profit down 17.7% for quarter; up 16% year-to-date
  • Key channels of distribution (sporting goods & consumer) net revenues
    down 9.9% for the quarter; up 20.9% year-to-date
  • General and administrative expenses down 3.6% for the quarter, 11.7%
    year to date
  • Net loss from continuing operations increased 3.1% for the quarter,
    improved 65.3% year to date

Select Consolidated Financial Results, Third Quarter Ended
September 30, 2015 and 2014

(in thousands):

   
For the Three Months Ended

Sept 30,

2015

   

% of
Sales

   

Sept 30,
2014

   

% of
Sales

       
$ Chg % Chg
Net revenue $ 1,985 100.0 % $ 2,203 100.0 % -218 -9.9 %
 
Gross profit 730 36.8 % 887 40.3 % -157 -17.7 %
 
Selling, general, and administrative expenses 1,056 53.2 % 1,095 49.7 % 39 -3.6 %
 
Operating loss (363 ) -18.3 % (248 ) -11.3 % -115 46.4 %
 
Net loss (335 ) -16.9 % (325 ) -14.8 % -10 3.1 %
 

Third Quarter Operational 2015 Highlights

During the quarter, the company added 20 new customer accounts,
including seven from the “tactical” market and six from the “sporting”
market. Mace also entered an exclusive licensing agreement with Kourt
Security Partners – which is part of one of the largest security
companies in the nation – that will bring Mace-branded security products
to homes across the United States.

According to Mace President and Chief Executive Officer John J. McCann,
the strength of the Mace brand continues to be a key growth driver and
differentiator in the marketplace. “The Mace brand is synonymous with
high-quality, non-lethal personal protection,” he said. “As a result, we
are seeing steadily increasing interest in our expanded product
offering, which includes our Nite-Beams LED safety products for people
and pets, as well as an array of state-of-the-art tactical products for
law enforcement.”

McCann noted that the company will have two new Mace-branded products in
the marketplace before year end – the previously announced Mace®
Alert911 device, which provides direct access to emergency assistance
through the push of a button, and a new WiFi-based home security system.
“New products like these are just another example of our commitment to
keeping people of all ages safe and at a safe distance,” he said.

Conference Call

Mace® will conduct a conference call on Tuesday, November 24,
2015 at 11:00 AM ET, 8:00 AM PT to discuss its financial and operational
performance for the quarter ended September 30, 2015. The participant
conference call number is (877) 719-8065, conference ID: 87668382. A
full set of the consolidated financial statements are available on the
Mace website. Presentation materials for the conference call will be
available Monday, November 23, 2015 on Mace’s website under Investor
Relations, Shareholder Transcripts & Presentations. A digital recording
of the teleconference will be available on the Mace website within 24
hours of the teleconference.

About Mace Security International, Inc.

Mace Security International Inc. is a globally recognized leader in
personal safety and security. Based in Cleveland, Ohio, the company has
spent more than 40 years designing and manufacturing consumer and
tactical products for personal defense, security and surveillance under
its world-renowned Mace® Brand – the original trusted brand
of pepper spray products. The company also offers aerosol defense sprays
and tactical products for law enforcement and security professionals
worldwide through its Mace® Take Down® brand.

Mace Security International distributes and supports Mace®
Brand products and services through mass-market retailers, wholesale
distributors, independent dealers, e-commerce marketers and installation
service providers. For more information, please visit www.mace.com.

Forward-Looking Statements

Certain statements and information included in this press release
constitute “forward-looking statements” within the meaning of the
Federal Private Securities Litigation Reform Act of 1995. When used in
this press release, the words or phrases “will likely result,” “are
expected to,” “will continue,” “is anticipated,” “estimate,”
“projected,” “intend to” or similar expressions are intended to identify
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements are subject to
certain risks, known and unknown, and uncertainties, including but not
limited to economic conditions, dependence on management, our ability to
compete with competitors, dilution to shareholders, and limited capital
resources.

Mace Security International, Inc.
Condensed
Consolidated Balance Sheets

 (Amounts in thousands)

   
ASSETS Sept 30,

2015

December 31,
2014

Current assets: (Unaudited)
Cash and cash equivalents $ 1 $ 359
Restricted cash 60 60
Short-term investments 2,287 5,848
Accounts receivable, net 1,382 1,352
Inventories, net 2,567 1,783
Prepaid expenses and other current assets   1,203   1,303
Total current assets 7,500 10,705
 
Plant and equipment, net 559 585
 
Other intangible assets 685 685
Other assets   686   1,054
Total assets $ 9,430 $ 13,029
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
Current portion of long-term debt $ $ 1,241
Accounts payable 359 481
Income taxes payable 59 60
Accrued expenses and other current liabilities   567   961
Total current liabilities 985 2,743
   
Total stockholders’ equity   8,445   10,286
Total liabilities and stockholders’ equity $ 9,430 $ 13,029
 

Mace Security International, Inc.
Condensed
Consolidated Statements of Operations

Three Months
Ended September 30, 2015 and 2014

(Unaudited)
(Amounts
in thousands)

   
2015 2014
 
Net revenue $ 1,985 $ 2,203
Cost of revenue   1,255     1,316  
 
Gross profit 730 887
 
Selling, general, and administrative expenses 1,056 1,095
Depreciation   37     40  
 
Operating loss (363 ) (248 )
 
Interest expense (13 ) (58 )
Interest income 44 64
Gain (loss) on sale of short-term investments (3 ) 10
Note receivable write-down (100 )
Other loss       7  
 
Loss from continuing operations before income tax provision (335 ) (325 )
 
Income tax provision        
 
Loss from continuing operations (335 ) (325 )
 
Income from discontinued operations, net of tax        
 
Net loss $ (335 ) $ (325 )
 

Mace Security International, Inc.
Condensed
Consolidated Statements of Operations

Nine Months
Ended September 30, 2015 and 2014

(Unaudited)
(Amounts
in thousands)

   
2015 2014
 
Net revenue $ 6,051 $ 5,703
Cost of revenue   3,676     3,655  
 
Gross profit 2,375 2,048
 
Selling, general, and administrative expenses 3,253 3,685
Depreciation   112     127  
 
Operating loss (990 ) (1,764 )
 
Interest expense (38 ) (171 )
Interest income 138 174
Gain (loss) on sale of short-term investments (19 ) 134
Note receivable write-down (100 )
Other income   312     8  
 
Loss from continuing operations before income tax provision (597 ) (1,719 )
 
Income tax provision        
 
Loss from continuing operations (597 ) (1,719 )
 
Income from discontinued operations, net of tax   20     408  
 
Net loss $ (577 ) $ (1,311 )
 

Contacts

Mace Security International Inc.
John J. McCann, 440-424-5322
President
and Chief Executive Officer
john@mace.com