Invisa, Inc. Reports First Quarter 2015 Financial Results

Revenues surpass $27 million and Net Income exceeds $1.4 million

SARASOTA, Fla.--()--Invisa, Inc. (OTCQB: INSA) today announced its financial results for the first quarter of 2015. The following is a brief summary of the results and should be read in conjunction with the complete filing on form 10-Q.

“We are pleased with our first quarter results as they reflect a number of new product wins and higher margin automotive platforms we received from OEMs and Tier 1 suppliers in our automotive markets”

Revenue:

Total revenue during the first quarter 2015 increased $3,144,701, or 12.9%, to $27,514,935 from $24,370,234 in the corresponding quarter of 2014. The increase was primarily attributable to new automotive platform launches and an additional reporting week in the 2015 fiscal quarter. The increase was partially offset by the negative impact of the average British Pound Sterling exchange rate for 2015 compared to the corresponding period in 2014.

Gross Profit:

Total gross profit in the quarter was $5,355,063 or 19.5% of sales compared with $4,437,099, or 18.2%, of sales in 2014. The gross profit percentage increased in 2015 primarily due to the elimination of lower margin automotive platforms which were replaced with higher margin platforms, and the positive results of cost efficiency programs implemented during 2014.

Operating Expenses:

Selling expense in the quarter increased $155,515, or 13.3%, to $1,327,926 from $1,172,411 in the corresponding quarter in 2014. The increase resulted from higher sales volume and increases in administrative, marketing and support staff expenses added during the second half of 2014.

General and administrative expenses during the quarter increased by $106,733, or 5.8%, to $1,955,776 from $1,849,043 in the same period 2014. The increase was a result of additional administrative expenses necessary to reflect the Company’s addition of multinational businesses subsequent to the first quarter of 2014.

Research and development expenses in the quarter decreased by $35,776 to $325,830, from $361,606 in 2014.

Interest Expense:

Interest expense during the quarter decreased by $66,640, or 14.7%, to $387,417 from $454,057 in first quarter of 2014. The decrease was attributable to a lower weighted average effective rate for the first quarter of 2015 compared to 2014.

Other Income:

Other income increased $142,928 to $167,361 from $24,433. The increase was primarily due to gains resulting from the foreign currency translation of certain assets and liabilities which are denominated in Euros to the functional currency of the U.K. operations.

Net Income:

Net income increased $814,897, or 173%, to $1,410,657 from $595,760 before the preferred dividend of $693,105, which was issued by the company as a result of the acquisition of Uniroyal Engineered Products LLC and Engineered Products Acquisition Limited.

Net income available to common shareholders for the quarter increased to $.05 per share, or 20%, from $.04 per share in the first quarter 2014. Net income per share on a fully diluted basis increased to $.04 from $.03 in the first quarter 2014.

"We are pleased with our first quarter results as they reflect a number of new product wins and higher margin automotive platforms we received from OEMs and Tier 1 suppliers in our automotive markets," stated Howard R. Curd, Co-Chairman and CEO of Invisa. "We continue our focus on penetrating untapped markets around the globe and improving operating efficiencies in both our U.S. and U.K. facilities,” added Curd.

About Invisa

Invisa is a leading manufacturer of vinyl coated fabrics that are durable, stain resistant, cost-effective alternatives to leather, cloth and other synthetic fabric coverings. Invisa’s revenue in 2014 was derived 63% from the automotive industry and approximately 37% from the recreational, industrial, indoor and outdoor furnishings, hospitality and health care markets.

Risk Factors

Except for statements of historical fact, certain information contained in this press release constitutes forward-looking statements, including, without limitation, statements containing the words “believe,” “expect,” “anticipate,” “intend,” “expect,” “should,” “planned,” “estimated” and “potential” and words of similar import, as well as all references to the future. These forward-looking statements are based on Invisa’s current expectations. The Company cautions investors that any forward-looking statements made by the Company are not guarantees of future performance and that a variety of factors could cause the Company´s actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company´s forward-looking statements. The risks and uncertainties which may affect the operations, performance, development and results of the Company´s business include, but are not limited to, the following: uncertainties relating to economic conditions, uncertainties relating to customer plans and commitments, the pricing and availability of equipment, materials and inventories, technological developments, performance issues with suppliers, economic growth, delays in testing of new products, the Company’s ability to successfully integrate acquired operations, the Company’s dependence on key personnel, the Company’s ability to protect its intellectual property rights, the effectiveness of cost-reduction plans, rapid technology changes and the highly competitive environment in which the Company operates. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.

   
Invisa, Inc.
Consolidated Statements of Comprehensive Income
(Unaudited)
 
Three Months Ended
April 5, 2015 March 30, 2014
 
NET SALES $ 27,514,935 $ 24,370,234
 
COST OF GOODS SOLD   22,159,872   19,933,135  
 
Gross Profit 5,355,063 4,437,099
 
OPERATING EXPENSES:
Selling 1,327,926 1,172,411
General and administrative 1,955,776 1,849,043
Research and development   325,830   361,606  
OPERATING EXPENSES   3,609,532   3,383,060  
 
Operating Income   1,745,531   1,054,039  
 
OTHER INCOME (EXPENSE):
Interest and other debt related expense (387,417 ) (454,057 )
Other income   167,361   24,433  
Net Other Expense   (220,056 ) (429,624 )
 
INCOME BEFORE TAX PROVISION 1,525,475 624,415
 
TAX PROVISION   114,818   28,655  
 
NET INCOME 1,410,657 595,760
 
Preferred stock dividend   (693,105 ) -  
 
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS 717,552 595,760
 
OTHER COMPREHENSIVE INCOME (LOSS):
Minimum benefit liability adjustment (45,229 ) (147,474 )
Foreign currency translation adjustment (359,216 ) 39,269
Unrealized gain (loss) on effective hedge:
Reclassification of amounts to earnings - 16,499
Unrealized loss for the year   -   (1,395 )
 

COMPREHENSIVE INCOME TO COMMON SHAREHOLDERS

$ 313,107   $ 502,659  

 

EARNINGS PER COMMON SHARE:

Basic

$ 0.05   $0.04  

Diluted

$ 0.04   $0.03  
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic   14,351,579   14,186,836  
Diluted   19,108,412   18,943,669  
 
 

Invisa, Inc.

Consolidated Balance Sheets
 
ASSETS

April 5, 2015
(Unaudited)

December 28,
2014

CURRENT ASSETS
Cash and cash equivalents $ 2,138,471 $ 604,234
Accounts receivable, net 16,354,138 14,607,787
Inventories, net 17,147,283 17,421,082
Other current assets 2,115,197 2,130,282
Related party receivable   16,144     74,931  
Total Current Assets   37,771,233     34,838,316  
PROPERTY AND EQUIPMENT   13,009,542     12,001,128  
OTHER ASSETS
Intangible assets 3,545,361 3,668,956
Goodwill 1,079,175 1,079,175
Other long-term assets   1,373,462     1,295,965  
Total Other Assets   5,997,998     6,044,096  
TOTAL ASSETS $ 56,778,773   $ 52,883,540  
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Checks issued in excess of bank balance $ 719,727 $ 438,145
Line of credit 17,353,679 16,396,306
Current maturities of long-term debt 473,118 522,095
Current maturities of capital lease obligations 538,509 96,071
Accounts payable 9,912,000 9,409,062
Accrued expenses 3,831,846 3,408,143
Related party payable - 20,260
Current portion of postretirement benefit liability - health and life   115,039     115,039  
Total Current Liabilities   32,943,918     30,405,121  
LONG-TERM LIABILITIES
Long-term debt, less current portion 1,197,526 1,355,297
Capital lease obligations, less current portion 1,604,039 238,836
Related party lease financing obligations 2,162,562 2,162,393
Long-term debt to related parties 4,676,801 4,740,728

Postretirement benefit liability - health and life, less current portion

2,656,580 2,662,570
Other long-term liabilities   745,282     840,378  
Total Long-Term Liabilities   13,042,790     12,000,202  
Total Liabilities   45,986,708     42,405,323  
STOCKHOLDERS' EQUITY

Convertible Preferred Stock: 5,000,000 shares authorized ($100 value):

Series A, 9,715 shares issued and outstanding 798,500 798,500
Series B, 2,702 shares issued and outstanding 270,160 270,160
Series C, 16,124 shares issued and outstanding 1,600,467 1,600,467
Preferred unit, Series A UEP Holdings, LLC, 200,000 units
issued and outstanding ($100 issue price) 617,571 617,571
Preferred units, Series B UEP Holdings, LLC, 150,000 units
Issued and outstanding ($100 issue price) 463,179 463,179
Preferred stock, Engineered Products Acquisition limited,
50 shares issued and outstanding ($1.51 stated value) 75 75
Common stock, 95,000,000 shares authorized ($.001 par
value) 14,351,698 and 14,351,398 shares issued and
outstanding as of April 5, 2015 and December 28, 2014,
respectively 14,352 14,352
Additional paid in capital 32,550,326 32,549,585
Accumulated deficit (25,909,082

)

 

(26,626,634 )
Accumulated other comprehensive income   386,517     790,962  
Total Stockholders' Equity   10,792,065     10,478,217  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 56,778,773   $ 52,883,540  
 

Contacts

Invisa Corporate Contact:
Elizabeth Henson, 941-870-3950
LHenson@invisa.com
or
Invisa Public Relations:
TTC Group, Inc.
Vic Allgeier, 646-290-6400
vic@ttcominc.com

Invisa, Inc.