Diversified Security (AMEX:DVS)
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Diversified Security Solutions Reports Record 2004 Revenues
NEW YORK, Feb. 22 /PRNewswire-FirstCall/ -- Diversified Security Solutions
Inc. (AMEX:DVS), a turnkey provider of technology-based integrated electronic
security solutions, today announced results for the year and three months ended
December 31, 2004.
For the year ended December 31, 2004, revenues were a record $29.7 million, an
increase of 63% over sales of $18.3 million in the same period a year ago.
Earnings Before Interest and Taxes (EBIT) were $399 thousand compared with a
loss of $5.0 million in 2003. Net income was $44 thousand, or $0.01 per share,
compared with a net loss of $3.0 million, or net loss of $0.58 per share in the
same period a year ago.
For the fourth quarter ended December 31, 2004, revenues were a record $9.7
million, an increase of 64% compared with revenues of $5.9 million in the same
period a year ago. EBIT totaled $405 thousand compared with a loss of $1.1
million in the fourth quarter of 2003. Fourth quarter net income was $87
thousand, or $0.02 per share, compared with a net income of $699 thousand, or
$0.14 per share in the fourth quarter of 2003.
At December 31, 2004, the company had cash and equivalents of $3.2 million, or
$0.55 cash per share. During 2004, the company paid down $905 thousand in bank
debt.
Jim Henry, Chief Executive Officer of Diversified Security Solutions, said,
"2004 revenues were the highest in the company's history. Our results are
highlighted by a 63% increase in annual sales and a return to operating
profitability after incurring a pre-tax loss of $5.0 million in 2003. We are
pleased that revenues have grown in every division this year and we ended 2004
with a backlog of $20.5 million, an increase of $1.0 million over the end of
our third quarter.
"Our strong 2004 performance was driven by strong demand for our turnkey
solutions as new and existing enterprise customers transition from analog to
digital networks and address their continued concerns about today's security
risks with greater investments in state-of-the-art security systems."
Mr. Henry continued, "Our operational improvements underscore the leverage in
our business and reflect our focus on achieving stronger overall margins. As we
handled an increasing number of projects in 2004 we were able to improve the
efficiency of our work force, generating greater labor utilization rates and
improving our year-over-year gross margin with an increased head count. The
economies of scale that we have built in 2004 are a solid base upon which to
drive greater profitability in 2005.
"Looking ahead, we are optimistic about the future. We are projecting revenues
between $36 and $40 million in 2005 with a target operating margin of 5%. As a
result, we expect to generate net income of $1.0 to $1.2 million, or $0.17 to
$0.21 per share, in 2005. Our guidance is based on our strong backlog and our
growing position as one of the leading security integrators. It is our belief
that our long entrenched relationships with marquis customers continues to be
our most valuable asset, driving new projects and customer references that fuel
our organic growth. Consequently, we believe that we are well-positioned to
benefit from the growth in next generation networks and the need for
enterprises to protect their assets."
The Company will host a conference call today at 1 p.m. EST. To listen to the
call, dial (800) 322-0079 (Domestic), or (973) 935-2100 (International). The
call will also be web cast on http://www.kcsa.com/. To listen, please go to
the site approximately twenty minutes before the conference call is scheduled
to begin to register as well as download and install any necessary audio
software. The web cast will be archived for 30 days.
About Diversified Security Solutions
Diversified Security Solutions (AMEX:DVS) provides technology-based integrated
electronic security systems, services and emergency preparedness consultation
to commercial enterprises and government agencies. Diversified Security
Solutions' integration business, Henry Bros. Electronics (HBE) has offices in
New Jersey, California, Texas, and Arizona. For more information visit
http://www.hbeonline.net/ or http://www.dssi-hq.com/
SAFE HARBOR STATEMENT: Certain statements in this press release constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Forward-looking statements
inherently involve risks and uncertainties that could cause actual results to
differ materially from the forward-looking statements. Additional information
concerning factors that could cause actual results to differ materially from
those in the forward looking statements is contained under the heading of risk
factors listed in the Company's filings with the U.S. Securities and Exchange
Commission. Diversified Security Solutions does not assume any obligation to
update the forward-looking information.
KCSA Todd Fromer / Erika Levy
CONTACTS: (212) 896-1215 / (212) 896-1208
/
DIVERSIFIED SECURITY SOLUTIONS,
INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF
OPERATIONS
Twelve Months Ended Three Months Ended
December 31, December 31,
2004 2003 2004 2003
Revenue $29,725,718 $18,261,065 $9,748,445 $5,940,805
Cost of Sales 22,305,632 14,908,700 7,140,117 4,801,928
Gross Profit 7,420,086 3,352,365 2,608,328 1,138,877
Operating Expenses:
Selling General &
Administrative
Expenses 7,020,885 8,339,337 2,203,407 2,206,979
Operating Profit
(Loss) 399,201 (4,986,972) 404,921 (1,068,102)
Interest Income 12,624 10,326 6,589 1,334
Interest Expense (94,039) (106,464) (21,152) (25,627)
Net Income (Loss)
Before Tax 317,786 (5,083,110) 390,358 (1,092,395)
Tax Provision
(Benefit) For
Income Tax 273,765 (2,126,008) 303,393 (1,790,918)
Income (Loss) After
Tax $44,021 $(2,957,102) $86,965 $698,523
Basic and Diluted
Income (Loss) Per
Common Share:
Basic Profit (Loss)
Per Common Share $0.01 $(0.58) $0.02 $0.14
Weighted Average
Common Shares 5,411,964 5,121,877 5,739,398 5,130,540
Diluted Profit
(Loss) Per Common
Share: $0.01 $(0.58) $0.02 $0.14
Weighted Average
Diluted Common
Shares 5,411,964 5,121,877 5,739,398 5,130,540
DATASOURCE: Diversified Security Solutions Inc.
CONTACT: Todd Fromer, +1-212-896-1215, , or Erika Levy,
+1-212-896-1208, , both of KCSA, for Diversified Security
Solutions Inc.
Web site: http://www.kcsa.com/
http://www.hbeonline.net/
http://www.dssi-hq.com/