Spy Inc. reported annual sales of Spy brand products were $37.7 million in 2013, an increase of 8 percent or $2.6 million, compared to $35.1 million in 2012
Spy brand annual sales included slightly higher closeout sales of $2.8 million in 2013, compared to $2.6 million in 2012.
Sales from discontinued licensed brand products, which are no longer a focus of the company, were less than $0.1 million in 2013, compared $0.5 million in 2012. Total company net sales increased by 6 percent or $2.2 million, to $37.8 million for the year ended December 31, 2013, compared to $35.6 million for the year ended December 31, 2012, primarily as a result of increased sales of snow goggle and optical products.
Fourth quarter sales of Spy brand products were $8.6 million in 2013, an increase of 7 percent or $0.5 million over the fourth quarter of 2012. The fourth quarter Spy brand sales included higher closeout sales of $0.7 million in the fourth quarter of 2013 compared to $0.6 million in the fourth quarter of 2012, or a $0.1 million increase. Total company net sales increased by 6 percent or $0.5 million, to $8.6 million in the fourth quarter of 2013, compared to $8.1 million in the fourth quarter of 2012, primarily as a result of higher sales of snow goggle and optical products.
“With continued strong Spy brand sales and an annual Spy brand growth of 8 percent for 2013 over 2012, we are happy to once again generate annual growth and achieve 11th quarter in a row of year over year growth of Spy brand products. What is also noteworthy is we had income from operations of $0.4 million during 2013 compared to an operating loss of $5.0 million in 2012,” said Michael Marckx, President and CEO. “We not only managed to significantly reduce operating expenses for 2013, but also increased margin to 50 percent in 2013 from 46 percent in 2012, which is a dramatic positive shift for us. This directly reflects the strong demand for product offering as well as the operational and manufacturing efficiencies that we have achieved over the past year. I'd like to mention that this is a definitive culmination of Spy's efforts to reduce costs, which has helped solidify operating cost structure. Achieving operating profit along with expanding portfolio of products, including successful Happy Lens Collection, positions us well for 2014 as we continue to focus on disruptive strategies, driving sales, improving product margins and managing operating costs.”
During 2013 the company had income from operations of $0.4 million compared to a loss from operations of $5.0 million in 2012 or an improvement of $5.4 million. Our loss from operations was $0.4 million in the fourth quarter of 2013 compared to $0.6 million in the fourth quarter of 2012, or an improvement of $0.2 million.
We incurred an annual net loss of $2.9 million in 2013 compared to a net loss of $7.2 million in 2012. We incurred a net loss of $1.3 million in the fourth quarter of 2013 compared to a net loss of $1.2 million in the fourth quarter of 2012. The primary difference between the net loss and income and loss from operations was due to interest expense on long-term debt.
SPY INC. AND SUBSIDIARIES |
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS |
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(Thousands, except per share amounts) | ||||||||||||||||||
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Net sales | $ | 8,627 | $ | 8,112 | $ | 37,782 | $ | 35,609 | ||||||||||
| Cost of sales | 4,571 | 4,545 | 18,921 | 19,189 | ||||||||||||||
| Gross profit | 4,056 | 3,567 | 18,861 | 16,420 | ||||||||||||||
| Operating expenses: | ||||||||||||||||||
| Sales and marketing | 2,547 | 2,552 | 11,314 | 13,814 | ||||||||||||||
| General and administrative | 1,607 | 1,211 | 6,112 | 6,285 | ||||||||||||||
| Shipping and warehousing | 155 | 159 | 534 | 767 | ||||||||||||||
| Research and development | 158 | 222 | 502 | 587 | ||||||||||||||
| Other operating expense | – | – | – | – | ||||||||||||||
| Total operating expenses | 4,467 | 4,144 | 18,462 | 21,453 | ||||||||||||||
| Loss from operations | (411 | ) | (577 | ) | 399 | (5,033 | ) | |||||||||||
| Other income (expense): | ||||||||||||||||||
| Interest expense | (737 | ) | (712 | ) | (2,966 | ) | (2,388 | ) | ||||||||||
| Foreign currency transaction gain (loss) | (116 | ) | 57 | (290 | ) | 137 | ||||||||||||
| Other (expense) income | (2 | ) | 21 | (5 | ) | 50 | ||||||||||||
| Total other expense | (855 | ) | (634 | ) | ||||||||||||||
