Reconditioned Systems, Inc. News
Release
2636 S. Wilson Street, Suite
105
Tempe, Arizona 85282 Contact: Investor Relations
(480) 968-1772 (Telephone)
(480) 894-1907 (Fax)
“RSI reports Fourth Quarter
2008 results”
Tempe, Arizona, May 9, 2008
Dear Fellow Shareholders:
I am pleased to report that Reconditioned Systems, Inc. (“RSI”) was profitable again this quarter. We ended the year on a negative note and although we were profitable for the quarter, we actually had a loss for the month of March. We are reducing costs where possible and will continue to watch our expenditures. Obviously increasing sales is our primary objective.
For the three months ending March 31 2008, RSI made pre-tax income of $30 thousand on sales of $3.5 million. This compares to a pre-tax profit of $350 thousand on sales of $5.1 million for the quarter ending March 31, 2007. Given the much lower sales, it is impressive that we were able to show a profit for the quarter. We have been able to control our costs in a very difficult environment.
The economy appears to be in recession and we are seeing the effects upon our industry. Sales remain sluggish and margins continue to be under pressure. I expect this to continue through this next fiscal year. The American consumer remains stressed with little real wage gains and rising costs for food and energy. The only bright spot is the lower dollar, which is making imports less competitive and helps our exports. We actually are making some sales in Canada as a result. We are budgeting for a 10% decrease in sales for the year ending March 31, 2009; we are expecting the year to be very challenging.
We have paid annual dividends for the last three years. This year the board again voted to pay an annual dividend of $0.15 on August 31, 2008, to shareholders of record on July 7, 2008. This is lower than last year and reflects the lower earnings. As in the past, any future dividends will depend on our performance and financial position.
/S/ Scott W. Ryan
Scott W. Ryan
Chairman of the Board
Reconditioned Systems, Inc.
May 9, 2008
Page -2-
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Summary Statement of Operations |
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|
|
For The Three Months Ended |
For the Year Ended |
||
|
|
March 31, 2008(Unaudited) |
March 31, 2007(Unaudited) |
March 31, 2008(Unaudited) |
March 31, 2007(Unaudited) |
|
Sales |
$3,475,517 |
$5,146,261 |
$16,527,436 |
$18,871,370 |
|
Net income before provision for income taxes and
loss on investment |
$30,122 |
$349,787 |
$609,323 |
$1,117,946 |
|
Net income * |
$18,014 |
$231,699 |
$347,573 |
$698,016 |
|
Basic earnings per share * |
$0.02 |
$0.19 |
$0.30 |
$0.56 |
|
Basic weighted average number of common shares
outstanding |
1,166,719 |
1,219,918 |
1,166,964 |
1,240,865 |
|
Diluted earnings per common and equivalent share * |
$0.02 |
$0.19 |
$0.30 |
$0.55 |
|
Diluted weighted average number of common and
equivalent shares outstanding |
1,168,892 |
1,245,701 |
1,177,143 |
1,259,336 |
|
Summary Balance Sheet as
of |
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|
|
March 31, 2008(Unaudited) |
March 31, 2007(Unaudited) |
|
March 31, 2008(Unaudited) |
March 31, 2007(Unaudited) |
|
Assets |
|
|
Liabilities
and Equity |
|
|
|
Cash |
$1,892,375 |
$1,328,165 |
Accounts payable |
$551,957 |
$958,262 |
|
Accounts receivable |
1,185,094 |
2,430,955 |
Customer deposits |
108,601 |
327,773 |
|
Inventory |
1,791,392 |
1,821,995 |
Accrued wages, commission and benefits |
516,771 |
777,618 |
|
Property & equipment |
713,019 |
836,646 |
Other current liabilities * |
433,750 |
85,189 |
|
Other assets |
666,618 |
345,911 |
Stockholders’ equity * |
4,637,419 |
4,614,830 |
|
Total |
$6,248,498 |
$6,763,672 |
Total |
$6,248,498 |
$6,763,672 |
* Income taxes have been estimated at 42% of pretax income and may be revised upon completion of the company’s tax returns.
Note: The
Company’s press releases are available on our website www.resy.net under Inventor Relations. Any shareholder who would like to sell
shares back to the Company should contact the Investor Relations Department at
800-280-5000.