Reconditioned Systems, Inc. News
Release
444 West Fairmont
Tempe, Arizona 85282 Contact: Investor Relations
(480) 968-1772 (Telephone)
(480) 894-1907 (Fax)
“RSI reports First Quarter
2006 results”
Tempe, Arizona, August 1,
2005
Dear Fellow Shareholders:
I am pleased to report that Reconditioned Systems, Inc. (“RSI”) had the best quarter in the company’s history. After a record year that ended March 31, 2005, we had tentatively projected flat sales with a slight increase in earnings for this fiscal year. I am frankly surprised that we have done so well in what continues to be a difficult environment. It is a tribute to the devoted men and women that work for your company.
For the three months that ended June 30, 2005, RSI made $318 thousand on sales of $5.9 million. This compares to a profit of $23 thousand on sales of $4.4 million for the quarter ending June 30, 2004. This is another strong relative performance and again validates the very difficult decisions and changes that we made over the last several years. By becoming a non-reporting public company, we saved a substantial amount of money, and combined with our cost cutting resulted in this excellent performance.
We still believe that high energy prices will have a significant negative impact on the economy. The last time energy prices had this kind of increase, it led to a recession. Both fiscal and monetary policies are already very stimulative, so the economy is vulnerable to such increases. It is because of this outlook that we have been conservative in our budget and our planning. We continue to project flat sales with a slight increase in earnings.
We declared the first common stock cash dividend in the history of the company which is payable August 31, 2005. This was in part to repay our shareholders who have stood by and supported us during these last few difficult years. We would hope to pay future annual dividends depending on our performance and what our cash needs are.
/s/ Scott W. Ryan
Scott W. Ryan
Chairman of the Board
Reconditioned Systems, Inc.
August 1, 2005
Page -2-
|
|
For The Three Months Ended |
|
|
|
June 30, 2005(Unaudited) |
June 30, 2004(Unaudited) |
|
Sales |
$5,895,651 |
$4,409,826 |
|
Net income before provision for income taxes |
$542,216 |
$31,529 |
|
Net income |
$318,116 |
$23,647 |
|
Basic earnings per share |
$0.25 |
$0.02 |
|
Basic weighted average number of common shares
outstanding |
1,274,528 |
1,367,154 |
|
Diluted earnings per common and equivalent share |
$0.25 |
$0.01 |
|
Diluted weighted average number of common and equivalent
shares outstanding |
1,274,528 |
1,474,628 |
|
Summary Balance Sheet as
of |
|||||
|
|
June 30, 2005 (Unaudited) |
June 30, 2004 (Unaudited) |
|
June 30, 2005 (Unaudited) |
June 30, 2004 (Unaudited) |
|
Assets |
|
|
Liabilities
and Equity |
|
|
|
Cash |
$1,166,062 |
$1,018,295 |
Accounts payable |
$1,190,080 |
$743,201 |
|
Accounts receivable |
2,665,847 |
1,651,958 |
Customer deposits |
380,800 |
465,912 |
|
Inventory |
1,788,382 |
1,851,963 |
Dividend payable |
255,826 |
- |
|
Property & equipment |
811,275 |
673,011 |
Other current liabilities |
965,300 |
610,822 |
|
Other assets |
256,078 |
467,955 |
Stockholders’ equity |
3,895,638 |
3,843,247 |
|
Total |
$6,687,644 |
$5,663,182 |
Total |
$6,687,644 |
$5,663,182 |
Note: The
Company’s quarterly 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.