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 First Quarter
2008 results”
Tempe, Arizona, August 10,
2007
Dear Fellow Shareholders:
I am pleased to report that Reconditioned Systems, Inc. (“RSI”) was profitable again this quarter. Although we fell short of our budget for sales and profits, I am hopeful that once we have all of our sales people back on track and comfortable with our new systems from Maxon that we will get closer to our goals. There is still very tough price competition and margin pressure, but I am hopeful that this year will be better than last year.
For the three months ending June 30, 2007, RSI made income of $155 thousand on sales of $4.5 million. This compares to net income of $252 thousand on sales of $5 million for the quarter ending June 30, 2006. This is the first quarter after the consolidation of our two manufacturing operations into our new facility in Tempe. While we did not achieve the margins I was expecting, I am confident that Carl Grending, our new vice president for sales, will develop a unified, professional sales team with improved sales result.
The economy is still slowing, and it is unlikely to return to the growth of the past few years. With little wage gains, high debt burdens and reduced mortgage refinancing, consumer spending should continue to slow as well. Despite this, we are still budgeting for a modest increase in sales and earnings for this next fiscal year.
We have paid annual dividends for the last two years. This year the board again voted to pay an annual dividend of $0.25 on August 31, 2007, to shareholders of record on July 5, 2007. 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.
August 10, 2007
Page -2-
|
|
For The Three Months Ended |
|
|
|
June 30, 2007(Unaudited) |
June 30, 2006(Unaudited) |
|
Sales |
$4,458,564 |
$5,026,429 |
|
Net income before provision for income taxes |
$260,270 |
$415,751 |
|
Net income |
$155,645 |
$252,441 |
|
Basic earnings per share |
$0.13 |
$0.20 |
|
Basic weighted average number of common shares
outstanding |
1,166,499 |
1,246,839 |
|
Diluted earnings per common and equivalent share |
$0.13 |
$0.20 |
|
Diluted weighted average number of common and
equivalent shares outstanding |
1,192,282 |
1,248,070 |
|
Summary Balance Sheet as
of |
|||||
|
|
June 30, 2007 (Unaudited) |
June 30, 2006 (Unaudited) |
|
June 30, 2007 (Unaudited) |
June 30, 2006 (Unaudited) |
|
Assets |
|
|
Liabilities
and Equity |
|
|
|
Cash |
$1,653,227 |
$2,343,397 |
Accounts payable |
$878,133 |
$1,490,731 |
|
Accounts receivable |
1,744,958 |
1,628,306 |
Customer deposits |
108,790 |
235,903 |
|
Inventory |
1,774,294 |
1,859,454 |
Dividend payable |
291,625 |
411,783 |
|
Property & equipment |
800,828 |
737,495 |
Other liabilities |
692,767 |
373,994 |
|
Other assets |
457,844 |
321,173 |
Stockholders’ equity |
4,459,836 |
4,377,414 |
|
Total |
$6,431,151 |
$6,889,825 |
Total |
$6,431,151 |
$6,889,825 |
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.