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Vicon Industries Inc Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: December 21, 2012 02:06PM
Vicon Industries Inc (VII) filed Annual Report for the period ended 2012-09-30. Vicon Industries Inc. has a market cap of $10.5 million; its shares were traded at around $2.5965 with and P/S ratio of 0.2.
Highlight of Business Operations:The Company sells video systems and system components in a highly competitive worldwide marketplace principally to authorized security dealers and system integrators. Such dealers and integrators typically resell the Company s products directly to end users, among other services. The Company s sales are principally project based and are largely dependent upon winning projects, construction activities and the timing of funding. Sales will vary from period to period depending upon many factors including seasonal and geographic trends in construction activities and the timing of deliveries due to changes in project schedules and funding. The Company usually does not have a large backlog as its customer orders are typically deliverable within three months or often upon receipt of order.
The Company competes in a market of rapid technology shifts which influence the performance capability of security systems. As a result, the Company spends a significant amount on new product development. In fiscal 2012 and 2011, the Company incurred $5.2 million and $5.9 million of engineering and development expense or 10% and 13% of net sales, respectively. The Company s expenditures for product development are substantially less than its major competitors. The ongoing market shift to software driven products and technologies will continue to burden the Company s development resources and increase ongoing annual expense for product development. Further, the Company s sales effort requires a high level of customer service and technical support for its products. Customer support levels were maintained during fiscal 2011 despite a reduction in sales and such expenditure levels have generally continued in fiscal 2012. The Company has considered various strategic initiatives that may augment or supplement its present product offerings and technology platforms, among other benefits.
Stocks Discussed: VII,