GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Napco Security Systems Inc. Reports Operating Results (10-Q)

May 22, 2009 | About:

Napco Security Systems Inc. (NSSC) filed Quarterly Report for the period ended 2009-03-31.

NAPCO SECURITY SYSTEMS is engaged in the development manufacture distribution and sale of security alarm products and door security devices for commercial and residential installations. Napco Security Systems Inc. has a market cap of $24.1 million; its shares were traded at around $1.26 with and P/S ratio of 0.3. Napco Security Systems Inc. had an annual average earning growth of 13.1% over the past 10 years.

Highlight of Business Operations:

Non-cash Investing activities:

Adjustment to Retained earnings relating

to adoption of FIN 48 $ - $ 485

= =

Accrued Business Acquisition costs $ 295 $ -

= =

Debt assumed in the Acquisition $ 1,000 $ -

= =



The Company's acquisition of substantially all of the assets and certain

liabilities of Marks included intangible assets with a fair value of

$16,440,000 on the date of acquisition. In accordance with the requirements

of SFAS No. 141, "Business Combinations", the Company recorded the

estimated value of $9,800,000 related to the customer relationships,

$340,000 related to a non-compete agreement and $6,300,000 related to the

Marks trade name within intangible assets. The remaining excess of the

purchase price of $922,000 was assigned to Goodwill. In accordance with the

provisions of SFAS No. 142, "Goodwill and Other Intangible Assets", the

intangible assets will be amortized over their estimated useful lives of

twenty years (customer relationships) and seven years (non-compete

agreement). The Marks USA trade name was deemed to have an indefinite life.

The goodwill recorded as a result of the acquisition is deductible for

Federal and New York State income tax purposes over a period of 15 years.



The Company has established two share incentive programs as discussed in

more detail in the Consolidated Financial Statements and related notes

contained in the Company's annual report on Form 10-K for the year ended

June 30, 2008. The Company accounts for its stock options and share units

granted in accordance with SFAS No. 123(R), "Share-Based Payment" ("SFAS

No. 123(R)") which requires that all stock-based compensation must be

recognized as an expense in the financial statements and that cost be

measured at the fair market value of the award. SFAS No. 123(R) also

requires that excess tax benefits related to stock option exercises be

reflected as financing cash inflows instead of operating cash inflows.

Stock-based compensation costs of $73,000 and $64,000 were recognized in

three months ended March 31, 2009 and 2008, respectively. Stock-based

compensation costs of $280,000 and $216,000 were recognized in nine months

ended March 31, 2009 and 2008, respectively. Unearned stock-based

compensation cost was $370,000 as of March 31, 2009.



Basic EPS

-

Net income, as reported $ 3,277 19,092 $ 0.17

Effect of dilutive securities

Employee Stock Options $ - 534 $ -

- - -

Diluted EPS

-

Net income, as reported and

assumed option exercises $ 3,277 19,626 $ 0.17

= = =



Nine months ended March 31, 2009

-

Net (Loss) Shares Per Share

(numerator) (denominator) Amounts

- - -

Basic EPS

-

Net loss, as reported $ (4,360) 19,096 $ (0.23)

Effect of dilutive securities

Employee Stock Options $ - - $ -

- - -

Diluted EPS

-

Net loss, as reported and

assumed option exercises $ (4,360) 19,096 $ (0.23)

= = =



Basic EPS

-

Net income, as reported $ 4,824 19,320 $ 0.25

Effect of dilutive securities

Employee Stock Options $ - 554 $ (0.01)

- - -

Diluted EPS

-

Net income, as reported and

assumed option exercises $ 4,824 19,874 $ 0.24

= = =



Read the The complete Report

Rating: 2.7/5 (3 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide