Forward Industries Inc. (FORD, Financial) filed Quarterly Report for the period ended 2009-03-31.
FORWARD INDUSTRIES INC. is engaged in the business of designing manufacturing and selling of custom soft-sided carrying cases and advertising specialties. Forward Industries Inc. has a market cap of $13.8 million; its shares were traded at around $1.75 with and P/S ratio of 0.7.
Net sales decreased $0.1 million, or 1%, to $9.6 million in the 2009 Period from $9.7 million in the 2008 Period, due to lower cell phone sales, which are now included in other products sales, which decreased $0.2 million, or 9%. The decline in sales of other products was offset, in part, by higher sales of diabetic products, which increased slightly more than $0.1 million, or 2% in the 2009 Period. The tables below set forth sales by product line and geographic location of our customers for the periods indicated.
Sales of cases and related accessories for blood glucose monitoring kits increased $0.1 million, or 2 %, to $7.2 million in the 2009 Period, from $7.1 million in the 2008 Period. These results were driven by higher sales to two of our largest customers, which increased by $1.2 million and $0.3 million, respectively, in the 2009 Period compared to the 2008 Period. These increases were primarily attributable to several new in-box programs in the first fiscal quarter of 2009 as well as higher volumes of existing in box programs. The higher sales to these two customers were offset, in part, by lower sales to Lifescan, our largest customer, which declined $1.4 million, or 31%, in the 2009 Period from the 2008 Period.
Gross profit decreased $0.1 million, or 7%, to $1.6 million in the 2009 Period from $1.7 million in the 2008 Period primarily due to higher costs incurred in connection with the relocation of our Hong Kong facility and staffing changes there that increased Hong Kong personnel expense. Higher compliance, warehouse, rent, and travel costs in the 2009 Period also contributed to the higher level of Hong Kong costs. In addition, material costs were $0.1 million higher on a lower sales base in the 2009 Period compared to the 2008 Period, which as a percentage of sales, negatively impacted gross profit as well as gross profit percentage. These cost increases were offset in part, by $0.4 million decrease in expense to reserve for obsolete inventories, and to a lesser extent, a decrease in our freight costs which were slightly lower in the 2009 Period on both on a dollar basis and as a percentage of sales.
During the 2009 Period, we used $0.8 million of cash in operations compared to $48 thousand in the 2008 Period. Our net cash used in operating activities in the 2009 Period consisted of a net loss of $1.3 million, reduced by $0.6 thousand for non-cash items, and changes in working capital items of $0.1 million. Accounts payable decreased $0.6 million, which had the effect of contributing to the net cash used by operating activities. This change was offset by decreases in accounts receivable, inventories, and prepaid expenses and other current assets of $25 thousand, $0.3 million, and $0.1 million, respectively, and an increase in accrued expenses and other liabilities of $28 thousand. The decrease in accounts receivable is attributable to the lower sales levels in the 2009 Period and the timing in which these accounts receivable were originated. The decrease in inventories and accounts payable is primarily in support of sales orders received. The decrease in prepaid expenses and other current assets is primarily due to the timing of payments made for our insurance policies and in connection with the inception of our lease for our Hong Kong facility.
During the 2008 Period, we used $48,000 of cash from operations consisting of a net loss of $0.6 million, decreased by $0.3 million for non-cash items, and $0.3 million for net changes in working capital items, consisting primarily of changes in accounts receivable and prepaid expenses and other current assets of $0.6 million and $0.2 million, respectively. These changes were offset, in part, by changes in inventories and accrued expenses and other liabilities of $0.5 million and $0.1 million, respectively.
Read the The complete Report
FORWARD INDUSTRIES INC. is engaged in the business of designing manufacturing and selling of custom soft-sided carrying cases and advertising specialties. Forward Industries Inc. has a market cap of $13.8 million; its shares were traded at around $1.75 with and P/S ratio of 0.7.
Highlight of Business Operations:
Net sales decreased $0.5 million, or 10%, to $4.3 million in the 2009 Quarter from $4.7 million in the 2008 Quarter, due to primarily to lower sales of diabetic products, which declined $0.4 million, or 12%, and to a lesser extent, lower sales of other products, which declined $0.1 million, or 4%. Cell phone revenues, which are now included in sales of other products, were $0.4 million in the 2009 Quarter compared to $0.3 million in the 2008 Quarter. The tables below set forth sales by product line and geographic location of our customers for the periods indicated.Net sales decreased $0.1 million, or 1%, to $9.6 million in the 2009 Period from $9.7 million in the 2008 Period, due to lower cell phone sales, which are now included in other products sales, which decreased $0.2 million, or 9%. The decline in sales of other products was offset, in part, by higher sales of diabetic products, which increased slightly more than $0.1 million, or 2% in the 2009 Period. The tables below set forth sales by product line and geographic location of our customers for the periods indicated.
Sales of cases and related accessories for blood glucose monitoring kits increased $0.1 million, or 2 %, to $7.2 million in the 2009 Period, from $7.1 million in the 2008 Period. These results were driven by higher sales to two of our largest customers, which increased by $1.2 million and $0.3 million, respectively, in the 2009 Period compared to the 2008 Period. These increases were primarily attributable to several new in-box programs in the first fiscal quarter of 2009 as well as higher volumes of existing in box programs. The higher sales to these two customers were offset, in part, by lower sales to Lifescan, our largest customer, which declined $1.4 million, or 31%, in the 2009 Period from the 2008 Period.
Gross profit decreased $0.1 million, or 7%, to $1.6 million in the 2009 Period from $1.7 million in the 2008 Period primarily due to higher costs incurred in connection with the relocation of our Hong Kong facility and staffing changes there that increased Hong Kong personnel expense. Higher compliance, warehouse, rent, and travel costs in the 2009 Period also contributed to the higher level of Hong Kong costs. In addition, material costs were $0.1 million higher on a lower sales base in the 2009 Period compared to the 2008 Period, which as a percentage of sales, negatively impacted gross profit as well as gross profit percentage. These cost increases were offset in part, by $0.4 million decrease in expense to reserve for obsolete inventories, and to a lesser extent, a decrease in our freight costs which were slightly lower in the 2009 Period on both on a dollar basis and as a percentage of sales.
During the 2009 Period, we used $0.8 million of cash in operations compared to $48 thousand in the 2008 Period. Our net cash used in operating activities in the 2009 Period consisted of a net loss of $1.3 million, reduced by $0.6 thousand for non-cash items, and changes in working capital items of $0.1 million. Accounts payable decreased $0.6 million, which had the effect of contributing to the net cash used by operating activities. This change was offset by decreases in accounts receivable, inventories, and prepaid expenses and other current assets of $25 thousand, $0.3 million, and $0.1 million, respectively, and an increase in accrued expenses and other liabilities of $28 thousand. The decrease in accounts receivable is attributable to the lower sales levels in the 2009 Period and the timing in which these accounts receivable were originated. The decrease in inventories and accounts payable is primarily in support of sales orders received. The decrease in prepaid expenses and other current assets is primarily due to the timing of payments made for our insurance policies and in connection with the inception of our lease for our Hong Kong facility.
During the 2008 Period, we used $48,000 of cash from operations consisting of a net loss of $0.6 million, decreased by $0.3 million for non-cash items, and $0.3 million for net changes in working capital items, consisting primarily of changes in accounts receivable and prepaid expenses and other current assets of $0.6 million and $0.2 million, respectively. These changes were offset, in part, by changes in inventories and accrued expenses and other liabilities of $0.5 million and $0.1 million, respectively.
Read the The complete Report
