Exhibit 99.1
FOR IMMEDIATE RELEASE
FOR FURTHER INFORMATION:
Vicon Industries: Joan Wolf
631/952-2288
Bliss, Gouverneur & Associates: John Bliss
212/840-1661
VICON INDUSTRIES REPORTS SECOND QUARTER RESULTS
HAUPPAUGE, NY, May 17, 2004 - Vicon Industries, Inc. (Amex: VII), a leading
designer and producer of video security and surveillance systems, today reported
operating results for the second fiscal quarter ended March 31, 2004. The
announcement was made by CEO Ken Darby, who said the results principally reflect
the effect of lower sales and higher operating expenses.
Net sales for the second fiscal quarter were $12.2 million, a decrease of 6%
compared with $13.1 million in the second quarter of the prior fiscal year. A
net loss of $901,000 ($.20 per share) was incurred compared with a net loss of
$2,735,000 ($.59 per share), which included a deferred tax asset valuation
charge of $2.1 million ($.45 per share), in the prior year quarter.
For the six months, net sales were $26.6 million, an increase of 6% compared
with $25.1 million in the first six months of the prior fiscal year. A net loss
of $779,000 ($.17 per share) was incurred compared with a net loss of $4.8
million ($1.04 per share), which included the combined effect of a goodwill
impairment and deferred tax asset valuation charges aggregating $3.5 million
($.75 per share), in the prior year six month period.
Commenting on the second quarter results, Mr. Darby said both foreign and
domestic sales were down in the quarter. Domestic sales totaled $7.0 million,
down from $7.7 million, while foreign sales were $5.2 million, compared with
$5.4 million in the prior year quarter. Gross profit margins increased to 37.0%
versus 35.5% as a result of sales of higher margin digital products and
favorable foreign currency exchange rates. Margin growth was tempered by the
write-off of $182,000 of first generation digital video recorders. Operating
expenses increased 4% to $5.4 million due primarily to higher legal fees
associated with the defense of a patent infringement suit and increased foreign
sales office expense as a result of an unfavorable exchange rate.
Mr. Darby also said that new orders in the second quarter were $11.8 million,
and the backlog of unfilled orders at March 31, 2004 totaled $6.1 million.
Vicon Industries, Inc. designs, manufactures, assembles and markets a wide range
of video systems and system components used for security, surveillance, safety
and communication purposes by a broad group of end users worldwide.
This news release contains forward-looking statements that involve risks and
uncertainties. Statements that are not historical facts, including statements
about the adequacy of reserves, estimated costs, Company intentions,
probabilities, beliefs, prospects and strategies and its expectations about
expansion into new markets, growth in existing markets, enhanced operating
margins or growth in its business, are forward-looking statements that involve
risks and uncertainties. Actual results and events may differ significantly from
those discussed in the forward-looking statements and the Company undertakes no
obligation to publicly update or revise any forward-looking statements.
(Table of Operations Attached)
Vicon Industries, Inc.
Condensed Statements of Operations
Three Months Ended March 31, Six Months Ended March 31,
---------------------------- --------------------------
2004 2003 2004 2003
==== ==== ==== ====
Net sales $ 12,235,000 $13,082,000 $26,573,000 $25,100,000
Gross profit 4,525,000 4,641,000 10,371,000 8,542,000
Operating loss (838,000) (523,000) (553,000) (1,593,000)
Loss before income taxes (822,000) (547,000) (545,000) (1,623,000)
Income tax expense (Note 1) 79,000 2,188,000 234,000 1,810,000
Loss before cumulative effect
of a change in accounting principle (901,000) (2,735,000) (779,000) (3,433,000)
Cumulative effect of a change in
accounting principle (Note 2) - - - (1,373,000)
------------ ------------ ------------ ------------
Net loss $ (901,000) $ (2,735,000) $ (779,000) $ (4,806,000)
============ ============ ============ ============
Basic and diluted loss per share:
---------------------------------
Loss before cumulative effect
of a change in accounting principle $ (.20) $ (.59) $ (.17) $ (.74)
Cumulative effect of a change in
accounting principle $ - $ - $ - $ (.30)
------------ ------------ ------------ ------------
Net loss per share $ (.20) $ (.59) $ (.17) $ (1.04)
============ ============ ============ ============
Shares used in computing basic
and diluted loss per share 4,605,000 4,641,000 4,606,000 4,642,000
Note 1: 2003 figures include a $2.1 million deferred tax asset valuation
allowance charge.
Note 2: Represents goodwill write-off as a result of adopting a new accounting
standard.