Mr. Gallagher concluded, “As we move into the fourth quarter, we are focused on continuing to improve those areas where we performed below expectations while continuing to execute on our strategic initiatives to expand our business within and tangent to the $6 billion decorated apparel industry."
"Our balance sheet continues to provide the perfect platform for this growth with an almost $2.00 per share equity value, of which 80% is in cash. We are looking forward to 2008, our fortieth year in business, to capitalize on our strong market and financial position, a great team, and the benefit of the infrastructure investments being made this year.”
Revenues were down 4%, due to weakness in embroidery machine revenues. Gross Margins remained constant at $4.5 million and increased as a percentage of revenues to 38% from 36%.
Operating Expenses increased $0.6 million, driven by increased investment in hiring of additional sales and technical service personnel for the two new product lines, incremental professional fees and FAS123R non cash compensation expense from the issuance of stock options.
Revenues were up $3.4 million because the summary included nine months of revenue as compared to eight months of revenue for last year. This year, MHM screen printing has contributed to over $3 million in revenues to date.
Gross Margins as a percentage of revenues have improved to 38% from 35%. Operating Expenses increased $2.2 million primarily due to the timing of expenses associated with the change in fiscal year from a 52/53 week fiscal year to a year ending December 31 as compared to the eight months ended September 30, 2006.
The Company has increased expenses during the nine months ended September 30, 2007 as a result of the hiring of additional staff and the inclusion of higher FAS123R non cash compensation expense. Also included in the nine month results is the recognition of $450,000 in income associated with the settlement agreement with Sheridan Square Entertainment. Included in the operating expenses for the eight months ended September 30, 2006 is the recognition of $128,000 in deferred gain associated with the termination of the lease on the Company's former corporate headquarters.
Hirsch International Corp
marketing@alchempro.com
