Ironclad Performance Wear Corporation (OTCMKTS:ICPW) Files An 8-K Results of Operations and Financial Condition
Item 2.02
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Results of Operations and Financial Condition. |
As compared to the unaudited financial information included in
the Earnings Release furnished as an exhibit to the Form 8-K, for
the fourth quarter of 2016:
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Net Sales has been decreased by $213,036 to $8.1 million from $8.3 million, a decrease of 4% (as opposed to 1%) from the fourth quarter total of $8.4 million for 2015. |
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Gross Profit has been decreased by $129,353 to $2.9 million from $3.0 million, or 36% of Net Sales in the fourth quarter of 2016, compared to $2.8 million, or 34% of Net Sales in the fourth quarter of 2015. |
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Operating Expenses in the fourth quarter of $2.6 million represented 33% (as opposed to 32%) of Net Sales. |
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Income from Operations has been decreased by $129,353 to $0.23 million from $0.36 million, or 3% of net sales (as opposed to 4% of net sales) as compared to $0.26 million or 3% during the same period in 2015. |
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Net Income has been decreased by $129,353 to $0.19 million from $0.32 million, or $0.00 per share, as compared to $0.24 million, or $0.00 per share, in the same period in 2015. |
As compared to the unaudited financial information included in
the Earnings Release furnished as an exhibit to the Form 8-K, for
the fiscal year ended December 31, 2016:
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Net Sales has been decreased by $213,036 to $25 million from $25.2 million, an increase of 6% (as opposed to 7%) from 2015 Net Sales of $23.6 million. |
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Gross Profit has been decreased by $129,353 to $8.9 million from $9 million, or 36% of Net Sales in 2016, compared to $8.3 million, or 35% of Net Sales in 2015. |
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Operating Expenses of $9.9 million represented 40% (as opposed to 39%) of Net Sales. |
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Loss from Operations has been increased by $129,353 to $0.96 million from $0.83 million. |
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Net Loss, including a non-cash reserve against the deferred tax asset of $1.8 million, has been increased by $129,353 to $2.96 million from $2.83 million, or $0.04 per share, as compared to $0.23 million, or $0.00 per share, in 2015. |
The adjustments did not affect any of the other unaudited
financial information and operating results reported in the
Earnings Release furnished as an exhibit to the Form 8-K, as
reflected in the Registrants financial statements included in the
Registrants Form 10-K, which was filed today with the Securities
and Exchange commission.
A summary of the revised operating results is as follows:
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Three Months Ended December 31, 2016 (Unaudited) |
Twelve Months Ended December 31, 2016 |
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| Net Sales | $ | 8,088,958 | $ | 24,986,878 |
| Gross Profit | 2,875,683 | 8,910,366 | ||
| Operating Expenses | 2,642,954 | 9,872,382 | ||
| Income (Loss) from Operations | 232,729 | (962,016) | ||
| Net Income (Loss) | $ | 187,480 | $ | (2,968,217) |
These revisions resulted from the Registrants acceptance, outside
of its normal protocol, of an email from a customer to initiate a
sale in lieu of a formal purchase order, which was not considered
persuasive evidence of an arrangement under Staff Accounting
Bulletin No. 104. In addition, the Registrant also recorded an
adjustment pertaining to an offsetting reversal of an original
invoice that was reissued due to revisions on a customer purchase
order. The reversal of the original invoice was not keyed timely
into the Registrants system, thereby overstating revenues. The
Registrant evaluated its controls over the revenue recognition
process and concluded that it did not maintain effective internal
control over financial reporting as of December 31, 2016.
The Registrants audit committee discussed with its independent
registered public accounting firm the matters disclosed herein.
The Registrant, with the oversight of its audit committee, is in
the process of dedicating resources and efforts to improve the
effectiveness of the Registrants revenue recognition controls to
prevent recurrence of the aforementioned process failures. The
Registrants management, with the oversight of its audit
committee, has begun to implement a remediation program for the
remainder of fiscal 2017, with more focused attention on
transaction processing and reporting to properly align the
remediation process.
The Registrants financial results for the fiscal year ended
December 31, 2016 are included in its Form 10-K, which was filed
today with the Securities and Exchange Commission.
| Item 7.01. | Regulation FD Disclosure. |
The disclosure under Item 2.02 above is incorporated herein by
reference in its entirety.
About Ironclad Performance Wear Corporation (OTCMKTS:ICPW)
Ironclad Performance Wear Corporation (Ironclad) designs and manufactures branded performance work wear for a range of construction, do-it-yourself, industrial, sporting goods and general services markets. The Company designs task-specific technical gloves and performance apparel for performing specific job functions. The Company’s primary products are its task-specific technical gloves. The Company produces and sells over 100 distinct glove types in a variety of sizes and colors, which cater to the specific demands and requirements of industrial, construction, do-it-yourself, and sporting goods consumers, including carpenters, machinists, package handlers, plumbers, welders, roofers, oil and gas workers, mechanics, hunters, gardeners and do-it-yourself users. It offers a line of performance apparel products, which consists of long and short sleeved shirts. The Company’s apparel line also includes performance jackets, pants, shorts, reflective and polo shirts, underwear and tights. Ironclad Performance Wear Corporation (OTCMKTS:ICPW) Recent Trading Information
Ironclad Performance Wear Corporation (OTCMKTS:ICPW) closed its last trading session down -0.002 at 0.215 with 30,674 shares trading hands.