Net Revenue for the First Quarter Was $24,795,315
Net Revenue Increases 68.8 Percent from First Quarter Fiscal Year 2007
EBITDA Increases 218% over First Quarter 2007
Net Income before Dividends was $460,347
ONTARIO, Calif., May 15, 2008 (PRIME NEWSWIRE) -- SOYO Inc. (OTCBB:SOYO) today announced its first quarter financial results for the period ending March 31, 2008.
The Company reported first quarter net revenues of $24,795,315 for the three months ending March 31, 2008, an increase of 68.8% compared to $14,691,110 in the first quarter fiscal year 2007. Gross margin for the first quarter 2008 was 3,106,104, as compared to 2,608,196 for the first quarter fiscal year 2007. Income from operations for the three months ending March 31, 2008 was 809,567 as compared to 414,437 for the same period in 2007. EBITDA grew to $833,000 during the quarter of 2008, from $382,000 during the first quarter of 2007. Net income for the three months ending March 31, 2008 was $460,347, as compared to $522,190 or $.01 per share for the same period in 2007.
The Company will hold a conference call today at 3pm Pacific Time (6pm Eastern) to discuss these financial results. Information for the call is as follows:
Date/Time: Thursday, May 15, 2008 3pm Pacific (6pm Eastern)
U.S./Canada Toll-Free Call-in Number: (866) 830-4434
International Toll-Free Call-in Number: (706) 679-4957
Pass code: # 47478573
It is recommended that participants call in approximately five to ten minutes prior to the beginning of the call. The call will be recorded and posted on SOYO's website at http://www.soyo.com/content/downloads/155/&download_category=Investor+Conference+Call&back.
About SOYO Inc.
SOYO Inc. is an innovative provider of consumer electronics and IT products such as LCD Monitors, LCD HD Televisions, Bluetooth Devices, Portable Storage, and Home Theater Furniture products and services. Headquartered in Ontario, California, with additional sales offices in Latin America, SOYO sells its products through an extensive network of authorized retailers, distributors, resellers, system integrators, VARs, and ecommerce web sites. Products are sold under the SOYO, Dragon, Onyx, Dymond, Honeywell, Le Vello, and Prive brand names. For more information, please visit http://www.soyo.com. For information on the Honeywell Consumer Electronics product lines, please visit www.honeywellce.com.
SOYO Group, Inc. and Subsidiary
Condensed Consolidated Balance Sheets
March 31, December 31,
2008 2007
----------- -----------
(Unaudited) (Restated)
ASSETS
Current Assets
Cash and cash equivalents 3,560,952 1,848,249
Accounts receivable, net of allowance for
doubtful accounts of $ 1,105,663 and
$783,573 at March 31, 2008 and
December 31, 2007 respectively 29,636,628 27,123,985
Inventories, net of allowance for
inventory obsolescence of $222,044 and
$88,114 as of March 31, 2008 and
December 31, 2007 and respectively 15,612,047 12,221,265
Prepaid expenses 723,893 187,749
Deferred income tax assets 582,963 544,688
Deposits 8,766,995 8,808,408
----------- -----------
Total Current Assets 58,883,478 50,734,344
----------- -----------
Investment in 247 MGI 800,000 400,000
Property and equipment 319,252 316,287
Less accumulated depreciation
and amortization (154,248) (141,613)
----------- -----------
165,004 174,674
Deferred income tax - noncurrent 677,037 658,312
Total noncurrent assets 1,642,041 1,232,986
Total Assets $60,525,519 $51,967,330
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $19,051,452 $14,336,196
Accrued liabilities 825,987 789,526
Commercial Loans due to UCB 26,359,020 27,824,490
Gateway Trade Finance 4,279,110 --
----------- -----------
Income Tax Payable 1,170,876 889,518
----------- -----------
Total current liabilities 51,686,445 43,839,730
----------- -----------
Long term payable 0 --
----------- -----------
Total liabilities 51,686,445 43,839,730
----------- -----------
EQUITY
Class B Preferred stock, $0.001 par value,
authorized - 10,000,000 shares, Issued
and outstanding - 3,181,357 shares in
2008 and 2,797,738 shares in 2006 2,263,678 2,187,165
Preferred stock backup withholding (253,356) (230,402)
Common stock, $0.001 par value.
Authorized - 75,000,000 shares, Issued
and outstanding - 52,179,656 shares
in 2008 and 52,004,656 shares in 2007 52,180 52,005
Additional paid-in capital 20,685,530 20,233,500
Accumulated deficit (13,908,958) (14,114,668)
----------- -----------
Total shareholders' Equity 8,839,074 8,127,600
----------- -----------
Total liabilities and shareholders'
equity $60,525,519 $51,967,330
=========== ===========
SOYO Group, Inc. and Subsidiary
Condensed Consolidated Statements of Operations
(Unaudited)
Three months ended
March 31,
2008 2007
Net revenues $24,795,315 $14,691,110
Cost of revenues 21,689,211 12,082,914
Gross margin 3,106,104 2,608,196
Costs and expenses:
Sales and marketing 427,635 590,856
General and
administrative 1,404,177 1,578,174
Provision for doubtful accounts 452,090 1,438
Depreciation and amortization:
Property and equipment 12,635 23,291
Total costs and expenses 2,296,537 2,193,759
Income from operations 809,567 414,437
Other income (expense):
Interest income 12,107 31,385
Interest expense (385,147) (59,715)
Other income (expense) 400,000 (87,690)
Other income (expense), net 26,960 (116,020)
Income before provision for income
taxes 836,527 298,417
Provision for income taxes 433,180 63,085
Deferred income tax benefit (57,000) (286,858)
Net income (loss) 460,347 522,190
Less: dividends on convertible preferred
stock 254,638 61,763
Net income (loss) attributable to common 205,709 460,427
shareholders
Net income (loss) per common share - .00 .01
Basic and diluted .00 .01
Weighted average number of shares of 50,111,501 49,025,511
common stock outstanding - Basic and 55,067,176 54,706,506
diluted
SOYO Group, Inc. and Subsidiary
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Three months ended
March 31,
2008 2007
OPERATING ACTIVITIES
Net Income (loss) 460,347 522,190
Adjustments to reconcile net income to
net cash used in operating activities:
Depreciation and Amortization 12,635 23,290
Unrealized gain on investment in 247MGI (400,000) --
Non cash payments for director's
compensation
Stock based compensation 212,831 176,794
Provision for doubtful accounts 322,090 1,438
Provision for inventory obsolescence 53,444 --
Changes in operating assets and
liabilities:
(Increase) decrease in:
Accounts Receivable (2,834,733) 230,273
Inventories (3,444,226) (541,848)
Prepaid expenses (536,144) 7,309
Deposits 41,413 (70,133)
Deferred income tax asset - current (38,275) (286,858)
Deferred income tax asset - non current (18,725) --
Increase (Decrease) in:
Accounts payable 4,715,256 (6,931,802)
Accrued liabilities 36,461 3,766
Income tax payable 281,358 --
------------------------
Net cash used in operating activities (1,136,268) (6,865,581)
------------------------
INVESTING ACTIVITIES
Purchase of property and equipment (2,965) (9,791)
Proceeds from sale of equipment
------------------------
Net cash used in investing activities (2,965) (9,791)
------------------------
FINANCING ACTIVITIES
Proceeds from issuance of common stock 61,250 --
Proceeds from accounts receivable
discounting -- 1,294,217
Repayments of accounts receivable
discounting -- (4,882,620)
Proceeds from business loan 4,279,110 11,000,512
Repayment of business loan (1,465,470) --
Payment of backup withholding tax on
accreted dividends on preferred stock (22,954) (18,529)
Short term loan -- (100,000)
------------------------
Net cash used in financing activities 2,851,936 7,293,580
------------------------
CASH AND CASH EQUIVALENTS
Net Increase (Decrease) 1,712,703 418,208
At beginning of Period 1,848,249 1,501,040
------------------------
At End of Period 3,560,952 1,919,248
========================
Non cash investing and financing
activities
Accretion of discount on Class B
preferred stock 76,513 61,763
Stock Option Compensation -- 176,794
Unrealized gain on available for sale
securities 400,000 --
"Safe Harbor" Statement
This release contains certain statements that may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward-looking statements. The words "plan," "confident that," "believe," "scheduled," "expect," or "intend to," and similar conditional expressions, are intended to identify forward-looking statements. Although the company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations or any of its forward-looking statements will prove to be correct. Factors that could cause results to differ include, but are not limited to, the availability of components and successful production of the company's products, successful performance of internal plans, the impact of competitive services and pricing, general economic risks and uncertainties, and various other information detailed from time to time in the company's filings with the United States Securities and Exchange Commission. The company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Please refer to the company's filings at www.sec.gov.