Message #14 From:
NewsBot Date: November 1, 2005 10:00:00 AM
BLHL News Blue Holdings Inc. Reports Strong Third Quarter 2005 Financial Results
COMMERCE, Calif.--(BUSINESS WIRE)--Nov. 1, 2005--Blue Holdings Inc. (OTCBB:BLHL):
-- Third quarter sales of $11.7 million, a 164% sequential increase
-- Third quarter diluted EPS of $0.07 versus $0.02 in the second quarter
Blue Holdings Inc. (OTCBB:BLHL), a designer, manufacturer and distributor of high-end fashion jeans and denim apparel, today announced financial results for the three and nine months ended September 30, 2005.
Three Months Ended September 30, 2005
Net sales for the third quarter of 2005 were $11.7 million, a 164% increase over the $4.4 million reported in the second quarter of 2005. The majority of our sales in the quarter were generated from the Antik Denim brand. The increase in sales was due to strong demand for the Antik Denim brand, both domestically and internationally. Net income for the third quarter of 2005 was $1.8 million, or $0.07 per basic and diluted share, compared to approximately $531,000 or $0.02 per basic and diluted share, in the second quarter of 2005. The per share results are based on weighted average shares outstanding of 25.5 million and 25.4 million for the third and second quarters respectively. Blue Holdings' wholly-owned subsidiary, Antik Denim, LLC, commenced operations in September 2004. As a result, there are no substantive year-over-year comparisons to report.
Blue Holdings' gross profit in the third quarter of 2005 increased to $5.7 million compared to $2.4 million in the second quarter of 2005. Third quarter gross margins declined to 48.5% from 53.0% previous quarter due to increased sales of old inventory at lower margins. Selling, distribution and administrative expenses were $2.6 million in the quarter, up from $1.2 million in the second quarter. Operating expenses as a percentage of sales declined significantly to 22.0% as compared to 27.2% in the second quarter as the Company began to take advantage of its various operating efficiencies. The operating expenses include design and sales-related expenses such as purchases of sample fabric, freight, advertising, commissions, travel and trade show costs. Blue Holdings expects that SG&A expenses will continue to increase in line with the expansion of its business.
Nine Months Ended September 30, 2005
For the nine months ended September 30, 2005, Blue Holdings' net sales were $20.6 million and reported net income was $3.5 million, or $0.14 per basic and diluted share based on 25.4 million weighted average shares outstanding. Gross profit for the nine months was $10.1 million or 49.3% of sales.
"We are very pleased with the tremendous growth we experienced in the quarter. The designers for our current brands, Antik Denim and Yanuk, continue to produce very popular and fashionable jeans which are selling well in both department stores and retail boutiques. During the quarter, we opened our Antik Denim retail boutique in Los Angeles which gives us the opportunity to showcase our full Antik line," said Paul Guez, Blue Holdings' Chairman and CEO.
Mr. Guez added, "While we anticipate that the fourth quarter of the fiscal year will be slower than the third quarter, due to typical seasonality, we are very excited about the many growth opportunities we believe exist for Blue Holdings. Our multi-brand strategy, combined with our leading-edge designs and focused distribution approach will allow us to grow Blue Holdings aggressively and profitably. We will continue to look to opportunistically add brands and selectively broaden our distribution as well as further leverage the operational aspects of our business."
Conference Call
Blue Holdings Inc. will host a conference call today, November 1, 2005 at 1:30 p.m. Pacific (4:30 p.m. Eastern). The call will be hosted by Paul Guez, the Company's President and Chief Executive Officer, and Patrick Chow, the Company's Chief Financial Officer. The call will be open to all interested investors through a live audio Web broadcast via the Internet at www.earnings.com. For those who are not available to listen to the live broadcast, the call will be archived.
About Blue Holdings Inc.
Blue Holdings Inc., directly and through its wholly-owned subsidiary, Antik Denim, LLC, designs, develops, manufactures, markets, distributes and sells high-end fashion jeans, apparel, and accessories with a western flair under the "Antik Denim," "Yanuk," "Taverniti So Jeans," and "U" brands, both in the United States and internationally. Blue Holdings currently sells men's and women's styles and is in the process of launching a children's line. Antik Denim and Yanuk jeans are made from high-quality fabrics milled in the United States, Japan, Italy and Spain, and are processed with cutting-edge treatments and finishes. Blue Holdings' concepts, designs, embellishments, patent-pending pockets and great attention to detail and quality give it a competitive advantage in the high-end fashion jeans market.
Forward-Looking Statements
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements contained in this press release include statements related to Blue Holdings' results in the fourth quarter of 2005, and its anticipated aggressive and profitable growth. Forward-looking statements are inherently unreliable and actual results may differ materially. Factors which could cause actual results to differ materially from these forward-looking statements include such factors as may be detailed from time to time in Blue Holdings' filings with the United States Securities and Exchange Commission. Blue Holdings undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Blue Holdings Inc. (formerly known as Marine Jet Technology Corp.)
Condensed & Consolidated Balance Sheet
(unaudited)
ASSETS September 30, 2005
Current Assets:
Cash $489,423
Due from Factor, net of reserves of $293,949 1,932,527
Accounts Receivable, net of reserves of $200,000 753,742
Inventories 6,474,070
Prepaid Expenses and Other Current Assets 192,687
----------------
Total Current Assets 9,842,449
Deferred Income Taxes 278,639
Property and Equipment 63,186
Less Accumulated Depreciation
----------------
Total Assets $10,184,274
================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable $1,853,224
Due to Related Parties 492,472
Income Taxes Payable 1,659,673
Accrued Expenses and Other Current Liabilities 608,492
----------------
Total Current Liabilities 4,613,861
----------------
Stockholders' Equity
Common Stock $0.001 par value
Authorized 75,000,000 shares
Issued and outstanding 25,557,200 shares 25,544
Additional Paid-in Capital 3,209,083
Retained Earnings 2,335,786
----------------
Total Stockholders' Equity 5,570,413
----------------
Total Liabilities and Stockholders' Equity $10,184,274
================
Blue Holdings Inc. (formerly known as Marine Jet Technology Corp.)
Condensed Consolidated Statement of Operations (Unaudited)
For the three and nine months ended September 30, 2005 and 2004
Three Month Period Ended Nine Month Period Ended
September 30 September 30
------------ ------------
2005 2004 2005 2004
------------ ----------- ------------ -----------
Net Sales $11,720,815 $ -- $20,575,044 $ --
Cost of Goods Sold 6,041,774 17,495 10,431,204 17,495
------------ ----------- ------------ -----------
Gross Profit 5,679,041 (17,495) 10,143,840 (17,495)
Selling,
distribution &
administrative
expenses 2,580,232 113,649 4,772,569 113,649
------------ ----------- ------------ -----------
Income before
expenses relating
to exchange
transaction and
provision for income
taxes 3,098,809 (131,144) 5,371,271 (131,144)
Expenses relating to
exchange
transaction 50,000 -- 527,617 --
------------ ----------- ------------ -----------
Income before
provision for
income taxes 3,048,809 (131,144) 4,843,654 (131,144)
Provision for income
taxes 1,239,830 -- 1,376,114 --
------------ ----------- ------------ -----------
Net Income (Loss) $1,808,979 $(131,144) $3,467,540 $(131,144)
============ =========== ============ ===========
Basic and diluted
earnings (loss) per
share $0.07 $(0.01) $0.14 $(0.01)
============ =========== ============ ===========
Basic and diluted
weighted average
shares 25,464,000 25,441,628 25,449,167 25,441,628
============ =========== ============ ===========
