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    LEAT   US5221322085

LEATT CORPORATION

(LEAT)
  Report
Delayed OTC Markets  -  03:07:32 2023-03-24 pm EDT
17.00 USD   +1.49%
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Leatt : Announces Results for Second Quarter 2022 - Form 8-K

08/11/2022 | 08:07am EDT

Leatt Corp Announces Results for Second Quarter 2022

Year-to-date revenues increase 55%;

Year-to-date net income increases 55%;

Year-to-date EPS increases to $1.20

CAPE TOWN, South Africa, (August 11, 2022) - Leatt Corporation (OTCQB: LEAT), a leading developer and marketer of protective equipment and ancillary products for many forms of sports, especially extreme high-velocity sports, today announced financial results for the second quarter ending June 30, 2022. All financial numbers are in U.S. dollars.

Second Quarter 2022 Highlights

•Global revenues of $17.9 million, up 25%, compared to second quarter 2021

•Income from operations of $3.7 million, up 18%, compared to second quarter 2021

•Net income of $2.7 million, up 13%, compared to second quarter 2021

•Earnings per basic share of $0.47 up 7%, compared to second quarter 2021

•Solid investment in sales and distribution capacity globally to fuel growth

Chief Executive Officer, Sean Macdonald commented: "The 2022 second quarter was our 17th consecutive quarter of year-over-year revenue growth with results that continue to demonstrate our ability to grow revenue, gain sales traction in important product categories and build Leatt as a global consumer brand recognized for innovation and exhilaration.

"Global revenues for the first six months of 2022 were $42.2 million, up 55%, compared to $27.2 million for the same period last year. Net income for the first six months was $6.9 million, up 55%, compared to $4.5 million for the comparative period and earnings per basic share increased to $1.20 as compared to $0.82 for the first six months of 2021.

"We continue to achieve double-digit revenue growth in all of our expanding product categories, with the exception of neck braces, our most established category, where sales decreased compared to a very strong second quarter of 2021. Apparel, helmet and off-road motorcycle boot sales have been particularly strong, energizing our entire team and our international distribution network. We continue to build out a global team of sales and brand managers who are focused on specific regional market dynamics and support for our distribution partners and dealer networks.

"Although port congestion created some restocking issues for our dealers that ulitmately resulted in a contraction in domestic sales during the second quarter and first six months of 2022, international revenues for the second quarter of 2022 were $13.9 million, up 45% over the same period last year. We have experienced an easing in these delays as we continue to drive consumer demand to stores with coordinated marketing campaigns and remain committed to investing heavily in our U.S. sales and distribution capacity to reach a wider group of MOTO and MTB dealers around the country."

Founder and Chairman Dr. Christopher Leatt remarked: "We continue to develop an exciting pipeline of innovative and consumer-centric products that are well-differentiated and rigorously tested by our team of dedicated product developers, engineers and passionate family of professional riders and athletes."

Financial Summary

Total revenues for the second quarter of 2022 increased to $17.9 million, up 25%, compared to $14.3 million for the second quarter of 2021.

The increase was driven by a 11% increase in body armor sales, a 132% increase in helmet sales, and a 51% increase in other products, parts and accessories, that were partially offset by a 17% decrease in neck brace sales

Income from operations for the second quarter of 2022 increased to $3.7 million, up 18%, compared to $3.1 million for the second quarter of 2021.

Net income for the second quarter of 2022 increased to $ 2.7 million, or $0.47 per basic and $0.44 per diluted share, up 13%, compared to $2.4 million, or $0.44 per basic and $0.39 per diluted share, for the second quarter of 2021.

Leatt continued to meet its working capital needs from cash on hand and internally generated cash flow from operations. At June 30, 2022, the Company had cash and cash equivalents of $4.95 million and a current ratio of 3.8:1.

Business Outlook

Mr. Macdonald added: "We are making strong progress and are very aware of the potential economic headwinds that the current environment may reveal, but we remain enthusiastic about our ability to gain traction. Many of our new categories that have launched extremely well are still in their infancy in terms of market share and their potential to meet the needs of all levels of riders worldwide.

"Our MTB and MOTO customers around the world have remained enthusiastic about the Leatt brand and our 'head-to-toe' offerings of exceptional protective gear over the last several quarters, and we expect that the global trend of consumer participation in outdoor riding activities will continue.

"Our team remains focused on our strong ability to invest in areas that fuel growth, control costs and operate efficiently in the midst of a widespread, global inflationary environment. We continue to monitor customer stocking, consumer buying patterns and worldwide economic and geo-political risks closely and are committed to building Leatt on a sustainable basis that creates lasting, on-going shareholder value."

Conference Call

The Company will host a conference call at 10:00 am ET on Thursday, August 11, 2022, to discuss the second quarter 2022 results.

Participants should dial in to the call ten minutes before the scheduled time, using the following numbers: 1-877-407-9716 (U.S.A) or +1-201-493-6779 (international) to access the call.

Audio Webcast

There will also be a simultaneous live webcast through the Company's website, www.leatt-corp.com. Participants should register on the website approximately ten minutes prior to the start of the webcast.

Replay

An audio replay of the conference call will be available for seven days and can be accessed by dialing 1-844-512-2921 (U.S.A) or +1-412-317-6671 (international) and using passcode 13731945.

For those unable to attend the call, a recording of the live webcast will be archived shortly following the event for 30 days on the Company's website.

About Leatt Corp

Leatt Corporation develops personal protective equipment and ancillary products for all forms of sports, especially extreme motorsports. The Leatt-Brace® is an award-winning neck brace system considered the gold standard for neck protection for anyone wearing a crash helmet as a form of protection. It was designed for participants in extreme sports or riding motorcycles, bicycles, mountain bicycles, all-terrain vehicles, snowmobiles and other vehicles. For more information, visit www.leatt.com.

Follow Leatt® on Facebook, Twitter, and Instagram.

Forward-looking Statements:

This press release may contain forward-looking statements regarding Leatt Corporation (the "Company") within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding: the likelihood that the Company's momentum of record-breaking revenue growth will continue; the ability of the Company to continue to maintain its innovative and cutting edge pipeline of branded products or to financially benefit from its sales and marketing efforts; the ability of the Company's global supply chain to withstand any adverse impact on global supply chains and to meet customer demand; the financial outlook of the Company; the general ability of the Company to achieve its commercial objectives; the business strategy, plans and objectives of the Company and its subsidiaries; and any other statements of non-historical information. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects," "anticipates," "seeks," "should," "could," "intends," or "projects" or similar expressions, and involve known and unknown risks and uncertainties. These statements are based upon the Company's current expectations and speak only as of the date hereof. Any indication of the merits of a claim does not necessarily mean the claim will prevail at trial or otherwise. Financial performance in one period does not necessarily mean continued or better performance in the future. The Company's actual results in any endeavor may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, which factors or uncertainties may be beyond our ability to foresee or control. Other risk factors include the status of the Company's common stock as a "penny stock" and those listed in other reports posted on The OTC Markets Group, Inc.

Contact:

Michael Mason

Investor Relations

Investor-info@leatt.com

[FINANCIAL TABLES TO FOLLOW]


LEATT CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS


June 30, 2022 December 31, 2021
Unaudited Audited
Current Assets
Cash and cash equivalents $ 4,949,771 $ 5,022,436
Short-term investments 58,263 58,262
Accounts receivable, net 13,823,969 12,660,936
Inventory, net 21,853,273 21,081,481
Payments in advance 1,351,666 1,610,640
Prepaid expenses and other current assets 3,449,089 4,178,427
Total current assets 45,486,031 44,612,182
Property and equipment, net 2,959,009 3,128,086
Operating lease right-of-use assets, net 1,239,776 1,393,213
Other Assets
Deposits 41,333 33,339
Total Assets $ 49,726,149 $ 49,166,820
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued expenses $ 7,967,771 $ 14,617,671
Note payable, current 88,950 83,270
Operating lease liabilities, current 301,640 318,621
Income taxes payable 3,442,038 2,738,818
Short term loan, net of finance charges 227,180 975,025
Total current liabilities 12,027,579 18,733,405
Deferred compensation 360,000 320,000
Note payable, net of current portion 147,423 189,249
Operating lease liabilities, net of current portion 938,136 1,074,592
Deferred tax liability, net 228,600 228,600
Commitments and contingencies
Stockholders' Equity
Preferred stock, $.001 par value, 1,120,000 shares
authorized, 120,000 shares issued and outstanding
3,000 3,000
Common stock, $.001 par value, 28,000,000 shares
authorized, 5,826,892 and 5,673,683 shares issued
and outstanding
130,280 130,162
Additional paid - in capital 9,809,539 9,230,847
Accumulated other comprehensive loss (904,316 ) (779,268 )
Retained earnings 26,985,908 20,036,233
Total stockholders' equity 36,024,411 28,620,974
Total Liabilities and Stockholders' Equity $ 49,726,149 $ 49,166,820

The accompanying notes are an integral part of these consolidated financial statements.



LEATT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME


Three Months Ended Six Months Ended
June 30 June 30
2022 2021 2022 2021
Unaudited Unaudited Unaudited Unaudited
Revenues $ 17,938,310 $ 14,300,559 $ 42,166,418 $ 27,197,034
Cost of Revenues 10,294,238 8,107,020 24,895,256 14,951,541
Gross Profit 7,644,072 6,193,539 17,271,162 12,245,493
Product Royalty Income 46,971 58,479 125,810 83,289
Operating Expenses
Salaries and wages 1,325,177 912,811 2,623,139 1,837,348
Commissions and consulting expenses 150,634 215,986 313,220 436,648
Professional fees 79,653 123,501 338,768 461,256
Advertising and marketing 746,114 518,153 1,360,004 1,035,733
Office lease and expenses 193,878 87,200 400,899 174,573
Research and development costs 480,843 445,156 1,014,543 850,261
Bad debt expense (recovery) (13,969) (51,732) 4,355 14,093
General and administrative expenses 710,351 609,760 1,422,103 1,138,359
Depreciation 287,943 242,401 564,867 478,936
Total operating expenses 3,960,624 3,103,236 8,041,898 6,427,207
Income from Operations 3,730,419 3,148,782 9,355,074 5,901,575
Other Income (Expenses)
Interest and other expenses, net (8,349) 3,948 (2,192) (59)
Total other income (expenses) (8,349) 3,948 (2,192) (59)
Income Before Income Taxes 3,722,070 3,152,730 9,352,882 5,901,516
Income Taxes 995,150 744,082 2,403,207 1,432,030
Net Income Available to Common Shareholders $ 2,726,920 $ 2,408,648 $ 6,949,675 $ 4,469,486
Net Income per Common Share
Basic $ 0.47 $ 0.44 $ 1.20 $ 0.82
Diluted $ 0.44 $ 0.39 $ 1.12 $ 0.72
Weighted Average Number of Common Shares Outstanding
Basic 5,815,285 5,438,686 5,790,510 5,434,553
Diluted 6,255,537 6,172,686 6,230,763 6,168,553
Comprehensive Income
Net Income $ 2,726,920 $ 2,408,648 $ 6,949,675 $ 4,469,486
Other comprehensive income, net of $0 deferred income
taxes in 2022 and 2021
Foreign currency translation (382,782 ) 60,893 (125,048 ) 32,541
Total Comprehensive Income $ 2,344,138 $ 2,469,541 $ 6,824,627 $ 4,502,027

The accompanying notes are an integral part of these consolidated financial statements.



LEATT CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021


2022 2021
Cash flows from operating activities
Net income $ 6,949,675 $ 4,469,486
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation 564,867 478,936
Stock-based compensation 323,010 55,020
Bad debts reserve (7,871 ) 11,763
Inventory reserve 94,269 39,995
(Gain) loss on sale of property and equipment (22,905 ) 5,767
(Increase) decrease in:
Accounts receivable (1,155,162 ) 2,077,870
Inventory (866,061 ) 3,478,553
Payments in advance 258,974 (397,698 )
Prepaid expenses and other current assets 729,338 (3,989,785 )
Income tax refunds receivable - 2,964
Deposits (7,994 ) (233 )
Increase (decrease) in:
Accounts payable and accrued expenses (6,649,900 ) (5,377,741 )
Income taxes payable 703,220 375,379
Deferred compensation 40,000 40,000
Net cash provided by operating activities 953,460 1,270,276
Cash flows from investing activities
Capital expenditures (435,537 ) (191,443 )
Proceeds from sale of property and equipment 42,773 -
Increase in short-term investments, net (1 ) (2 )
Net cash used in investing activities (392,765 ) (191,445 )
Cash flows from financing activities
Issuance of common stock 255,800 -
Repayment of note payable to bank (36,146 ) -
Repayment of short-term loan, net (747,845 ) (317,720 )
Net cash used in financing activities (528,191 ) (317,720 )
Effect of exchange rates on cash and cash equivalents (105,169 ) 20,427
Net increase (decrease) in cash and cash equivalents (72,665 ) 781,538
Cash and cash equivalents - beginning of period 5,022,436 2,967,042
Cash and cash equivalents - end of period $ 4,949,771 $ 3,748,580
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest $ 30,178 $ 16,379
Cash paid for income taxes $ 1,699,987 $ 1,088,360
Other noncash investing and financing activities
Common stock issued for services $ 323,010 $ 55,020

The accompanying notes are an integral part of these consolidated financial statements.

Disclaimer

Leatt Corporation published this content on 11 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 August 2022 12:06:08 UTC.


ę Publicnow 2022
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Financials (USD)
Sales 2021 72,5 M - -
Net income 2021 12,6 M - -
Net cash 2021 2,44 M - -
P/E ratio 2021 15,7x
Yield 2021 -
Capitalization 102 M 102 M -
EV / Sales 2020 0,98x
EV / Sales 2021 2,49x
Nbr of Employees 57
Free-Float 56,4%
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Managers and Directors
Sean MacDonald Chief Financial Officer
Christopher James Leatt Chairman, Head-Research & Development
Jeffrey Joseph Guzy Independent Director
Michael Mason Investor Relations Contact
Lara-Jane Pretorius Secretary
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