<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
- --
SECURITIES ACT OF 1934
For the quarterly period ended August 31, 1997
----------------
___TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURTIES ACT OF 1934
For the transition period from ______________ to _______________.
Commission File Number 2-74238-B
LOJACK CORPORATION
------------------
(Exact name of registrant as specified in its charter)
Massachusetts 04-2664794
- ------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
333 Elm Street Dedham, Massachusetts 02026
- --------------------------------------------------------------
(Address of principal executive offices) (Zip code)
617-326-4700
------------
(Registrant's telephone number, including area code)
________________________________________________________________________________
(Former name, former address and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN
BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
YES NO
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
There were 19,104,501 shares issued and outstanding of $.01 par value,
common stock, as of October 14, 1997.
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Part I. Financial Information PAGE
----
Item 1. Financial Statements
<S> <C>
Consolidated Balance Sheets, August 31, 1997
and February 28, 1997............................................. 1
Consolidated Statements of Operations:
Three Months Ended August 31, 1997 and 1996...................... 2
Six Months Ended August 31, 1997 and 1996......................... 3
Consolidated Statements of Cash Flows:
Six Months Ended August 31, 1997 and 1996......................... 4
Notes to Consolidated Financial Statements.......................... 5
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition....................... 6
Part II. Other Information............................................... 9
Item 6. Exhibits and Reports on Form 8-K
Signatures.......................................................... 10
Exhibit 11.......................................................... 11
Exhibit 27.......................................................... 12
</TABLE>
<PAGE>
LO JACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
AUGUST 31, FEBRUARY 28,
1997 1997
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and equivalents ........................................................... $ 13,340,398 $ 14,671,700
Short-term investments ......................................................... 1,600,000 1,600,000
Accounts receivable - net ...................................................... 8,455,814 7,430,491
Inventories .................................................................... 4,046,519 3,745,473
Prepaid expenses and other ..................................................... 149,164 153,812
Deferred income taxes .......................................................... 1,549,782 1,525,010
------------ ------------
Total current assets ........................................................ 29,141,677 29,126,486
PROPERTY AND EQUIPMENT - Net ................................................... 9,856,955 8,722,950
OTHER ASSETS - Net ............................................................. 295,543 315,707
------------ ------------
TOTAL .......................................................................... $ 39,294,175 $ 38,165,143
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of capital lease
obligations ................................................................. $ 1,108,350 $ 693,553
Accounts payable ............................................................... 2,977,450 2,842,186
Accrued and other liabilities .................................................. 624,295 847,984
Deposits ....................................................................... 150,236 749,020
Current portion of deferred revenue ........................................... 1,057,081 985,301
Accrued compensation ........................................................... 649,056 837,953
Accrued income taxes ........................................................... 1,137,382 287,473
------------ ------------
Total current liabilities ................................................. 7,703,850 7,243,470
DEFERRED REVENUE ............................................................... 2,538,564 2,149,524
DEFERRED INCOME TAXES .......................................................... 660,748 770,143
CAPITAL LEASE OBLIGATIONS ...................................................... 580,823 781,817
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock - $ 01 par value; authorized, 35,000,000 shares; issued, 22,153,801
and 21,985,091 at August 31, 1997 and
February 28, 1997, respectively .............................................. 221,538 219,851
Additional paid-in-capital ..................................................... 58,347,980 57,539,986
Retained earnings (deficit) .................................................... 442,138 (4,335,990)
Treasury stock, at cost, 3,065,500 and 2,569,500 shares of common stock at
August 31, 1997 and February 28, 1997,
respectively .................................................................. (31,201,466) (26,203,658)
------------ ------------
Total stockholders' equity ............................................... 27,810,190 27,220,189
------------ ------------
TOTAL .......................................................................... $ 39,294,175 $ 38,165,143
============ ============
</TABLE>
See notes to consolidated financial statements.
(1)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED
(Unaudited)
AUGUST 31, AUGUST 31,
1997 1996
<S> <C> <C>
Revenues ..................... $ 18,744,847 $ 15,909,555
Cost of goods sold ........... 8,284,487 7,050,953
------------ ------------
Gross margin ................. 10,460,360 8,858,602
------------ ------------
Costs and expenses:
Systems costs and research and
development ............... 255,628 182,208
Sales and marketing .......... 4,242,534 3,298,788
General and administrative ... 1,681,380 1,581,837
Depreciation and amortization 408,166 354,592
------------ ------------
Total ........................ 6,587,708 5,417,425
------------ ------------
Operating income ............. 3,872,652 3,441,177
------------ ------------
Interest income .............. 244,785 449,154
Interest expense ............. (48,452) (31,607)
Other income ................. 47,889 9,614
------------ ------------
Total ........................ 244,222 427,161
------------ ------------
Income before provision
for income taxes ............ 4,116,874 3,868,338
Provision for income taxes ... 1,600,000 1,508,000
------------ ------------
Net income ................... $ 2,516,874 $ 2,360,338
============ ============
Earnings per share: .......... $ 0.12 $ 0.10
============ ============
Common shares and equivalents 20,766,211 23,081,958
============ ============
</TABLE>
See notes to consolidated financial statements.
(2)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
(Unaudited)
AUGUST 31, AUGUST 31,
1997 1996
<S> <C> <C>
Revenues ..................... $ 37,303,000 $ 30,914,881
Cost of goods sold ........... 16,845,281 13,983,371
------------ ------------
Gross margin ................. 20,457,719 16,931,510
------------ ------------
Costs and expenses:
Systems costs and research and
development ............... 597,942 529,382
Sales and marketing .......... 8,177,258 6,473,735
General and administrative ... 3,461,832 2,990,868
Depreciation and amortization 804,093 710,684
------------ ------------
Total ........................ 13,041,125 10,704,669
------------ ------------
Operating income ............. 7,416,594 6,226,841
------------ ------------
Interest income .............. 429,224 872,319
Interest expense ............. (89,080) (66,926)
Other income ................. 67,390 10,392
------------ ------------
Total ........................ 407,534 815,785
------------ ------------
Income before provision
for income taxes ............ 7,824,128 7,042,626
Provision for income taxes ... 3,046,000 2,746,000
------------ ------------
Net income ................... $ 4,778,128 $ 4,296,626
============ ============
Earnings per share: .......... $ 0.23 $ 0.18
============ ============
Common shares and equivalents 20,607,729 23,184,376
============ ============
</TABLE>
See notes to consolidated financial statements.
(3)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
AUGUST 31, AUGUST 31,
1997 1996
------------------ ------------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income .......................... $ 4,778,128 $ 4,296,626
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and
amortization ................. 1,266,883 1,142,701
Deferred taxes ................. (134,167) 2,216,000
Increase (decrease) in
cash from changes in
assets and liabilities:
Accounts receivable -net ....... (1,025,323) (2,044,805)
Inventories .................... (301,046) 4,068
Prepaid expenses and other ..... 4,648 (129,564)
Other assets ................... (2,930) (7,251)
Accounts payable ............... 135,264 697,588
Accrued and other
liablities ................... 299,357 (361,290)
------------ ------------
Total adjustments ................... 242,686 1,517,447
------------ ------------
Net cash provided by operating
activities ........................ 5,020,814 5,814,073
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property
and equipment -net ............. (1,570,108) (558,588)
------------ ------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Issuance of common stock ............ 809,681 402,292
Repayment of debt ................... (593,881) (537,431)
Repurchase of common stock .......... (4,997,808) (4,858,439)
------------ ------------
Net cash used for
financing activities .............. (4,782,008) (4,993,578)
------------ ------------
(DECREASE) INCREASE IN CASH
AND EQUIVALENTS ................ (1,331,302) 261,907
BEGINNING CASH AND EQUIVALENTS ...... 14,671,700 31,630,663
------------ ------------
ENDING CASH AND EQUIVALENTS ......... $ 13,340,398 $ 31,892,570
============ ============
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. The accompanying consolidated financial statements and notes do not include
all of the disclosures made in the Company's Annual Report to Stockholders,
which should be read in conjunction with these statements. Certain fiscal
1997 amounts have been reclassified to conform with the fiscal 1998
presentation. In the opinion of the Company, the statements include all
adjustments necessary for a fair presentation of the quarterly results and
any and all such adjustments were of a normal recurring nature.
2. The results of operations for the three and six months ended August 31, 1997
and 1996 are not necessarily indicative of the results to be expected for the
full year.
3. Supplemental cash flow information:
Cash paid for interest for the six months ended August 31, 1997 and 1996 was
$48,000 and and $63,000, respectively. Cash paid for income taxes for the six
months ended August 31, 1997 and 1996 was $ 2,670,000 and $581,000,
respectively. For the six months ended August 31, 1997 and 1996 the Company
incurred capital lease obligations of $808,000 and $535,000, respectively.
4. Earnings per share:
Earnings per share has been computed by dividing net earnings by the weighted
average number of common shares and equivalents outstanding. Common share
equivalents included in the computation represent shares issuable upon
assumed exercise of stock options which would have a dilutive effect. Fully
diluted and primary earnings per share were the same for the three and six
months ended August 31, 1997 and 1996.
In February 1997, the Financial Accounting Standards Board ("FASB") issued
SFAS No. 128, "Earnings per Share" which will become effective during the
fourth quarter of fiscal 1998. SFAS No. 128 replaces the presentation of
primary earnings per share with basic earnings per share, which excludes
dilution, and requires the dual presentation of basic and diluted earnings
per share. Had the Company used SFAS No. 128, the Company's basic earnings
per share on a proforma basis would have been $.13 and $.11 for the three
months ended August 31, 1997 and 1996, respectively, and $.25 and $.20 for
the six months ended August 31, 1997 and 1996, respectively. Diluted earnings
per share would have been the same as the earnings per share presented in the
accompanying consolidated financial statements.
(5)
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS AUGUST 31, 1997 ("FISCAL 1998")
VERSUS THREE AND SIX MONTHS ENDED AUGUST 31, 1996 ("FISCAL 1997")
Revenues for the three and six months ending August 31, 1997 increased by
$2,835,000 and $6,388,000, or 18% and 21%, respectively, to $18,745,000 and
$37,303,000 from $15,910,000 and $30,915,000 for the same periods a year
earlier. Revenues from domestic markets increased by $2,971,000, or 22%, and
$3,589,000, or 13%, for the three and six months ended August 31, 1997,
respectively. International revenues decreased by $135,000, or 6%, in the three
months ended August 31, 1997 and increased by $2,799,000, or 75%, for the six
months ended August 31, 1997. The increase in domestic revenues resulted from an
increase in revenues from existing markets of $1,611,000 and $1,449,000 for the
three and six months ended August 31 ,1997, respectively . Revenues from
existing markets increased as the result of increases in the overall sale of
LoJack Units. The additional increase in domestic revenues of $1,360,000 and
$2,140,000, respectively were generated from the start-up markets of Texas,
Maryland, and Pennsylvania ("New Markets") which began operations during the end
of fiscal 1997 and first quarter of fiscal 1998. The decrease in international
revenues for the three months ended August 31, 1997 of $135,000 resulted
primarily from a decrease of $1,268,000 as compared to the same period a year
earlier in one-time license fees and initial orders of system components from
new licensees, offset partially by an increase of $1,133,000, or 279%, in the
sale of the international version of the LoJack Unit to licensees in several
international markets. The increase in international revenues for the six
months ended August 31, 1997 of $ 2,799,000 resulted primarily from an increase
in revenues of $2,937,000, or 192%, from the sales of the international version
of the LoJack Unit, offset partially by decreased revenues of $138,000 related
to initial orders of system components to new licensees as compared with the
same period a year earlier.
Cost of goods sold for the three and six months ended August 31, 1997 and 1996
remained constant at 44% and 45% of revenues, respectively. Domestically, cost
of goods sold for the three and six months ended August 31, 1997 decreased to
44% of related revenues from 45% for the same periods a year earlier. The
positive effect on cost of goods sold of decreased penetrations of lower
margin, optional security products and increased efficiencies from economies of
scale was partially offset by start-up costs of the New Markets. International
cost of goods sold increased to 48% and 49% of related revenues for the three
and six months ended August 31, 1997, respectively, from 42% and 47%,
respectively, for the same periods a year earlier. International revenues for
the periods ending August 31, 1997 were more heavily weighted toward sales of
the international version of the LoJack Unit which have a lower margin than the
sale of initial system components and license fees, which constituted a
substantial portion of the revenues in the same periods a year ago.
Systems costs and research and development expense increased by $74,000 and
$69,000, respectively, for the three and six months ended August 31, 1997 to
$256,000 and $598,000, respectively, from $182,000 and $529,000, respectively,
for the same periods a year earlier. These increases were primarily the result
of increases in system operating costs related to the start-up of the New
Markets, and certain system maintenance costs in existing markets. Research and
development expense decreased by $10,000 for the three and six months ended
August 31, 1997 compared with the same periods a year earlier.
Marketing expense increased by $944,000 and $1,703,000 for the three and six
months ended August 31, 1997, respectively, to $4,243,000 and $8,177,000,
respectively, from $3,299,000 and $6,474,000 for the same respective periods a
year earlier. The increase in marketing expense was related primarily to an
increase in spending on advertising, personnel and other costs related to the
start-up of the New Markets.
(6)
<PAGE>
General and administrative expense increased by $99,000 and $471,000 for the
three and six months ended August 31, 1997 to $1,681,000 and $3,462,000 from
$1,582,000 and $2,991,000 for the same periods a year ago. This increase is
related primarily to increase in general and administrative salaries, rent, and
telephone expense related to the start-up of the New Markets.
Depreciation expense increased by $53,000 and $93,000 for the three and six
months ended August 31, 1997, respectively to $408,000 and $804,000,
respectively, from $355,000 and $711,000, respectively, for the same periods a
year earlier. This increase is reflects depreciation expense on the LoJack
System and related equipment in the New Markets, and on additions of certain
computer equipment and software in the existing markets, offset by decreases
resulting from equipment in certain older markets becoming fully depreciated.
Interest income decreased by $204,000 and $443,000 for the three and six months
ended August 31, 1997, respectively to $245,000 and $429,000, respectively, from
$449,000 and $872,000, respectively, for the same periods a year earlier
primarily as the result of the decrease in cash balances available for
investment.
Interest expense increased by $16,000 and $22,000 for the three and six months
ended August 31, 1997 to $48,000 and $89,000, respectively, from $32,000 and
$67,000 for the same periods a year earlier reflecting an increase in interest
expense on capital leases for installation vehicles primarily related to the New
Markets.
Provision for income taxes remained constant at 39% of income before provision
for income taxes for the three and six months ended August 31, 1997 resulting
in provisions of $1,600,000 and $3,046,000, respectively, compared to
$1,508,000 and $2,746,000, respectively, for the same periods a year ago.
As a result of the foregoing, net income for the three and six months ended
August 31, 1997 was $2,517,000 and $4,778,000, respectively, increases of
$157,000 and $481,000 over net income for the same periods a year earlier of
$2,360,000 and $4,297,000, respectively.
LIQUIDITY AND CAPITAL RESOURCES
In the first six months of fiscal 1998 cash and equivalents decreased by
$1,331,000. Cash flow from operations was $5,021,000, cash flow used for
investing activities was $1,570,000 and cash flow used for financing purposes
was $4,782,000. Cash flow from operations included net income of $4,778,000,
non-cash additions to net income of $1,133,000, and decreases from changes in
assets and liabilities of $890,000. The decrease in cash flow from changes in
assets and liabilities includes an increase in accrued and other liabilities of
$299,000 primarily as the result of an increase in certain accrued federal and
state income taxes of $850,000 and an increase in deferred revenue of $460,000,
partially offset by decreases in deposits of $599,000, accrued compensation of
$188,000 and other liabilities of $224,000. An increase in accounts receivable
of $1,025,000 was the result of an increase in domestic receivables of
$2,127,000 reflecting an increase in domestic revenues in the second quarter of
fiscal 1998, due in part to revenues generated from the New Markets, as
compared with the fourth quarter of fiscal 1997 offset by improved domestic
collections, as well as a decrease in international receivables of $1,102,000
resulting from the timing of certain international equipment and product
shipments and collections. An increase in inventory of $301,000 related to
certain international purchase orders which are expected to be shipped during
the third quarter of fiscal 1998, and an increase in accounts payable of
$135,000 related to the overall increase in business volume.
(7)
<PAGE>
Expenditures for property and equipment (exclusive of additions under capital
leases) for the six months ended August 31, 1997 were $1,570,000 compared with
$559,000 for the same period a year earlier. The increase was primarily due to
the purchase of LoJack system components and equipment for the New Markets as
well as expenditures related to an upgrade of the Company's computer systems.
As of August 31, 1997 the Company had working capital of $21,438,000. The
Company believes that it can meet its anticipated capital and operating
requirements for the remainder of fiscal 1998 using existing working capital,
cash flow from operations, and if necessary, the Company's $7,500,000 line of
credit, which was unused as of August 31, 1997.
The Company presently is pursuing expansion efforts in several additional
domestic jurisdictions. The Company expects that, pending receipt of necessary
governmental approvals, certain of these potential expansion markets may become
operational during fiscal 1998. The Company plans to fund these expansions as
well as other capital expenditures during fiscal 1998 using existing working
capital, cash flow from operations, or the line of credit. The Company expects
that it will spend approximately $1,000,000 on capital expenditures (excluding
assets purchased under capital lease agreements) during the remainder of fiscal
1998 including an investment to upgrade the Company's information systems.
The Company repurchased an additional 496,000 shares of its common stock during
the six months ended August 31, 1997 for $4,997,808. Total cumulative common
shares repurchased under the Company's stock repurchase program were 3,065,500
as of August 31, 1997. The Company intends to continue to repurchase shares of
its common stock in open market transactions, from time to time, depending upon
the price of the stock. As of August 31, 1997 there are 2,134,500 additional
common shares authorized for repurchase under the Company's existing repurchase
program.
The Company's expansion to additional international markets is achieved through
licensing agreements and has not in the past required capital investment on the
part of the Company. The Company currently has no plans to change this practice.
The Company is also continuing to explore possible investment opportunities,
including , but not limited to, possible acquisitions of, or investments in,
other companies.
CAUTIONARY STATEMENTS
The Private Securities Litigation Reform Act of 1995 contains certain safe
harbors regarding forward-looking statements. From time to time, information
provided by the Company or statements made by its employees may contain
"forward-looking" information which involve risk and uncertainties. Any
statements in this report that are not statements of historical fact are
forward-looking statements (including, but not limited to, statements concerning
characteristics and growth of the Company's objectives and plans for future
operations and the Company's expected liquidity and capital resources). Such
forward-looking statements are based on a number of assumptions and involve a
number of risks and uncertainties, and accordingly, actual results could differ
materially. Factors that may cause such differences include, but are not limited
to: the continued and future acceptance of the Company's products and services,
the rate of growth in the industries of the Company's customers; the presence of
competitors with greater technical, marketing and financial resources; the
Company's ability to promptly and effectively respond to technological change to
meet evolving customer needs; capacity and supply constraints or difficulties;
and the Company's ability to successfully integrate new operations. For a
further discussion of these and other significant factors to consider in
connection with forward-looking statements concerning the Company, reference is
made to Exhibit 99 of the Company's Annual Report on Form 10-K for the fiscal
year ended February 29, 1996.
(8)
<PAGE>
PART II - OTHER INFORMATION
Item 1. Not Applicable
Item 2. Not Applicable
Item 3. Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Stockholders of the company was held on July 16,
1997. Stockholders acted affirmatively to elect nominees for directors
proposed by management:
<TABLE>
<CAPTION>
VOTES "FOR" VOTES "WITHELD"
----------- ---------------
<S> <C> <C>
C. Michael Daley 16,957,857 304,839
James A. Daley 16,962,289 300,407
Harold W. Shad III 16,960,689 302,007
Lee T. Sprague 16,962,089 300,607
Robert J. Murray 16,962,089 300,607
Larry C. Renfro 16,961,489 301,207
Harvey Rosenthal 16,957,989 304,707
</TABLE>
The stockholders also approved an amendment to the Company's Restated
and Amended Stock Incentive Plan ("the Plan") to provide for an increase
of 150,000 in the number of shares of Common Stock authorized for
issuance under the Plan to employees who are not eligible to receive
Senior Management Options. The amendment was approved with 15,111,218
votes in favor, 1,917,484 votes opposed and 116,997 votes abstaining.
Item 5. Not Applicable
Item 6a. Exhibit 11. Statement Regarding Computation of Per Share
Earnings
Exhibit 27. Financial Data Schedule
b. No reports on Form 8-K were filed during the quarter for which
this report is filed.
(9)
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
October 14, 1997 /s/ C. Michael Daley
------------------ --------------------
Date C. Michael Daley
Chief Executive Officer
October 14, 1997 /s/ Joseph F. Abely
----------------- -------------------
Date Joseph. F. Abely
President and Chief
Operating Officer
(Principal Financial Officer)
(10)
<PAGE>
EXHIBIT 11
STATEMENT REGARDING COMPUTATION OF
PER SHARE EARNINGS
<TABLE>
<CAPTION>
PRIMARY CALCULATION: THREE MONTHS ENDED
AUGUST 31, AUGUST 31,
1997 1996
----------- -----------
<S> <C> <C>
Net Income $ 2,516,874 $ 2,360,338
=========== ===========
Shares:
Weighted average number of common
shares outstanding 18,978,756 21,645,424
Assumed exercise of options 1,707,838 1,436,534
Dilutive effect of exercised options 79,617
----------- -----------
Weighted average number of common
shares for primary calculation 20,766,211 23,081,958
=========== ===========
Primary earnings per share $ 0.12 $ 0.10
=========== ===========
FULLY DILUTED CALCULATION
Net Income $ 2,516,874 $ 2,360,338
=========== ===========
Shares:
Weighted average number of common
shares outstanding 18,978,756 21,645,424
Assumed exercise of options 1,923,771 1,436,534
Dilutive effect of exercised options 83,754
----------- -----------
Weighted average number of common
shares for fully diluted calculation 20,986,281 23,081,958
=========== ===========
Fully diluted earnings per share $ 0.12 $ 0.10
=========== ===========
</TABLE>
<PAGE>
EXHIBIT 11
STATEMENT REGARDING COMPUTATION OF
PER SHARE EARNINGS
<TABLE>
<CAPTION>
PRIMARY CALCULATION: SIX MONTHS ENDED
AUGUST 31, AUGUST 31,
1997 1996
----------------------------
<S> <C> <C>
Net Income $ 4,778,128 $ 4,296,626
=========== ===========
Shares:
Weighted average number of common
shares outstanding 19,032,513 21,717,724
Assumed exercise of options 1,531,949 1,466,652
Dilutive effect of exercised options 43,267
----------- -----------
Weighted average number of common
shares for primary calculation 20,607,729 23,184,376
=========== ===========
Primary earnings per share $ 0.23 $ 0.18
=========== ===========
FULLY DILUTED CALCULATION
Net Income $ 4,778,128 $ 4,296,626
=========== ===========
Shares:
Weighted average number of common
shares outstanding 19,032,513 21,717,724
Assumed exercise of options 1,923,771 1,540,751
Dilutive effect of exercised options 83,754
----------- -----------
Weighted average number of common
shares for fully diluted calculation 21,040,038 23,258,475
=========== ===========
Fully diluted earnings per share $ 0.23 $ 0.18
=========== ===========
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM LOJACK
CORPORATION FORM 10-Q AUGUST 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> FEB-28-1998 FEB-28-1998
<PERIOD-START> JUN-01-1997 MAR-01-1997
<PERIOD-END> AUG-31-1997 AUG-31-1997
<CASH> 13,340,398 0
<SECURITIES> 1,600,000 0
<RECEIVABLES> 9,054,532 0
<ALLOWANCES> 598,718 0
<INVENTORY> 4,046,519 0
<CURRENT-ASSETS> 29,141,677 0
<PP&E> 25,047,648 0
<DEPRECIATION> 15,190,693 0
<TOTAL-ASSETS> 39,294,175 0
<CURRENT-LIABILITIES> 7,703,850 0
<BONDS> 0 0
0 0
0 0
<COMMON> 221,538 0
<OTHER-SE> 27,588,652 0
<TOTAL-LIABILITY-AND-EQUITY> 39,294,175 0
<SALES> 18,440,847 36,547,887
<TOTAL-REVENUES> 18,744,847 37,303,000
<CGS> 8,284,487 16,845,281
<TOTAL-COSTS> 8,284,487 16,845,281
<OTHER-EXPENSES> 6,587,708 13,041,125
<LOSS-PROVISION> 28,884 60,268
<INTEREST-EXPENSE> 48,452 89,080
<INCOME-PRETAX> 4,116,874 7,824,128
<INCOME-TAX> 1,600,000 3,046,000
<INCOME-CONTINUING> 2,516,874 4,778,128
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 2,516,874 4,778,128
<EPS-PRIMARY> .12 .23
<EPS-DILUTED> .12 .23
</TABLE>
