<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 November 30, 1998
OR
_____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES 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)
781-326-4700
(Registrant's telephone number, including area code)
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 CORPORATE ISSUERS:
There were 17,685,381 shares issued and outstanding of $.01 par value, common
stock, as of January 14, 1999.
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets:
November 30, 1998 and February 28, 1998....................................... 1
Consolidated Statements of Operations:
Three Months Ended November 30, 1998 and 1997............................... 2
Nine Months Ended November 30, 1998 and 1997................................ 3
Consolidated Statements of Cash Flows:
Nine Months Ended November 30, 1998 and 1997................................ 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........................................................... 11
Item 6. Exhibits and Reports on Form 8-K
Signatures.................................................................... 12
Exhibit 11.................................................................... 13
Exhibit 27.................................................................... 14
</TABLE>
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
NOVEMBER FEBRUARY 28
1998 1998
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and equivalents........................... $ 5,904,900 $ 5,498,348
Short-term investments......................... 1,400,000 1,400,000
Accounts receivable - net...................... 9,042,373 8,073,981
Inventories.................................... 5,565,348 4,883,038
Vendor deposit................................. - 1,432,000
Prepaid expenses and other..................... 258,353 132,154
Prepaid income taxes........................... 618,766 -
Deferred income taxes.......................... 1,308,283 1,195,881
------------ ------------
Total current assets....................... 24,098,023 22,615,402
MARKETABLE SECURITIES.......................... 1,315,567 -
PROPERTY AND EQUIPMENT - Net................... 10,759,770 9,763,720
OTHER ASSETS - Net............................. 261,663 281,786
------------ ------------
TOTAL.......................................... $ 36,435,023 $ 32,660,908
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of capital lease
obligations.................................. $ 1,678,309 $ 746,304
Accounts payable............................... 2,432,601 2,578,348
Accrued and other liabilities.................. 1,646,020 1,016,345
Deposits....................................... 52,866 379,421
Current portion of deferred revenue............ 1,392,606 1,213,693
Accrued compensation........................... 1,063,419 1,057,895
Accrued taxes.................................. - 136,993
------------ ------------
Total current liabilities.................. 8,265,821 7,128,999
DEFERRED REVENUE............................... 3,052,514 2,676,351
DEFERRED INCOME TAXES.......................... 703,848 560,148
CAPITAL LEASE OBLIGATIONS...................... 1,348,290 792,926
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock - $.01 par value; authorized,
35,000,000 shares; issued, 22,388,481 and
22,250,381 at November 30, 1998 and
February 28, 1998, respectively.............. 223,885 222,504
Additional paid-in-capital..................... 59,975,114 59,493,808
Accumulated other comprehensive income......... 428,287 -
Retained earnings.............................. 14,115,515 5,550,998
Treasury stock, at cost, 4,684,100
and 3,971,500 shares of common stock at
November 30, 1998 and February 28, 1998,
respectively.................................. (51,678,251) (43,764,826)
------------ ------------
Total stockholders' equity............... 23,064,550 21,502,484
------------ ------------
TOTAL.......................................... $ 36,435,023 $ 32,660,908
============ ============
</TABLE>
See notes to consolidated financial statements.
(1)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED
(Unaudited)
NOVEMBER 30, NOVEMBER 30,
1998 1997
<S> <C> <C>
Revenues................................... $20,863,621 $19,310,762
Cost of goods sold......................... 9,550,509 8,006,590
----------- -----------
Gross margin............................... 11,313,112 11,304,172
----------- -----------
Costs and expenses:
Systems costs and research and
development............................. 304,395 271,976
Marketing.................................. 4,773,160 4,156,897
General and administrative................. 2,119,422 1,810,078
Depreciation and amortization.............. 452,972 443,752
----------- -----------
Total................................... 7,649,949 6,682,703
----------- -----------
Operating income .......................... 3,663,163 4,621,469
----------- -----------
Other income (expense):
Interest income............................ 117,815 189,729
Interest expense........................... (87,165) (51,244)
Gain on sale of fixed assets............... 45,183 15,136
----------- -----------
Total................................... 75,833 153,621
----------- -----------
Income before provision
for income taxes 3,738,996 4,775,090
Provision for income taxes................. 1,460,000 1,864,000
----------- -----------
Net income ................................ $ 2,278,996 $ 2,911,090
=========== ===========
Earnings per share:
Basic $ 0.13 $ 0.15
=========== ===========
Diluted $ 0.12 $ 0.14
=========== ===========
Weighted average shares:
Basic 17,767,033 19,016,550
=========== ===========
Diluted 18,896,581 20,793,560
=========== ===========
</TABLE>
See notes to consolidated financial statements.
(2)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
NINE MONTHS ENDED
(Unaudited)
NOVEMBER 30, NOVEMBER,
1998 1997
<S> <C> <C>
Revenues................................... $62,938,199 $56,613,762
Cost of goods sold......................... 27,914,397 24,851,298
------------- --------------
Gross margin............................... 35,023,802 31,762,464
------------- --------------
Costs and expenses:
Systems costs and research and
development............................. 920,893 869,972
Marketing.................................. 13,825,707 12,334,756
General and administrative................. 6,343,540 5,271,824
Depreciation and amortization.............. 1,264,633 1,247,845
------------- --------------
Total................................... 22,354,773 19,724,397
------------- --------------
Operating income........................... 12,669,029 12,038,067
------------- --------------
Other income (expense):
Interest income............................ 325,014 618,953
Interest expense........................... (201,837) (140,324)
Gain on sale of fixed assets............... 152,714 82,522
Gain on sale of marketable securities...... 1,099,597 -
------------- --------------
Total................................... 1,375,488 561,151
------------- --------------
Income before provision
for income taxes.......................... 14,044,517 12,599,218
Provision for income taxes................. 5,480,000 4,910,000
------------- --------------
Net income................................. $ 8,564,517 $ 7,689,218
============= ==============
Earnings per share:
Basic $ 0.48 $ 0.40
============= ==============
Diluted $ 0.44 $ 0.37
============= ==============
Weighted average shares:
Basic 17,997,374 19,030,240
============= ==============
Diluted 19,358,699 20,672,721
============= ==============
</TABLE>
See notes to consolidated financial statements.
(3)
<PAGE>
LOJACK CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS ENDED
NOV 30, NOV 30,
1998 1997
-------------- ---------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income...................................... $ 8,564,517 $ 7,689,218
-------------- ---------------
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and
amortization................................ 2,363,295 1,941,590
Provision for doubtful accounts.............. 109,103 134,152
Deferred taxes............................... (242,527) (176,671)
Gain on sale of marketable security.......... (1,099,597) -
Increase (decrease) in
cash from changes in
assets and liabilities:
Accounts receivable -net..................... (1,077,495) (1,238,391)
Inventories.................................. (682,310) (1,337,456)
Vendor deposit............................... 1,432,000 -
Prepaid expenses and other................... (126,196) (1,379,808)
Prepaid income taxes......................... (618,766) -
Other assets................................. (11,481) (73,120)
Accounts payable............................. (145,747) 509,853
Accrued and other
liabilities................................. 726,727 1,596,169
-------------- ---------------
Total adjustments............................... 627,006 (23,682)
-------------- ---------------
Net cash provided by operating
activities.................................... 9,191,523 7,665,536
-------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property
and equipment -net............................ (727,614) (1,684,911)
Purchase of marketable securities............... (1,259,170) -
Proceeds from sale of marketable securities..... 1,745,310 -
-------------- ---------------
Net cash used for investing activities.......... (241,474) (1,684,911)
-------------- ---------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Issuance of common stock........................ 482,687 860,640
Repayment of debt............................... (1,112,759) (907,611)
Repurchase of common stock...................... (7,913,425) (8,844,058)
-------------- ---------------
Net cash used for
financing activities.......................... (8,543,497) (8,891,029)
-------------- ---------------
INCREASE (DECREASE) IN CASH
AND EQUIVALENTS............................... 406,552 (2,910,404)
BEGINNING CASH AND EQUIVALENTS.................. 5,498,348 14,671,700
-------------- ---------------
ENDING CASH AND EQUIVALENTS..................... $ 5,904,900 $ 11,761,296
============== ===============
</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
1998 amounts have been reclassified to conform to the fiscal 1999
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 nine months ended November 30,
1998 and 1997 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 nine months ended November 30, 1998 and 1997
was $202,000 and $140,000, respectively. Cash paid for income taxes for the
nine months ended November 30, 1998 and 1997 was $5,460,000 and $3,524,000,
respectively. For the nine months ended November 30, 1998 and 1997 the
Company incurred capital lease obligations of $2,600,000 and $1,009,000,
respectively.
4. Earnings per share:
In fiscal 1998 the Company adopted the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 128, "Earnings per Share." All prior
periods have been restated to conform to the provisions of SFAS No. 128.
Basic earnings per share is computed using the weighted average number of
common shares outstanding during the period. Diluted earnings per share
reflects the effect of the Company's outstanding options (using the
treasury stock method), except where such options would be antidilutive.
5. Marketable Securities:
In March 1998 the Company exercised an option to purchase 292,507 common
shares of its United Kingdom licensee, Tracker Network, UK Ltd. for an
aggregate exercise price of $1,259,000. In April 1998 the Company sold
150,000 of these shares and recognized a pre-tax gain of approximately
$1,100,000. The remaining 142,507 shares of the investment are classified
as an available-for-sale security in accordance with SFAS No. 115 in the
Company's Consolidated Balance Sheet with a fair value of approximately
$1,316,000 as of November 30, 1998. The unrealized gain of $428,000 (net of
taxes of $274,000) is reported in accumulated other comprehensive income
under stockholders' equity at November 30, 1998.
6. Comprehensive Income:
Effective March 1, 1998, the Company adopted the provisions of SFAS No.
130, "Reporting Comprehensive Income." Currently, in addition to net
income, the only item which would be included in comprehensive income is
unrealized gains or losses on available-for-sale securities. Unrealized
gains or losses on available-for-sale securities (net of taxes) for the
three and nine months ended November 30, 1998 were an unrealized loss of
$61,000 and an unrealized gain of $428,000, respectively. Comprehensive
income for the three months ended November 30, 1998 and 1997 totaled
$2,218,000 and $2,911,000, respectively. Comprehensive income for the nine
months ended November 30, 1998 and 1997 totaled approximately $8,993,000
and $7,689,000, respectively.
(5)
<PAGE>
Management Discussion and Analysis of Results of Operations and Financial
Condition
Three and nine months ended November 30, 1998 ("fiscal 1999")
versus three and nine months ended November 30, 1997 ("fiscal 1998")
Results of Operations
Revenues for the three and nine months ended November 30, 1998 increased by
$1,553,000 and $6,324,000, or 8% and 11%, respectively to $20,864,000 and
$62,938,000, from $19,311,000 and $56,614,000, respectively, for the same
periods a year earlier.
Revenues from domestic markets increased by $2,920,000 and $9,073,000, or 19%
and 20%, for the three and nine months ended November 30, 1998, respectively, to
$18,383,000 and $55,312,000, from $15,463,000 and $46,239,000, respectively, for
the same periods a year earlier. The increase in domestic revenues resulted
primarily from an increase in the number of LoJack Units sold of 22% and 24% for
the three and nine months ended November 30, 1998, respectively, as compared to
the same periods a year earlier, offset partially by decreases in the
penetration of sales of low margin optional alarm products.
International revenues decreased by $1,367,000 and $2,749,000, or 36% and 26%
for the three and nine months ended November 30, 1998 to $2,481,000 and
$7,626,000, from $3,848,000 and $10,375,000, respectively, for the same periods
last year. The decreases in international revenues for the three months ended
November 30, 1998 resulted from a decrease in revenues from non-recurring
license fees and system components revenues of $1,749,000 offset by an increase
in revenues from sales of and royalties on the international version of the
LoJack Unit and related products of $381,000. For the nine months ended
November 30, 1998 the decrease in revenues of $2,749,000 was the result of a
decrease in non-recurring license fees and system components revenues of
$1,764,000, and a decrease in sales of and royalties on the international
version of the LoJack Unit and related products of $985,000. The decrease in
sales of the international version of the LoJack Unit for the nine months ended
November 30, 1998 is related to the effect on certain licensees of the economic
crises in certain areas of the world and a decrease in sales to the licensee in
Argentina as the result of financial difficulties, offset partially by increased
sales to other existing licensees in both South America and Africa.
Cost of goods sold for the three months ended November 30, 1998 increased to 46%
from 41% a year earlier. Cost of goods sold for the nine months ended
November 30, 1998 remained consistent at 44% from a year earlier. Domestically,
cost of goods sold for the three months ended November 30, 1998 and 1997 was 45%
and 44%, respectively, of related revenues. For the nine months ended November
30, 1998 cost of goods sold remained the same at 44% for the same period a year
earlier. Cost of goods sold for the three months ended November 30, 1998
increased primarily as the result of start-up costs in Arizona and Houston
markets. International cost of goods sold increased to 55% and 49% for the three
and nine months ended November 30, 1998 from 32% and 42%, respectively, from a
year earlier primarily as the result of the decrease in non-recurring revenues
from license fees and system components sales during the period, which have a
higher margin than sales of LoJack Units and related products.
(6)
<PAGE>
Systems costs and research and development increased by $32,000 and $51,000 for
the three and nine months ended November 30, 1998, respectively to $304,000 and
$921,000 from $272,000 and $870,000 for the same periods a year earlier. Systems
costs increased by $7,000 and $92,000 for the three and nine months ended
November 30, 1998, respectively, as compared with the same periods a year
earlier primarily as the result of the start-up of new markets and maintenance
costs in certain existing markets. Research and development expense increased by
$25,000 for the three months ended November 30, 1998 and decreased by $41,000
for the nine months ended November 30, 1998 as compared with the same periods a
year earlier primarily as the result of timing of certain work related to the
redesign of the LoJack Unit as well as costs related to new product development.
Marketing expense increased by $616,000 and $1,491,000 for the three and nine
months ended November 30, 1998 and 1997, respectively to $4,773,000 and
$13,826,000 from $4,157,000 and $12,335,000 for the same periods a year earlier.
These increases were primarily related to increases in marketing salaries and
benefits, advertising, and promotional spending related to expansion to new
markets and increased domestic sales, as well as marketing expenses related to
sales efforts in the fleet and commercial market.
General and administrative expense increased by $309,000 and $1,072,000 for the
three and nine months ended November 30, 1998 and 1997, respectively to
$2,119,000 and $6,344,000, from $1,810,000 and $5,272,000 for the same periods a
year earlier. These increases were the result of increases in administrative
salaries and benefits, and other general and overhead expenses related to the
increase in the domestic business and market expansion, as well as certain
professional fees related to ongoing business and international markets.
Depreciation and amortization increased by $ 9,000 and $17,000 for the three and
nine months ended November 30, 1998, respectively, to $453,000 and $1,265,000,
from $444,000 and $1,248,000 for the same periods a year earlier, primarily as
the result of depreciation expense on LoJack System components in new markets.
Interest income decreased by $72,000 and $294,000 for the three and nine months
ended November 30, 1998, respectively, to $118,000 and $325,000, from $190,000
and $619,000 for the same periods a year earlier. These decreases were the
result of a decrease in the average cash balances available for investment
during the periods.
Interest expense increased by $36,000 and $62,000 for the three and nine months
ended November 30, 1998, respectively, to $87,000 and $202,000, from $51,000 and
$140,000 for the same periods a year earlier as the result of interest expense
on capital leases of installation vehicles.
Gain on sale of fixed assets increased by $30,000 and $70,000 for the three and
nine months ended November 30, 1998, respectively, to $45,000 and $153,000, from
$15,000 and $83,000 for the same periods a year earlier, due to an increase in
the number of fully depreciated installation vehicles sold during the periods in
the normal course of business.
(7)
<PAGE>
Gain on sale of marketable securities for the nine months ended
November 30, 1998 of $1,100,000 was the result of the sale of a portion of the
company's stock in its United Kingdom licensee which had been acquired pursuant
to an option agreement in the related license agreement.
The provision for income taxes decreased by $404,000 for the three months ended
November 30, 1998, to $1,460,000 from $1,864,000 for the same period a year
earlier as the result of the decrease in the Company's taxable income during the
period. Provision for income taxes increased $570,000 for the nine months ended
November 30, 1998, to $5,480,000 from $4,910,000 for the same period a year
earlier. The Company's effective tax rate remained at 39% during both periods.
As a result of the foregoing, net income decreased by $632,000 for the three
months ended November 30, 1998, to $2,279,000, from $2,911,000 for the same
period a year earlier. Net income for the nine months ended November 30, 1998
increased by $876,000, to $8,565,000 from $7,689,000 for the same period a year
earlier.
Liquidity and Capital Resources
In the nine months ended November 30, 1998 cash and equivalents increased by
$407,000. Cash flow from operations was $9,191,000, cash flow used for investing
activities was $241,000 and cash flow used for financing purposes was
$8,543,000. Cash flow from operations included net income of $8,565,000, non-
cash additions to net income of $2,472,000, less $1,100,000 related to the sale
of a marketable security, $243,000 of deferred taxes and decreases from changes
in assets and liabilities of $502,000. The decrease in cash flow from changes in
assets and liabilities includes an increase in accounts receivable of $1,077,000
and inventories of $682,000 both of which were primarily related to the increase
in domestic revenues and timing of certain international shipments, an increase
in prepaid expenses of $126,000 as a result of insurance policy renewals, an
increase in prepaid income taxes of $619,000 and an increase in other assets of
$11,000. The decrease in accounts payable of $146,000 is primarily related to
the timing of payment on certain media expenses, and an inventory supplier.
These decreases in cash flow were offset partially by a return of a vendor
deposit of $1,432,000 and increases in accrued and other liabilities of
$727,000.
Cash flows used for investing activities included expenditures for property and
equipment (exclusive of additions under capital leases of $2,600,000) for the
nine months ended November 30, 1998 of $728,000. Additionally, the Company
purchased 292,507 common shares of its United Kingdom licensee for $1,259,000
under terms of an option agreement in the related license agreement. A
subsequent sale of 150,000 of these shares netted proceeds to the Company of
$1,745,000.
Cash flows used for financing activities included the repurchase of 712,600
shares of the Company's common stock during the nine months ended
November 30, 1998 for $7,913,000. Total cumulative common shares repurchased
under the Company's stock repurchase program were 4,684,100 as of November 30,
1998. 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 November 30, 1998 there are 515,900 additional common shares
authorized for repurchase under the Company's existing repurchase program. In
addition, the Company repaid capital lease obligations of $1,100,000 for nine
months ended November 30, 1998.
(8)
<PAGE>
As of November 30, 1998 the Company had working capital of $15,832,000 compared
to $15,486,000 at February 28, 1998. The Company believes that it can meet its
anticipated capital and operating requirements for the remainder of fiscal 1999
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 November 30, 1998.
The Company presently is pursuing expansion efforts in several additional
domestic jurisdictions. The Company expects that, pending receipt of necessary
governmental approvals, certain potential expansion markets may become
operational during fiscal 2000. The Company plans to fund these future
expansions as well as other 1999 capital expenditures using existing working
capital, cash flow from operations, and/or the line of credit. The Company
expects that it will spend approximately $500,000 (excluding assets purchased
under capital lease agreements) during the remainder of fiscal 1999.
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 formal 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.
New Accounting Pronouncements
Effective January 1, 1998, the Company adopted the provisions of SFAS No. 130,
"Reporting Comprehensive Income" and SFAS No. 131, "Disclosures about Segments
of an Enterprise and Related Information." The adoption of SFAS No. 130 had no
effect on the financial position or results of operations of the Company, but
resulted in the disclosure of comprehensive income of approximately $2,218,000
and $8,993,000 for the three and nine months ended November 30, 1998,
respectively, which was derived from net income and unrealized gains on
available-for-sale marketable securities. With the adoption of SFAS No. 131 and
as permitted by the pronouncement, the Company will provide information about
its operating segments, as determined, in the annual financial statements, and
will begin providing such information on an interim basis for the first quarter
of fiscal 2000.
Year 2000
The Company has conducted a review of its computer systems to identify those
areas that could be affected by the "Year 2000" issue and is developing an
implementation plan to resolve the issue. The Company is currently implementing
new accounting and custom software as well as new computer network systems which
have been designed by the vendors to properly process transactions which could
be impacted by the "Year 2000" problem. The Company believes that with certain
modifications to LoJack System components, the "Year 2000" problem will not pose
significant operational problems and costs to complete this process are not
anticipated to be material to its financial position or results of operations in
any given year.
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 risks 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
(9)
<PAGE>
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 known
and unknown risks and uncertainties which could cause actual results expressed
or implied in such forward looking statements to differ from those projected.
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, prospects
for international expansion and the timing of commencement of operations of new
licensees, and general and economic conditions in domestic and foreign markets.
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.
(10)
<PAGE>
PART II - OTHER INFORMATION
Item 1. Not Applicable
Item 2. Not Applicable
Item 3. Not Applicable
Item 4. Not Applicable
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.
(11)
<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.
LoJack Corporation
------------------
Registrant
January 14, 1999 /s/ C. Michael Daley
- ---------------- --------------------
Date C. Michael Daley
Chief Executive Officer
January 14, 1999 /s/ Joseph F. Abely
- ---------------- -------------------
Date Joseph F. Abely
President and Chief
Operating Officer
(Principal Financial Officer)
(12)
<PAGE>
EXHIBIT 11
STATEMENT REGARDING COMPUTATION OF
PER SHARE EARNINGS
<TABLE>
<CAPTION>
THREE MONTHS ENDED
NOVEMBER 30, NOVEMBER 30,
1998 1997
------------ ------------
<S> <C> <C>
Basic Earnings Per Share:
Weighted average number of common
shares outstanding 17,767,033 19,016,550
=========== ===========
Net Income $ 2,278,996 $ 2,911,090
=========== ===========
Basic earning per share: $ 0.13 $ 0.15
=========== ===========
Diluted Earnings Per Share:
Weighted average number of common
shares outstanding 17,767,033 19,016,550
Common equivalent shares from
stock options 1,129,548 1,777,010
----------- -----------
Total 18,896,581 20,793,560
=========== ===========
Net Income $ 2,278,996 $ 2,911,090
=========== ===========
Diluted earnings per share $ 0.12 $ 0.14
=========== ===========
<CAPTION>
NINE MONTHS ENDED
NOVEMBER 30, NOVEMBER 30,
1998 1997
------------ ------------
<S> <C> <C>
Basic Earnings Per Share:
Weighted average number of common
shares outstanding 17,997,374 19,030,240
=========== ===========
Net Income $ 8,564,517 $ 7,689,218
=========== ===========
Basic earning per share: $ 0.48 $ 0.40
=========== ===========
Diluted Earnings Per Share:
Weighted average number of common
shares outstanding 17,997,374 19,030,240
Common equivalent shares from
stock options 1,361,325 1,642,481
----------- -----------
Total 19,358,699 20,672,721
=========== ===========
Net Income $ 8,564,517 $ 7,689,218
=========== ===========
Diluted earnings per share $ 0.44 $ 0.37
=========== ===========
</TABLE>
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<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR QUARTER ENDING NOVEMBER 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 9-MOS
<FISCAL-YEAR-END> FEB-28-1999 FEB-28-1999
<PERIOD-START> SEP-01-1998 MAR-01-1998
<PERIOD-END> NOV-30-1998 NOV-30-1998
<CASH> 5,904,900 0
<SECURITIES> 1,400,000 0
<RECEIVABLES> 9,790,469 0
<ALLOWANCES> 748,096 0
<INVENTORY> 5,565,348 0
<CURRENT-ASSETS> 24,098,023 0
<PP&E> 29,176,784 0
<DEPRECIATION> 18,417,014 0
<TOTAL-ASSETS> 36,435,023 0
<CURRENT-LIABILITIES> 8,265,821 0
<BONDS> 0 0
0 0
0 0
<COMMON> 223,885 0
<OTHER-SE> 22,840,665 0
<TOTAL-LIABILITY-AND-EQUITY> 36,435,023 0
<SALES> 20,662,716 61,901,007
<TOTAL-REVENUES> 20,863,621 62,938,199
<CGS> 9,550,509 27,914,397
<TOTAL-COSTS> 9,550,509 27,914,397
<OTHER-EXPENSES> 7,649,949 22,354,773
<LOSS-PROVISION> 6,333 109,103
<INTEREST-EXPENSE> 87,165 201,837
<INCOME-PRETAX> 3,738,996 14,044,517
<INCOME-TAX> 1,460,000 5,480,000
<INCOME-CONTINUING> 2,278,996 8,564,517
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 2,278,996 8,564,517
<EPS-PRIMARY> .13 .48
<EPS-DILUTED> .12 .44
</TABLE>
