Infosonics (IFON), a leading distributor of wireless handsets in South America and Central America, announced first quarter 2008 net sales of $68.3 million, compared to $58.4 million in the first quarter of 2007. The company sold a record number of handsets (923,000), and realized increasing penetration of its proprietary, higher margin, verykool® line. Net loss for the quarter was $413,000 or 3 cents per share vs. a net loss of $558,000 or 4 cents per share year over year.
Sales in South America increased 32% to $46.8 million, while sales in Central America rose 97% to $21.4 million. Changes in U.S. regulations affecting rural service area (RSA) carriers caused domestic revenues to plummet 99%, from $12.2 million in 2007 to $141,000 this year. The total number of units shipped increased 53%, but the average selling price per unit decreased 20% as the company’s OEM partners, Samsung and LG, introduced lower priced handsets.
“Our results this quarter demonstrate our commitment to executing on our strategy,” said Joseph Ram, President and Chief Executive Officer of Infosonics. “We remain focused on returning to profitability and are working with our vendors, both existing and new, OEM and proprietary, to better manage our inventory levels and reduce overall expenses related to the manufacturing process of our verykool® line. We expect to see the positive impact of these efforts in the later half of 2008.”
“Looking forward, we will further enhance our verykool® line-up with products featuring advanced GSM and 3G technologies. The introduction and shipping of these new verykool® products is anticipated to drive improved results in the coming quarters,” Mr. Ram added.
Shares of IFON closed at $1.06, and have ranged between $0.90 – $4.10 during the past year. With 14.8 million shares outstanding, IFON has a market cap of $15.7 million. The company has a solid balance sheet with no long term debt and net tangible assets of $36 million, or $2.40 per share. Trailing twelve month revenues of $254 million gives IFON a price-to-sales ratio of 0.06.
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