LoJack Corporation Reports Fourth Quarter And Year End 2009 Results

WESTWOOD, Mass., March 3 /PRNewswire-FirstCall/ -- LoJack Corporation (Nasdaq: LOJN) reported today that revenue for the fourth quarter ended December 31, 2009 declined 26% to $35.6 million, from $48.2 million in the same quarter a year ago.  The net loss attributable to LoJack Corporation for the fourth quarter of 2009 was $2.3 million or $0.13 per diluted share, compared to net income attributable to LoJack Corporation of $0.2 million or $0.01 per diluted share in the same quarter a year ago.

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In announcing the results, Ronald V. Waters, President and Chief Executive Officer said, "Both our North American and international segments continued to stabilize during the quarter, as U.S. new car sales improved and our international licensees began to return to historical purchasing trends. Our performance in the fourth quarter benefited from our continued tight management of operating expenses. We delivered $5.8 million in positive operating cash flow for the quarter and ended the year with a cash balance of $36.5 million.

"During the quarter, our North American business was impacted by tight credit and high unemployment. However, we do anticipate a moderate recovery in 2010 with gradual improvement throughout the year, based on industry estimates of U.S. new vehicle sales of between 11 million and 11.5 for the year.

"Our international business delivered a sequential increase in unit volume and revenue over the third quarter based on strengthening orders from our licensees. Most have worked through existing inventory purchased in 2008 and now are ordering based on increasing demand and expectations for the coming year."

Within LoJack Corporation's North American segment, revenue in the fourth quarter for the U.S. declined 11% to $18.6 million, from $21.0 million for the same quarter of the last year, on a 19% reduction in unit volume. Additionally, revenue in the fourth quarter for Boomerang Tracking declined 12% to $3.3 million from the same period a year ago.

International revenue in the fourth quarter declined 42% to $12.9 million, from $22.4 million in the same quarter of the prior year, attributable to a 42% decline in unit volume.

Gross margin dollars for the fourth quarter declined 25% to $18.2 million from the same quarter last year. Gross margin as a percentage of revenue was 51.0%, compared to 50.4% in the prior year, reflecting benefits of our restructuring efforts during the year.

The operating loss for the fourth quarter of 2009 was $1.6 million, compared to operating income of $3.1 million in the same quarter a year ago.  Operating expenses reflect a non-cash adjustment to depreciation of approximately $1.0 million associated with software and equipment placed in service in prior years. Excluding depreciation and amortization, operating expenses declined 14% to $16.8 million in the fourth quarter, compared to $19.5 million in the same quarter of 2008.

The net loss attributable to LoJack Corporation for the fourth quarter of 2009 was $2.3 million or $0.13 per diluted share, compared to net income of $0.2 million or $0.01 per diluted share in the same quarter a year ago.

Adjusted EBITDA for the fourth quarter was $2.2 million, compared to $5.5 million in the fourth quarter of 2008. LoJack Corporation has introduced Adjusted EBITDA as an additional measurement of the company's operating performance, since it excludes any significant non-cash operating expenses.

For the year ended December 31, 2009, revenue declined 32% to $135.0 million, from $198.7 million in 2008. On a GAAP basis, the net loss attributable to LoJack Corporation for the full year was $34.7 million, or $2.02 per fully diluted share, compared to net loss of $32.5 million, or $1.88 per fully diluted share in 2008. Adjusting for the items in Table 2, pro forma net loss for 2009 was $4.9 million or $0.28 per fully diluted share.

On a GAAP basis, the company's 2009 operating expenses and operating loss reflect the impact of charges of approximately $36.7 million related to severance costs, a non-cash charge related to the impairment of goodwill and intangible assets of our Boomerang Tracking business, and the comprehensive agreement to settle all pending disputes with the company's former licensee in China, as well as associated expenses.

Adjusted EBITDA for the year ended December 31, 2009 was a loss of $19.2 million, compared to a gain of $20.7 million in 2008.

Mr. Waters said, "Despite the uncertain and volatile economic conditions throughout 2009, we remained committed to our long term strategies for growth and made the appropriate investments to support them. We continued to invest in our core technology and introduced our next generation stolen vehicle recovery system, which is self-powered and optimized for vehicles of today and the future, including hybrid and electric cars.  Additionally, we effectively re-structured our operations ensuring that costs of our core auto business were in line with related sales. The company is well positioned to take advantage of opportunities presented by a strengthening global economy.