Command Security Corporation Reports Results For Second Quarter Of Fiscal 2012

Command Security Corporation (NYSE Amex: MOC) announced today its financial results for its second fiscal quarter of 2012 ended September 30, 2011.

For the three months ended September 30, 2011, revenues decreased 2.3% to $36,108,610, compared with revenues of $36,944,398 in the same period of the prior year. Operating income for the three months ended September 30, 2011 increased 23.3% to $1,185,301, compared with $961,206 in the same period of the prior year. Net income increased 11.3% to $520,463, or $0.05 per basic and diluted share, compared with $467,785, or $0.04 per basic and diluted share in the same period of the prior year.

For the six months ended September 30, 2011, revenues decreased 3.1% to $70,894,213, compared with revenues of $73,180,566 in the same period of the prior year. Operating income for the six months ended September 30, 2011 decreased 11.5% to $1,662,162, compared with $1,878,915 in the same period of the prior year. Net income decreased 19.9% to $729,183, or $0.07 per basic and diluted share, compared with $909,960, or $0.08 per basic and diluted share in the same period of the prior year.

The decrease in revenues for the six months ended September 30, 2011, compared with the corresponding period of the prior year was due primarily to the following events:

• The previously reported loss of a major domestic carrier’s aviation services business at six domestic airport locations during the latter half of fiscal 2011;
• The loss of security services contracts for a technology company, a semiconductor equipment manufacturer’s facility and a company that provides distribution services to a grocery retailer; and
• Reductions in security services hours associated with a large banking and financial services organization.

The decrease in revenues was partially offset by the following events:

• Increased revenues associated with an expansion of services provided under a contract with a major transportation company;
• A new aviation services contract with a municipal airport authority; and
• Expansion of services to new and existing security and aviation customers.

The increase in operating and net income for the three months ended September 30, 2011, compared with the corresponding period of the prior year, was due primarily to lower executive salaries resulting mainly from reorganizing our regional and local branch management in conjunction with cost reduction opportunities that were identified and implemented during the latter part of our first quarter of fiscal 2012. The effective tax rate was 53.4 percent, compared to 46.4 percent in the prior year period due primarily to the loss of deferred tax assets resulting from the cancellation of stock options previously held by former employees and directors.

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