For the quarter, cost of sales decreased by $17.0 million, or 43% to $22.8 million, as compared to $39.8 million during the same period in 2011, primarily driven by lower sales. Cost of sales as a percentage of revenue decreased from 90.4% in 2011 to 78.6% in 2012 primarily due to higher margins on the SBT business, as well as reduced sales of bullion which carry significantly lower margins than other categories.Selling, General & Administrative (“SG&A”) expenses increased by $3.3 million, or 107% to $6.4 million for the quarter, as compared to $3.1 million during the same period in 2011. $1.6 million of this increase is due to the addition of the SBT stores, while the opening of four new non-SBT stores added $870,000 in the current period, related to increased advertising, salaries, payroll taxes, building rent and other costs. $1.4 million of the $3.3 million SG&A increase were one-time expenses related to professional fees associated with the restatement of our financial statements, and the related Securities and Exchange Commission (“SEC”) investigation. These additional expenses were partially offset by cost reduction efforts in the Company’s legacy operations.
DGSE Reports Financial Results For Third Quarter Of 2012
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