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DGSE Reports Financial Results For Third Quarter Of 2012

Shareholder Relations

If you would like to schedule an individual meeting with DGSE management please call 972-481-3820 or email investorrelations@dgse.com with your meeting request.

About DGSE Companies, Inc.

DGSE Companies, Inc. wholesales and retails jewelry, diamonds, fine watches, and precious metal bullion and rare coin products through its Bullion Express, Charleston Gold & Diamond Exchange, Dallas Gold & Silver Exchange and Southern Bullion Coin & Jewelry operations. DGSE also owns Fairchild International, Inc., one of the largest vintage watch wholesalers in the country. In addition to its retail facilities in Alabama, Florida, Georgia, Illinois, North Carolina, South Carolina, Tennessee and Texas, the Company operates internet websites which can be accessed at www.bullionexpress.com, www.dgse.com, www.cgdeinc.com and www.sbcoin.com. Real-time price quotations and real-time order execution in precious metals are provided on another DGSE website at www.USBullionExchange.com. Wholesale customers can access the full vintage watch inventory through the restricted site at www.FairchildWatches.com.

The Company is headquartered in Dallas, Texas, and its common stock trades on the NYSE MKT Exchange under the symbol "DGSE."

This press release includes statements which may constitute "forward-looking" statements, usually containing the words "believe," "estimate," "project," "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company's products and services in the marketplace, competitive factors, dependence upon third-party vendors and other risks detailed in the Company's periodic report filings with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.

 

DGSE COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

     
September 30, December 31,
  2012     2011  
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 2,775,962 $ 5,976,928
Trade receivables 1,439,394 1,578,892
Inventories 11,692,290 10,717,291
Prepaid expenses   225,068     84,971  
Current assets related to continuing operations 16,132,714 18,358,082
 
Assets related to discontinued operations   64,678     1,311,929  
 
Total current assets   16,197,392     19,670,011  
 
Property and equipment, net 4,856,470 4,420,704
Intangible assets, net 3,226,722 3,397,367
Other assets 208,049 160,491
   
Total assets $ 24,488,633   $ 27,648,573  
 
LIABILITIES
Current Liabilities:
Line of credit $ - $ 2,999,887
Current maturities of long-term debt 180,920 451,674
Current maturities of capital leases 27,094 21,184
Accounts payable-trade 2,612,258 1,497,492
Accrued expenses 787,244 3,017,394
Customer deposits and other liabilities 2,455,493 1,836,748
   
Current liabilities related to continuing operations 6,063,009 9,824,379
 
Liabilities related to discontinued operations   12,222     54,454  
 
Total current liabilities   6,075,231     9,878,833  
 
Line of credit, related party 3,583,358 -
Long-term debt, less current maturities 1,874,000 2,447,336
Capital leases, less current maturities   7,534     30,914  
Total liabilities 11,540,123 12,357,083
 
Commitments and contingencies
 
STOCKHOLDERS' EQUITY
Common stock 121,755 121,639
Additional paid-in capital 34,045,654 33,942,579
Accumulated deficit   (21,218,899 )   (18,772,728 )
Total stockholders' equity 12,948,510 15,291,490
   
Total liabilities and stockholders' equity $ 24,488,633   $ 27,648,573  

       
DGSE COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
   
Three Months Ended

September 30,

 

Nine Months Ended

September 30,

  2012     2011     2012     2011  
As Restated As Restated
Revenue:
Sales $ 28,975,063 $ 44,014,649 $ 90,374,423 $ 97,627,732
 
Costs and expenses:
Cost of goods sold 22,787,722 39,795,575 73,447,142 87,740,414
Selling, general and administrative expenses 6,431,750 3,101,560 18,030,768 7,712,328
Depreciation and amortization   152,337     5,899     448,260     165,993  
29,371,809 42,903,034 91,926,170 95,618,735
 
Operating (loss) income   (396,746 )   1,111,615     (1,551,747 )   2,008,997  
 
Other expense (income) :
Loss on settlement of debt with related party - 1,720,000 - 1,720,000
Other income, net (41,202 ) - (127,596 ) (1,745 )
Interest expense   72,677     174,296     253,796     437,889  
  31,475     1,894,296     126,200     2,156,144  
 
Loss from continuing operations before income taxes (428,221 ) (782,681 ) (1,677,947 ) (147,147 )
 
Income tax expense   -     -     -     -  
 
Loss from continuing operations (428,221 ) (782,681 ) (1,677,947 ) (147,147 )
 
Discontinued operations:
Loss from discontinued operations, net of taxes of $0 (107,669 ) (101,366 ) (768,225 ) (303,625 )
       
Net loss $ (535,890 ) $ (884,047 ) $ (2,446,172 ) $ (450,772 )
 
Basic and diluted net loss per common share:
Loss from continuing operations $ (0.04 ) $ (0.07 ) $ (0.14 ) $ (0.01 )
Loss from discontinued operations   -     (0.01 )   (0.06 )   (0.03 )
Net loss per share $ (0.04 ) $ (0.08 ) $ (0.20 ) $ (0.04 )
 
Weighted-average number of common shares
Basic 12,175,287 10,441,418 12,175,287 10,441,418
Diluted 12,175,287 10,441,418 12,175,287 10,441,418




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