MadCatz Posts Record Profits

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MadCatz, manufacturer of gaming peripherals, has posted record profits for its Second Quarter.  For the period ended September 30, 2010, MadCatz generated record net sales of $37.4 million, a 73.2% increase from $21.6 million in the prior year quarter. Gross profit increased 55.5% to a fiscal second quarter record $10.5 million from $6.8 million in the September 2009 quarter, while gross profit margin was 28.1% compared to 31.3% a year ago. Total operating expenses in the fiscal 2011 second quarter were $8.6 million, up 23.7% from $6.9 million in the prior year quarter. Total operating expenses as a percentage of net sales were 22.9% compared to 32.1% of net sales in the prior year period and the Company recorded a record second quarter operating profit of $1.9 million compared to a loss of $0.2 million in the prior year quarter. Reflecting income tax expense of $1.1 million in the second quarter of fiscal 2011 and $0.2 million in the prior year quarter, the Company reported record second quarter net income of $1.1 million, or $0.02 per diluted share, compared with a net loss of $1.0 million, or a loss of $0.02 per diluted share, in the comparable prior year period.

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Second Quarter Fiscal 2011 Financial Highlights:

• Net sales for the second quarter of fiscal 2011 increased 73.2% from the prior year quarter:
  • North American net sales rose 103.0% to $24.4 million or 65.2% of quarterly sales;
  • European net sales rose 43.9% to $12.2 million or 32.7% of quarterly sales; and,
  • Net sales to other countries decreased 28.0% to $0.8 million or 2.1% of quarterly sales.
• Gross sales by platform were as follows:
  • Xbox 360 accounted for 37% of total gross sales vs. 26% a year ago;
  • PC represented 17% of total gross sales vs. 32% a year ago;
  • PlayStation 3 accounted for 12% of total gross sales vs. 11% in the prior year;
  • Wii products represented 11% of total gross sales in both periods;
  • Handhelds represented 4% of total gross sales vs. 5% a year ago; and,
  • All other platforms represented 19% of total gross sales vs. 15% in the prior year.
• Gross sales by category were as follows:
  • Audio products represented 27% of total gross sales vs. 9% in the prior year;
  • Specialty controllers represented 23% of total gross sales vs. 35% a year ago;
  • Games represented 15% of total gross sales vs. 2% a year ago;
  • Accessories represented 14% of total gross sales vs. 23% a year ago;
  • Controllers represented 12% of total gross sales vs. 22% a year ago;
  • PC devices represented 8% of total gross sales vs. 9% in the prior year; and,
  • All other sales represented 1% of total gross sales vs. 0% a year ago.
• Reported net position of bank loan less cash at September 30, 2010, of $24.6 million, compared to $1.6 million as of March 31, 2010, and $13.0 million at September 30, 2009.

New Products Shipped in and Subsequent to Second Quarter of Fiscal 2011 include:

• Cyborg R.A.T. 3 Pro Gaming Mouse;
• Cyborg R.A.T. 9 Wireless Pro Gaming Mouse;
• Cyborg F.L.Y.9 Wireless Flight Stick;
• A range of Rock Band 3 products including wireless Keyboards, Mustang ProGuitar, PRO-Drums and PRO-Cymbals Kit;
• Call of Duty:Black Ops ProGaming Headset, Stealth Mouse and Pro Gaming Glasses;
• Eclipse mobilemouse; and,
• Mad Catz Xbox 360 Wireless Racing Wheel.