Lifeloc Reports First Quarter 2021 Results

WHEAT RIDGE, Colo., May 12, 2021 /PRNewswire/ — Lifeloc Technologies, Inc. (OTC: LCTC), a global leader in the development and manufacturing…

WHEAT RIDGE, Colo., May 12, 2021 /PRNewswire/ — Lifeloc Technologies, Inc. (OTC: LCTC), a global leader in the development and manufacturing of breath alcohol and drug testing devices, has announced financial results for the first quarter ended March 31, 2021.

First Quarter Financial Highlights

Lifeloc posted quarterly net revenue of $1.810 million resulting in a quarterly net income of $403 thousand, or $0.16 per diluted share.  These results compare to net revenue of $2.018 million and quarterly net loss of $(165) thousand, or $(0.07) per diluted share in the first quarter of 2020.  Revenue for the quarter declined 10% versus the first quarter last year, primarily from the impact of the COVID-19 global pandemic and the government ordered shutdowns.

As previously reported in 2020, Lifeloc received a $465 thousand SBA guaranteed loan through the Paycheck Protection Program (PPP).  These loans could be completely forgiven by the SBA if the proceeds were spent in accordance with the program rules.  Lifeloc complied with this program and applied for forgiveness in 2020, which was granted by the SBA in early 2021, with the financial benefit of the forgiveness realized in the first quarter of 2021.  The PPP program was quite successful in mitigating the negative effect of the significant demand suppression on cash flow from the pandemic while allowing Lifeloc to carefully reduce structural costs and retain critical personnel, with no compromise to our product development efforts. 

Lifeloc qualified for and received a second PPP loan of $471 thousand in Q1 of 2021.  As with the first loan, Lifeloc intends to comply with all requirements and will apply for forgiveness of this loan after the program conditions are satisfied and the application process is made available.

Our new platform LX9 and LT7 devices were introduced late in 2019.  Despite current difficult market conditions, the features (and performance) of the new L-series products have driven penetration by meeting previously unaddressable market needs, such as wider temperature ranges and fast customization that incorporates local languages.  We expect that most L-series sales will be incremental to FC-series devices rather than displacing FC-series sales.  «In January 2021 our L-series devices were certified to SAI’s (Standards Australia International) latest AS 3547:2019 standards for Breath Alcohol Detectors. This achievement solidifies our ability to provide advanced breath alcohol detectors to a robust market and provides a product certification that is highly regarded in the Pacific Rim,» said Mark Lary, Director of Regulatory Affairs.

We continue to invest in the significant growth opportunities of alcohol monitoring and drug detection.  The monitoring opportunity will be addressed primarily through the redesigned Real-Time Alcohol Detection and Reporting (R.A.D.A.R.®) device.  Manufacture of the second generation R.A.D.A.R. 200 protype devices began in late 2020.  Testing of these redesigned R.A.D.A.R. devices and integration with the monitoring system has been extensive, requiring additional modification before final release.  The design has been finalized with several devices now in field testing by key customers and sales release planned this year.  Several upgrades have been made to the reporting system with an entirely new enrollment app to automate that process.

Our most important goal remains the convergence of the market need for rapid detection of drugs of abuse with Lifeloc’s capabilities.  Resources have been committed to finalizing the development of the SpinDx™ technology platform and the rapid, quantitative marijuana breathalyzer built on that platform.  We have improved the detection sensitivity for delta-9-THC as well as the robustness of the device.  Work continues to develop this system into a device that can be used for roadside testing.

«We look forward to the continued improvement of general business conditions, especially within our customer base.  The last year has been particularly difficult for the travel industry and law enforcement,» commented Dr. Wayne Willkomm, President and CEO.  «But our real growth driver is the strong pipeline of recent and coming product releases.  Additional features requested by various European law enforcement agencies are being added to the L-series platform. Together with the imminent release of the redesigned R.A.D.A.R 200 devices, this should develop a healthy recurring revenue stream. The next big milestone for Lifeloc will be completing the commercialization of the SpinDx platform – a major effort that will be prioritized over short-term profitability.»

About Lifeloc Technologies

Lifeloc Technologies, Inc. (OTC: LCTC) is a trusted U.S. manufacturer of evidential breath alcohol testers and related training and supplies for Workplace, Law Enforcement, Corrections and International customers.  Lifeloc stock trades over-the-counter under the symbol LCTC.  We are a fully reporting Company with our SEC filings available on our web site, www.lifeloc.com/investor.

Forward Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which involve substantial risks and uncertainties that may cause actual results to differ materially from those indicated by the forward-looking statements. All forward-looking statements expressed or implied in this press release, including statements about our strategies, expectations about new and existing products, market demand, acceptance of new and existing products, technologies and opportunities, market size and growth, and return on investments in products and market, are based on information available to us on the date of this document, and we assume no obligation to update such forward-looking statements. Investors are strongly encouraged to review the section titled «Risk Factors» in our SEC filings.

R.A.D.A.R.® is a registered trademark of Lifeloc Technologies, Inc.

SpinDx™ is a trademark of Sandia Corporation.

Amy Evans 

Lifeloc Technologies, Inc. 

http://www.lifeloc.com 

(303) 431-9500

LIFELOC TECHNOLOGIES, INC.

Condensed Balance Sheets


ASSETS








March 31,







2021



December 31,

CURRENT ASSETS:


(Unaudited)



2020


Cash

$

2,317,035


$

2,195,070


Accounts receivable, net


693,225



523,603


Inventories, net


2,580,148



2,498,126


Income taxes receivable


234,541



220,657


Prepaid expenses and other


98,568



77,962


      Total current assets


5,923,517



5,515,418








PROPERTY AND EQUIPMENT, at cost:







Land


317,932



317,932


Building


1,928,795



1,928,795


Real-time Alcohol Detection And Recognition equipment and software


569,448



569,448


Production equipment, software and space modifications


958,785



958,785


Training courses


432,375



432,375


Office equipment, software and space modifications


216,618



216,618


Sales and marketing equipment and space modifications


226,356



226,356


Research and development equipment, software and space modifications


190,818



190,818


Less accumulated depreciation


(2,341,432)



(2,277,839)


     Total property and equipment, net


2,499,695



2,563,288








OTHER ASSETS:







Patents, net


141,738



144,702


Deposits and other


164,798



164,798


Deferred taxes


149,583



148,142


     Total other assets


456,119



457,642









     Total assets

$

8,879,331


$

8,536,348








LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:







Accounts payable

$

355,819


$

333,851


Term loan payable, current portion


46,612



46,936


Paycheck Protection loan payable


471,347



465,097


Customer deposits


161,465



155,295


Accrued expenses


163,719



266,266


Deferred revenue, current portion


44,154



41,053


Reserve for warranty expense


46,500



46,500


      Total current liabilities


1,289,616



1,354,998








TERM LOAN PAYABLE, net of current portion and







debt issuance costs


1,266,120



1,277,531








DEFERRED REVENUE, net of current portion


2,325



3,177


      Total liabilities


2,558,061



2,635,706








COMMITMENTS AND CONTINGENCIES













STOCKHOLDERS’ EQUITY:







Common stock, no par value; 50,000,000 shares







  authorized, 2,454,116 shares outstanding


4,650,812



4,633,655


Retained earnings


1,670,458



1,266,987


      Total stockholders’ equity


6,321,270



5,900,642









      Total liabilities and stockholders’ equity

$

8,879,331


$

8,536,348















LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Income (Unaudited)






Three Months Ended March 31,

REVENUES:


2021



2020


Product sales

$

1,775,447


$

1,937,866


Royalties


12,564



59,281


Rental income


21,532



21,189


Total


1,809,543



2,018,336








COST OF SALES


985,666



1,240,260








GROSS PROFIT


823,877



778,076








OPERATING EXPENSES:







Research and development


307,212



296,897


Sales and marketing


230,478



326,564


General and administrative


350,120



356,887


Total


887,810



980,348








OPERATING INCOME (LOSS)


(63,933)



(202,272)








OTHER INCOME (EXPENSE):







Forgiveness of Paycheck Protection loan


465,097




Interest income


499



7,176


Interest expense


(13,517)



(14,131)


Total other income (expense) 


452,079



(6,955)








NET INCOME (LOSS) BEFORE PROVISION FOR TAXES


388,146



(209,227)








BENEFIT FROM (PROVISION FOR) FEDERAL AND STATE INCOME TAXES


15,325



43,921








NET INCOME (LOSS)

$

403,471


$

(165,306)








NET INCOME (LOSS) PER SHARE, BASIC

$

0.16


$

(0.07)








NET INCOME (LOSS) PER SHARE, DILUTED

$

0.16


$

(0.07)








WEIGHTED AVERAGE SHARES, BASIC


2,454,116



2,454,116








WEIGHTED AVERAGE SHARES, DILUTED


2,454,116



2,454,116

 

Lifeloc Technologies, Inc.

Statements of Stockholders’ Equity (Unaudited)

















Three Months Ended March 31,



2021


2020

Total stockholders’ equity, beginning balances

$

5,900,642


$

6,792,221








Common stock (no shares issued during periods):







Beginning balances


4,633,655



4,603,304


Stock based compensation expense related







 to stock options


17,157



32,111


Ending balances


4,650,812



4,635,415








Retained earnings:







Beginning balances


1,266,987



2,188,917


Net income (loss)


403,471



(165,306)


Ending balances


1,670,458



2,023,611








Total stockholders’ equity, ending balances

$

6,321,270


$

6,659,026

 

LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Cash Flows (Unaudited)












Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

2021


2020


Net income (loss)

$

403,471


$

(165,306)


Adjustments to reconcile net income (loss) to net cash






 provided from (used in) operating activities-








Forgiveness of Paycheck Protection loan (round 1)


(465,097)




   Depreciation and amortization


66,828



97,199


   Provision for doubtful accounts, net change




2,000


   Provision for inventory obsolescence, net change




36,765


   Deferred taxes, net change


(1,441)



(9,349)


   Reserve for warranty expense, net change




1,000


   Stock based compensation expense related to







     stock options


17,157



32,111


Changes in operating assets and liabilities-







   Accounts receivable


(169,622)



1,201


   Inventories 


(82,022)



(286,797)


   Income taxes receivable 


(13,884)



(34,555)


   Prepaid expenses and other 


(20,606)



(120,915)


   Accounts payable 


21,968



218,563


   Customer deposits 


6,170



(29,699)


   Accrued expenses 


(102,547)



28,908


   Deferred revenue 


2,249



(4,539)



           Net cash provided from (used in)








            operating activities


(337,376)



(233,413)









CASH FLOWS FROM INVESTING ACTIVITIES:







Purchases of property and equipment




(9,088)


Patent filing expense




(18,772)



           Net cash (used in) investing activities




(27,860)









CASH FLOWS FROM FINANCING ACTIVITIES:







Proceeds from Paycheck Protection loan (round 2)


471,347




Principal payments made on term loan


(12,006)



(11,391)



           Net cash provided from (used in)








            financing activities


459,341



(11,391)









NET INCREASE (DECREASE) IN CASH


121,965



(272,664)









CASH, BEGINNING OF PERIOD


2,195,070



3,185,996









CASH, END OF PERIOD

$

2,317,035


$

2,913,332









SUPPLEMENTAL INFORMATION:







Cash paid for interest

$

13,246


$

13,860










Cash paid for income tax

$


$

20,063

 

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SOURCE Lifeloc Technologies