Lifeloc Reports Second Quarter 2022 Results

WHEAT RIDGE, Colo.,  Aug. 9, 2022 /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 second quarter ended June 30, 2022.

First Quarter Financial Highlights

Lifeloc posted quarterly net revenue of $2.180 million in the second quarter of 2022, resulting in a quarterly net loss of $(202) thousand, or $(0.08) per diluted share. These results compare to net revenue of $1.730 million and quarterly net loss of $(110) thousand, or $(0.04) per diluted share in the second quarter of 2021. Revenue for the quarter increased 26% versus the second quarter last year, as demand continued to recover from the impact of the COVID-19 global pandemic and the government ordered shutdowns. Six-month net revenue of $4.341 million and a net loss of $(346) thousand, or $(0.14) per diluted share, compare to net revenue of $3.539 million and a net profit of $294 thousand, or $0.12 per diluted share, for the same six months of 2021. The income for the first six months of 2021 includes the benefit from the forgiveness of the first round SBA Paycheck Protection Program (PPP) loan of $465 thousand.   

Increasing research and development investment as well as supply chain disruption contributed to the net loss in this quarter despite increased revenue. Supply chain delays have added some costs, and component inflation has added more. The company implemented a broad price increase during the quarter in response to rising costs.

New platform LX9 and LT7 devices are producing strong sales growth. The L-series devices feature a high-resolution color display with a highly customizable user interface. Their features and performance 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 sales. The L-series devices are meeting the requirements of the most modern registration standards, such as SAI’s (Standards Australia International) latest AS 3547:2019 standards for Breath Alcohol Detectors.

We believe our most important goal and best opportunity remains the convergence of the global need for rapid detection of drugs of abuse with Lifeloc’s proven capability to build easy-to-use portable testing equipment.  We are focusing our research and development efforts on leveraging the SpinDx™ technology platform, sometimes referred to as “Lab on a Disk,” to develop a series of devices and tests that can be used at roadside, emergency rooms and in workplace testing to get a rapid and quantitative measure for a panel of drugs of abuse, beginning with a device that allows for detection of delta-9-THC (the major intoxicating component of the cannabis plant) from a test subject’s saliva.  We are also developing a device based on our recently updated LX9 breathalyzer that, when coupled with the SpinDx technology, will be our first marijuana breathalyzer system. In anticipation of possible SpinDx supply chain delays, we’ve already begun purchasing small quantities of components ahead of the initial production builds.

Our R.A.D.A.R.® 200 device has been introduced to the market, and the market feedback is that the device needs a few additional specific upgrades to gain widespread acceptance. The R.A.D.A.R. device promises to address a critical and valuable market need for self-administered alcohol monitoring. However, in late 2021, we determined that Lifeloc’s full research and development resources must remain focused on completing the SpinDx development and bringing it to market. To maximize shareholder value, Lifeloc has created a new wholly owned subsidiary, Probation Tracker Inc. (PTI), to focus exclusively on development of R.A.D.A.R.® 300.  We intend to distribute the shares of PTI to our shareholders as a stock dividend once we’ve received the required regulatory approvals and expect PTI to work independently to develop R.A.D.A.R.® 300 and raise additional funds as needed to commercialize it. More details are available in our 10-Q for the second quarter of 2022 and will be forthcoming in subsequent filings.

“Our sales continue to recover well in 2022,” commented Dr. Wayne Willkomm, President and CEO. “The new L-series devices have grown from a small base to become a significant contributor to revenue and profit margin. Revenue from these is expected to provide the continued funding to push the SpinDx product platform across the finish line to commercialization. We expect research and development expenses to remain high in this push to complete the first of many products built on the SpinDx platform, prioritizing substantial value creation over short-term profitability.  We are working toward the goal of initial SpinDx sales this year.”

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, performance, expectations about new and existing products, market demand, economic conditions, 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

June 30, 2022
(Unaudited)

December 31,
2021

CURRENT ASSETS:

Cash

$

2,251,315

$

2,571,668

Accounts receivable, net

735,675

562,092

Inventories, net

2,300,987

2,668,789

Prepaid expenses and other

124,781

56,897

      Total current assets

5,412,758

5,859,446

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

988,738

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

467,485

456,685

Less accumulated depreciation

(2,747,253)

(2,518,966)

     Total property and equipment, net

2,400,494

2,588,028

OTHER ASSETS:

Patents, net

97,412

134,428

Deposits and other

163,480

163,480

Deferred taxes

315,486

204,449

     Total other assets

576,378

502,357

     Total assets

$

8,389,630

$

8,949,831

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Accounts payable

$

299,663

$

445,985

Term loan payable, current portion

49,265

48,513

Customer deposits

171,228

170,952

Accrued expenses

240,193

298,530

Deferred revenue, current portion

67,238

71,604

Reserve for warranty expense

46,500

46,500

      Total current liabilities

874,087

1,082,084

TERM LOAN PAYABLE, net of current portion and

debt issuance costs

1,243,807

1,267,551

DEFERRED REVENUE, net of current portion

6,806

6,430

      Total liabilities

2,124,700

2,356,065

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ EQUITY:

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

  authorized, 2,454,116 shares outstanding

4,668,014

4,650,812

Retained earnings

1,596,916

1,942,954

      Total stockholders’ equity

6,264,930

6,593,766

      Total liabilities and stockholders’ equity

$

8,389,630

$

8,949,831

LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Income (Unaudited)

Three Months Ended June 30,

REVENUES:

2022

2021

Product sales

$

2,144,813

$

1,674,045

Royalties

12,572

33,652

Rental income

22,639

21,939

Total

2,180,024

1,729,636

COST OF SALES

1,516,389

1,124,218

GROSS PROFIT

663,635

605,418

OPERATING EXPENSES:

Research and development

352,910

266,633

Sales and marketing

276,669

214,124

General and administrative

293,421

256,908

Total

923,000

737,665

OPERATING INCOME (LOSS)

(259,365)

(132,247)

OTHER INCOME (EXPENSE):

Interest income

1,190

813

Interest expense

(10,817)

(13,544)

Total 

(9,627)

(12,731)

NET INCOME (LOSS) BEFORE PROVISION FOR TAXES

(268,992)

(144,978)

BENEFIT FROM (PROVISION FOR) FEDERAL AND STATE INCOME TAXES

67,462

35,266

NET INCOME (LOSS)

$

(201,530)

$

(109,712)

NET INCOME (LOSS) PER SHARE, BASIC

$

(0.08)

$

(0.04)

NET INCOME (LOSS) PER SHARE, DILUTED

$

(0.08)

$

(0.04)

WEIGHTED AVERAGE SHARES, BASIC

2,454,116

2,454,116

WEIGHTED AVERAGE SHARES, DILUTED

2,454,116

2,454,116

 

LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Income (Unaudited)

Six Months Ended June 30,

REVENUES:

2022

2021

Product sales

$

4,256,570

$

3,449,492

Royalties

39,212

46,216

Rental income

44,878

43,471

Total

4,340,660

3,539,179

COST OF SALES

2,835,136

2,109,884

GROSS PROFIT

1,505,524

1,429,295

OPERATING EXPENSES:

Research and development

742,934

573,845

Sales and marketing

553,306

444,602

General and administrative

646,254

607,028

Total

1,942,494

1,625,475

OPERATING INCOME (LOSS)

(436,970)

(196,180)

OTHER INCOME (EXPENSE):

Forgiveness of Paycheck Protection loan

465,097

Interest income

1,622

1,312

Interest expense

(21,727)

(27,061)

Total 

(20,105)

439,348

NET INCOME (LOSS) BEFORE PROVISION FOR TAXES

(457,075)

243,168

BENEFIT FROM (PROVISION FOR) FEDERAL AND STATE INCOME TAXES

111,037

50,591

NET INCOME (LOSS)

$

(346,038)

$

293,759

NET INCOME (LOSS) PER SHARE, BASIC

$

(0.14)

$

0.12

NET INCOME (LOSS) PER SHARE, DILUTED

$

(0.14)

$

0.12

WEIGHTED AVERAGE SHARES, BASIC

2,454,116

2,454,116

WEIGHTED AVERAGE SHARES, DILUTED

2,454,116

2,454,116

 

Lifeloc Technologies, Inc.

Condensed Statements of Stockholders’ Equity (Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2022

2021

2022

2021

Total stockholders’ equity, beginning balances

$

6,466,460

$

6,321,270

$

6,593,766

$

5,900,642

Common stock (no shares issued during periods):

Beginning balances

4,668,014

4,650,812

4,650,812

4,633,655

Stock based compensation expense related

 to stock options

17,202

17,157

Ending balances

4,668,014

4,650,812

4,668,014

4,650,812

Retained earnings:

Beginning balances

1,798,446

1,670,458

1,942,954

1,266,987

Net income (loss)

(201,530)

(109,712)

(346,038)

293,759

Ending balances

1,596,916

1,560,746

1,596,916

1,560,746

Total stockholders’ equity, ending balances

$

6,264,930

$

6,211,558

$

6,264,930

$

6,211,558

 

LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Cash Flows (Unaudited)

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

2022

2021

Net income (loss)

$

(346,038)

$

293,759

Adjustments to reconcile net income to net cash

 provided from (used in) operating activities-

 Forgiveness of Paycheck Protection loan (round 1)

(465,097)

   Depreciation and amortization

267,455

133,657

   Provision for doubtful accounts, net change

(49,000)

   Provision for inventory obsolescence, net change

94,578

(5,000)

   Deferred taxes, net change

(111,037)

10,648

   Stock based compensation expense related to

     stock options

17,202

17,157

Changes in operating assets and liabilities-

   Accounts receivable

(173,583)

73,553

   Inventories 

273,224

7,166

   Income taxes receivable 

(54,506)

   Prepaid expenses and other 

(67,884)

(12,804)

   Deposits and other 

966

   Accounts payable 

(146,322)

(101,836)

   Customer deposits 

276

8,130

   Accrued expenses 

(58,337)

(54,102)

   Deferred revenue 

(3,990)

3,930

           Net cash provided from (used in)

            operating activities

(254,456)

(193,379)

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

(40,753)

(58,461)

Patent filing expense

           Net cash (used in) investing activities

(40,753)

(58,461)

CASH FLOWS FROM FINANCING ACTIVITIES:

Principal payments made on term loan

(25,144)

(23,986)

Proceeds from Paycheck Protection loan (round 2)

471,347

           Net cash provided from (used in)

            financing activities

(25,144)

447,361

NET INCREASE (DECREASE) IN CASH

(320,353)

195,521

CASH, BEGINNING OF PERIOD

2,571,668

2,195,070

CASH, END OF PERIOD

$

2,251,315

$

2,390,591

SUPPLEMENTAL INFORMATION:

Cash paid for interest

$

19,575

$

 

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SOURCE Lifeloc Technologies

Lifeloc Reports Second Quarter 2022 Results WeeklyReviewer

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