Redline Performance Products Reports First Quarter Results
SAN DIEGO and MINNEAPOLIS--Aug. 13, 2003--Redline Performance Products, Inc. ("Redline(TM)" or "the Company") (AMEX: RED) today announced financial results for its fiscal 2004 first quarter ended June 30, 2003 (see attached tables).As a development stage Company, Redline reported no revenues for the three-month periods ended June 30, 2003 and June 30, 2002. Since inception, Redline's operations have focused on the design, engineering, development and marketing of its initial product, the 800 Revolt(R) snowmobile. The Company expects to introduce the 800 Revolt snowmobile in time for the 2003-2004 snowmobile season.
The net loss for the first quarter of fiscal 2004 was $2.3 million, or $.86 per share, versus a net loss of $649,000, or $.46 per share, for the same period last year. The increased net loss for the fiscal 2004 first quarter is due primarily to higher interest expense, higher selling, general and administrative expenses, and increased research and development costs. Interest expense in the first quarter of fiscal 2004 was approximately $1.5 million. Beginning in the current fiscal 2004 second quarter, interest expense going forward is expected to be minimal since substantially all of the Company's long and short term debt has been re-paid with the proceeds generated from the completion in May 2003 of its initial public offering ("IPO").
At June 30, 2003, Redline's cash position was $3.0 million versus cash of $37,300 at March 31, 2003, and the Company had no long-term debt. The increase in cash is due to the completion of the IPO in May 20, 200303. In July 2003, Redline received an additional $1.3 million in net proceeds subsequent to the IPO underwriter's exercise of its over allotment option, bringing the total cash position at July 31, 2003 to approximately $4.1 million.
Mark A. Payne, President and CFO of Redline, commented, "We continue to expect to introduce the 800 Revolt in time for the upcoming snowmobile season. Discussions are also accelerating with companies that have the capabilities to assemble our 800 Revolt snowmobile. We anticipate identifying an assembly partner within the next 60 days. We believe we have a sound business plan and an established and growing dealer network. We have recently started to accept purchase orders from dealers and are very pleased with the level of interest."
About Redline Performance Products, Inc.
Redline Performance Products, Inc. designs, engineers, markets, and intends to manufacture and sell, snowmobiles under the Redline(TM) brand name. The Company maintains its principal executive offices in San Diego, CA, and also has an office in Minneapolis, MN. Learn more at www.1redline.com.
Forward-Looking Statements
This news release includes "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included or incorporated herein may constitute forward-looking statements. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. The forward-looking statements involve risks and uncertainties that affect the Company's operations, financial performance and other factors discussed in its filings with the Securities and Exchange Commission ("SEC").
REDLINE PERFORMANCE PRODUCTS, INC.
SUMMARY FINANCIAL INFORMATION
Selected Statements of Operations Data:
For the three months
ended
---------------------
June 30, June 30,
2003 2002
---------------------
Total Operating Expense $781,383 $406,423
---------------------
Net Other Expense (1,487,725) (242,638)
---------------------
Net Loss (2,269,168) (649,061)
Loss per Common Share
Basic and Diluted $ (0.86) $ (0.46)
=====================
Weighted Average Common Shares Outstanding
Basic and Diluted 2,625,828 1,416,003
=====================
Selected Balance Sheet Data:
June 30, 2003 March 31, 2003
(Unaudited) (Audited)
----------------------------------------
Assets
------------------------------
Cash $2,973,699 (1) $ 37,305
Other Current Assets 560,680 402,878
----------------------------------------
Property and Equipment, Net 772,956 694,545
----------------------------------------
Other Assets 93,473 690,058
Total Assets $4,400,808 $1,824,786
========================================
Liabilities and Shareholders'
Equity (Deficit)
------------------------------
Total Short Term Debt $ 137,509 $2,508,082
Accounts Payable 216,973 912,073
Other Current Liabilities 180,458 503,645
----------------------------------------
Long Term Liabilities 57,440 36,405
----------------------------------------
Total Liabilities 592,380 3,960,205
----------------------------------------
Total Shareholders' Equity
(Deficit) 3,808,428 (2,135,419)
----------------------------------------
Total Liabilities and
Shareholders' Equity
(Deficit) $4,400,808 $1,824,786
========================================
(1) Does not include $1.3 million in net proceeds subsequent to the
IPO underwriter's exercise of its over allotment option in July
2003.