Northern, WI  12/26/2012 (BasicsMedia) – If you are looking for deals on that big screen TV you want to watch the Superbowl on, then now is the time to go get it. Who knows is just might be a product made by SGOCO. SGOCO designs and develops LCD/LED monitors, TVs, and application specific products for sale primarily to the flat panel display market. It offers LCD/LED monitors; LCD/LED televisions; application specific LCD/LED display products and a wide variety of other electronic products for both commercial and consumer use.

SGOCO has seen its share price shoot up over 60% today on trading volume of close to a million shares.

The company has been trying out a new business model which outsources manufacturing and enhances the Company’s flexibility to rapid changes in emerging technologies and market conditions. Given the significant changes to SGOCO’s business model and balance sheet in the last year, the Company is looking at a much better outlook for the upcoming years.

During the nine month period ending September 30, 2012, Revenues were $103.3 million. During this period, 74% of sales were generated from the Company’s own-brand products and 26% of sales were derived from OEM customers.

Gross profit came in for the nine month period ending September 30, 2012 at $7.6 million, or 7.3% of total revenues. SGOCO’s long-term strategy is to continue to emphasize its own-brand sales while improving the margins by adding new personalized devices and multimedia systems and services to the Company’s product portfolio.

Exspenses for selling, general and administrative costs for the nine month period ending September 30, 2012 came in at $4.6 million, or 4.5% of total revenues. During the period, the Company incurred approximately $2.7 million in third-party expenses including one-time expenses of over $1.6 million in professional fees related to the Company’s Nasdaq trading halt as well as from a change in auditors.

The net income for the nine month period ending September 30, 2012 was $1.1 million, or 1.0% of revenues. The net income was negatively impacted by around $0.7 million provision for interest the company gained on tax related to the sale of its manufacturing assets during its business model change over.

SGOCO reported strong liquidity ratios as of September 30, 2012. The Company’s current ratio was 6.97 and the debt-to-equity ratio was 0.17. These strong ratios will support SGOCO as it completes its business model transformation focused on developing new personalized products and multimedia systems combined with related business services.

Chairman and Chief Executive Officer of SGOCO Mr. Burnette Or commented “We remain encouraged by the progress of our business transition and remain positive about our long-term strategy and profitability. Our new “light-asset” business model provides us with greater flexibility to adapt to challenging market conditions. The Company continues to operate free of debt, build its brand portfolio, and develop new display products. Our R&D team is developing higher-margin products including smart phones, tablet PCs, e-boards, all-in-ones (AIOs) and application specific products (ASPs) which are expected to become commercial ready within the next 1-2 years. The Company is also working on services that can be matched with these new products to further enhance their attractiveness and profitability.

 

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