Ironclad Performance Wear Reports Third Quarter 19.1% Sales Increase and 18.1% Gross Profit Increase from Prior Year

FARMERS BRANCH, Texas, Nov. 10, 2016 /PRNewswire/ -- Ironclad Performance Wear Corporation (OTCQB: ICPW), the recognized leader in high-performance task-specific work gloves, reported financial results for the third quarter and year-to-date ended September 30, 2016.

The Company reported increased Net Sales for the quarter of $6.45 million, a 19.1% increase from $5.42 million in the third quarter of 2015, on stronger sales from the industrial, international and retail segments and patent licensing fees.  

For the 3rd quarter, the Company's industrial segment recorded a 6% revenue increase. Notwithstanding the segment increase in sales driven by its expanding distributor base, Ironclad offset a 54% decrease in segment sales attributable to sales to ORR Safety.

The Company recorded a 19% increase in revenues for its international segment with the acquisition of new international distributors and stronger order levels for its Australian distributor.

The Company also recorded an 87% increase in revenues for its retail segment, continuing to gain traction with new accounts and expanded placements nation-wide.

The Company's private label business declined as expected due to the discontinuance of the 5.11 tactical program.

Gross Profit dollars increased 18.1% to $2.26 million, or 35.1% of Net Sales, compared to $1.92 million, or 35.4% of Net Sales, in the third quarter of 2015.

Operating Expenses in the third quarter were $2.57 million or 39.9% of Net Sales, as compared to $2.09 million or 38.6% of Net Sales during the same period last year.  The increase in Operating Expenses was primarily driven by an increase in bad debt expense resulting from the Company's decision to discontinue its relationship with its Canadian distributor to better serve our expanding customer base of multi-national accounts operating in Canada.  This was necessitated by the Canadian distributor's inability to grow and service the Canadian market and to meet their financial obligations for goods sold to them in 2015.  To a lesser extent, the increase in Operating Expenses was attributable to investment in personnel required to drive our increased industrial, international and retail sales and our international sourcing operations to position the business for future growth.  Partially offsetting this increase in Operating Expenses was a recovery, net of in-quarter legal expenses, attributable to the Confidential Settlement Agreement with ORR Safety.

As a result of the above, Loss from Operations increased by $135,581, to a loss of $310,676, from a loss of $175,095 in the third quarter of 2015.  Had the Company not realized the charge to bad debt expense necessitated by the termination of the relationship with the Canadian distributor, the Company would have been profitable for the quarter.

Interest Expense increased $15,299 to $45,992 in the third quarter of 2016 from $30,693 in the same period of 2015.  This increase is due to increased borrowings under our bank line of credit agreement.

Net Loss Before Provision for Income Taxes for the third quarter of 2016 was $356,643, as compared to a loss of $205,781 in the same period last year.

Deferred income Tax Expense increased $1,832,000 in the third quarter of 2016 from $0 in the same period in 2015.  This increase is due to the establishment of an allowance for the deferred tax assets due to the uncertain realizability of this asset. 

Net Loss for the third quarter of 2016 was $2,188,643, or $0.03 per share, as compared to a loss of $205,781, or $0.00 per share, in the same period last year.

Ironclad's Chief Executive Officer, Jeffrey Cordes, commented: "In the midst of an extremely difficult industrial market, we continue to grow our business. As we continue to execute the roll out of our products across the North American Grainger network, we are also rapidly adding domestic and international distributors that are more than offsetting the former ORR Safety revenue. Retail clearly has also found traction with significant increases this quarter and it is exciting to see this business taking hold.

"While the quarter to quarter impact of a very depressed oil and gas market is uncertain, our expansion of segments outside of oil and gas is placing us on a path to solid growth at Ironclad."

Conference Call
Ironclad Performance Wear will hold a conference call to discuss third quarter 2016 financial results on Thursday, November 10th, at 3:30 p.m. Central Time (4:30 p.m. Eastern Time).  To participate in the conference call, interested parties should dial:

Date: November 10th, 2016
Time: 4:30 p.m. Eastern Time (3:30 p.m. Central Time)
Domestic Dial-In Number: 1-888-471-3836
International Dial-In Number: 1-719-457-2506
Conference ID Number: 3827804

The conference call will be broadcast simultaneously and available for replay at: http://public.viavid.com/index.php?id=121894 and also via the landing page of the Company's Website at www.ironclad.com.

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization.

Replay Dial-In Numbers:
TOLL-FREE   1-844-512-2921
TOLL/INTERNATIONAL   1-412-317-6671
From:  11/10/16 at 7:30 pm Eastern Time
To:  12/10/16 at 11:59 pm Eastern Time
Replay Pin Number:  3827804

The Company's financial results will be posted online at www.ironcladinvestor.com once they are publicly released.

About Ironclad Performance Wear Corporation
Ironclad Performance Wear is a leader in high-performance task-specific work gloves.  It created the performance work glove category in 1998, and continues to leverage its leadership position in the safety, construction and industrial markets through the design, development and distribution of specialized task-specific gloves for industries such as oil & gas extraction; automotive; and police, fire, first-responder and military. Ironclad engineers and manufactures its products with a focus on innovation, design, advanced material science and durability. Ironclad's gloves and apparel are available through industrial suppliers, hardware stores, home centers, lumber yards, and sporting goods retailers nationwide; and through authorized distributors in North America, Europe, Australia and Asia.

For more information on Ironclad, please visit the Company's Website at www.ironclad.com.

Information about Forward-Looking Statements
This release contains "forward-looking statements" that include information relating to future events and future financial and operating performance. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: fluctuations in demand for Ironclad's products, the introduction of new products, Ironclad's ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of Ironclad's liquidity and financial strength to support its growth, and other information that may be detailed from time-to-time in Ironclad's filings with the United States Securities and Exchange Commission. Examples of such forward looking statements in this release include statements regarding trends in segment sales, our expanding distributor base and improved international sales, and executing on growth initiatives.  For a more detailed description of the risk factors and uncertainties affecting Ironclad, please refer to the Company's recent Securities and Exchange Commission filings, which are available at www.sec.gov. Ironclad undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact
William Aisenberg, CFO
[email protected]
(972) 996-5664

SOURCE Ironclad Performance Wear Corporation

Related Links

http://www.ironclad.com