Valley Forge Composite Technologies Reports Financial Results for First Six Months of 2012

COVINGTON, Ky., Aug. 14, 2012 /PRNewswire/ -- Valley Forge Composite Technologies, Inc. (OTC BB: VLYF), developer of state-of-the-art detection systems, including the THOR LVX photonuclear detection system, today announced financial results for the three and six month periods ended June 30, 2012.

"The last few months has been among the most important, transformative period in Valley Forge's history, and we are positioned to build on this progress to deliver significantly improved results in future periods," commented Louis Brothers, president and chief executive officer of Valley Forge Composite Technologies.

Year-to-Date 2012 Financial Results

Revenues for the six months ended June 30, 2012 were $5.3 million compared to $9.6 million for the same period in 2011. The decline in revenues is related to the timing of customer orders and shipments for the Company's aerospace products. For the month ended July 31, 2012, the Company recognized sales of approximately $5.7 million.  In addition, the Company had a significant non-recurring order for the period ended June 30, 2011.

"The timing of orders continues to be inconsistent for our aerospace products," Mr. Brothers added. "A significant order shifted out of the second quarter and was booked in July. Through the end of July, we've generated approximately $11 million in revenues, which is approximately 80% of the revenues we generated for all last year, demonstrating that we are on pace for solid growth in our aerospace business. This is before the significant anticipated contribution of revenue from our THOR LVX sales."

Year-to-date gross profit was $647,000, or 11.9% gross margin, compared to $1.6 million, or 16.6% gross margin, for the first six months of 2011. The decrease in profit margin for the six months ended June 30, 2012 was due to several high margin sales in the June 30, 2011 period.    These high margin sales consisted of products the Company assembled and tested utilizing key legacy components the Company was able to source on a one-time basis. The Company's goal is to increase gross profit margin on future sales of momentum wheels and other aerospace products. Total expenses were $1.3 million, including $457,000 in non-cash expenses related to options and warrants, compared to total expenses of $1.2 million, including $410,000 in non-cash expenses related to options and warrants, in the first half of last year. The Company reported a loss from operations of $685,000 compared to operating income of $422,000 in the year-ago period. Net loss was $(669,000), or $(0.01) per basic and diluted share (based on 62.4 million weighted average shares outstanding) compared to net income of $280,000, or $0.01 per basic and $0.00 per diluted share (based on 61.3 million weighted average shares outstanding) for the same period last year.

As of June 30, 2012, the Company had a projected backlog in excess of approximately $15 million, related only to aerospace products.

Second Quarter 2012 Financial Results

Revenues for the second quarter were $905,000 compared to $3.2 million for the same period last year. Gross profit was $170,000, or 18.7% gross margin, compared to $278,000, or 8.8% gross margin, for the same period last year. Total expenses were $590,000 in the second quarter, including $218,000 in non-cash expenses related to options and warrants, compared to total expenses of $540,000, including $205,000 in non-cash expenses related to options and warrants, in the fourth quarter last year. The Company reported a loss from operations of $595,000 compared to an operating loss of $262,000 in the year-ago period. Net loss for the quarter was $(416,000), or $(0.01) per basic and diluted share (based on 62.4 million weighted average shares outstanding) compared to a net loss of $(408,000), or $(0.01) loss per basic and diluted share (based on 61.3 million weighted average shares outstanding) for the same period last year.

The Company had $347,000 in cash and no debt. Shareholders' equity was $3.0 million.

About Valley Forge

Valley Forge Composite Technologies, Inc., through its subsidiaries, develops, manufactures, and markets detection systems primarily in the United States. The company offers THOR LVX, a photonuclear detection system; and ODIN, a passenger weapons scanning device. These products consist of detection capability for illicit narcotics, explosives, and bio-chemical weapons hidden in cargo containers. It also engages in the design and manufacture of attitude control instruments for small satellites. Valley Forge Composite Technologies, Inc. was founded in 1996 and is headquartered in Covington, Kentucky. More information about Valley Forge Composite Technologies, Inc. can be found at www.vlyf.com.

Forward-Looking Statement

The Private Securities Litigation Reform Act of 1995 provides a 'safe harbor' for certain forward-looking statements. Statements in this press release that relate to Valley Forge Composite Technologies, Inc.'s future plans, objectives, expectations, performance, events, reports made by others and the like, including a statement about the assumptions underlying a forward-looking statement, are forward-looking statements protected by the safe harbor. Investors should understand that future events, risks and uncertainties, individually or in the aggregate, are factors that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. These factors could include changes in economic conditions or government policies that may change the demand for the Company's products and services and could include other factors discussed in the sections of the Company's report on Form 10-K for the year ended 31 December, 2010 as filed with the U.S. Securities and Exchange Commission, entitled 'Business,' 'Management's Discussion and Analysis of Financial Condition and Results of Operations' and 'Risk Factors.' This release is comprised of interrelated information that must be interpreted in the context of all of the information provided and care should be exercised not to consider portions of this release out of context. Investments in the Company should be considered speculative and prior to acquisition, should be thoroughly researched. Valley Forge Composite Technologies, Inc. does not intend to update these forward-looking statements prior to its reporting of its quarterly or annual results.

Investor Relations Contact:
Hayden IR
Brett Maas
Phone: 646-536-7331
Email: [email protected]

SOURCE Valley Forge Composite Technologies, Inc.