Alpha Pro Tech net income rises 4.7% in 2012

Shield sales were down by 0.2% to $1.4 million. The overall mask sales decrease for 2012 was primarily due to a decline in industrial mask sales as a result of our previous largest industrial distributor launching its own line of masks, partially offset by an increase in medical mask sales.

Gross profit for the three months ended December 31, 2012 increased by 4.7% to $3.4 million, or 34.4% gross profit margin, compared to $3.2 million, or 35.3% gross profit margin, for the same period in 2011. Gross profit for the year ended December 31, 2012 increased 2.9% to $14.5 million, or 35.2% gross profit margin, from $14.0 million, or 36.5% gross profit margin, for 2011. The gross profit margin for the year ended December 31, 2012 was affected by the Building Supply segment margin, which has declined due to increased raw material costs and competitive pricing pressures.

Selling, general and administrative expenses increased by 26.6% to $3.3 million for the fourth quarter of 2012 from $2.6 million for the same quarter of 2011. As a percentage of net sales, selling, general and administrative expenses increased to 33.8% for the three months ended December 31, 2012 from 28.7% for the same period of 2011.

Selling, general and administrative expenses for the year ended December 31, 2012 increased by 4.5% to $12.9 million from $12.3 million for 2011. The increase was primarily due to increased sales and marketing expenses for both the Building Supply and Disposable Protective Apparel segments, which enjoyed revenue growth in 2012. In addition, executive bonuses were declined in 2011. As a percentage of net sales, selling, general and administrative expenses decreased to 31.4% for the year ended December 31, 2012 from 32.0% for 2011.

Net income decreased by 66.8% for the three months ended December 31, 2012 to $118,000, compared to $355,000 for the three months ended December 31, 2011. Net income as a percentage of net sales for the three months ended December 31, 2012 and 2011 was 1.2% and 3.9%, respectively. Basic and diluted net income per common share for the three months ended December 31, 2012 and 2011 were $0.01 and $0.02, respectively.

Net income increased by 4.7% for the year ended December 31, 2012 to $977,000, compared to $933,000 for 2011. Net income as a percentage of net sales for the year ended December 31, 2012 and 2011 was 2.4% and 2.4%, respectively. Basic and diluted net income per common share for the years ended December 31, 2012 and 2011 were $0.05 and $0.04, respectively.

The consolidated balance sheet remained strong with a current ratio of 19:1 as of December 31, 2012, compared to 35:1 as of December 31, 2011. The Company completed the fourth quarter of 2012 with working capital of $29.6 million.

Alpha Pro Tech