Sales for the six months ended June 30, 2013 were $26.8 million, an increase of 22.1% from same period in 2012.
Gross profit for the first six months of 2013 was $8.7 million, or 32.6% of sales, as compared to $7.1 million, or 32.5% of sales, for the same period in 2012.
Operating expenses for the six months ended June 30, 2013 were $6.9 million, or 25.9% of sales, as compared to $6.6 million, or 30.2% of sales, in the first half of 2012. Sales and marketing expenses of $2.8 million increased 23.5% from the same period in 2012. General and administrative expenses for the period totaled $4.1 million, a decrease of 5.3% from the prior year period.
Net income for the six months ended June 30, 2013 was $1,543,000, more than three times higher than net income of $466,000 in the same period in 2012.
Recapitalization
On July 12, 2013, Talon redeemed all of its outstanding Series B Preferred stock for $18.8 million. This resulted in an effective immediate $7.1 million benefit to common shareholders as the Company eliminated the shares at a significant discount from its book value of $25.9 million. T
he preferred share liquidation preference was scheduled to increase 16% annually, and would have reached nearly $41 million when it was due to mature in 2016, so the longer-term savings achieved through the early redemption was even more significant.
Talon funded the redemption with $13.0 million in cash and a $5.8 million promissory note. Talon also raised $5.5 million through a strategic equity sale of 61.1 million shares of common stock to a group of private investors, including Chairman of the Board Mark Dyne, and a former Board member. The Company now has 91.9 million common shares outstanding.
Talon International