Hi Sergio, just started researching KDST
in the last 10 days. Like the online sales idea, easy for mothers to shop. Rumor of good news to come in more than one PR. Here is a portion of their last 10QSB:
Three months ended June 30, 1999 compared to the three months ended June 30, 1998.
Sales for the quarter ended June 30, 1999 increased 29.6% to $4,418,106, compared with $3,408,744 for the same period of 1998. Net income for the second quarter of 1999 improved to $182,763, compared with $62,497 for the same period in 1998.
Cost of sales decreased from 57.1% of net sales in 1998 to 55.2% in 1999. The change is attributable to improved cost of merchandise sold, which declined from 39.3% of sales in the first six months of 1998 to 35.3% of sales in the comparable 1999 period. The gain was partially offset by increased fulfillment costs.
Selling expenses, consisting of advertising and marketing costs, decreased to 26.1% of net sales in the second quarter of 1999, compared with 29.1% in the second quarter of 1998. This reduction is attributable to lower advertising costs and reduced marketing department expense.
General and Administrative expenses were $607,407, an increase of $216,063 from the $391,344 recorded in the same period in 1998. Approximately 34% of the increase was in depreciation and amortization expense, as we amortized the expense of the redesign of all of our catalogs that began in the fall of 1998. Other factors were increased wage expense, and reduced billings in our operating agreement with Havana.
Beginning January 1, 1998, we entered into a one-year contract to provide administrative and other support services to Havana. The contract details specific fees to be charged by Kids Stuff for providing administrative support and order fulfillment services to Havana. The contract also provides an additional charge of 5% of Havana's pretax profit for 1998. The contract extended on a monthly basis on January 1, 1999, and provided for reductions in services from us as Havana established its own operations. As a result, billings to Havana $56,736 for the three months ended June 30, 1999 were, compared with $177,377 during the same period in 1998.
Net income improved to $182,763 or 4.1% of sales during this quarter, compared with $62,497 or 1.8% of sales for the same period in 1998. The principal reason for this is the 29.6% sales increase with improved gross margins and slightly reduced selling expense as a percentage of sales.
Six months ended June 30, 1999 compared to the six months ended June 30, 1998.
Sales for the six months ended June 30, 1999 increased 21.7% to $8,051,664, compared with $6,613,621 for the same period of 1998. Net income for the first half of 1999 improved 156% to $310,947, compared with $121,557 for the same period in 1998.
Our sales increase came from the Natural Baby and Perfectly Safe catalogs, which recorded gains in merchandise sales of 34% and 23% respectively. These gains were offset by the Kids Club catalog, whose sales were down 8.8% from the same period last year due to reduced circulation of catalogs.
Cost of sales decreased from 59.7% of sales in 1998 to 56.0% of sales in 1999. The change is attributable to reductions in cost of merchandise sold, which declined 3.7% as a percentage of sales during the period. Other costs of fulfillment, such as shipping costs, packaging, direct labor, remained consistent as a percentage of sales.
Selling expenses, consisting of advertising and marketing costs, were 26.9% of total sales in the first half of 1999, compared with 26.6% in the first half of 1998, as our growth in sales of 21.7% was achieved without significantly increasing sales expense.
General and Administrative expenses increased by $251,834, from 11.5% of sales in 1998 to 12.5% in 1999. The most significant reason for this is increased depreciation and amortization expense, which increased $149,021 compared with the same period last year. In addition to this, wages increased $106,576 during the first six months of 1999 compared with the first six months of 1998.
Susie
p.s. Had a great opportunity to pick up KDST under 1.40 for a short period on Friday. |
