Here's some info on SCTU. .09*.09
Look for reasons behind Friday's sudden interest.
SC&T International, Inc. (the "Company") was formed in June 1993. The Company develops and markets accessory and peripheral products for the computer and video game industries under its PLATINUM SOUND and PER4MER registered trademarks and its AIR RACER trademark. The Company's products include sub-woofer and speaker sound enhancement systems, headphone & microphone accessory items, PC volume controllers, and the largest assortment of PC and video arcade racing wheels and game controller products for Nintendo, Sony Playstation and IBM-PC's.
SC&T,s Per4mer line has expanded and now comprises products that offer Force Feed Back, Optical and Tilt technologies. It has also successfully launched its Air Racer controller, an innovative item which is a racing wheel, fight yoke and game controller, all in one. SC&T plans to take a very aggressive positioning for its line of Per4mer products in 1999.
The Company's multimeda keyboards line has been discontinued in favor of a second generation product targeted at the corporate market. This second generation product, which, features an enhanced Voice Recognition product, has been completed, but at this time has not been introduced into the market. However, the Company is entering into license agreements with other keyboard manufacturers which will provide SC&T with additional income from the U.S.technology patents it holds for this technology.
The Company continues to reduce operating costs, while increasing both its distribution base and gross margins on products sold. Over the past 2-3 months, new an improved retail and reseller alliances have been made both by the Company's North American and European operations. SC&T Is very optimistic about adding many more customers and increasing the number of products currently sold by these customers. The Company's Chairman is also planning a more active role in the Company's global sales operations, which SC&T hopes will increase the number of customers for the Company.
On December 31, 1994, the Company purchased SC&T Europe, a marketing and distribution company located in Antwerp, Belgium. The Company, in an effort to reduce its European operating costs, consolidated its European distribution operations into one central facility located in the United Kingdom, in May 1997. The Company formed SC&T Europe Limited, located in Portsmouth England. The Belgium office was closed in August, 1998. All current marketing and distribution operations, including a United Kingdom domestic sales force, is now being handled out of the United Kingdom operations.
The expansion in the number of customers and the corresponding increase in revenue since commencing operations, the Company's total revenue exceed operating expenses revenue, resulting in a net profitof approximately $68,000
for the three months ended October 31,1998. The Company's primary costs are for research and development, tooling for new products, inventory, trade shows, and selling and promotion activities. Although these expenses were kept to a minimum during the quarter, the Company expects these costs to increase at a reduced rate when compared to the expected rate of increase in sales. In addition, operating results may be influenced by factors such as the demand for the Company's products, the timing of new product introductions by both the Company and its competitors, pricing by both the Company and its competitors, inventory levels, the Company's ability to develop and market new products, the Company's ability to manufacture its products at high quality levels and at commercially reasonable costs, the timing and levels of sales and marketing expenditures, and general economic conditions.
Operating results of the Company for the thre month period ended October 31,1998 and 1997.
NET SALES
Net sales for the three months ended October 31,1998 increased $516,000 or 39% compared to the three months ended October 31,1997. The sales increase is attributed to the Company,s new product Air Racer introduced in September.
GROSS PROFIT
The Company's gross profit percentage for the three months ended October 31,1998 was $701,000 or 38% in contrast to a gross profit of 20% for the quarter ended July 31,1997. Gross profit margins are affected by several factors, including the product mix between the Company's products. Typically, products sell at gross profit margins ranging from 20% to 40%. The Company anticipates that new products will initially sell at higher gross profit margins. However, there can be no assurance that higher margins will be maintained over the life of the product.
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