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SANTA MONICA, Calif., Dec 15, 2011 (BUSINESS WIRE) –
Forward Industries, Inc.


/quotes/zigman/66041/quotes/nls/ford FORD
0.00%



, a designer and distributor of
custom carry and protective solutions, today announced financial results
for its fiscal year ended September 30, 2011.

Fiscal 2011 Financial Results — Compared to fiscal 2010:

–
Net sales increased $3.8 million, or 20%, to $22.8 million in fiscal
2011 due to higher sales of diabetic products, which increased $2.5
million, or 18%, and higher sales of Other Products, which increased
$1.2 million, or 26%.

–
Gross profit increased $0.8 million, or 20%, to $5.1 million in fiscal
2011 primarily due to the increase in net sales, and to a lesser
extent, decreases in certain components of costs of goods sold as a
percentage of sales. These improvements to costs of goods sold were
offset, in part, by higher materials costs.

–
Sales and marketing expenses increased $1.2 million, or 56%, to $3.4
million in fiscal 2011 primarily due to investments we made in
personnel and the incurrence of related travel and entertainment
costs. To a lesser extent, additional investments made with regard to
office and telecommunication, product development, and sampling and
promotion also contributed to the increase. Such investments were made
in Fiscal 2011 in order to expand our business, the beginnings of
which we expect to see in the first quarter of our 2012 fiscal year,
with continued growth thereafter.

–
General and administrative expenses increased $1.1 million, or 29%, to
$4.7 million in fiscal 2011 primarily due to investments we made in
personnel including the payment of retention and inducement bonuses
and the incurrence of related travel and entertainment costs, which,
in part, was related to the relocation of our executive offices. To a
lesser extent, additional investments made with regard to
telecommunication, general office, and professional services also
contributed to the increase. Such investments are related to the
anticipated growth referred to in the preceding paragraph.

–
Other income (expense) increased to $58 thousand of income in fiscal
2011 from $10 thousand of income in fiscal 2010, due primarily to
higher interest income resulting from a note receivable.

–
Net loss was $2.9 million, or ($0.36) per share, in 2011 compared to
net loss of $1.7 million, or ($0.21) per share, in fiscal 2010. The
increase in net loss was due primarily to the investments in operating
expenses made in respect of fiscal 2011 and in anticipation of the
growth we expect for our fiscal 2012 year (primarily sales and
marketing as well as general and administrative expenses), which were
offset, in part, by higher gross profit and other income.

Brett M. Johnson, Forward’s President and Chief Executive Officer,
commented: “We are pleased with the growth in sales and gross profit
that we achieved in our OEM business for fiscal 2011, which, on a
standalone basis, would have been profitable in fiscal 2011. Our net
loss in fiscal 2011 directly reflects the ongoing investments we are
making in diversifying our selling channels and expanding our product
portfolio.”

Mr. Johnson continued: “In our OEM business, we have recently been
awarded several large programs by two major customers. We anticipate
that these programs will begin to contribute meaningfully to revenues in
the second half of fiscal 2012. In addition, we have experienced
increased interest from several existing customers in both diabetic and
consumer electronics products. We are committed to growing our OEM
business and we are encouraged by the momentum we are experiencing in
this channel. At the same time, there are also headwinds in this market,
as we continue to face a very price-constrained environment and are
looking at increases in supplier prices.”

“As previously announced, our strategy is to leverage our design,
logistics, and sourcing expertise to build a global, multi-channel
(retail, corporate, online and OEM) consumer electronics accessory brand
that defines itself through leading edge technology. We have invested
significantly in product development and sales resources in order to
launch a “Forward” branded line of cases and accessories into the retail
and corporate marketplace. This product range will include an extensive
collection of cases for smartphones, tablets and portable computers,
incorporating our exclusive license of G-Form’s revolutionary and
patented protection technology.”

“We believe the investments we have made in experienced sales, design,
product development, operations, and administrative personnel, will bear
fruit in fiscal 2012 with the expansion of our product range, customer
base and geographic coverage. As a result, we hope to achieve our goal
of transitioning Forward from a predominantly “in-box” medical OEM case
company, to a multi-channel, multi-product, geographically diverse
business that differentiates itself through cutting-edge technology,
design and innovation.”

The tables below are derived from the Company’s audited, consolidated
financial statements included in its Annual Report on Form 10-K filed
today with the Securities and Exchange Commission. Please refer to the
Form 10-K for complete financial statements and further information
regarding the Company’s results of operations and financial condition
relating to the fiscal years ended September 30, 2011 and 2010. Please
also refer to the Form 10-K for a discussion of risk factors applicable
to the Company and its business.

Note Regarding Forward-Looking Statements

In addition to the historical information contained herein, this press
release contains certain “forward-looking statements” within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, that reflect
Forward’s current expectations and projections about its future results,
performance, prospects and opportunities. Forward has tried to identify
these forward-looking statements by using words such as “may”, “should,”
“expect,” “hope,” “anticipate,” “believe,” “intend,” “plan,” “estimate”
and similar expressions. These forward-looking statements are based on
information currently available to the Company and are subject to a
number of risks, uncertainties and other factors that could cause its
actual results, performance, prospects or opportunities in fiscal 2012
and beyond to differ materially from those expressed in, or implied by,
these forward-looking statements. No assurance can be given that the
actual results will be consistent with the forward-looking statements.
Investors should read carefully the factors described in the “Risk
Factors” section of the Company’s filings with the SEC, including the
Company’s Form 10-K for the year ended September 31, 2011 for
information regarding risk factors that could affect the Company’s
results. Except as otherwise required by Federal securities laws,
Forward undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, changed circumstances or any other reason.

About Forward Industries

Forward Industries, Inc. a designer and distributor of custom carrying
case solutions for hand held electronic devices, is expanding into a
multi- faceted product-focused company specializing in power, protection
and peripherals, is expert at identifying new products that aim to make
life more efficient with superior function and smart design that enhance
daily life. Forward’s products, including those incorporating G-Form’s
extreme protection technology, can be viewed online at
www.forwardindustries.com .

                                                 FORWARD INDUSTRIES, INC.
                                           CONSOLIDATED STATEMENTS OF OPERATIONS
                                                                                For the Fiscal Years Ended
                                                                                       September 30,
                                                                                2011                  2010
                                                                        --------------------- ---------------------
        Net sales                                                          $ 22,777,040          $ 18,996,827
        Cost of goods sold                                                   17,712,425            14,764,840
                                                                             ----------            ----------
        Gross profit                                                          5,064,615             4,231,987
                                                                             ----------            ----------
        Operating expenses:
           Sales and marketing                                                3,391,396             2,166,542
           General and administrative                                         4,688,236             3,636,309
                                                                             ----------            ----------
              Total operating expenses                                        8,079,632             5,802,851
                                                                             ----------            ----------
        Loss from operations                                                 (3,015,017)          (1,570,864)
                                                                             ---------- ----       ---------- ----
        Other income (expense):
           Interest income                                                      107,686                42,941
           Other expense, net                                                   (49,258)             (32,868)
                                                                             ---------- ----       ---------- ----
              Total other income                                                 58,428                10,073
                                                                             ----------            ----------
        Loss before income tax (benefit) expense                             (2,956,589)          (1,560,791)
        Income tax (benefit) expense                                            (56,050)             124,032
                                                                             ---------- ----       ----------
        Net loss                                                           $ (2,900,539)        $ (1,684,823)
                                                                        ==== ========== ====  ==== ========== ====
        Net loss per common and common equivalent share
              Basic                                                        $      (0.36)        $      (0.21)
                                                                        ==== ========== ====  ==== ========== ====
              Diluted                                                      $      (0.36)        $      (0.21)
                                                                        ==== ========== ====  ==== ========== ====
        Weighted average number of common and common equivalent shares
        outstanding
              Basic                                                           8,080,344             7,983,257
                                                                             ==========            ==========
              Diluted                                                         8,080,344             7,983,257
                                                                             ==========            ==========

                                                    FORWARD INDUSTRIES, INC.
                                                   CONSOLIDATED BALANCE SHEETS
                                                                                  September 30,         September 30,
                                                                                      2011                  2010
                                                                              --------------------- ---------------------
        Assets
        --------------------------------------------------------------------
        Current assets:
         Cash and cash equivalents                                               $ 14,911,844          $ 18,471,520
         Accounts receivable, net                                                   3,894,118             4,621,181
         Inventories                                                                1,045,219             1,036,386
         Prepaid expenses and other current assets                                  1,018,227               240,651
         Note receivable                                                            1,000,000                    --
                                                                                   ----------            ----------
            Total current assets                                                   21,869,408            24,369,738
        Property and equipment, net                                                   302,158               115,205
        Other assets                                                                   88,716                46,032
                                                                                   ----------            ----------
        Total assets                                                             $ 22,260,282          $ 24,530,975
                                                                              ==== ==========       ==== ==========
        Liabilities and shareholders' equity
        --------------------------------------------------------------------
        Current liabilities:
           Accounts payable                                                      $  2,947,562          $  2,439,273
           Accrued expenses and other current liabilities                             630,031               885,332
                                                                                   ----------            ----------
            Total current liabilities                                               3,577,593             3,324,605
                                                                                   ----------            ----------
        Commitments and contingencies
        Shareholders' equity:
           Preferred stock, par value $0.01 per share; 4,000,000 shares
           authorized;
                                                                                           --                    --
            no shares issued
           Common stock, par value $0.01 per share; 40,000,000 shares
           authorized,
            8,794,296 and 8,761,629 shares issued (including 706,410 held in
                                                                                       87,943                87,616
            treasury at both dates)
           Capital in excess of par value                                          16,845,673            16,469,142
           Treasury stock, 706,410 shares at cost                                  (1,260,057)          (1,260,057)
           Retained earnings                                                        3,009,130             5,909,669
                                                                                   ----------            ----------
        Total shareholders' equity                                                 18,682,689            21,206,370
                                                                                   ----------            ----------
        Total liabilities and shareholders' equity                               $ 22,260,282          $ 24,530,975
                                                                              ==== ==========       ==== ==========

SOURCE: Forward Industries, Inc.

        Forward Industries, Inc.
        James McKenna, CFO, 424-268-3836

Copyright Business Wire 2011

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