LRAD Corporation Announces Fiscal Q2 and First Half 2012 Results

Company Reports Small Profit for the First Six Months of Fiscal 2012

SAN DIEGO, CA, May 07, 2012 – LRAD Corporation (NASDAQ: LRAD), the world's leading provider of long range acoustic hailing devices (AHDs), today reported revenues of $2.4 million and a net loss of $292,000, or $0.01 per diluted share, for its fiscal second quarter ended March 31, 2012. The Company also reported revenues of $6.0 million and net income of $22,000, or $0.00 per diluted share, for the six months ended March 31, 2012.

"We effectively managed our business to generate breakeven results in our fiscal first half in spite of ongoing worldwide economic and defense budget uncertainties that resulted in lower year over year revenues," commented Tom Brown, president and chief executive officer of LRAD Corporation. "Even with global market conditions remaining unsettled, we anticipate achieving stronger second half results." Revenues for fiscal Q2 2012 decreased 85% from $15.5 million recorded in fiscal Q2 2011. The decrease in revenues was primarily attributable to the lack of orders replacing the delivery of a $12.1 million foreign military order in the quarter ended March 31, 2011.

Gross profit for fiscal Q2 2012 was $1.3 million, or 55% of revenues, compared to $10.9 million, or 70% of revenues, for the same quarter a year ago. The decrease in gross profit was primarily due to a much higher margin in fiscal Q2 2011 as a result of the higher revenues, lower product cost due to volume pricing, and higher fixed absorption due to the increased production levels to fulfill the large foreign military order.

Operating expenses for fiscal Q2 2012 decreased 68% to $1.6 million, compared to $5.1 million for the same period in the prior year. The decrease was primarily attributed to decreases of $3.0 million in commission expense primarily related to the large foreign military sale in the prior year and $482,000 in bonus expense as a result of not meeting current year performance targets.

Net loss for fiscal Q2 2012 was $292,000, or $0.01 per diluted share, compared to net income of $5.7 million, or $0.17 per diluted share, for the same period last year. The decrease in income was primarily attributable to the decrease in revenues and gross margin, partially offset by a reduction in operating expenses.

For the six months ended March 31, 2012, revenues decreased 66% to $6.0 million compared to $17.7 million for the six months ended March 31, 2011. For the first six months of fiscal 2012, gross profit was $3.1 million, or 51% of revenues, compared to $11.9 million, or 67% of revenues, for the same period a year ago. The decrease in gross profit was primarily due to a higher margin in the prior year as a result of the $12.1 million foreign military order, lower product cost due to volume pricing, and higher fixed absorption due to the increased production levels to fulfill the large foreign military order.

Operating expenses for the six months ended March 31, 2012 were $3.1 million, a decrease of $3.4 million from the same period a year ago. The decrease was primarily attributed to decreases of $3.0 million in commission expense primarily related to the large foreign military sale and $482,000 in bonus expense as a result of not meeting current year performance targets.

Net income for the six months ended March 31, 2012 was $22,000, or $0.00 per diluted share, compared to $5.3 million, or $0.17 per diluted share, for the same six-month period last year. The decrease in income was primarily attributable to the decrease in revenues and gross margin, partially offset by decreased operating expense.

Cash and cash equivalents of $13.9 million at March 31, 2012 were up $14,000 compared to September 30, 2011.

Management is scheduled to discuss the Company's fiscal Q2 2012 business and financial results on a conference call tomorrow, May 8, 2012, at 4:30 p.m. Eastern Time.

View the LRAD and Subsidiary Consolidated Balance Sheets

About LRAD Corporation
LRAD Corporation's Long RangeAcoustic Device® (LRAD®) directional communication systems are being used around the world in diverse applications including fixed and mobile military deployments, maritime security, critical infrastructure and perimeter security, commercial security, border and port security, law enforcement and emergency responder communications, and wildlife preservation and control. For more information about LRAD Corporation and its long-range directional sound systems, please visit the company's web site at http://www.lradx.com/.