VERSUS TECHNOLOGY, INC. 
By Gross profits as a percentage of revenues were 71% for the current year's third quarter compared to 69% for the same quarter of the prior year. Operating expenses, other than cost of revenues, increased 25% for the current year's third quarter compared to the same quarter of the prior year, due primarily to an increase in research and development and sales and marketing expenses.
Versus reported a net loss of
For additional information, please refer to the attached unaudited consolidated financial statements.
Versus Technology, Inc. (Pink Sheets: VSTI.PK) ( www.versustech.com ) (Versus) is the leader in the development and sale of context-aware systems used for the management of patient flow and medical assets and to improve caregiver/patient communications in medical and long-term care facilities. Versus also supplies Active RFID/IR tags and readers that make locating systems more precise, security systems more intelligent, data collection routines automatic, and asset management systems more efficient. Versus' systems, which are currently installed in hospitals, corporate facilities, government facilities, and other complexes, permit the automatic and accurate registry of essential management and business information. By monitoring the precise location of personnel or equipment and automatically recording events associated with their locations, the systems offer real-time asset and staff locating, automatic data collection, access/egress control, and a passive source of location data that facilitates scheduling and communication interfaces. Versus' proprietary locating systems are sold primarily through an expanding network of resellers and dealers.
Safe Harbor Provision
This document may contain forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. These statements fall within the meaning of forward-looking information as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of important risks and uncertainties that could cause actual results to differ materially including, but not limited to, economic, competitive, governmental, and technological factors affecting the Company's markets and market growth rates, products and their rate of commercialization, services, prices and adequacy of financing, and other factors. The Company undertakes no obligation to update, amend, or clarify forward-looking statements, whether because of new information, future events, or otherwise.
Report of Management
The accompanying consolidated balance sheets of Versus Technology, Inc.
and Subsidiary as of
Management has elected to omit substantially all of the footnote
disclosures required by accounting principles generally accepted in
The reader should refer to the Versus Technology, Inc. 2007 Annual Report
which is available at www.versustech.com/annual_reports.htm for further
details regarding the Company's financial position at
Richard W. Ebersole
Chief Financial Officer
August 28, 2008
VERSUS TECHNOLOGY, INC. AND SUBSIDIARY
Consolidated Balance Sheets
(Unaudited)
July 31, 2008 October 31, 2007
Assets
Current Assets
Cash and cash equivalents $1,690,000 $2,428,000
Accounts receivable 661,000 1,134,000
Inventories 903,000 824,000
Prepaid expenses and other current assets 191,000 127,000
Total Current Assets 3,445,000 4,513,000
Property and Equipment
Machinery and equipment 401,000 374,000
Furniture and fixtures 100,000 92,000
Leasehold improvements 420,000 160,000
Construction in progress - 14,000
921,000 640,000
Less accumulated depreciation 577,000 542,000
Net Property and Equipment 344,000 98,000
Goodwill 1,533,000 1,533,000
Other Non-Current Assets 9,000 9,000
$5,331,000 $6,153,000
See accompanying report of management.
VERSUS TECHNOLOGY, INC. AND SUBSIDIARY
Consolidated Balance Sheets
(Unaudited)
July 31, 2008 October 31, 2007
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $470,000 $523,000
Accrued expenses 224,000 263,000
Deferred revenue from customer advance
payments 138,000 242,000
Total Current Liabilities 832,000 1,028,000
Shareholders' Equity
Common stock $0.01 par value;
120,000,000 shares authorized;
95,325,325 and 92,781,325 shares
issued and outstanding 953,000 928,000
Additional paid-in capital 42,657,000 42,483,000
Accumulated deficit (39,111,000) (38,286,000)
Total Shareholders' Equity 4,499,000 5,125,000
$5,331,000 $6,153,000
See accompanying report of management.
VERSUS TECHNOLOGY, INC. AND SUBSIDIARY
Consolidated Statements of Operations
(Unaudited)
Three Months Ended Nine Months Ended
July 31, July 31,
2008 2007 2008 2007
Revenues $1,176,000 $1,283,000 $4,026,000 $3,554,000
Operating Expenses
Cost of revenues 340,000 403,000 1,166,000 1,229,000
Research and development 218,000 137,000 601,000 455,000
Sales and marketing 814,000 648,000 2,371,000 1,733,000
General and
administrative 261,000 246,000 752,000 728,000
Total Operating Expenses 1,633,000 1,434,000 4,890,000 4,145,000
Loss From Operations (457,000) (151,000) (864,000) (591,000)
Other Income (Expense)
Interest income 9,000 17,000 40,000 45,000
Net foreign currency
transaction gains - - (1,000) 2,000
Total Other Income
(Expense) 9,000 17,000 39,000 47,000
Net Loss $(448,000) $(134,000) $(825,000) $(544,000)
Basic and Diluted Net
Loss Per Share $(-) $(-) $(-) $(-)
See accompanying report of management.
VERSUS TECHNOLOGY, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Unaudited)
For the nine months ended
July 31,
2008 2007
Operating Activities
Net loss $(825,000) $(544,000)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation 35,000 24,000
Amortization of intangibles - 41,000
Non-cash equity based compensation 82,000 82,000
Changes in operating assets and liabilities:
Accounts receivable 473,000 890,000
Inventories (79,000) (184,000)
Prepaid expenses and other current assets (64,000) (85,000)
Accounts payable (53,000) (36,000)
Accrued expenses (39,000) (2,000)
Deferred revenues - customer advance
payments (104,000) (46,000)
Net cash (used in) provided by operating
activities (574,000) 140,000
Investing Activities
Additions to property and equipment (281,000) (33,000)
Financing Activities
Issuance of common stock 117,000 352,000
Net (Decrease) Increase in Cash and
Cash Equivalents (738,000) 459,000
Cash and Cash Equivalents, at the
beginning of the period 2,428,000 1,401,000
Cash and Cash Equivalents, at the end
of the period $1,690,000 $1,860,000
See accompanying report of management.
SOURCE Versus Technology, Inc.
