Digital Ally Reports 470% Increase in Pretax Income and 250% Increase in Net Income for Second Quarter of 2008, as Revenue Rises

OVERLAND PARK, Kan. , July 30 /PRNewswire-FirstCall/ -- Digital Ally, Inc. (Nasdaq: DGLY), which develops, manufactures and markets advanced video surveillance products for law enforcement, homeland security and commercial security applications...


OVERLAND PARK, Kan. , July 30 /PRNewswire-FirstCall/ -- Digital Ally, Inc. (Nasdaq: DGLY), which develops, manufactures and markets advanced video surveillance products for law enforcement, homeland security and commercial security applications, today announced higher sales and earnings for the second quarter and first half of 2008. An investor conference call is scheduled for 11:00 a.m. EDT today, July 30, 2008 (see details below).

For the three months ended June 30, 2008 , revenue approximated $8.9 million, which represented a 133% increase when compared with revenue of approximately $3.8 million in the three months ended June 30, 2007 .

Gross profits increased 122% to $5,429,532 (61.1% of revenue) in the quarter ended June 30, 2008 , compared with gross profits of $2,449,425 (64.1% of revenue) in the corresponding period of the previous year. Pretax income rose 470% to $2,301,280 in the most recent quarter, versus $403,872 in the prior-year period. After an income tax provision of $889,000, the Company recorded net income of $1,412,280 in the second quarter of 2008. This compared with no income tax provision and net income of $403,872 in the quarter ended June 30, 2007 .

Basic earnings per share increased 200% to $0.09 in the quarter ended June 30, 2008 , compared with earnings of $0.03 per basic share in the prior-year period. Diluted earnings per share rose 167% to $0.08 in the second quarter of 2008, versus $0.03 in the second quarter of 2007. The weighted average number of basic shares outstanding increased 11% to 15,329,259 in the quarter ended June 30, 2008 , versus 13,773,412 shares in the second quarter of 2007. The weighted average number of diluted shares outstanding increased 14% to 17,694,285 in the most recent quarter, compared with 15,548,520 in the prior-year quarter.

Adjusted EBITDA (net income before interest, income taxes, depreciation, amortization, and stock-based compensation), a non-GAAP financial measure, increased to $2,730,612 in the most recent quarter when compared with $841,677 in the quarter ended June 30, 2007 . (Adjusted EBITDA is described in greater detail in a table at the end of this news release).

For the six months ended June 30, 2008 , the Company reported that its revenue increased 141% to approximately $17.5 million, compared with revenue of approximately $7.3 million in the first half of 2007. Pretax income increased 752% to $4,824,067, versus $566,022 in the corresponding period of 2007. After an income tax provision of $1,735,000, the Company reported net income of $3,089,067 in the first half of 2008, compared with $566,022 (non-taxed) in the six months ended June 30, 2007 .

Basic earnings per share rose 425% to $0.21 in the six months ended June 30, 2008 , versus $0.04 in the first half of 2007. Diluted earnings per share increased 350% to $0.18 in the first half of 2008, compared with $0.04 in the year-earlier period. The weighted average number of basic shares outstanding increased 10% to 14,901,660 in the six months ended June 30, 2008 , versus 13,542,502 shares in the first half of 2007. The weighted average number of diluted shares outstanding increased 15% to 17,173,787 in the first half of 2008, compared with 14,960,015 in the prior-year period.

Adjusted EBITDA increased to $5,482,178 in the six months ended June 30, 2008 , versus $1,581,480 in the first half of 2007.

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