YTD Is Slightly Down, But Prognosis Looks Good

Ballistic Recovery Systems, Inc. reported $1,879,221 in third quarter fiscal 2004 sales which represents a 2% increase over the $1,836,535 figure reported for same period in fiscal 2003. On a year to date basis fiscal 2004 sales figures are at $4,852,664 which is $267,012 below the comparable fiscal 2003 figure or a 5% reduction. According to the Company, several factors accounted for the decrease.
 
A one-time accounting adjustment of approximately $105,000 was recorded as a reduction in sales. This was attributed to stock purchase warrants held by Cirrus Design, the primary customer for the Company's general aviation products. In addition, the Company granted pricing reductions to Cirrus Design in compliance with the long-term purchase and supply agreement. An additional impact was modestly softer orders of the company's recreational aircraft products which account for approximately 25% of the Company's sales mix.

The Company is anticipating fiscal year 2004 revenues to exceed fiscal year 2003 by approximately 5% with gross revenues approaching $7,000,000. Net income is expected to lag slightly behind prior year levels as a result of expanded business development expenditures and legal fees. According to BRS President & CEO Mark Thomas, "BRS completed FAA certification of our new parachute system for Cessna model 182 aircraft this July. This has opened up a new market that includes over 5,000 potential new customers. Early sales activities suggest that a significant number of Cessna 182 owners are interested in this new system. This is in addition to the market potential that exists for approximately 10,000 Cessna 172 owners." Both the Cessna 172 and 182 models are in current production at Cessna. John Gilmore, VP of Sales, added, "Having a one-of-a-kind product tailored to a previously untouched market gives us significant strength going forward."

The Company is in active discussions with additional general and recreational aviation aircraft manufacturers in both the US and Europe to develop BRS systems designed specifically for their airplanes. These aircraft include a new category designated as Light Sport Aircraft (LSA) which the FAA projects could grow from 0 to 3000 planes by 2006 year end. "If we can make our products available for more aircraft, we think we can get more people flying," added Thomas.

Over the company's 18-year history, BRS has sold over 19,000 of its whole- plane parachute systems; and these have been documented to have saved over 167 lives.

FMI: www.brsparachutes.com