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Audiovox Posts Year, Q4 Sales Gains

5/15/2008 09:45:00 AM Eastern

Hauppauge, N.Y. — Audiovox reported double-digit sales gains for its fiscal fourth quarter, ended Feb. 29.

While the company posted a fiscal year increase in net income, Audiovox reported a slightly higher quarterly loss.

In its fiscal fourth quarter, net sales were $131.3 million, an increase of 36.6 percent compared with $96.1 million reported in the comparable prior year quarter.

The operating loss for the quarter was $3.5 million compared with an operating loss of $2.6 million reported in the comparable prior year period.

The net loss for continuing operations, after completion of a foreign tax audit, was $1.8 million compared with a net loss of $300,000 in the fiscal 2007 fourth quarter.

Audiovox said that on a pro forma basis, excluding non-recurring charges it would have had a “break even” Q4

Electronics sales, which include both mobile and consumer electronics were $95.8 million in the fiscal fourth quarter, an increase of 15.3 percent compared with the prior year’s Q4 of $83.1 million.

Accessories sales in the quarter were $35.5 million, an increase of 173.1 percent compared with sales of $13.0 million in the fiscal 2007 fourth quarter. This increase was primarily due to sales generated by the acquired operations of Thomson, Oehlbach and Technuity, the latter two, which were not part of fiscal 2007 results.

Pat Lavelle, president/CEO, said in a prepared statement, “During the fourth quarter we assimilated additional overhead for the Thomson audio video and Technuity acquisitions during what is traditionally our weakest period. In addition, the period was further impacted by the economic conditions facing our customers and consumers, which affected Holiday sales as well as automobile sales that continue to suffer due to the state of the economy and rising fuel prices.”

Lavelle concluded, “The acquisitions we made last year provide us with the strongest portfolio of brands we’ve ever had, give us added leverage at the retail level domestically and enhance our foundation internationally. Our focus this year is to fully consolidate the five acquisitions we made in 2007 and generate the types of returns this company is capable of achieving.”

For the fiscal year Audiovox reported net sales of $591.4 million, an increase of 29.5 percent compared with $456.7 million reported in the comparable prior year period.

Operating income for fiscal 2008 was $4.4 million compared with an operating loss of $5.1 million in fiscal 2007. Pretax income from continuing operations for fiscal 2008 was $10.6 million, an increase of $8.4 million, or 381.8 percent, compared with $2.2 million in the comparable prior year.

Net income from continuing operations in fiscal 2008 was approximately $6.7 million compared with $3.7 million in fiscal 2007. 

Audiovox said it has shipped OEM two-way remote starters to General Motors, and is supplying OEM car entertainment products for MOPAR.

The company said it does not expect any further major acquisitions this year, after completing five recently and will focus on creating synergies with those recently purchased. 

When asked during a conference call with analysts how the proposed merger between Sirius and XM would impact sales, the company said it does not expect much impact through 2009.   Audiovox Electronics president and CEO, Pat Lavelle said, “We’re monitoring the situation very closely...I think our prospects for working with them are very good in a post merger.” Audiovox is the distributor for XM. Directed, the distributor for Sirius recently extended its contract with Sirius through January, 2009.

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