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Audiovox Reports Delayed Fiscal Q4 Financials

6/03/2003 09:40:00 AM Eastern

Hauppauge, N.Y. - Following a delay filing its fourth quarter and 12-month financial results, due to a Securities and Exchange Commission comment letter and completion of an audit, Audiovox has filed a 10-K for its fiscal year, ended Nov. 30, 2002.

The Audiovox Electronics (AEC) subsidiary, including mobile video, security and consumer product categories, was "positively impacted by continued growth," during the fourth quarter, posting $105.8 million in sales on income before taxes of $2.8 million.

The Audiovox Communications (ACC) subsidiary saw wireless sales impacted by reduced consumer demand, price erosion and delivery delays by some ACC suppliers, resulting in fourth quarter sales of $211.1 million, and a loss before taxes of $9.4 million.

Overall Audiovox fourth quarter sales hit $316.9 million, and net loss for the three months - which includes a valuation allowance, or charge of $13.1 million, on ACC's deferred tax assets - was $15.1 million. In the fourth quarter a year earlier, sales reached $341.2 million, with a loss of $3.1 million.

For the 12 months, the ACC subsidiary recorded revenue of $727.7 million, and a loss before taxes of $24.9 million. The AEC subsidiary reported sales of $372.7 million for the fiscal year, on income before taxes of $17.7 million.

Overall 12 month results for Audiovox shows sales of $1.1 billion, and a loss of $14 million. A year earlier, 12-month sales hit $1.3 billion, combined with a loss of $7.2 million.

"We are pleased to get this difficult period behind us and are anxious to get on with the company's business for 2003," said John J. Shalam, chairman. "Our balance sheet remains strong and we are in a position to grow, with both new product additions and synergistic business acquisitions, should they arise."

As a result of its SEC dealings, Audiovox has restated results for fiscal years 2000, 2001 and the first three quarters of 2002. At the end of May, Audiovox announced a cumulative change to income and equity of $1 million. At the completion of the audit, the cumulative change results in a loss of $65,000 through the period ending Aug. 31, 2002.

In finalizing its 10-K, Audiovox made an additional adjustment to its financial statements, reversing $1.7 million in expenses which was previously recorded in paid in capital. This resulted in an increase in stockholders equity and reduced the gain recorded on the issuance of those shares.

After recovery for income taxes, the net charge to the income statement was $1.1 million. The net effect of the adjustments had no impact on Audiovox's cash balances for any of those periods, said the company.

As soon as Audiovox files its 10-Q for the quarter ended Feb. 28, 2003, it intends to request that Nasdaq remove the "E" on its trading symbol. This is subject to Nasdaq's requirement that the company file its 10-Q for the quarter ended May 31, 2003 on or before July 15.