Marked by a difficult year that included the economic slowdown, over-capacity in manufacturing, intense pricing competition and diminished consumer confidence, Audiovox reported a decrease in both sales and earnings for its fiscal fourth quarter.
The consumer electronics, cellphone, entertainment systems and vehicle security maker reported overall net sales of $345.8 million in the three months ended Nov. 30, down 32.3 percent from the $510.9 million recorded in the year-ago period. Net loss for the fourth quarter was $2.3 million, compared with income of $5.1 million in the same quarter in 2000.
"In the wireless industry, growth that had been driven by the change from analog to digital slowed dramatically as the demand for replacement handsets subsided," said chairman/CEO John Shalam, about one of the key reasons for Audiovox's down quarter.
The company's Audiovox Communications subsidiary was hurt by economic conditions unfavorable to the wireless business, and recovery has been slow. Audiovox anticipates that this sluggish market will continue for the first half of 2000, but that new product introductions using 1X technology should help restore margin and profit in the second half of the fiscal year.
In the company's CE subsidiary, Audiovox Electronics, sales were boosted by 8 percent and it finished with its best sales year in history, according to president/CEO Patrick Lavelle. "Strong sales in mobile video and CE products continue to give us the opportunity to expand distribution and strengthen our customer base."
Looking ahead to fiscal 2002, Lavelle noted Audiovox has a number of new products coming out of the CE subsidiary, namely a self-contained DVD rear-seat entertainment system, satellite radio, a vehicle tracking system, a GPS 5-mile two-way radio and home theater systems utilizing new flat-screen technology.
Looking to next year, Audiovox has revised its overall company estimates for the first quarter to revenue ranging from $240 million to $253 million. It expects wireless unit sales of about 1.2 million to 1.3 million. It also anticipates a small loss for the first quarter in 2002.
For the full year, the company expects revenue in the range of $1.2 billion to $1.4 billion, and wireless unit sales between 8 million and 8.5 million units. Audiovox anticipates that the first half of the year will be slow, but business should pick up in the third and fourth quarters.
In the full fiscal year, overall Audiovox net sales were $1.3 billion, a 25.6 percent drop from the $1.7 billion in sales for 2000. Net loss totaled $7 million, down from $27.2 million in 2000.