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Cobra Q4 Sales Increase 6.2%

2/20/2002 09:12:00 AM Eastern

Chicago - Driven by new products in its Family Radio Service (FRS) two-way radio business, as well as aggressive expansion in its distribution network, mobile communications products maker Cobra Electronics reported a 6.2 percent increase in fourth-quarter sales, hitting $52 million, up from $48.8 million in the year-ago period.

'FRS experienced growth in domestic sales of more than 30 percent in the fourth quarter,' said Jim Bazet, Cobra president/CEO. 'This has added strength to our solid No. 2 position in this fast growing segment of the large two-way mobile communications industry,' he said.

In the fourth quarter ended Dec. 31, Cobra recorded net income of $2.2 million, down from $3 million in the same quarter in 2000.

At the same time, the company said it had improved gross margin in the fourth quarter by 70 basis points, hitting 29 percent, up from 28.3 percent in the same three months the previous year.

In the 12 months, Cobra sales climbed 6.6 percent, to $154.1 million, up from $144.6 million in 2000. However, net income dropped to $4.7 million, down from $7.2 million the previous year. Excluding one-time, second-quarter 2001 expenses, the company's net income for the current 12 months would have been $5.5 million.

Gross margin for the 12 months was 28 percent, a 20-basis-point dip from the 28.2 percent registered in 2000.

'The weakening economy and resulting price reductions by our competitors led to significantly higher selling expenses for the company, and this was a major reason for the drop in income in 2001,' said Bazet.

At the end of 2001, Kmart owed Cobra nearly $4 million, however, because of certain programs put into place prior to Kmart's bankruptcy filing in January, Cobra will realize substantially all of the amounts owed to it by the discount chain, said Cobra.

Cobra, which announced entry into the Global Positioning System (GPS) market at the International Consumer Electronics Show in January, said its three-model lineup of hand-held GPS products will start shipping in the second half of this year.