Chicago – Cobra Electronics reported higher sales, but slightly lower net income for the third quarter, ended Sept. 30.
Net income was $394,000 as compared to net income of $564,000 for the third quarter of 2012. In addition, there was operating income of $124,000 for the current quarter compared to operating income of $304,000 in the same quarter last year.
Consolidated net sales were $29.0 million compared to $27.7 million in the third quarter of 2012, with the Cobra segment reporting a $1.5 million, or 6.2 percent, increase in sales and the Performance Products Limited ("PPL") segment reporting a sales decrease of $122,000, or 3.3 percent.
The sales increase for the Cobra segment resulted from higher domestic sales of detection products, two-way radios, and a new category, dash cams, which were limited as a result of supplier constraints. The increase in sales of detection products reflected strong demand for certain new products and the higher sales of two-way radios resulted from improved sell-through and additional placement.
“We are pleased with the growth in revenue, however, we remain disappointed that our margins were lower than both our expectations and compared to the third quarter of 2012. Nevertheless, we believe that the increase in net sales and a return to profitability in the third quarter of 2013 are encouraging signs that our company has turned the corner heading into the fourth quarter, which is typically the strongest quarter of our company's fiscal year,” said Jim Bazet, Cobra's chairman/CEO.
In discussing the outlook for the fourth quarter of 2013, as well as the entire year, Bazet said, "We are continuing to implement several actions which began in the third quarter of 2013 that are aimed at significantly improving our financial performance. Some of these actions include substantially reducing operating expenses, adding meaningful sales of several exciting new products and taking certain steps to promote and improve distributor sales.”
Bazet added that Cobra expects higher operating income for the fourth quarter.
“However, even absent the Fleming litigation expenses, the company anticipates a lower operating income in fiscal year 2013 compared to fiscal year 2012 due to the losses experienced in the first half of 2013.”