Chicago - Cobra Electronics reported higher net earnings and sales for the fourth quarter of 2010, as compared with the prior-year period.
Net earnings were $2.3 million in Q4 2010, compared with $1.8 million in 2009. This includes a $1.2 million tax benefit due to a one-time election to carry back net operating losses.
The earnings improvement resulted from higher net sales, which increased by $2.1 million, or 6.3 percent, to $34.8 million, compared with $32.8 million in the prior year's quarter, Cobra said. Higher gross margin, which increased 2.1 points, to 27.9 percent, from 25.8 percent in the fourth quarter of 2009, also contributed to the rise, the company added.
For the year, Cobra reported net income of $1.6 million, compared with a net loss of $10.3 million (which also included a net $8.4 million tax valuation allowance charge), in the prior year.
Segment sales increased 9.7 percent in the fourth quarter, driven by strong sales in CB radios as well as several new product introductions: the iRadar, PhoneLynx and 7750 Platinum truck navigation product.
For the year, consolidated net sales increased $5.3 million, or 5 percent, to $110.5 million from $105.2 million in 2009. The increase for the Cobra segment was $2.5 million, or 2.7 percent, while the increase for the PPL segment was $2.8 million, or 23.5 percent. The increase in Cobra segment net sales was attributable primarily to higher sales of CB radios domestically, the company said, as well as to an increase in European sales. These increases were partially offset by a decline in sales of radar detection domestically.
The increase in net sales for PPL was primarily higher sales of satellite navigation products.
"Because of the improvement in net sales and gross margin and lower selling, general and administrative expense, the company had operating income of $1.8 million for 2010, compared to an operating loss of $3.7 million in 2009, a favorable swing of $5.5 million," said Jim Bazet, Cobra chairman and CEO.
Consolidated net earnings in 2010 were $1.6 million, compared with a net loss of $10.3 million in 2009. This contained a tax provision of $6.8 million, including the $8.4 million tax valuation allowance charge and $1.2 million tax benefit. Net earnings for 2010 included a $380,000 tax benefit, which resulted from an additional refund under the 2009 one-time election to carry back net operating losses and a prospective reduction in the U.K. corporate tax rate, the company said.