Emerson Q1 CE Sales Up 17.7%

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Parsippany, N.J. - With unit sales increases of audio products and licensing revenue leading the way, Emerson Radio recorded a 17.7 percent jump in consumer electronics revenue in the first quarter, to $57.9 million, compared with $49.2 million in the first three months of last year.

The sales increase was partially offset by a decrease in sales of microwave ovens.

Net income for the CE segment improved to $2.6 million in the current quarter, compared with $2.5 million in the same quarter in 2001. Net income would have been $4.4 million in the first quarter, absent a non-cash tax expense.

CE gross margin in the first quarter climbed 350 basis points, to 19.6 percent, up from 16.1 percent in the year-ago first quarter. The hike was attributed to a growth in licensing revenue and improved margin on audio and microwave oven products.

CE operating income surged to $4.4 million in the first quarter, up from $2.4 million in the same year-ago three months.

Strong demand for consumer electronics more than offset a slight decline in sporting goods sales at Emerson Radio, helping the company post an overall first quarter revenue increase of 9.8 percent in the three months ended June 30.

Emerson, which is reporting its first quarter financial results a mere three weeks after reporting fourth quarter figures, said consolidated revenue hit $84.7 million, up from $77.1 million in the year-ago first quarter. The sporting goods segment accounted for $26.8 million, down from $28 million year over year.

Consolidated gross margin soared 310 basis points, to 23 percent, in the first three months, compared with 19.9 percent in the same period in 2001. Emerson said higher gross margin in its consumer CE segment was attributed to strong licensing revenue growth and core product sales.

Overall operating income for Emerson's first quarter increased 106 percent, reaching $5.5 million, up from $2.7 million in the same three months last year. Net income hit $2.7 million for the first quarter, compared with $2.2 million year over year.


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