LAKE MARY, Fla. -- Dragged down by the performance of its InterAct video game division, Recoton Corp. extended its loss in the first quarter of 2000 to $2.6 million, up from the $1.5 million loss reported in the first three months of 1999.
Sales for the first quarter were relatively flat, with Recoton enjoying about a 1 percent increase for the three months, or $145.5 million, up from $144 million in the first quarter last year. Operating profit for the first quarter was $5.1 million, about a 45 percent jump over the $3.5 million reported in the first quarter of 1999.
Recoton is tying its outlook for growth in the coming quarters to the strong, improved results generated by its mobile and home audio, and consumer electronic accessory divisions during this year's first quarter. The company noted that in-vehicle entertainment systems represent a significant opportunity in both revenues and profit growth, and that the vehicles of the not-too-distant future will offer consumers access to digital entertainment, including VCRs, DVD players, video game systems, navigational products and the Internet.
The company's accessory business demonstrated solid increases in sales and profits in the first quarter, compared to the same period last year. Much of this result is attributed to strong sales of its Advent and Jensen 900MHz wireless headphone and speaker products and new digital product introductions.
"These positive results are masked by what we believe is a temporary weakness in the entire gaming industry due to its current transition phase," said president/CEO Robert L. Borchardt. "With the expected introduction of new, exciting and advanced game platforms by Sony, Nintendo and Microsoft in 2000 and 2001, our InterAct subsidiary is poised to benefit from what we expect will be one of the fastest growing sectors of the consumer electronics industry."