Small-appliance maker Salton, Inc., of Lake Forest, IL, U.S., announced its fiscal 2004 results for the fourth quarter and full year ending July 3, 2004. The company reported net sales of $249.7 million U.S. for the fourth quarter, compared to $189.2 million for the fiscal 2003 fourth quarter. Salton also reported a loss of $50.2 million, or $4.42 per share, versus a loss of $8.8 million or $0.79 per share for the same period of fiscal 2003.
Net sales increases were attributed to the inclusion of an additional $42.5 million in sales from Amalgamated Appliances Holdings Limited as a result of growth and the inclusion a full fourth quarter of sales. The company also experienced $9.4 million in favorable currency effects and $5.8 million of growth in other international operations. U.S. sales grew by $2.8 million, the first increase in the U.S. since the 2002 fiscal year. The George Foreman product line posted a global increase in sales of 7.1 percent for the fourth quarter. Salton reported that its loss in the fiscal 2004 fourth quarter included a $23.6 million pre-tax charge associated with its U.S. restructuring plans.
For the full fiscal year 2004, Salton reported net sales of $1.1 billion versus $894.9 million in the fiscal 2003 period. Included in Salton's fiscal 2004 net sales report is an additional $206.4 million in sales for a full year of Amalgamated Appliances. The company also experienced $29.2 million in favorable currency effects and $12.6 million of growth in other international operations. Offsetting these increases was a $66.5 million decline in the U.S market primarily due to a decrease in George Foreman product sales in the first part of the year. For the full year, Salton reported a net loss of $95.2 million, or $8.45 per share, versus net income of $8 million, or $0.53 per diluted share in the fiscal 2003 period.
Since May, Salton has undergone a restructuring plan to reduce its annual U.S operating expenses by a minimum of $40 million, through a 25-percent reduction in its U.S workforce, the closure of several facilities, a reduction in advertising, and other consolidation and cost reduction initiatives. During the month of July, Salton's SG&A and distribution cost reductions exceeded budgeted expectations. The company expects that the reduction in annual operating expenses resulting from its U.S. restructuring plans will exceed $40 million.
"Since we announced plans to restructure our U.S. operations, we have aggressively pursued initiatives to realign our domestic cost structure with our current level of domestic revenue," Salton CEO Leonhard Dreimann said. "These actions have lowered our operating costs in the U.S., allowing us to significantly improve our operating results going forward. Our fourth quarter sales results, which included our first quarter of revenue growth in the U.S. in two years, suggest U.S. sales are stabilizing."
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