Consumer electronics manufacturer Audiovox Corporation announced results for its fiscal second quarter ended May 31, 2005.
The company reported 2005 fiscal second quarter net sales of U.S. $144.5 million, a decrease of 1.6 percent compared to net sales of $146.9 million reported in the fiscal second quarter of 2004. Net income from continuing operations for the 2005 fiscal second quarter was $5.8 million compared to $1.6 million in the comparable prior-year period.
Including discontinued operations, the manufacturer reported net income of $5.6 million compared to net income of $3.7 million in the fiscal second quarter of 2004. Net income was favorably impacted by a tax benefit of $3.3 million during the quarter ended May 31, 2005.
Commenting on the results, John J. Shalam, chairman of Audiovox Corporation, stated: "Our second-quarter sales were in line with earlier projections, and margins are beginning to trend higher as we have worked through the mobile inventory and have begun shipments of some of the new products in both our mobile and consumer electronics divisions."
Mr. Shalam also said that as the company moves into the second half of 2005, it will continue to actively seek strategic and synergistic acquisitions that will improve sales and profits, as well as shareholder value, over the long-term.
"We also are well into some of the expense reductions we outlined at the end of the year and will continue the process, which should bring us to our previously announced goal of a five percent operating margin by the fourth quarter," he noted.
The company's Mobile Electronics segment, which represented 64.3 percent of net sales, came in at $93.0 million, down 23.5 percent compared to net sales of $121.5 million reported in the comparable prior year period. This decline was primarily related to lower mobile video sales, the company said.
The Consumer Electronics segment, which represented 35.7 percent of net sales, had sales of $51.6 million, an increase of 103 percent compared to net sales of $25.4 million reported in the fiscal second quarter of 2004. Audiovox said the significant increase was due to higher sales of LCD flat panel TVs. Sales of portable DVD players, however, declined during the period due to ongoing price erosion.
The company confirmed its previous guidance for growth of 3 to 8 percent in fiscal 2005, with improving margins during the second half of the year. Audiovox expects to report sales of $135 million to $145 million in the fiscal third quarter of 2005.
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