HAUPPAUGE, N.Y., Oct. 11 /PRNewswire-FirstCall/ -- Audiovox Corporation (Nasdaq: VOXX) today announced results for its fiscal third quarter and nine-months ended August 31, 2005.
Audiovox Corporation (the "Company") reported fiscal 2005 third quarter net sales of $122.9 million, a decrease of 7.3% compared to net sales of $132.6 million reported in the fiscal third quarter of
2004. Net loss from continuing operations for the 2005 fiscal third quarter was $3.6 million or a loss of $0.16 per diluted share compared to net income of $37,000 or earnings per diluted share of $0.00 in the comparable prior year period. Including discontinued operations, the Company reported a net loss of $3.7 million or a loss per diluted share of $0.17 compared to net income of $5.3 million or $0.24 per diluted share in the fiscal third quarter of 2004.Mobile Electronics, which represented 64.0% of net sales, came in at $78.6 million, down 21.3% compared to net sales of $99.8 million reported in the comparable prior year period. This decline was primarily related to the reduction of selling prices in satellite radio Plug-N-Play units and certain discontinued mobile video products. As previously announced, the Company took an inventory write down of $3.8 million to reflect current market conditions in the satellite radio category, which has seen prices on Plug-N-Play units fall by roughly 50%. Offsetting these declines were stronger sales of the Company's Jensen branded auto sound products, Terk products and the introduction of new mobile video systems. Consumer Electronics, which represented 36.0% of net sales, had sales of $44.4 million, an increase of 35.2% compared to net sales of $32.8 million reported in the fiscal third quarter of 2004. This increase was due primarily to higher sales of LCD flat- panel TV's and portable DVD products.
Gross margins for the third fiscal quarter of 2005 declined primarily to the satellite radio inventory write down, increased consumer electronics sales at traditionally lower margins and the lower margins associated with the remaining sales of discontinued mobile video products. This decline was partially offset by higher margins from the Terk and Jensen product lines.
Operating expenses for the fiscal 2005 third quarter were $21.3 million, a decrease of 3.6% as compared to operating expenses of $22.1 million reported in the fiscal third quarter last year. The reductions in operating expenses were primarily in selling, general and administrative expenses and were partially offset by higher expenses associated with increased technical and engineering support. Other income came in at $2.5 million as compared to $580,000 reported in the comparable prior year period. This increase was primarily related to higher interest income generated during the quarter.
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