VOXX Q3 2020 Earnings Report
Key Takeaways
VOXX International reported net sales of $110.1 million, a decrease compared to the previous year, with operating income of $0.1 million and net income of $2.5 million. The company's premium audio business grew, but the automotive electronics segment faced challenges. New OEM programs are expected to drive future growth.
Net sales decreased to $110.1 million from $129.6 million year-over-year.
Automotive Electronics segment sales declined due to lower OEM product sales.
Premium audio product sales increased by $3.6 million.
Operating income was $0.1 million, down from $5.7 million in the prior year.
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VOXX Revenue by Segment
Forward Guidance
VOXX International anticipates growth from new OEM programs and partnerships, while focusing on value creation through strategic initiatives.
Positive Outlook
- New OEM programs are slated to begin next fiscal year, which should drive year-over-growth.
- Significant new business has been awarded that begins in CY21 and will run for several years.
- Balance sheet remains strong.
- Executing on share repurchase program.
- Evaluating potential divestitures and acquisitions to improve earnings and cash flow.
Challenges Ahead
- Automotive Electronics segment has been impacted throughout the year.
- OEM business results have been less than anticipated.
- Gross margin in the Company’s Fiscal 2020 third quarter was 28.6%, representing a 140-basis point decline, as compared to 30.0% in the Fiscal 2019 third quarter.
- Biometrics segment gross margins were (28.3)% in the fiscal 2020 third quarter, as compared to 80.5% in the comparable year-ago period.
- Equity in income of equity investees declined by $0.7 million due to the impact of tariffs, higher warranty costs and other one-time expenses.
Revenue & Expenses
Visualization of income flow from segment revenue to net income