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EyeLock LLC, a subsidiary of $VOXX, entered into a partnership with CSD (Central Security Distribution), an Australian distributor of electronic security brands, to deliver EyeLock's product suite of hardware and software solutions to its broad customer base in Australia.
$VOXX said its subsidiary VOXXHirschmann has officially launched its new efob or Phone-as-a-Key technology, the latest evolution in its full line of remote start and keyless entry products. $VOXX also disclosed that it has secured an award of business for the efob technology with production and delivery scheduled to begin in 2018.
$VOXX expects the gross margins in Premium Audio to stay pretty well constant. As it introduces new product, the company has the ability to set the new prices. The company is anticipating that it will be able to hold margins pretty much where it is right now, and it will be somewhere in the 33-34% range.
$VOXX said its total debt as of 2Q17, less its current portion of long-term debt and less debt issuance cost, stood at $92.9MM, an increase of $4.7MM. The increase was mainly in the company's domestic credit facility, which amounted to $87.5MM at 2Q17-end, as compared to $72.3MM at FY16-end.
$VOXX's cash position as of Aug. 31, 2016 was $4.9MM versus $11.8MM as of Feb. 29, 2016. Cash receivables net were $81.1MM, down $5.9MM. The company's inventory position stood at $160.8MM, up $16.8MM. This was mainly due to higher inventory in support of product load-ins planned for 3Q17 within the Consumer Accessories and Premium Audio segments.
$VOXX does not believe FY17 will yield a tax benefit and therefore, it is using 45.1% as the basis for its annual effective tax rate, excluding any discrete items. This is higher than the statutory rate of 35%, mainly due to an income tax provision resulting from the increase in deferred tax liabilities related to indefinite-lived intangibles.
$VOXX said that for 2Q17, Automotive sales were down 5.2%, hurt by lower OEM sales domestically. Premium Audio segment sales grew 15.5%, helped by the introduction of many new products and Consumer Accessories segment sales also reported an increase of 13.2%, driven by higher sales of reception products.
Consumer electronics company $VOXX posted net income for 2Q17 of $1.3MM or $0.12 per share compared to a net loss of $4.39MM or $0.18 per share a year ago. The earnings for the quarter was helped by higher net sales and the company's Consumer Accessories and Premium Audio segments posting strong growth. For 2Q17, net sales rose 3.24% to $159.2MM.
VOXX Advanced Solutions (VAS), a subsidiary of $VOXX, said it entered into strategic partnership with Striiv. Under deal, VOXX Accessories Corp. and VOXX German Holdings will exclusively distribute the Striiv line of wearable fitness and activity trackers in North America and Europe.
Cowen & Company analyst Rob Stone follows up asking $VOXX if the GM in Premium Audio, which is up nicely, sustainable on the back of new digital products. CFO Charles Stoehr says that with the launch of new products, there is always a lift in margins, so yes, it will be sustainable this year. And if the products mature, then margins will decline.
Cowen & Company analyst Rob Stone questions $VOXX whether it sees enough growth in Consumer Accessories & Premium Audio to get the mid-single digit top line for 2017. CEO Patrick Lavelle says that $VOXX anticipates to grow sales even with Automotive being flat. The company expects to sees good load-ins for new launches of digital products.
$VOXX said that it closed on its second amended and restated credit agreement, which provided a total facility of $155MM comprised of $140MM asset based loan and a $15MM four-year term loan. The ABL can be increased at the company's option of $275MM. The ABL is secured by AR inventory in certain assets and term loan is secured by trade loans.
In 1Q17, $VOXX said that is total R&D expenses rose $5.3MM to $10.3MM vs. 1Q16, with almost $2.8MM of this R&D coming from the Automotive segment for the support of both current and future OEMs programs. Premium Audio R&D rose approx. $500,000 for the continued development of new digital solutions and Consumer Accessories R&D rose by $2MM for 1Q17.
In the Consumer Accessories segment, $VOXX said that it has a new line of Project Nursery products, which will be in place by the end of July at retailers like Buy Buy Baby, Amazon and Giggle. The company said that it has new programs like wireless outdoor speakers with Wal-Mart and Costco, which will launch in 3Q17.
Maker of automotive and consumer accessories $VOXX said that 1Q17 Automotive sales were down a little less than 5% when factoring in the Euro conversion & sale and licensing of 12 Volt portfolio business. Premium Audio sales grew by 10% due to higher sales of soundbars & HD wireless speakers, while Consumer Accessories sales fell by approx. 7%.
During 1Q17, $VOXX GM came in at 29.7% vs. 29.2% for 1Q16, up 50 BP. The increase was mainly due to higher margins in the Premium Audio segment, given the introduction of new product lines and a shift in product mix. Automotive GM fell 30 BP to 30%, while Premium Audio GM rose 250 BP to 34.6%. Consumer Accessories GM was 24.7% for the quarter.
New digital technologies within Premium Audio helped $VOXX see a 10% rise in segment sales & higher GM. The Consumer Accessories business should be aided by the launch of new 360Fly 4K action camera, strength in RCA & Terk reception business, and the introduction of Project Nursery, a line of high-end cameras for the nursery said CEO, Pat Lavelle.
Consumer electronics firm $VOXX posted lower 1Q17 earnings due to higher loss before income taxes of $7.5MM. The company's net loss was $4.3MM or $0.18 loss per diluted share vs. $0.71MM or $0.03 loss per diluted share in 1Q16. Net sales fell 5.4% to $155.5MM vs. 1Q16, while average Euro was $1.13, which positively impacted sales by approx. $1.8MM.