Audiovox 1999 Annual Report Download - page 9

Audiovox Communications Corp., is a 95% owned subsidiary of Audiovox
Corporation. The Communications group’s 1999 revenues of $929,303
represented a 110% increase over 1998 revenues. ACC sales represent
80% of the total for Audiovox Corporation. Handset sales increased
83.2% over fiscal 1998 to 6,067,000.
Dataquest has named ACC the number three overall wireless supplier
in North America and the number two supplier of CDMA, the industry’s
fastest growing platform. In 1998 we began providing our customer base
with digital technology and by the end of fiscal 1999, digital handset sales
had grown to represent 56% of our total.
We market our products worldwide with operation centers and/or
sales offices in the United States, Canada, Japan, Korea, Malaysia,
Taiwan, Thailand, Peru, Venezuela and the Netherlands. We sell wireless
products to the wireless carriers and their respective agents, distributors
and retailers. Some of our key customers in 1999 included Bell Atlantic,
Vodafone Airtouch, PrimeCo, CenturyTel, Movicom, MCI WorldCom,
U.S. Cellular, Frontier Cellular and Radio Shack.
Although we do not manufacture our own products, we work closely
with both customers and suppliers in the design, development and test-
ing of our products. We test all products in our own facilities to ensure
compliance with our own standards and supervise testing in our carrier
markets to ensure compliance with carrier specifications. We believe
that the combination of our engineering support with that of our manu-
facturing partners provides our customers with the most up to date tech-
nology. We currently supply wireless products in AMPS and N-AMPS as
well as a variety of digital technologies including CDMA, CDMA/PCS,
TDMA/PCS, and GSM.
Our core business objective is to increase our earnings by expand-
ing into new technologies, new global markets made accessible by those
products and continued improvements to our operating performance.
Our business strategy is to leverage our competitive strengths and
capitalize on key trends in the global wireless industry. Key elements
of that strategy are:
•Enhance and capitalize on the Audiovox brand name.
We believe that the Audiovox Brand name is one of our greatest
strengths. Our wireless products generally bear the Audiovox
name or are co-branded with the wireless carriers. We have
invested heavily over the last 35 years in promoting our brand
name and we expect to continue that trend.
•Expand wireless technology offerings to increase
market opportunities. We intend to continue to offer a
wide breadth of wireless products in advanced wireless tech-
nologies. Some of our year 2000 product initiatives will include
handsets with Internet access and other interactive technologies.
We will also continue to design products specifically to meet
the unique requirements of our carrier customers.
•Expand global presence. During fiscal 2000, we intend to
seek to expand our international wireless business as we begin
to market products compatible with international wireless
technologies, such as GSM, TDMA and CDMA. We intend to
capitalize on our strong relationships with domestic carriers
who are expanding their footprint in international markets.
•Continue to provide added value to our customers
and suppliers. Our customers and suppliers rely on us to
provide value-added services such as product design and
development, engineering and testing, proprietary handsets and
software, technical and sales support and all repair and customer
support services. Because of our efficient internal systems, we
believe that we provide those services more cost effectively.
7
AUDIOVOX
Communications
AUDIOVOX
Wireless Handset Mix
(millions of units)
’97
analog digital
’98 ’99
3.0
2.7 2.7
.6
3.4
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