Audiovox 2001 Annual Report Download - page 4

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Fiscal 2001 was a difficult year for our Company as it was marked by the slowdown in the economy, product
oversupply, intense pricing competition and diminishing consumer confidence. In the wireless industry, growth
that had been driven by the change from analog to digital slowed dramatically as the demand for replacement
handsets subsided. In addition, our communications subsidiary was impacted by rapid changes in technology
that resulted in inventory adjustments for the older technology products. In spite of these difficulties, Audiovox
Communications Corp. (ACC) continued to rank among the industry leaders in market share.
For the fiscal year ended November 30, 2001, net sales were $1.3 billion, a 25.6% decrease from sales of $1.7
billion in the comparable period one year ago. Net loss and loss per share was $8.2 million or $0.38 basic and
diluted compared to net income of $27.2 million and $1.27 basic and $1.21 diluted for 2000.
One particularly bright note for 2001 was the contribution made by Audiovox Electronics Corp. (AEC) as it
exceeded sales and profit targets and finished with the best sales year in its history which helped the overall
picture at Audiovox. During the year, AEC also made serious inroads in brand acceptance at major retailers
such as Circuit City and Best Buy. In addition to the inroads made at these major retailers, we increased our
involvement as an OE (Original Equipment) supplier to major car manufacturers. In December, Audiovox was
listed by NPD, Techworld as the leader in Mobile Video with a 39% market share. The Audiovox brand also had
strong showings in several of the other markets served by AEC.
We expect to see improvements during our fiscal year 2002. In our wireless subsidiary, E911 products should
generate replacement handset demand similar to that which we saw when digital products began to replace
analog. New high speed 1XRTT phones for data and GPS phones for tracking, which represent the next gen-
eration of technology, will have their full impact in the second part of the year and they should also contribute
to improved top and bottom-line results. Our introduction of hand-held PDA’s that contain the comprehensive
functionality of Microsoft Windows-Powered Pocket PC software is our first step in what promises to be a major
convergence product with strong growth prospects.
Chairman’s Letter to Shareholders
COMMITMENT
Audiovox 2001 Annual Report 02