Audiovox 2003 Annual Report Download - page 55

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conditions in South America and increased insurance expense, particularly with
general liability insurance, of $1,167. This increase in operating expenses was
partially offset by reductions in employee benefits expense of $1,332 due to
reduced bonuses and lower health care costs. Operating loss for fiscal 2002 was
$14,076, compared to operating loss of $9,236 in 2001.
Net Loss
Net loss for fiscal 2002 was $14,040 compared to net loss of $7,198 in
fiscal 2001. Loss per share for fiscal 2002 was $0.64, basic and diluted
compared to $0.33 for fiscal 2001, basic and diluted.
Wireless Results
The following table sets forth for the fiscal years indicated certain
statements of operations data for Wireless expressed as a percentage of net
sales:
2001 (1) 2002
−−−−−−−−−−−−−−−−−−−−− −−−−−−−−−−−−−−−−−−−−−−
Net sales:
Wireless products $ 948,921 96.9% $ 700,658 96.3%
Activation commissions 26,879 2.8 24,393 3.3
Residual fees 2,396 0.2 2,187 0.3
Other 692 0.1 420 0.1
−−−−−−−−−− −−−−−− −−−−−−−−−− −−−−−−−−
Total net sales 978,888 100.0 727,658 100.0
Gross profit 21,980 2.2 14,291 2.0
Operating expenses
Selling 13,108 1.3 11,148 1.5
General and administrative 16,077 1.6 21,522 3.0
Warehousing and technical support 2,761 0.3 2,593 0.4
−−−−−−−−−− −−−−−− −−−−−−−−−− −−−−−−−−
Total operating expenses 31,946 3.2 35,263 4.9
−−−−−−−−−− −−−−−− −−−−−−−−−− −−−−−−−−
Operating loss (9,966) (1.0) (20,972) (2.9)
Other expense (7,690) (0.8) (3,934) (0.5)
−−−−−−−−−− −−−−−−− −−−−−−−−−− −−−−−−−−
Pre−tax loss $ (17,656) (1.8)% $ (24,906) (3.4)%
========== ======= ========== ========
(1) See Note (2) of Notes to Consolidated Financial Statements.
Wireless is composed of ACC and Quintex, both subsidiaries of the Company.
Net Sales
Net sales were $727,658 in fiscal 2002, a decrease of $251,230, or 25.7%,
from fiscal 2001. Unit sales of wireless handsets decreased by 2,050,000 units
in fiscal 2002, or 29.3%, to approximately 4,950,000 units from 7,000,000 units
in fiscal 2001. This decrease was attributable to decreased sales of digital
handsets due to delayed new product introductions, longer testing cycles
53