Audiovox 2005 Annual Report Download - page 25

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ITEM 7−MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS ("MD&A")
This section should be read in conjunction with "Cautionary Statements" and
"Risk Factors" in Item 1a of Part I, and Item 8 of Part II, " Consolidated
Financial Statements and Supplementary Data."
We begin Management's Discussion and Analysis of Financial Condition and
Results of Operations with an overview of the business, including our strategy
to give the reader a summary of the goals of our business and the direction in
which our business is moving. This is followed by a discussion of the Critical
Accounting Policies and Estimates that we believe are important to understanding
the assumptions and judgments incorporated in our reported financial results. In
the next section, we discuss our Results of Operations for fiscal 2004 compared
to 2005, and for fiscal 2003 compared to 2004. We then provide an analysis of
changes in our balance sheet and cash flows, and discuss our financial
commitments in the sections entitled "Liquidity and Capital Resources, including
Contractual and Commercial Commitments". We conclude this MD&A with a discussion
of "Related Party Transactions" and "Recent Accounting Pronouncements".
BUSINESS OVERVIEW AND STRATEGY
We operate through one reportable segment, the Electronics Group, which
consists of four wholly−owned subsidiaries: Audiovox Electronics Corporation,
American Radio Corp., Code Systems, Inc. and Audiovox German Holdings GmbH and
one majority−owned subsidiary: Audiovox Venezuela, C.A. and market our products
under the Audiovox(R) brand name and other brand names, such as Jensen(R),
Pursuit(R), Code−Alarm(R), Car Link(R), Movies 2 Go(R), Magnate(R), Mac
Audio(R), Heco(R), Acoustic Research(R), Advent(R), Terk(R), and Phase
Linear(R), as well as private labels through a large domestic and international
distribution network. Our products are broken down into two major categories:
Mobile Electronics and Consumer Electronics.
Mobile Electronics products include:
o mobile multi−media video products, including overhead, headrest and
portable mobile video systems,
o autosound products including radios, speakers, amplifiers and CD
changers,
o satellite radios including plug and play and direct connect models,
o automotive security and remote start systems,
o navigation systems,
o rear observation and collision avoidance systems, and
o automotive power accessories, including cruise control systems.
Consumer Electronics include:
o LCD and Plasma flat panel televisions,
o home and portable stereos,
o HDTV Antennas,
o Two−way (GMRS) radios, digital multi−media product such as personal
video recorders and MP3 products,
o home speaker systems and home theater in a box,
o portable DVD players,
o hand−held portables GPS,
o flat panel TV mounting systems, and
o home electronic accessories such as cabling and performance enhancing
electronics.
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