Audiovox 2010 Annual Report Download - page 24

Download and view the complete annual report

Please find page 24 of the 2010 Audiovox annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 131

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131

Item 7-Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A")
This section should be read in conjunction with the “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 the year ended February 28, 2010 compared to the years ended February 28, 2009 and February 29, 2008. 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”.
Segment
We have determined that we operate in one reportable segment, the Electronics Group, based on review of ASC 280 “Segment
Reporting” (“ASC 280”). The characteristics of our operations that are relied on in making and reviewing business decisions include
the similarities in our products, the commonality of our customers, suppliers and product developers across multiple brands, our
unified marketing and distribution strategy, our centralized inventory management and logistics, and the nature of the financial
information used by our Executive Officers. Management reviews the financial results of the Company based on the performance of
the Electronics Group.
Outlook
The Company’s domestic and international business is subject to retail industry conditions and the sales of new and used vehicles. The
current worldwide economic condition has adversely impacted consumer spending and vehicle sales. If the global macroeconomic
environment continues to be weak or deteriorates further, this could have a negative effect on the Company’s revenues and earnings.
In an attempt to offset the current market condition, the Company has reduced its operating expenses and has been introducing new
product to obtain a greater market share. The Company continues to focus on cash flow and anticipates having sufficient resources to
operate during Fiscal 2011 and 2012.
16
Source: AUDIOVOX CORP, 10-K, May 14, 2010 Powered by Morningstar® Document Research℠