Huffy Corporation announced that sales and earnings for August were below anticipated levels. Early indications are that neither lost sales volume nor earnings will be recovered in the balance of the third quarter or during the remainder of this year.
Don R. Graber, President and CEO said, “August and September are traditionally the months in the third quarter during which our customers begin to ramp up purchase activity in anticipation of the fall and holiday selling season, and in the past, have been a reasonable barometer of sales and earnings for the remainder of the year. Based on early third quarter order flow and bookings, we believed that for the full year, sales in the $470.0 million to $480.0 million range and earnings per common share of $0.55 to $0.65 were achievable. Sales in August and in early September have clearly been both disappointing and softer than anticipated, particularly in the in- line skate, action sports, backboard and opportunity businesses. Sales of our other product lines are in line with expectations, but will not offset the softness in those product lines just mentioned.”
Mr. Graber continued, “Based on our current view, we now anticipate that sales for the third quarter will be in the range of $113.0 million to $118.0 million and that earnings from continuing operations will be in the range of $0.14 to $0.16 per common share. For the full year, we now anticipate that net sales will be in the $455.0 million to $460.0 million range, with earnings from continuing operations in the range of $0.34 to $0.40 per common share. Net income for the year is expected to be in the range of $0.44 to $0.52 per common share, as a result of the favorable impact of the final settlement related to Washington Inventory Service.”
Mr. Graber concluded, “We continue to focus our efforts on improving earnings from continuing operations and believe that the organizational changes announced over the past few weeks together with the consolidation of administrative and operations functions will favorably impact our cost structure and enhance earnings in the future. We remain dedicated to fulfilling our strategic vision of creating value for our shareholders and evolving towards our goal of being a much larger entity serving the retail and sporting goods channels.”
