Huffy Corporation shares fell 24.0% last week to close at $2.22 on Friday, a share price that is now down almost 58% since the first of the year and down more than 72% from its 52-week high. The brands acquired through the acquisition of Gen-X that kept the company afloat and posting positive numbers last year have now apparently come home to roost.
Huffy last week announced that it had retained Lazard Freres & Co. LLC to advise the company on financing and strategic alternatives, “including the sale of the Company or of product segments within the Company.”
Company president and CEO Paul D'Aloia, who just took the chief executive job in January, has attempted a number of moves to right size Huffy, including the recent sales of the Huffy Service Solutions and Gen-X close-out businesses, and the integration of the Gen-X brands into the companys Dayton, OH operations.
D'Aloia said in a release last week that the transition to a single sporting goods platform is “well underway”, but is not expected improve operational results until Q3 or Q4. He said that “higher than anticipated costs” associated with the restructuring of the Canadian business will defer a return to profitability until 2005.
