Cycle Country Accessories Corporation, Milford, Iowa, says revenue for its second quarter ended March 31, 2005, was $2,809,226, a decrease of 47.8% from revenue of $5,381,420 for the same period last year. The company says sales decreased 52.7% from sales posted for the second quarter of 2004.
Cost of goods sold also saw a decrease, down 49.1% to $1,991,754 from $3,912,365 for the same period last year.
Gross profits in dollars was $817,472, down 44.4% from $1,469,055. However, gross profit as a percentage of revenue was up for the second quarter to 29.1% compared to 27.3% in second quarter ended March 31, 2004. The increase in gross profit as a percentage of revenue, according to management, is attributed to the implementation of price increases on products, that due to increased raw material or other input costs, had fallen below standard gross profit levels.
"Results for the second quarter of fiscal 2005 did not equal the results for the second quarter of fiscal 2004, but current second quarter results did meet our baseline growth projections,” said Ron Hickman, President and CEO of Cycle Country Accessories Corporation.
Hickman said he is confident in earlier basic net income projections of 40 cents per share for fiscal year 2005. He said the company forecasts 50 cents per share for fiscal 2006.
Shares of Cycle Country plummeted $1.10, or 22.5%, to $3.80 on Monday after the company reported its results.
Earlier this month, Cycle Country completed the acquisition of its largest supplier, Simonsen Iron Works, Inc. Under the terms of an agreement announced prior to closing, Cycle Country paid $7 million in cash and issued 1.2 million shares of stock to the founders of Simonsen.
Simonsen, Spencer, Iowa, is a 99-year-old fourth-generation family-run contract manufacturer offering metal fabrication, CNC machining, powder coating, laser cutting and tool and die services.
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