July 2, 2007 – Finance Digest

Piaggio Group cycle sales rise in first quarter
Piaggio Group saw a 22 percent increase in its motorcycle division for its first quarter, the company reported.
Revenues from the sale of vehicles, spare parts and accessories for the Piaggio, Vespa, Gilera and Derbi brands amounted to euro 278.8 million ($374 million). Aprilia and Moto Guzzi revenues increased by 19 percent compared to the past year period, amounting to euro 115.4 million ($155 million).
North America operations reported a 7.6 percent rise in business. Overall, the manufacturer’s net sales were up 5.3 percent to euro 394.2 million ($530 million).
The company’s first-quarter net profit totaled euro 9.7 million ($13 million), nearly a 5 percent drop from the previous year period. Another first-quarter item of note for Piaggio: The OEM began marketing its new three-wheeled scooter, the Mp3, in April.


Cycle Country quarterly revenues drop 20 percent
Cycle Country Accessories Corp. cited warm weather as a reason for its drop in second-quarter revenue.
The Milford, Iowa, manufacturer reported a 20.4 percent dip in its quarterly revenue to $2.7 million.
The decrease included a 24 percent drop in ATV accessory sales, a 30 percent dip in contract manufacturing and a 54 percent decrease in Weekend Warrior sales.
“While we are disappointed that the numbers did not meet our publicly stated original numbers for the quarter, (the company) continues to position itself, as has been stated previously, to become less reliant on the seasonal and cyclical nature of the ATV accessories market,” Cycle Country CEO Randy Kempf said in a news release.
The reduction in orders that led to the decline in contract manufacturing is not expected to continue as Cycle Country has seen demand increase enough to add a second shift.


Deere’s consumer division sees little sales change
Deere & Co.’s commercial and consumer division, which includes the manufacturer’s UTV Gator lineup, saw little change in its second-quarter revenue, the manufacturer reported.
The operating profit, however, was up 18 percent for the second quarter to $150 million and increased nearly 29 percent for the first six months of the company’s fiscal year.
Overall, Deere said its worldwide net sales increased 5 percent to $6.8 billion for its second quarter, which ended April 30. For its first six months, net income was down 12 percent to $862.3 million. Last year’s net income, however, included revenue generated from its now discontinued health-care business.


Bell Industries reports decreased year-end sales
Bell Industries Inc., an aftermarket distributor that supplies dealerships mainly in the Midwest, reported a 2.4 percent decrease in its 2006 recreational products division sales.
The Indianapolis-based company had sales of $44.7 million in 2006, according to its annual report. The year-end decline was partially a result of warm winter conditions.
Bell also reported that it had decreases in its sales of cycle, snow and ATV products. But that was partially offset by increases in recreational vehicle and marine products.
Bell’s gross margin percentage in 2006 was “relatively consistent” with the previous year, according to the annual report.


LoJack first-quarter revenue, net income rise
LoJack Corp., the Westwood, Mass., company tied to the stolen vehicle recovery market, reported increased revenue and net income for its first quarter, which ended March 31.
Sales were up 7 percent to $54 million and net income more than doubled to $6.1 million.
Sales within the United States increased by 9 percent ($38.4 million) driven, by a 7 percent increase in volume.
“Our domestic unit sales increase in the first quarter was slightly less than expected, as dealer bulk installation volume was relatively consistent quarter over quarter,” Richard Riley, LoJack CEO, said in a released statement.
International sales also grew but at a lower clip (5 percent).
“While consolidated revenue and the underlying growth in units were slightly below our expectations for the quarter, we are particularly pleased with the improvement of our gross margin by approximately 400 basis points,” Riley said. “This significant improvement was driven by the successful execution of initiatives to manage our operating cost structure, which primarily included efforts to reduce the manufactured cost of our products.”
Looking ahead, Riley said the company expects revenue growth to be in the 8-10 percent range and net income growth to be in the 31-34 percent area.


Interstate Services expands management team
Interstate National Dealer Services (INDS) has taken a step toward growing its financial division with the addition of Michael Flaherty as its senior vice president, Channel Distribution.
Flaherty, previously with Balboa, AIG and American Bankers Insurance Group, brings more than 20 years of credit experience to the INDS executive team. He will be tasked to aggressively market and pursue the INDS product line with the bank and credit union markets. Interstate’s premier product, AutoGuard, will be marketed through these channels in addition to their flagship StarAuto, StarRV, StarSport, StarMarine and newly reinvented Hi-Road product lines.
Flaherty joins the INDS executive management team, which includes Gene Becker, chairman, and Dominic Sansone, EVP sales. This team has led INDS to surpass aggressive sales goals and growth since San Francisco-based private equity firm Golden Gate Capital acquired INDS in March 2006.


Dover Corp. reports 18 percent increase in first quarter sales
Dover Corp., which owns Wiseco, Warn and other powersports manufacturers, reported an 18 percent increase in revenue in its 2007 first-quarter report.
The corporation’s best-ever first quarter included $1.7 billion in sales.
Its Diversified segment, which includes Wiseco, had sales of $215 million in the first quarter, an 11 percent increase over the past-year period. Dover’s Resources segment, which includes Warn, posted first-quarter sales of more than $551 million, an increase of nearly 30 percent.
Overall, the corporation said organic revenue growth for the quarter was nearly 4 percent while growth from acquisitions and foreign currency were 12 percent and 2 percent, respectively.

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