Rockford Corp. (ROFO, Financial) filed Quarterly Report for the period ended 2009-06-30.
Rockford Corp. designs manufactures and distributes high-performance audio systems for the car and professional audio markets. The car audio products are sold primarily in the worldwide car audio aftermarket to consumers who want to improve their existing car audio systems. The company markets the car audio products under our Rockford Fosgate and Lightning Audio brand names selling products that include digital and analog amplifiers speakers source units CD and MP3 changers and accessories. Rockford Corp. has a market cap of $1.5 million; its shares were traded at around $0.18 .
Interest and Other Expense (Income), Net. Interest and other expense (income), net, primarily consists of interest expense and other gains and losses. Interest and other expense (income), net, increased by $0.7 million or 113.1%, to an expense of $0.1 million for the three months ended June 30, 2009 from income of $0.6 million for the three months ended June 30, 2008. The decline is primarily attributable to the gain of approximately $0.8 million arising from the repurchase of $2.0 million face value of convertible notes in 2008 partially offset by lower interest expense in 2009 due to lower effective borrowing rates and reduced loan balances.
Net Sales. Net sales decreased by $10.3 million, or 25.6%, to $29.9 million for the six months ended June 30, 2009, from $40.2 million for the six months ended June 30, 2008. The decrease in sales was primarily attributable to substantially lower royalty revenue, lower sales of Rockfords Lightning Audio branded products, lower sales to international customers, and higher discounts due to end-of-life sales. These reductions were partially offset by lower returns. Net sales for the six months ended June 30, 2009 also included sales of end-of-life product and initial pipeline shipments of Rockfords 2009 new product line. OEM royalty revenue for the six months ended June 30, 2009 and 2008 were $0.5 million and $3.4 million, respectively.
U.S. sales decreased by $7.1 million, or 21.8%, to $25.7 million for the six months ended June 30, 2009, from $32.8 million for the six months ended June 30, 2008. International sales decreased by $3.2 million, or 42.8%, to $4.3 million for the six months ended June 30, 2009, from $7.4 million for the six months ended June 30, 2008. The decrease in international sales was primarily due to across the board reductions in sales, which were significantly aggravated by a receivership for one of Rockfords larger European distributors. Rockford replaced the European distributor at the end of the second quarter 2009.
Interest and Other Expense (Income), Net. Interest and other expense (income), net, primarily consists of interest expense and other gains and losses. Interest and other expense (income), net, declined by $0.1 million or 26.7%, to income of $0.3 million for the six months ended June 30, 2009 from income of $0.4 million for the six months ended June 30, 2008. The decline is primarily attributable to the gain of approximately $0.8 million arising from the repurchase of $2.0 million face value of convertible notes in 2008 compared to the gain of approximately of $0.5 million arising from the repurchase of $2.5 million face value of convertible notes
In January 2009 Rockford had repurchased $2.5 million of convertible notes for approximately $2.0 million. In connection with this repurchase, Rockford recorded a gain to interest and other expense (income), net of approximately $0.5 million, net of fees and related unamortized debt issuance costs. This repurchase reduced the principal amount outstanding on the notes from $7.5 million to $5.0 million.
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Rockford Corp. designs manufactures and distributes high-performance audio systems for the car and professional audio markets. The car audio products are sold primarily in the worldwide car audio aftermarket to consumers who want to improve their existing car audio systems. The company markets the car audio products under our Rockford Fosgate and Lightning Audio brand names selling products that include digital and analog amplifiers speakers source units CD and MP3 changers and accessories. Rockford Corp. has a market cap of $1.5 million; its shares were traded at around $0.18 .
Highlight of Business Operations:
U.S. sales decreased by $4.5 million, or 25.8%, to $13.1 million for the three months ended June 30, 2009, from $17.6 million for the three months ended June 30, 2008. International sales decreased by $1.8 million, or 43.1%, to $2.4 million for the three months ended June 30, 2009, from $4.1 million for the three months ended June 30, 2008. The decrease in international sales was primarily due to across the board reductions in sales, which were significantly aggravated by a receivership for one of Rockfords larger European distributors. Rockford replaced the European distributor at the end of the second quarter 2009Interest and Other Expense (Income), Net. Interest and other expense (income), net, primarily consists of interest expense and other gains and losses. Interest and other expense (income), net, increased by $0.7 million or 113.1%, to an expense of $0.1 million for the three months ended June 30, 2009 from income of $0.6 million for the three months ended June 30, 2008. The decline is primarily attributable to the gain of approximately $0.8 million arising from the repurchase of $2.0 million face value of convertible notes in 2008 partially offset by lower interest expense in 2009 due to lower effective borrowing rates and reduced loan balances.
Net Sales. Net sales decreased by $10.3 million, or 25.6%, to $29.9 million for the six months ended June 30, 2009, from $40.2 million for the six months ended June 30, 2008. The decrease in sales was primarily attributable to substantially lower royalty revenue, lower sales of Rockfords Lightning Audio branded products, lower sales to international customers, and higher discounts due to end-of-life sales. These reductions were partially offset by lower returns. Net sales for the six months ended June 30, 2009 also included sales of end-of-life product and initial pipeline shipments of Rockfords 2009 new product line. OEM royalty revenue for the six months ended June 30, 2009 and 2008 were $0.5 million and $3.4 million, respectively.
U.S. sales decreased by $7.1 million, or 21.8%, to $25.7 million for the six months ended June 30, 2009, from $32.8 million for the six months ended June 30, 2008. International sales decreased by $3.2 million, or 42.8%, to $4.3 million for the six months ended June 30, 2009, from $7.4 million for the six months ended June 30, 2008. The decrease in international sales was primarily due to across the board reductions in sales, which were significantly aggravated by a receivership for one of Rockfords larger European distributors. Rockford replaced the European distributor at the end of the second quarter 2009.
Interest and Other Expense (Income), Net. Interest and other expense (income), net, primarily consists of interest expense and other gains and losses. Interest and other expense (income), net, declined by $0.1 million or 26.7%, to income of $0.3 million for the six months ended June 30, 2009 from income of $0.4 million for the six months ended June 30, 2008. The decline is primarily attributable to the gain of approximately $0.8 million arising from the repurchase of $2.0 million face value of convertible notes in 2008 compared to the gain of approximately of $0.5 million arising from the repurchase of $2.5 million face value of convertible notes
In January 2009 Rockford had repurchased $2.5 million of convertible notes for approximately $2.0 million. In connection with this repurchase, Rockford recorded a gain to interest and other expense (income), net of approximately $0.5 million, net of fees and related unamortized debt issuance costs. This repurchase reduced the principal amount outstanding on the notes from $7.5 million to $5.0 million.
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