Nortek Experiences Gain
Most of this month’s industry news is financial and not much of it is all that good. However, Nortek, parent of multiple residential and commercial systems brands (e.g., Aton, Elan, Niles, SpeakerCraft, Sunfire, and Xantech), is the exception. It posted a second consecutive quarter of net profits, but the figure was small. In its fiscal third quarter, Nortek posted a $4.7 million net profit compared with a year-ago $2.1 million loss. Its second quarter net profit was $18.5 million compared with a year-ago $31.9 million net loss. The first-quarter net loss was $1.2 million. In fiscal 2011, Nortek posted a $55.9 million net loss following a 2010 $13.4 million net loss. This fiscal year, third-quarter revenues were up 1% to $557.4 million and its operating income surged 141% to $33.8 million. Nortek provides products to the U.S., Canada, and Europe.
Logitech Sees Drop in Sales
Logitech International sales were down for its fiscal second quarter, which ended September 30, 2012, but its operating income and net income were up. Sales for the quarter were $548 million, down 7% from $589 million in the prior year. Excluding the unfavorable impact of exchange rates, sales were down 4% compared with the same quarter in the prior year. Sales were down 14% in its audio segment, 17% in its video segment, and 31% in its digital home segment. The digital home decline could be attributed to the company discontinuing sales of its Google TV peripherals. Operating income was $24 million, up 3% from an operating income of $23 million in the same quarter a year ago. Net income was $55 million versus last year’s $17 million. Net income for the quarter includes a net tax benefit of $32 million from the closure of an income tax audit. Logitech’s retail sales decreased by 5% year over year. They were down 3% in EMEA countries, 6% in the Americas, and 7% in Asia. OEM sales decreased by 27% and sales for the LifeSize division decreased by 7%.
Net Sales Down for h.h. gregg
h.h.gregg reported a 5% drop in net sales and lower net earnings for the second quarter, which ended September 30, 2012. Net sales for the quarter decreased to $587.6 million, from $618.6 million in the comparable prior year period. The decrease for the three-month period was the result of an 8.8% store sales decrease along with the lapping of strong grand-opening sales performance from stores that opened in the prior fiscal year, partially offset by the net addition of 19 stores during the past 12 months. Net income was $3.8 million, down $6 million for the comparable prior year period, a result of a decrease in store sales, an increase in net advertising expense as a percentage of net sales, an increase in SG&A expense as a percentage of net sales, and other factors, h.h. gregg said.
McMagic to Revive Vann’s Line
Vann’s, the bankrupt consumer electronics (CE) specialty chain, has been acquired by a conglomerate for $4.5 million. The buyer, McMagic Partners, a subsidiary of Texas-based Khaledi Group, intends to operate the chain as a going concern under former Panasonic and LG Electronics regional sales executive Greg Regelbrugge, who will serve as CEO. According to the retailer’s Chapter 7 trustee Richard Samson, Vann’s assets were purchased “free and clear of liens and encumbrances” and McMagic has started “bringing the management team up to speed.” The sale successfully concluded on November 6, 2012.
McMagic, a holding company, plans to operate all five remaining Vann’s stores and expand to new markets. Vann’s filed for Chapter 11 bankruptcy protection in August 2012, several weeks after losing a major line of credit. The company said it had attempted several rounds of restructuring in an attempt to save the business, but financial support was deemed insufficient, forcing Vann’s to move into a structured liquidation. Vann’s moved from Chapter 11 reorganization to Chapter 7 liquidation in October 2012 to expedite the sale. The specialty chain was founded in 1961 by Pete Vann. The company helped pioneer authorized online CE sales in the late 1990s under former CEO George Manlove, and remains the largest independent CE retailer in Montana.
Abe’s of Maine Files for Chapter 11
Abe’s of Maine, the 33-year-old direct CE seller, has filed for Chapter 11 bankruptcy protection. According to a Nov. 5, 2012 bankruptcy court filing, the company sought Chapter 11 protection to reduce debt, improve liquidity, and find a backer to bolster its “long-term growth prospects and operating potential.”
Total fiscal year sales through June 30, 2012 were about $87 million, down from $110 million in 2011 and $115 million in 2010. President and founder Abraham Mosseri said he plans to sell or liquidate the business if an investor cannot be found. He currently employs 41 staff members.
Abe’s of Maine’s estimated assets are between $1 million and $10 million, including $2.5 million in inventory, and the company carries “substantial debt” of $11 million, the court filings show. Mosseri founded the privately held business in 1979 as a mom-and-pop photo dealer in Old Orchard Beach, ME. The company moved to Brooklyn, NY, in 1986, and in 2006 relocated again to a significantly larger facility in Edison, NJ, where it also maintains a storefront.
Abe’s of Maine had expanded its inventory to span the full gamut of consumer electronics, as well as pro audio, DJ equipment, and major appliances.
The company, which sells direct online, through third-party sites (e.g., Amazon.com), via a catalog, and from its lone storefront, is ranked 56th in TWICE’s Top 100 CE Retailers report.
McIntosh Ships New Tabletop Speakers
McIntosh Laboratory has begun shipping its first AirPlay-equipped tabletop speaker, the $3,000 McAire. At that price, the single-chassis stereo speaker system joins a growing selection of very high-end single-chassis AirPlay speakers, including Bang & Olufsen’s recently unveiled $2,699 BeoPlay A9, a disc-shaped, floor-standing model that can also be wall mounted.
McIntosh calls the product an integrated audio system. It features McIntosh’s component-audio cosmetics with a black glass front panel with blue output meters. Its component size measures 8” × 17” × 19.4” and weighs 31 lb. Into that chassis, McAire packs a three-way speaker system and embedded Wi-Fi. The product doesn’t include a tuner or a CD player.
With embedded Wi-Fi 802.11 b/g and AirPlay, the speaker wirelessly streams music from Apple’s mobile devices and from a networked PC’s iTunes application over a home’s Wi-Fi network. The speaker also features an Apple-certified USB port with 1-A charging to charge and stream music from connected iPods and iPhones. The USB port also connects to USB mass storage devices, including Android devices, to play back music.
In addition, the port connects to iPads to play back its song selection, although the port isn’t Apple-certified for quick iPad charging.
The system features two 4” woofers, two 2” inverted-dome midranges, and two 0.75” dome tweeters. The power output was not disclosed.
Though McAire is McIntosh’s first AirPlay speaker, it is the company’s second AirPlay product. The company also markets the AirPlay-equipped MX121 home theater processor, which costs $6,000. McIntosh was recently purchased by Fine Sounds from D+M Group.
JBL Unveils Its Docking Speaker Systems
JBL unveiled some of the industry’s first docking speaker systems, the OnBeat Micro and the OnBeat Venue LT, with Apple’s new eight-pin Lightning connector for the iPhone 5, the fifth-generation iPod Touch, the seventh-generation iPod Nano, the iPad Mini, and the fourth-generation iPad. The OnBeat Micro features a pair of full-range drivers, a fully digital signal path with digital signal processing, AC/DC operation, USB port, and 3.5-mm auxiliary input (see Photo 2). The OnBeat Venue LT features a hidden Lightning dock connector behind the JBL logo, two full-range drivers and two tweeters, component video output, and Slipstream port to boost bass with low distortion. VC