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Action Performance Reports Second Quarter 2005 Results
PHOENIX(BUSINESS WIRE)May 9, 2005Action Performance Companies, Inc. (NYSE:ATN News), the leader in the design, marketing, promotion, and distribution of licensed motorsports merchandise, today announced financial results for the fiscal second quarter ended March 31, 2005. For the quarter, the company reported revenues of $75.3 million compared with $83.6 million in the prior year, a decrease of 9.9%. The decrease in revenue in the quarter resulted primarily from lower sales of die-cast products to mass merchandisers and, to a lesser extent, lower apparel sales to wholesale channels.
The Company reported a net loss of $2.9 million, or $0.16 per share, compared with net income of $1.3 million, or $0.07 in second quarter of 2004.
For the six months ended March 31, 2005, the company reported revenues of $151.4 million, compared with revenues of $154.8 million in the prior year, a decrease of 2.2%. The company reported a net loss of $6.5 million, or $0.35 per share, compared with a net loss of $0.4 million, or $0.02 per share in the prior year.
Fred Wagenhals, Chief Executive Officer, commented We continue to refine the restructuring plan that was announced last quarter. Improving our distribution model is the cornerstone of that plan. After an exhaustive review of our options, management concluded that Actions existing Concord, North Carolina facility provided the best combination of cost, access to the customer, control of product to the retail market and ease of implementation. We believe that having Action employees talk directly to our retail customers to understand their needs will help us restore growth to the collector die-cast market.
Mr. Wagenhals stated further Although there is much work ahead, we have implemented a number of initiatives that we believe will improve long term profitability at Action Performance. During the quarter, we consolidated the Jeff Hamilton apparel business, reduced headcount and improved our accounts receivable. Overall, I am pleased with the progress that the Company is making and with the commitment that the employees of Action Performance have made to the turnaround plan.
While Action Performance refrains from giving specific revenue and earnings guidance, the Company expects fiscal third quarter 2005 sales to be sequentially higher compared to the second quarter, but below year ago levels. Further, it expects wholesale sales of die cast to be down year-on-year reflecting uncertainties associated with the termination of its distributor relationships as the Company transitions to a direct distribution model.
The Board of Directors has decided not to declare the quarterly dividend of $0.05 per share. The Board believes that it is prudent to take this action coincident with the restructuring initiatives in place. The evaluation of paying a dividend will be made on a quarter-by-quarter basis.
About Action Performance
Action Performance Companies Inc. (NYSE:ATN News) is the leader in the design, promotion, marketing and distribution of licensed motorsports merchandise. The Companys products include a broad range of motorsports-related die-cast replica collectibles, apparel, souvenirs and other memorabilia. Action Performance markets and distributes products through a variety of channels including the Action Racing Collectables network of wholesale distributors, the Racing Collectables Club of America, QVC, goracing.com, trackside at racing events, direct corporate promotions, mass retail, department stores, and specialty dealers. Additional information about Action Performance can be found at http://www.action-performance.com/.
The following information was filed by Action Performance Companies Inc on Monday, May 9, 2005 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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