EXETER, Pa. — Keystone Automotive Operations, a leading distributor and marketer of automotive aftermarket accessories and equipment in North America, has announced financial results for the third quarter of its 2009 fiscal year, which ended Oct. 3.
Net sales for the third quarter were $116.6 million, a decrease of $19.6 million, or 14.4 percent, compared to $136.2 million for the same period in the prior year. The company said the decrease in sales was driven by a combination of factors, including a decrease in consumer spending on discretionary items due to the continued economic recession, a year-over-year decline in truck and SUV sales, and the decline in available credit in the marketplace.
Gross profit for the third quarter of fiscal 2009 was $35.5 million, a decrease of $6.5 million, or 15.4 percent, versus the same period in the prior year. Gross margin was 30.4 percent, down from 30.8 percent in the third quarter of the prior fiscal year.
Loss from operations for the third quarter of fiscal 2009 was $0.4 million, a decrease of $1.4 million compared to income from operations of $1 million for the same period in the prior year. Keystone said the decrease was attributable to the decline in sales and gross margin, partially offset by a decrease in selling, general and administrative expenses. The expense reductions resulted primarily from cost-reduction programs in the delivery, warehouse and selling areas, a decrease in bad debt expense and a decrease in fuel costs.
Net loss for the third quarter of fiscal 2009 was $7.5 million, compared to $5.5 million during the same period in the prior year. The increase in the net loss is primarily attributable to the $6.5 million decrease in gross profit and a $1.7 million decrease in income tax benefit, partially offset by a $5.2 million decrease in selling, general and administrative expenses and a $1 million decrease in interest expense.
As of Oct. 3, the company had a cash balance of $64.3 million and an additional $32.6 million of borrowing capacity under its revolving credit facility.
"We continue to operate in an environment where the automobile industry remains in a slump and the general economy struggles in recession, reflective of continued high unemployment rates, low consumer confidence and tight credit," said Ed Orzetti, chief executive officer of Keystone Automotive Operations Inc. "However, we continue to invest in inventory, new cross-docks and information tools to maintain and enhance the level of service we deliver to customers and to better support our vendors. These are the right investments to make to further strengthen our business and position us for growth as the economy improves."
