EXETER, Pa. — Keystone Automotive Operations, North American distributor and marketer of automotive aftermarket accessories and equipment, has announced financial results for the third quarter of fiscal year 2010 ended Oct. 2.
Keystone said net sales in the third quarter of fiscal 2010 were $123.3 million, an increase of $6.7 million, or 5.7 percent, compared to $116.6 million for the same period in the prior year, driven primarily by volume increases across most of the company’s geographical markets.
Gross profit for the third quarter was $39.5 million, an increase of $3.5 million, or 9.8 percent, over the same period in the prior year. Gross margin was 32 percent for the three month period ended Oct. 2, 2010 versus 30.8 percent for the three month period ended Oct. 3, 2009. These increases were primarily attributable to higher sales volumes and improved sales mix, the company said.
Income from operations in the third quarter was $1.2 million, compared to a loss from operations of $0.4 million for the same period in the prior year. This improvement was primarily attributable to the gross profit increase, partially offset by increased selling, general and administrative expenses.
The company recorded a net loss of $5.8 million for the three months ended Oct. 2 versus a net loss of $7.5 million for the same period in the prior year. The decreased net loss was primarily attributable to the improvement in income from operations.
As of Oct. 2, the company had a cash balance of $40.6 million and an additional $39.4 million of borrowing capacity under its revolving credit facility. Working capital totaled approximately $130.2 million, up slightly from $127.4 million at Jan. 2.
Net cash provided by operating activities during the nine months ended Oct. 2, was $18.7 million compared to $40.9 million for the same period in the prior year. The decrease in net cash provided by operating activities resulted primarily from increases in accounts receivable and inventory levels versus decreases in the prior year, partially offset by a smaller increase in accounts payable levels. This decrease in cash for higher net operating assets employed in the business year-over-year was partially offset by an $8.3 million increase in net income adjusted for non-cash charges.
"We are pleased to report our third consecutive quarter of increases in year-over-year sales, despite a sluggish macroeconomic environment," said CEO Ed Orzetti. "We continue to operate the business conservatively in these challenging economic times while prudently investing in the business for both the short and long term. A key ongoing priority is working with our strategic suppliers to introduce programs that continuously improve the customer experience. We are well-positioned to benefit from a rebound in the economy and an increase in discretionary spending, and we are busy getting ready for our ‘Big Show’ events in New Jersey and Texas, which we expect to be bigger and better than last year."
