Sales at US sound Company Vox International the owners of Premium Audio Products, Klipsch, Onkyo, Acoustic Research and formerly Pioneer, is still spiralling downwards with their consumer audio category down 35%, overall sales which include their automotive business were down 18.6% in the last quarter, with the business moving to offload more assets in an effort to inject the business with capital.
Arch rival Masimo Consumer the former Sound United that is up for sale are facing face similar problems in the audio market with confirmation that Vox International is also up for sale and that part of the business could possibly be merged into a Masimo deal.
In Australia, the business who three years ago were bragging that their new subsidiary was set to be a major player in the market has all but been abandoned with Westan appointed as their distributor.
During the last quarter, the Company sold the Jameo brand to a Chinese Company this allowed Vox to trim their nett debt.
In their general consumer electronics market Vox only managed sales of US $66.1 million, which was a decline of $12.0 million or 15.4% compared to net sales of $78.0 million in the same quarter last year.
Premium Audio Products net sales declined 6.2% to $49.9 million $53.2 million in the same period in 2023.
The company said the declines in the category were due to “fewer close-out sales in the prior year, and lower consumer spending amid economic and geopolitical concerns…”
Overall Consumer Electronics product sales collapsed by over 35% with sales of $16.1 million versus net sales of $24.8 million last year with several markets including Australia and Europe now a problem for the Company.
The business that is also being impacted by poor staff morale, the current economic environment high interest rates, limited inventory, and lower consumer spending has managed to cut debt.
As a result, the company has moved to totally restructure the business and this involves cutting overheads such as Peter Shamoon and other senior executives in Australia.
The business has also offloaded “non-core” brands and assets and is trying to pay down its debt which ballooned after the business was ordered by a US Court to pay US $40M to Former Supplier with the business facing the potential of additional claims going against them.
As a result of the Jamo sale and pending sales of other assets Vox Internationals debt is now less than $$20 million.
Despite the sale and the restructuring of the business gross profits are still falling and operating losses increasing.
In Q2 Voxx reported Total Operating Expenses of $31.8 million which was $5.3 million or 14.3% lower than total operating expenses of $37.1 million in Q2 of Fiscal 2024.
The company didn’t mince words, expenses were much lower due to “the positive impact from restructuring programs and other initiatives designed to lower costs and working capital needs.” Lavell claimed last week.
At the end of August, Voxx sold significant assets from its wholly owned subsidiary, VOXX Accessories Corp (VAC).
Those assets included intangible assets and inventory – which the company says is included in the Consumer Electronics segment.
This was sold to Talisman Brands which trades as Established, the business was sold for $24.5 million.
Vox’s audio division, Premium Audio Company, sold off two “non-core” speaker brands – Jamo & Energy Cinemaster Shanghai Ltd for a total of $3.4 million collectively.
The company noted that it “recognized a gain of $2.2 million on the sale of these assets”.
Premium Audio Company, which is a wholly owned subsidiary, of Vox International has sold off its Jamo and Energy brands has also stopped manufacturing Pioneer, Elite, and Esoteric audio products with sales halted globally.
ChannelNews understands that Pioneer pulled the license from them because of the problems the Company was facing.
Lavelle has said that they are talking to third parties regarding to possible sale of the business.
During last week’s conference call Lavelle indicated that the company had already received an offer for the entire company, but it appears that he is hanging out for the potential of other bidders as we understand the offer is on the “low side”.
One Company interested in part of the business is Gentex – an automotive parts supplier who has made an investment in Voxx, and whose CEO sits on the Voxx Board of Directors.
“We are in a process, and that process is to determine the value of the company” he said.
