VOXX International’s aftermarket automotive business grew about 15 percent during the recent year ended February 28. Sales rose to $136 million, up from $118 million a year ago.
When VOXX purchased Directed in July 2020, it said the new business would add $50 million a year to VOXX revenue. VOXX sales grew slightly more than that in 2021 over 2020 to $118 million, up from $65 million, said the company.
Automotive Electronics sales overall for the recent year, including OEM sales, grew over 22 percent to $201 million as compared to $164 million a year ago. Of that, $65 million was in OEM sales, which were up 41 percent.
VOXX reported “higher sales of aftermarket security products related to the Company’s DEI subsidiary and higher sales of rear-seat entertainment systems due to the start of new programs with Stellantis, Ford and Nissan…”
Gross margins were 23.6 percent in automotive, as compared to 24 percent a year ago.
While the full year sales were strong, the most recent quarter was more challenging. Aftermarket sales were down about 4 percent to $50.6 million as compared to $52.5 million a year ago. Gross margins for the full automotive sector fell to 20 percent from 26 percent. This was due mainly to higher supply chain and other costs.
In a call with analysts, VOXX gave much insight into how it is shifting strategies to cope with chip shortages and the general economy.
Reporting on its fourth quarter, VOXX Director, President & CEO Pat Lavelle said, “Although the overall container and chassis situation at the ports has improved, the COVID shutdowns in China are a concern and if this continues will disrupt supply for many companies. We are watching this closely to get ahead of it.”
VOXX was told by Texas Instruments that its chip production run was moved back from November to January of 2023. This could delay VOXX’s deliveries to Chrysler and Ram (Stellantis), so it developed a new circuit board using an alternative chip. If Stellantis gives the okay, then VOXX could resume production in August, it said. VOXX has $400 million in contracts with Pacifica, Wagoneer, Cherokee, and Dodge Ram vehicles that have already been impacted by parts shortages, it said.
VOXX is taking other steps as well. It has moved production outside of China in some categories (we don’t know if that includes automotive). It is negotiating higher prices with its customers. It is increasing the amount of inventory its carries. Lavelle said the company has been able to weather shortages, “Thanks, in part, to our decades-long relationships with many of our suppliers.”
As for the coming year he noted that demand in many categories is still high, including automobiles. “We could see double-digit growth. Again, it all depends on whether or not we’re going to get componentry that we need, which we think we will. The big caveat that’s out there, is whether or not we have COVID shutdowns, which starts delaying shipments out of the ports, which — it’s really unpredictable what China may do with their COVID policy.”
For all of VOXX International, including consumer electronics, sales for the year were $636 million up from $564 million a year ago. Net income swung to a loss of $22.3 million compared to a net income of $26.8 million last year.
See the full VOXX earnings report here: https://investors.voxxintl.com/news-releases/news-release-details/voxx-international-corporation-reports-its-fiscal-2022-fourth
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Good article