Cycle Country 3Q Revenues Drop 18.5%
August 19, 2005
Filed under Uncategorized
Cycle Country Accessories Corporation reported revenues for its third quarter ended June 30, 2005 were $3,314,455, down 18.5% from $4,067,499 for the same period in 2004. Cost of goods sold during the quarter decreased $640,347 or 21.3% to $2,366,152.
Company officials said the drop is sales resulted from dealers returning to seasonal buying patterns and management’s increased inventories to meet anticipated demand for the fourth quarter.
Cycle Country’s gross profit as a percentage of revenue increased approximately 3% for the third quarter ended June 30, 2005 as compared to third quarter ended June 30, 2004.
While Ron Hickman, President and CEO of Cycle Country, said third quarter results of fiscal 2005 did not meet management’s baseline growth projections, he explained that the increase in gross profit percentage was due to price increases on products that, due to increased raw material or other input costs, had fallen below standard gross profit levels.
Also, he said the integration of Simonsen Iron Works, Inc., Cycle Country’s largest supplier, is starting to show increases to gross profit due to more efficiency in the manufacturing process and better scheduling of production.
“A few of our largest distributors indicate that their July orders for Cycle Country product are up 40%-50% over last year,” Hickman said. “Distributors are indicating low levels of inventory of Cycle Country product at dealer and warehouse locations. Therefore, we are seeing very strong truckload orders from our distributors for August and September deliveries.”