Sales at the Premium Audio Company both globally and in Australia, have been smashed with questions now being raised about the future of their subsidiary in Australia.
In the last quarter global sales fell 32% with 25% of the value of parent Company Vox International wiped overnight on the shocker result.
Pat Lavelle the CEO of Vox International the owner of PAC claims there is worse to come with questions now being raised as to whether the business would do better in Australia operating via a distributor than via their own subsidiary.
Local sales director Peter Shamoon told ChannelNews “This is the first I have heard of these claims, times are tough for everyone even our competitors”.
Recently Vince Bonacorsi was promoted to President of Sales and Marketing for Australia and New Zealand.
Vox International management claim that Bonacorsi has developed Asia-Pacific into one of the fastest-growing and most profitable business segments for Premium Audio Company.
He now has full P&L responsibility for the region.
He was also the man responsible for the exit of people and the Vox International brands from Qualifi during the time that the Melbourne based business was still the appointed distribitor.
Bonacorsi has been with the company since 2007.
Vince Bonacorsi with Peter Shamoon.
PAC who sells Onkyo, Klipsch Pioneer, and Integra, products in Australia, recently lost another high-profile executive after Bill Liacopoulos their National Sales Manager left last month to work in property management.
ChannelNews understands that he is not being replaced in the short term.
Lavelle claims that the business is now focusing on “more workforce reductions and other cost reduction actions to try to achieve profitability on lower sales volume”.
During a conference call with analysts, Lavelle added his opinion on why consumer demand may be declining: “Our business continues to be impacted by changing consumer patterns, higher interest rates, all-time high credit card debt, and continued production issues at our OEM customers.”
He then had a stab at his competition (Masimo Consumer) claiming “I can tell you VOXX is not alone. Our peers are facing the same issues as we are. We are not alone in losing market share.”
He admitted that PAC “has been hit hard.”.
Overall Voxx says that net sales in the quarter came in at US$111.9 million, a drop of US$16.8 million or 13.1% lower than the net sales of $128.7 million in the same quarter last year.
All three divisions – Automotive, Consumer Electronics, and Biometrics declined however, consumer electronics was the biggest loser in the quarter for the US business whose business methods have been questioned in the past.
Overall consumer electronics Q1 sales were $73.3 million compared to sales of $88.9 million in the same quarter last year.
This was a decrease of -$15.6 million or -17.5%.
Another problem was that rampant discounting led to a significant fall in gross margins which in the CE division was down 2%.
As of May 31, 2023, the Company only had cash and equivalent reserves of $5.2 million compared to $6.1 million as of February 28, 2023.
Total debt as of May 31, 2023, was $36.7 million compared to $39.2 million as of February 28, 2023.
Lavelle claims that the business has several new innovations on the horizon.
Despite PAC being the worst performing division, the Company still has hope for the business claiming that an improved supply chain will allow for the expanded production of AV receivers.
However, insiders claim that that is not happening.
During COVID lockdowns Voxx acquired Onkyo Home Entertainment Corporation from the now-bankrupt Japanese Onkyo Group.
They also acquired the license to sell Pioneer and Pioneer Elite brands.
This acquisition was done in partnership with Sharp Corporation, with Voxx owning the lion’s share of the joint venture (77.2%) and providing distribution, sales, and marketing; with Sharp owning a minority share (22.8%) and providing all of the manufacturing.
New information reveals that US domestic Sales of Onkyo & Pioneer Products Declined $4 Million in the Quarter with the business admitting that competition by archrival Masimo Consumer the former Sound United entity as having hurt sales.
Global sales at PMA came in at US $47.6 million compared to $69.9 million in the same quarter the prior year, a decline of $22.3 million or 32%.
The Company claims: “The decline in Premium Audio product sales was across the majority of categories both domestically and internationally due to slowing of economies and a decrease in consumer spending.”
Vox International has lost almost 25% this week.
The value of Voxx stock closed last night $9.54 per share, down -15.87% from the close yesterday of $11.34. Interestingly, Voxx stock dropped yesterday as well, as that $11.34 was down -10.38% from last Friday’s close.
That means that in two trading days, Voxx stock lost nearly 25% of its value.
