Things are going from bad to worse at the Voxx International-owned Premium Audio Company, who distribute Klipsch, Onkyo, Jamo Integra and Pioneer products in Australia, with a senior executive quitting after the salaries of several senior executives were recently cut by 20 per cent.
This is the same business that tried to nobble Sound United’s business in Australia, by stealing their distributor’s staff, who had spent months stealing confidential information from Qualifi during their time employed by Sound United’s then distributor in Australia.
The executives were planning the launch of a Premium Audio subsidiary.
During a recent public holiday in the USA, when only bad announcements are made, the Voxx International-owned Premium Audio Products chose to quietly announce their COO Oscar Bernardo, who has been with the PAC (and Klipsch Group) for more than 16 years, had quit the company.
It appears Bernardo, the former COO, at the Premium Audio Company, was not confident of the future success for the PAC products so he moved to go out on his own, by acquiring the Mirage speaker brand, which he plans to restore to what he has described as “Its status as an innovator audio product that sets new standards in speaker design and performance.”
At CES 2023 several audio industry figures tipped that other senior executives could quit the Voxx International Company, which is an audio business that has been described as “riddled with problems and falling profits”.
Back in September, Voxx International moved to slash the salaries of several top executives, including CEO Pat Lavelle, Charles Stoehr (Senior VP and CFO), Loriann Shelton (Senior VP and COO), T. Paul Jacobs (President and CEO of Klipsch Group), and Ian Geise (President, Voxx Accessories) – all executives who were involved in the questionable business activities in Australia.
They also failed to appear at CEDIA Expo 2022, despite taking over the Integra, Onkyo and Pioneer brands for the custom install market.
The move to announce the sudden exit of a key executive was made only days before the business is due to announce their latest financials.
According to analysts, the business is in “deep cost-cutting mode”, with major retrenchments of staff set to be announced.
Recently, PAC Australia were showing dealers around their all-new headquarters in Eastern Creek, NSW, complete with five dedicated demonstration rooms, boardroom, and large open spaces.
In their last filing the business reported Q2 net sales were $125.7M, down 12.2% year on year.
Consumer Electronics sales in the second quarter were US$88 million. Compared to $97 million in the comparable year-ago period, this was a decrease of $8.9 million or 9.2 per cent.
Also falling was Premium Audio product sales. They came in at $69.2 million compared to $76.1 million in the prior period.
The decline in Premium Audio product sales was primarily related to lower domestic sales of premium home theatre speakers and wireless speaker products.
In a briefing to analysts, the Company admitted that nonessential leisure products were “feeling the pinch”.
They also admitted that major retailers have recently lowered their levels of Vox International inventory such as Klipsch speakers because of lower sell-through and the fact they know the supply chain is full and they can avail themselves of product quickly without carrying the capital cost of carrying stock.
Premium Audio sales of premium home speakers and wireless speakers were down $24.5 million, but this was offset by an increase of $18.4 million in sales of Onkyo and Pioneer products.
Sales at the Asia Pacific operations of Premium Audio were up $3.7 million. This was because the business had a “terrible” year last year according to Company documents.
Also contributing to the growth is sales of Onkyo and Pioneer products that the local subsidiary did not range last year.
In the US, the Company has not announced it was looking for a replacement for Bernardo. Instead, CEO Jacobs would act as an interim COO.
ChannelNews will report the Company’s financials when they are announced.
