Coast Distribution Reports Loss for 2008
Coast Distribution System Inc. today (March 31) reported its operating results for the fourth quarter and year ended Dec. 31, 2008.
The Morgan Hill, Calif.-based supplier of aftermarket replacement parts, accessories and supplies for the RV, marine and outdoor recreation industries reported a net loss of $2.3 million on sales of $16.9 million for the fourth quarter 2008, compared with a loss of $1.5 million on sales of $26.7 million a year earlier.
Net sales in the 2008 fourth quarter declined 37% year-over-year, as industry associations for both the RV and boating industries reported double-digit declines in shipments for the year.
For the year ended Dec. 31, 2008, Coast reported a loss of $1.8 million on sales of $132.2 million, compared with earnings of $215,000 on sales of $164.3 million for 2007.
“As expected, 2008 was extremely difficult based on the drop in sales traffic to RV dealerships, our primary customer, due to the economic recession, unstable fuel prices and lack of available financing for potential purchasers,” said Coast’s CEO Jim Musbach.
“We continue to control costs and optimize costs in line with sales wherever possible,” he continued. “We have reduced our staffing levels by 30% and replaced our costly annual trade show with a more efficient and effective online sales program. We also restructured our sales department to focus more on inside sales to existing accounts, and have worked with our vendors and landlords to secure discounts.
“Looking ahead, we are expecting a challenging 2009,” said Musbach. “The RVIA is forecasting another year of decline for the RV industry. That said, we believe people are still using the RVs they own and enjoying the RV lifestyle more than ever, and will continue to demand our aftermarket products even in a recession. We are closely monitoring our inventory levels, inventory turnover and days sales outstanding. We believe we have the cash, financing and level of demand to weather this storm, even as we proactively streamline our operations, and evaluate strategic options to maximize shareholder value in 2009.”