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Nautilus enjoys record 4th quarter(Columbian, The (Vancouver, WA) (KRT) Via Thomson Dialog NewsEdge) Feb. 8--Nautilus Inc. avoided the production problems of a year ago to finish 2006 with record fourth quarter and annual net sales. Gregg Hammann, president and CEO of the Vancouver-based manufacturer of fitness equipment and apparel, said Wednesday during a conference call that the strong finish to 2006 was made possible by three years of strengthening the company's financial underpinnings. "All of the heavy lifting has positioned us with a solid foundation for a sustainable rhythm of sales and earnings growth," Hammann said in a press release. Nautilus employs more than 500 people at its Vancouver headquarters and sports campus on Southeast 164th Avenue. Fourth-quarter profits jumped 579 percent to $12.9 million, or 41 cents per share. Profits for the year were 26.1 million or 81 cents a per share, a 29 percent increase in share earnings. Net sales for the three-month period that ended Dec. 31 were $199.3 million, up 9.5 percent and in the middle of analysts' expectations. Net sales for the year were $681.5 million, up 8 percent. Hammann promised investors earlier in 2006 that previous production problems had been fixed by reducing the number of plants and greater scrutiny of the manufacturing process. Those internal changes allowed Nautilus to release 17 new product lines during the year, three more than promised, Hammann said. It also resulted in improved customer satisfaction scores and pushed the company from the No. 3 position in the industry to within striking distance of Icon Health and Fitness of Logan, Utah, which is the leader. Cutting costs Hammann said executives are pushing to capitalize on 2006's accomplishments by continuing to cut costs on the production side of the business. To that end, Nautilus announced recently that it signed a deal to buy Land America Health and Fitness Co. Ltd., in Xiamen, China. The contract manufacturer is already building Nautilus products. The $72.2 million deal is expected to reduce production costs and also gives Nautilus protection against leaks of its intellectual property. Hammann said net sales are expected to grow by 10 percent in 2007 and a 20 percent to 30 percent increase of per share earnings of 81 cents. Net sales for the first quarter are projected to be between $185 million and $195 million, with earnings of 18 cents to 21 cents per diluted share. The company issued a quarterly dividend of 10 cents per share. Nautilus' stock closed Wednesday at $16.64, down 25 cents. Jonathan Nelson can be reached at 360-759-8013 or via e-mail at [email protected]. Update --Previously: Nautilus Inc., the Vancouver-based maker of fitness equipment and apparel, ended 2005 with disappointing sales due to production problems. --What's new: On Wednesday, the company reported strong increases in both 2006 net sales and earnings. Sales for the year reached $681.5 million, up 8 percent. --What's next: Nautilus expects net sales this year to increase another 10 percent. Copyright (c) 2007, The Columbian, Vancouver, Wash. Distributed by McClatchy-Tribune Business News. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |