Brunswick posts 4Q loss, warns on 2009 sales
Brunswick reports 4th-quarter loss as sales slump, warns of lower sales for 2009
On Thursday January 29, 2009, 11:37 am EST
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LAKE FOREST, Ill. (AP) -- Brunswick Corp. posted a fourth-quarter loss Thursday, as the boat maker's sales continued to slide amid decreased demand for big-ticket recreational items.
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The company also cautioned of lower sales results for 2009, with bigger declines during the first half of the year as it deals with ongoing market volatility and expectations for a continued slowdown in retail demand for the first six months.
Brunswick's stock shed 37 cents, or 11.2 percent, to $2.93 in morning trading as the broader market fell amid fresh economic worries. Over the past year, the stock has traded in a range of $1.82 to $19.63.
Brunswick has been hampered as consumers have increasingly pulled back on their discretionary spending due to the ongoing housing slowdown, eroding credit, rising food costs and unemployment concerns.
Brunswick, which also makes exercise and bowling equipment, reported a loss of $66.3 million, or 75 cents per share, compared with a profit of $6.8 million, or 8 cents per share, a year ago.
Quarterly results included 34 cents per share in restructuring charges and 54 cents per share in non-cash tax charges, which was partially offset by a 56 cents-per-share gain related to a reversal of variable compensation accruals.
Sales slumped 42 percent to $837.7 million from $1.44 billion for the period ended Dec. 31.
Analysts polled by Thomson Reuters predicted a loss of 88 cents per share on revenue of $1.01 billion. Analysts' estimates typically exclude one-time items.
"The continued decline in global recreational marine markets experienced throughout the first nine months of the year increased during the fourth quarter of 2008," Chairman and Chief Executive Dustan E. McCoy said in a statement.
Fourth-quarter boat segment revenue plunged 54 percent to $293.7 million, while revenue for the marine engine division sagged 46 percent to $297.5 million.
Fitness segment revenue dropped 20 percent to $171.8 million, while bowling and billiards sales dipped 8 percent to $113.2 million.
For the year, Brunswick posted a loss of $788.1 million, or $8.93 per share, compared with a profit of $111.6 million, or $1.24 per share, in the previous year. Earnings from continuing operations in 2007 totaled $79.6 million, or 88 cents per share.
Annual sales dropped 17 percent to $4.71 billion from $5.67 billion.
Earlier this month Brunswick said it would cut up to 275 jobs and idle another 300 workers as it tries to cope with softening demand for its watercrafts. In November, the company said it would be closing a Maryland plant, which would result in the elimination of 115 jobs.
