MEDWAY, MA -- Cybex International reported a third quarter loss of $15,000 with a net sales increase of $0.2 million, according to financials released yesterday by the company.
The Medway, MA-based company had $29.2 million in sales during the quarter compared to $29 million in sales during third quarter 2009, but third quarter 2010 had a $15,000 loss while third quarter 2009 had a profit of $81,000.
John Aglialoro, CEO of Cybex, attributed this quarter’s loss to investments the company has made in marketing, sales and new products. He said that he expects those investments to result in higher future sales as the company penetrates new markets. Aglialoro has stated in the past that Cybex is targeting the university, military, police and fire markets at a greater level than in the past.
Aglialoro and Arthur Hicks, CFO, indicated that perhaps the U.S. market was seeing a bit of an uptick, as North American sales were up 4 percent while international sales were down 5 percent.
“The trend seems to be that clubs are being forced to make replacements for equipment for their clubs,” Aglialoro said in a conference call with analysts yesterday. “That’s a welcome sign.”
However, he noted that funding continues to be difficult for small companies, although he is seeing some companies stepping up to finance these small organizations.
Cardio sales for the company were $15.9 million, down 3 percent from the prior year, Hicks said in the call. Arc Trainer sales, which made up about $7 million of the cardio sales, were up slightly. Strength sales were $10.2 million, an increase of about 1 percent.
Hicks said that because club owners typically replace strength equipment every five to seven years, it’s the easiest category to defer purchasing. He wouldn’t speculate on whether the increase in strength sales meant club owners are deferring less or whether it was a statistical blimp.
“The third quarter of 2010 continued the stabilizing trend of Q2 with sales slightly higher than Q3 2009 and gross margins improving from both Q2 2010 and 2009 levels,” Aglialoro said.
For the nine months ended Sept. 25, 2010, net sales were $83 million compared to $85.7 million for the same period in 2009. The net loss for the first nine months of 2010 was $1.1 million compared to a net loss of $3.4 million for 2009.