Recreational vehicle and marine aftermarket supplier Coast Distribution System reported a slight decrease in sales and earnings for its third quarter, ended Sept. 30.
“Coming off a second quarter that was the best quarter in company history, we are pleased with our sustained profitability in a difficult market,” said Thomas R. McGuire, chairman and CEO of the Morgan Hill, Calif.-based company. “Both the RV and marine industries, our primary markets, suffered this summer due to global instability and high fuel prices. The high fuel prices also created pressure on our gross margins as it lead to higher shipping costs.”
Coast reported third-quarter net income of $705,000 compared with $1.7 million a year ago while revenues dipped to $44.3 million from $45.4 million.
For the nine months, net earnings were flat at $4.8 million versus the previous year and sales rose to $152.6 million from $147 million.
McGuire noted that year-over-year comparisons in recreational vehicle sales were “difficult” due to heightened demand from hurricane recovery units in the third quarter of 2005.
Coast reported gross margin of 18% in its third quarter, compared with 18.9% for the same period in 2005. The company said the decrease was due to increased freight costs associated with overseas products and increased shipping costs as a result of higher fuel prices.