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The Coast Distribution System Inc. reported a slight increase in earnings on lower sales as the company was able to improve gross margins through the “strengthened Canadian dollar, improved pricing and increased sourcing of products from Asia.”
“Given the extremely difficult market conditions, we are pleased with our ability to increase margins and maintain our profitability,” said Jim Musbach, CEO of the Morgan Hill, Calif.-based RV and marine aftermarket supplier. “…Though sales of new RVs are sluggish, we believe consumers are using their RVs and enjoying the RV lifestyle more than ever, and will continue to need our aftermarket products.”
Coast reported net income of $1.6 million for the quarter, ended June 30, compared with $1.5 million in the year-ago period while sales fell to $41.2 million from $50.8 million.
For the six months, net income was $711,000 compared with $873,000 a year ago and sales declined to $80.7 million from $94.5 million.
Looking ahead, Musbach said the second half of the year would be a “difficult period” due to continued weakness in the RV and marine markets.
“Our focus remains on areas management can directly control, such as increasing the number of exclusive products we sell, and controlling costs to keep them in line with sales,” he said. “We believe that the strategic steps we have taken in the last several years – the improved efficiency of our operations, our improved product development capabilities and our expanded market share of Coast developed products – continues to place us in a good position for the future.”