Cycle Country Announces First Quarter Revenues For Fiscal 2003MILFORD, Iowa--Feb. 15, 2003--Cycle Country Accessories Corp. (OTCBB:CYCY), the recognized leader in developing and manufacturing custom-fitting accessories for the all-terrain vehicle (ATV), announced first quarter revenues of $4,414,053 for the three-month period ending December 31, 2002. This represents an 8.3% decrease compared with revenues of $4,811,424 during the corresponding period in 2001. The single-digit decrease in revenues during the first quarter is mainly attributable to a reduction of $594,000 in sales volume from the Company's mainstay Snowplow Blade products. Essentially all North American distributors' early season order quantities were below last year's during the Company's recently ending first quarter of 2003.
However, this was offset by increased sales of $301,000 from manufacturing new John Deere products, additional Plastic Wheel Cover units and new sales of Perf-Form oil filter and oil cooler products. Additionally, the Company has current orders from these same distributors throughout the U. S. and Canada with scheduled deliveries into the month of February 2003. These current shipments for Snowplow blades and other related winter-season products are running nearly 30 days longer than the last shipments sent on January 10th of 2002.
Gross profit as a percentage of revenues was 24.9% for the first quarter of fiscal 2003 in comparison to 26.7% for the same quarter the previous year. The decrease of 1.8% in gross profit is primarily the result of an increase in direct labor costs in the Plastic Wheel Cover segment and a decrease in the gross profit margin for Snowplow Blades. The increased direct labor cost in the Plastic Wheel Cover segment was due to additional staffing requirements to institute a higher quality clear coating process along with additional personnel for operating two full production shifts and a limited third production shift. The production increase was attributed to continued growth in wheel cover sales from increasing off-season demand as well as in-season demand growth. The minimal decrease in the gross profit margin of the market leading Snowplow Blades was to strengthen the Company's position with a new snowplow blade configuration that increases its durability and standard features while maintaining its competitive pricing.
The increased Wheel Cover production shifts and reconfiguring the standard snowplow blade, while impacting the first quarter's operating profits, will strengthen the position of the Company going forward. All to meet the demands of the market, expand sales and increase revenue and profits throughout the remaining three fiscal quarters.
Mr. Ron Hickman, CEO and president of Cycle Country, stated: "We anticipate that our revenues for each of the remaining quarters of fiscal 2003 will exceed the actual results of the second, third and fourth quarters of fiscal 2002. Management's aggressive efforts to address seasonality issues, expand into new markets and strengthen the market-leading positions of our current products will begin to provide superior financial results. Our reintroduction of the Weekend Warrior brand of heavy-duty equipment attachments and continued expansion of marketing our current line of ATV accessories into the lawn and garden industry should account for some of the improved second and third quarter fiscal 2003 revenue levels. Also contributing to improved revenues for the remaining quarters is our projected growth of the Perf-Form premium oil filters and oil coolers as we increase production and devote greater sales and marketing resources to increase its presence and availability in the marketplace. Weekend Warrior and Perf-Form will also provide the company with tremendous opportunities for strong sales and profits in quarters that traditionally have been weak for the company due to the seasonality of some of the ATV accessories market."
About Cycle Country Accessories Corp.
Cycle Country, www.cyclecountry.com, with over 50% of the worldwide market in several product categories, is the industry leader in the design, engineering and manufacturing of custom-fitting accessories for the utility all-terrain vehicle (ATV). Since 1981, Cycle Country has developed an extensive line of branded products of snowplows, lawnmowers, spreaders, sprayers, hitches and many other utility equipment items along with recreational accessories. The Company's products custom fit virtually every brand of ATV on the market, which are distributed by a group of 16 distributors who sell their products to essentially all ATV and motorcycle dealers in North America.
The Company has also developed 19 international distributors that sell Cycle Country products in 35 countries throughout Asia, Europe, Central and South America. Additionally, Cycle Country dominates the golf car wheel cover market by manufacturing approximately 90% of all wheel covers sold to original equipment manufacturers (OEM's) worldwide. Cycle Country sells high-performance premium oil filters and oil coolers for motorcycles and ATVs throughout the U.S. under the brand name Perf-form Products. Cycle Country also manufactures heavy-duty garden equipment attachments for Garden Tractors, ATVs and other utility vehicles within the Lawn & Garden industry under the brand name Weekend Warrior.
For the complete 10-QSB filing, go to the company's website at www.cyclecountry.com and click on the Investor Relations heading. Please direct any financial questions to Scott Gibson at Heritage First Capital & Equity Research Group by calling 407.444.5959 or via e-mail to CYCY@heritagefirstcapital.com. Cycle Country Accessories Corporation Headquarters: 2188 Highway 86 - Milford, Iowa 51351 - 800.841.2222.
This press release does not constitute an offer to sell or the solicitation of any offer to buy any securities of Cycle Country Accessories Corporation, nor shall there be any sale of any such security in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state. Forward looking statements: This press release and other statements by Cycle Country may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to the outlook for earnings and revenues, other future financial or business performance, strategies and expectations. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "estimate," "potential," or future/conditional verbs such as "will," "should" and "could."