CLEVELAND–Fourth-quarter net income for Hamilton Beach totaled $6.6 million, down 48 percent from the last quarter of 2007, according to results released by NACCO Industries, parent company of the housewares brand.
The unit felt the impact of a 7 percent decline in revenues to $186.5 million, rising product and freight costs, lower unit volumes and reduced sales of higher-margin products. Unit sales suffered from “a significant drop” in consumer spending throughout the world, NACCO said.
These bottom-line results did not reflect a pre-tax charge NACCO took companywide as a write-off because its stock price as of Dec. 31, 2008, was well below the book value of tangible assets and the book value of equity. The company said accounting rules require that it take a write-off of goodwill and other intangible assets, which for Hamilton Beach was about $80 million; for NACCO as a whole, this charge was $435.7 million. Factoring in this write-off, Hamilton Beach posted a net loss of $74.1 million for the fourth quarter.
For the full year, Hamilton Beach’s net income was $7.4 million (a $73.3 million net loss with the above-mentioned charge), down 62 percent from fiscal 2007. Revenues totaled $528.7 million, 2.2 percent less than the prior year. The outlook for 2009 includes an expected drop-off in revenues for the brand, with consumer spending expected to decline due to the global economic troubles, NACCO said.
NACCO posted a 2008 net loss of $437.4 million (including the charges) on sales of $3.7 billion for all of 2008.