Finances are pretty boring (to me, at least) so I’ll keep this brief.
Piano manufacturer Steinway has announced its 2009 first quarter financial results.
Sales dropped 26% to $70m, gross margin decreased to 26.6% from 29.1%, and the company had a net income of $1 million, down 49%.
Steinway’s CEO, Dana Messina, noted, “In the second quarter, we anticipate continued softness in band instrument sales. We expect our back-to-school season in the third quarter to be better and are building inventories to meet the expected customer demand. Our new products are gaining traction in the marketplace; we are excited about their prospects and expect them to do well for us beginning in 2010.”
“Piano sales have been dismal as dealers struggle with low traffic, a general lack of affordable financing and excess inventories,” said Messina. “We expect continued soft sales during the next few quarters until dealers gain more confidence that consumer demand is improving. Given the conditions, we have further reduced factory headcount, lowered production rates and reduced production days at both of our piano plants. We have aggressively reduced staff headcount and salaries to keep our expenses in line with sales. Looking forward, we believe that we can adapt to this new expense structure and increase profitability as demand recovers.”