Sunbeam Corp. shares fell nearly 17 percent Monday
after the appliance maker announced a wider-than-expected second
quarter loss that fell well short of Wall Street expectations.
Sunbeam, based in Boca Raton, Fla., posted a second-quarter loss
of was $80.2 million, or 75 cents per share, compared with $46.9
million, or 47 cents per share in the year-ago quarter.
Excluding $27 million in one-time charges, the company lost $54
million, or 50 cents per share, for the quarter ended June 30.
Analysts surveyed by First Call/Thomson Financial had forecast a
loss of 33 cents per share.
Efraim Levy, an analyst at S&P; Equity Group in New York, called
the report "disappointing'' and said he will continue to tell his
company's clients to avoid Sunbeam stock. He said the company
currently has $2 billion worth of debt, which it cannot pay down.
"They are not generating enough cash,'' he said.
Shares of Sunbeam closed down 43.7 cents at $2.188 on the New
York Stock Exchange, recovering somewhat after a 19 percent swoon.
Sunbeam, which primarily makes appliances, other household goods
and camping gear, blamed its poor performance on customers no
longer buying generators and outdoor equipment in preparation for
possible Y2K power outages.
Second quarter sales fell 8 percent to $610 million, compared
with $661 million in 1999.
"We underestimated the degree to which the sale of Y2K-related
products, mostly Powermate generators and to a lesser degree
Coleman cooking and lighting products, impacted our results in
1999,'' chairman and CEO Jerry W. Levin said in a statement.
Levy said Sunbeam should not have been surprised by declining
sales in those product lines.
"Management is supposed to anticipate such factors,'' the
analyst said. "Sunbeam had the benefit of those sales last year --
this year it's payback time.''
Levin also announced that the company plans to sell its Oster
Professional Products Division, which makes professional barber and
hairstyling equipment, saying it no longer fits within the
company's line of consumer-based products.
Levy said the sale would not have much impact on the company's
For the first six months of 2000, Sunbeam said it lost $140
million or $1.30 per share, compared to $108 million or $1.07 per
share during the first half of 1999.
Sales for the first half of the year were $1.15 billion,
compared with $1.18 billion during the same period last year.