Recoton

[Guest Nigel]

I have heard from various sources, none that I would rate as reliable, that Recoton, the current owner of the AR brand, is in dire straits and fast approaching bankruptcy.

Is anyone here in a position to know for sure?

If this is the case, who will get the AR brand? Is there enough left to salvage it after Retocon? Could the 303, 302 and 338 be brought back?

Nigel

[soundminded]

Recoton trades on the NASDAQ under the symbol RCOT for about 34 cents to 35 cents a share. It peaked in mid 1998 at about $40 a share so it has lost 99 percent of its value. This is not too different from many so called high tech companies that flew too high and close to the sun. Its 12 month trading range was from a low of 26 cents to 6 dollars a share mostly on the downtrend. I didn't look at its 2002 annual report but it's a safe bet that it isn't pretty. In 2001 they lost about 7.5 million on 613 million in sales, down from a high of 710 million in 1999. At the end of 2001, they still had considerable assets so things may not be that bad. If you want to know, look at some brokerage recommendations. Consumers electronics is probably in a slump right now along with the rest of the economy. Things might improve if the economy picks up.

Recoton execs have several options if things don't get better. AR is probably among their greatest assets. All of Recoton could be acquired, they could sell AR to another company, spin it off as an IPO (not too likely IMO) , or the whole company including AR could go into bankrupcy if things get really bad. Or, they could try to tough it out until things get better. A lot of companies are doing that. Any way you look at it, AR will probably still be around. The prestige value of the brand name alone makes it valuable and unlike the dot com companies, there are real assets to this company.

Unfortunately, what AR would look like in future years is anyone's guess. Would they go the way of KLH? Would Harmon Industries buy them up so that they could be absorbed into the empire? At this point, nobody knows.

BTW, if you really want to know their exact status, you can check their investor relations website at http://www.rcot.com/stock.asp

I got their chart from bigcharts, one of my favorites for this type of data.

[Guest audioslave]

I run a small car audio shop and my local distributor informed me about a month ago that indeed Recoton would be dropping or selling certian lines like Jensen, AR, and Advent and they (my distributor) would no longer be carrying any Recoton products. That's what little I know.