Tag - MNC

Monaco Coach Corp. (NYSE:MNC) CEO Kay Toolson said that since the RV maker does not see a quick recovery in the RV market, the firm will be taking additional steps to cut costs and lower its breakeven point to quarterly sales of between $260 million and $280 million. Monaco will lower its production rates, lower expenses and more quickly facilitate other consolidations within the company. Toolson made the comments during a Wednesday afternoon conference call.

“While these steps are painful for many of our great employees, they are necessary to ensure the long-range stability and strength of our company,” Toolson said. “Additionally, we are focused on new product introductions that we feel will augment our business.”

The company is working on a new lightweight, fuel-efficient model, he said. The new model will be introduced in early 2009, the CEO said.

Toolson said the firm expects second-quarter sales slightly above first-quarter sales. However, CFO P. Martin Daley said it is difficult to forecast sales in the current economic environment.

Before Wednesday’s opening, Monaco reported a first-quarter loss of $8.5 million, or $0.28 per share, versus a profit of $1.5 million, or $0.05 per share, . . .

The South Financial Group (Nasdaq:TSFG), Rimage Corp. (Nasdaq:RIMG) and Monaco Coach Corp. (NYSE:MNC) were among the new 52-week lows established during Wednesday's trading among companies with market capitalizations or values under $750 million.

Western Refining, Inc. (NYSE:WNR), Buckeye Technologies Inc. (NYSE:BKI) and Marlin Business Services Corp. (Nasdaq:MRLN) were also among the 52-week small-cap lows.

Here are today's 52-week small-cap lows:

Daktronics, Inc. (Nasdaq:DAKT), The South Financial Group (Nasdaq:TSFG) and Buckeye Technologies Inc. (NYSE:BKI) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $750 million.

Rimage Corp. (Nasdaq:RIMG), Wavecom S.A. (Nasdaq:WVCM) and Monaco Coach Corp. (NYSE:MNC) are also among the top small-cap percentage losers.

Here are Wednesday's biggest percentage losers among small caps:

The Russell 2000 (IWM) fell as comments from Fed officials stating that inflation remains a concern erased early gains. The small-cap index fell 9.09 points, or 1.30%, to 692.49, its third consecutive decline. The Dow Jones Industrial Average (INDU) lost 65.03 points, or 0.53%, to 12,200.10.

On a year-to-date basis, the Russell 2000 has decreased 9.60%, while the Dow has let go 8.03% and the S&P 500 is missing 9.66%.

“It will be necessary to continue to monitor inflation developments carefully,” Philadelphia Federal Reserve Bank President Charles Plosser said in a speech to the Birmingham Rotary Club this afternoon. “With inflation creeping up, we have to be particularly alert for rising inflation expectations.”

Similarly, Richmond Federal Reserve Bank President Jeffrey Lacker told an audience at Marshall University’s Lewis College of Business that the risks of a recession have recently increased while inflation has not moderated as some expected, according to news reports.

Higher inflation makes it difficult for the U.S. Federal Reserve to boost the economy with cuts to the target federal funds rate for fear that lower interest rates could drive inflation even higher.

The Russell 2000 (NYSE: IWM) is rising following news that U.S. productivity grew more than expected in the fourth quarter.

At 10:20 a.m. ET, the small-cap index had climbed 3.35 points, or 0.48%, to 704.93. The Dow Jones Industrial Average (INDU) had advanced 54.14 points, or 0.44%, to 12,319.27.

Worker productivity grew more than expected during the fourth quarter, the U.S. Labor Department reported before the start of trading. Productivity increased at an annual rate of 1.8% during the final three months of 2007, above the 0.5% rate expected by economists but below the downwardly revised 6% pace during the third quarter.

Productivity for the entire 2007 rose 1.6%, compared with 1% in 2006.

Increases in productivity allow for an increase in production without a corresponding increase in prices or a jump in the company’s costs.

Unit labor costs, which are a key measure of inflation, rose 1.6% after falling 1.9% in the third quarter. Economists were expecting fourth-quarter unit labor costs to rise 3.8%. Increases in labor costs must be matched by productivity increases in order to keep inflation in check.

The unexpectedly bullish productivity news lifted all the major U.S. indices out of the gate, but the Russell 2000 gave investors a scare when it briefly dipped into the red shortly before 10 a.m. ET.

The Russell 2000 (NYSE: IWM) posted solid gains today, propelled by news of unexpectedly strong economic growth and a drop in the federal funds rate. The small-cap index added 11.87 points, or 1.45%, to 828.02. The Dow Jones Industrial Average (INDU) gained 137.54 points, or 1%, to 13,930.01.

On a year-to-date basis, the Russell 2000 has increased 5.16%, while the Dow has added 11.67% and the S&P 500 has gained 9.37%.

The U.S. Federal Reserve decided to lower the federal funds rate, the rate at which commercial banks make overnight loans to each other, to 4.50% from 4.75% in an effort to keep the economy growing.

The central bank lowered the federal funds rate to 4.5% and the discount rate to 5% in an effort to stimulate economic activity and keep the country from dipping into a recession. The move will make it cheaper for consumers and businesses to borrow money.

However, Fed policymakers signaled that Wednesday's cut may be all that is needed to deal with the economy's troubles.

“Today’s action, combined with the policy action taken in September, should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and promote moderate growth over time,” the Federal Open Market Committee said in statement released at about 2:15 p.m. ET.

Stocks, which declined sharply minutes before the decision was announced, raced ahead to their highest levels during the session.

FARO Technologies, Inc. (Nasdaq: FARO), Document Sciences Corp. (Nasdaq: DOCX) and Buffalo Wild Wings (Nasdaq: BWLD) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $500 million.

Here are today's biggest percentage gainers:

Shares of Monaco Coach Corp. (NYSE: MNC) are taking a dive today after the manufacturer of recreational vehicles’ lowered its outlook, overshadowing positive news that it swung to a profit in the third quarter.

For the three months ended Sept. 29, the small cap recorded net income of $3.7 million, or $0.12 per share, compared with a $7.1 million loss, or loss of $0.24 per share in the third quarter last year. Earnings were two pennies above the $0.10 per share ten analysts surveyed by Thomson on average had forecasted.

Revenues clocked in at $322.4 million, right in line with the $322.21 million seven analysts polled by Thomson were projecting on average. The current quarter’s revenues represent a 10.2% increase over the $292.5 million in revenues earned in the third quarter of 2006.

Going forward, Monaco said based on its current backlog, rates of production and production days available in the fourth quarter, revenue will be between $290 million and $300 million, and that the prescribed level of revenue coupled with its consolidation of towable operations will lead to lower margins and earnings per share for the fourth quarter of $0.02 to $0.04. Nine analysts polled by Thomson are on average forecasting earnings of $0.10 per share, while six analysts polled by Thomson are on average expecting revenues of $315.41 million.

For 2008, based on the Recreational Vehicle Industry Association's flat 2008 class A shipment forecast, the company said it’s forecasting its fiscal 2008 sales to be approximately even with 2007, or $1.27 billion to $1.28 billion. Seven analysts polled by Thomson were on average projecting 2008 revenues of $1.44 billion.

Shares of Monaco Coach (MNC) tumbled 18.12%, or $2.70 to $12.19 at 12:04 p.m. ET. Shares of Monaco Coach have been trading in the range of $11.41 to $17.95 for the past 52 weeks.

Monaco Coach Corporation (NYSE: MNC) may be smarting now as weak consumer confidence,  interest rate instability and pricey fuel stall sales of recreation vehicles. But a match made in demographic heaven--the new-look RV industry and comfort-seeking baby boomers—looks set to take hold in 2008.

Monaco’s middle name should be Luxury. Its high-end motor coaches are not complete without a Sharp LCD 37-inch TV screen, Corian solid surface kitchen and bath countertops, leather furniture, imported ceramic tile, and Ralph Lauren fabrics. They’ve got GPS systems and automatic satellite systems and big, new chassis, ready to be wheeled to one of Monaco’s motor home resorts. Enjoy the swimming pool, the golf course and all the other amenities that make life so, well, luxurious.

And costly. Suggested retail for motor coaches runs from $45,000 is $600,000; towable RVs can range from $11,000 to $80,000. Coburg, Ore.-based Monaco is the top manufacturer in Class A motor coaches (those built on the mightiest of chassis), owning 24% of the market for diesel Class A motor vehicles, based on 2006 retail registrations. Monaco also had an 8% share of the market for gas Class A motor coaches, and a 16% share of the market for all Class A motor coaches. In other categories, including the towable market, percentages fall dramatically.

As the leading maker of premium Class A vehicles, Monaco’s results have been particularly susceptible to increasing interest rates and gas prices. Just small rises in interest rates can turn consumers away from buying an RV, which many—particularly in the case of Monaco—consider to be second homes.

Shares of Monaco Coach Corp. (NYSE: MNC) got a jolt Wednesday morning after the manufacturer of recreational vehicles reported second quarter results up from a year ago and net income above analyst estimates.

For the three months ended June 30, the Coburg, Ore.-based company recorded net income of $4.5 million, or $0.15 per diluted share, compared with net income of $0.37 million, or $0.01 for the second quarter last year.

Second quarter revenues increased 4.4% to $335.3 million, compared with revenues of $321.3 million for the second quarter of 2006.

Shares of Monaco Coach climbed 9.77%, or $1.34, to $15.06 in Wednesday morning trading.

U.S. stocks are firmly in positive territory, while the price of oil has shot up. At 2:51 ET the Russell 2000 had added 4.91 points, or 0.59%, to 837.45. The Dow Jones Industrial Average was up 77.55 points, or 0.58%, to 13,559.90.

Ultralife Batteries, Inc. (Nasdaq: ULBI) will relocate one of its plant to Newark, N.Y., where the company is based, from Waco, Texas. The target date for the McDowell Research communications accessories manufacturing operation to complete its moved is Sept. 30, the provider of high-energy power solutions products announced before the start of trading. “While our McDowell Research products continue to be extremely popular with our customers, and are in high demand, unfortunately the Waco operation has not achieved the profitability that we had planned,” CEO and President John D. Kavazanjian explained.

The following are the most actively traded companies in Friday's trading among those with market capitalizations under $500 million: