Sales Slide Pushes Profits Down for Armor All; Stock Still Solid

Calling it a “disappointing year,” Armor All Products Corp.’s president said Thursday that the company’s profit plunged 71% in fiscal 1996 to $7.2 million, or 34 cents a share, from $24.5 million, or $1.16 a share, the previous year.

Revenue for the 12 months ended March 31 dropped 14% to $186.3 million from $216.8 million as sales of Armor All’s car care and home care products fell throughout the North America market and grew only slightly overseas, where Armor All gets about 12% of its revenue.

The weak performance did not dim investors’ view of the company however, as Armor All’s common stock price rose 75 cents a share to close at $16.75 in moderate trading on the Nasdaq market. While lower than the stock’s year-ago price of $20 per share, Thursday’s closing price represents a gain of $1.75 a share since Tuesday.

“I don’t think we surprised anybody” with the financial report, said Michael McCafferty, Armor All’s chief financial officer.

Company president Kenneth Evans said in March that advertising costs and the price of replacing Armor All wheel cleaner that had been shipped to retailers in faulty aerosol cans would result in an $8-million charge against fourth quarter earnings.

Evans also announced Thursday that the company would be buying back up to 1 million shares of its stock in private sales and on the open market--a move designed to bolster the stock price.

For its fourth quarter, Armor All reported a loss of $854,000, or 4 cents a share, compared to a profit of $9.7 million, or 46 cents a share, for the same period a year ago. Revenue was $61.7 million, down 22.7% from $79.8 million.

Analysts have said that Armor All’s weak sales reflect a nationwide malaise in the auto care market--due both to tighter budgeting by consumers and to harsh spring and winter weather conditions that have kept car owners from heading outside with a sudsy bucket of car cleaner and a tin of auto polish.