High expenses and low sales on the West Coast continue to plague Trak Auto Corp.'s bottom line, the company said yesterday in announcing its yearly earnings.
Despite a 26 percent increase in sales for its fiscal year that ended Jan. 31, the company's profits dropped 30 percent, from $4.6 million (83 cents a share) to $3.2 million (54 cents).
Meanwhile, increased earnings were reported by Crown Books Corp. for its latest fiscal year and by American Management Systems Inc. for its first quarter.
Trak Auto attributed the decrease in profits to losses incurred by Trak Auto West Corp., which is 50 percent owned by Trak Auto Corp. Trak Auto West lost $4.3 million last year, 44 percent more than the $2.9 million it lost a year earlier.
"The company attributes Trak West's loss to low sales and gross profit in existing and new locations, and high expenses such as advertising and start-up costs associated with competitive factors and entry into the Los Angeles market," Trak Auto said. Trak West has opened five new stores since Nov. 1.
"The factors causing Trak West to incur high expenses in relationship to sales are continuing," Trak Auto said.
Sales figures for Trak Auto West -- with its 51 stores -- were not disclosed. For Trak East -- with its 93 stores in the Mid-Atlantic and Chicago areas, sales increased 26 percent, to $73.8 million from $58.6 million. Earnings remained about $7.5 million.
For the last three months of the fiscal year, Trak Auto East's sales were up 36 percent to $20.7 million from $15.1 million. Earnings for Trak Auto East were down 35 percent, however, from $2 million to $1.3 million.
Losses for Trak West were $1 million, a 5 percent improvement from the previous year, when Trak West lost $1.1 million. Overall, for the quarter, Trak Auto earned $255 million (4 cents), a 73 percent decrease from the previous year's quarter, when profits totaled $929 million (15 cents).
* Crown Books Corp.'s profits increased by 33 percent for its fiscal year that ended Jan. 31 to $6.5 million (81 cents a share) from $4.9 million (73 cents).
Sales increased by 25 percent for the 183-store discount book chain to $114.4 million from $91.4 million.
For the last quarter, Crown's profits were up 41 percent, to $4 million (50 cents) from $2.8 milion (35 cents) a year ago. Sales were also up 25 percent, to $41.6 million from $33.4 million.
* American Management Systems Inc., which develops, installs and operates computer software systems for managing business and governmental organizations, reported that its first-quarter net income increased 18 percent to $530,000 (32 cents a share) from $449,000 (27 cents) during the same period a year ago.
The Arlington-based company's revenue increased 27 percent to $26.6 million from $20.99 million a year earlier.
The company said that income for the quarter increased more slowly than revenue, principally because revenue from its energy market declined at the same time costs increased slightly as the company's energy staff in Houston was consolidated.