NOV. 17 I STEINWAY I FINANCIAL
Steinway Q3 Sales Down
Steinway reported its sales were down 18 percent for the third quarter, which ended Sept. 30.
“We operated our piano facilities at reduced production levels during the quarter in an effort to reduce inventories,” said Dana Messina, Steinway’s CEO. “While that resulted in lower piano gross margins, reduced sales incentives led to an 180 basis point improvement in our band division gross margins.”
According to Messina, Steinway’s piano division had stable institutional business, which helped offset weak consumer sales. Third quarter piano sales were down 19 percent, and gross margins decreased from 35 to 31 percent. Year-to-date sales were down 26 percent with gross margins decreased from 34.8 to 30.8 percent.
While Messina said the company successfully met back-to-school orders for band instruments in the third quarter, the segment’s sales were down 16 percent. Gross margins increased from 23 to 25 percent. Year-to-date sales were down 20 percent and gross margins increased from 22.2 to 22.5 percent.
“We expect difficult sales trends to carry through the fourth quarter as consumer spending remains soft worldwide,” Messina said. “We are hopeful that worldwide economies improve next year, but we are managing our business with the expectation that 2010 will be challenging.”