Updated from 12:13 p.m.
Shares of LeapFrog Enterprises (LF) were among the NYSE's losers Wednesday, falling 10% after the company posted a fourth-quarter loss, cut about 180 jobs in an attempt to restore profitability, and announced a management shuffle.
The toymaker posted a loss of $9 million, or 15 cents a share, on sales of $255.3 million. Analysts polled by Thomson First Call were expecting the company to post a profit of 18 cents a share on sales of $288.8 million. A year earlier the company posted earnings of $44.2 million, or 72 cents a share, on sales of $331.4 million. LeapFrog said that operational issues and increased operating costs, which were compounded by a lack of retailer reorders during the company's critical Thanksgiving period, led to a difficult year.
As for the job cuts, which took place in early February, the company said they are part of its realignment plan to restore profitability, and strengthen its infrastructure and business processes.Finally, LeapFrog said that Fred Forsyth, its chief operating officer, has resigned and that it is in the process of hiring a new supply chain expert. LeapFrog also announced the hiring of Rob Moon as chief information officer. Shares traded down $1.21 to $10.90. Ultimate Electronics (ULTEQ) fell 42.9% after the company, which filed for bankruptcy protection in January, posted poor fourth-quarter sales, announced the departure of its CEO, and warned that its common shares would likely be worthless as a result of the bankruptcy filing. The consumer electronics retailer posted fourth-quarter sales of $195.9 million, well below the $217.2 million that analysts were expecting. Comparable-store sales, meanwhile, fell by about 19%. A year ago the company posted sales of $243.2 million. Ultimate Electronics said that Mark Wattles, who most recently served as the company's chairman, would replace CEO David Workman. Seven other individuals who have previous experience working with Wattles will join Wattles' management team later this week. Aside from the management changes and fourth-quarter sales, Ultimate also announced final approval for its $118.5 million debtor-in-possession financing. The company said that based on testimony at the DIP financing hearing "it appears unlikely that the outcome of the company's reorganization will result in any value for the holders for our common stock." Shares traded down 84 cents to $1.12.