Sachdeva settlement boosts Koss

Milwaukee-based headphone manufacturer Koss Corp. reported fourth quarter net income of $4.6 million, or 62 cents per share, up from $931,891, or 13 cents per share, in the fourth quarter of 2012.

For the full fiscal year, net income was $5.4 million, or 74 cents per share, up from $2.9 million, or 40 cents per share.

Net sales for the quarter were $9.9 million, down from $10.8 million in the same period a year ago. For the full year, net sales were $35.7 million, down from $37.8 million in 2012.

The company received $7.5 million in 2013 and $1.4 million in 2012 for insurance and other recoveries that went beyond the legal costs for previously reported unauthorized transactions. In 2013, the figure included a settlement with Grant Thornton LLP, Koss’ auditor during the time Sujata “Sue” Sachdeva embezzled $34 million from the company.

“The fourth quarter last year had strong sales driven by the addition of new customers,” said Michael J. Koss, president and chief executive officer. “This year’s fourth quarter did not have similar load in shipments of full product lines at new customers. The Fit Series, designed for women with the help of Olympian Dara Torres, was launched in this quarter and we have had very good shipments beginning in late June and continuing into July. Net income was up primarily due to the settlement with our former auditors.”
  

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