December 20, 2001 — LIBERTY CORNER, NJ — Fedders Corporation, a global manufacturer of air treatment products, including air conditioners, air cleaners, dehumidifiers and humidifiers, and thermal technology products, reported sales of $38.1 million for the first quarter of fiscal year 2002 ended November 30 compared to $41.0 million in the first quarter of fiscal 2001.
Sales declined in the quarter mainly due to reduced demand for air cleaners in the semiconductor cleanroom market associated with slowing economic conditions and due to a reduction in off-season sales of room air conditioners.
The gross profit margin improved to 23.5 percent in the first quarter of fiscal 2002 from 21.0 percent in the first quarter of fiscal 2001. The improvement is a result of lower costs due to the previously announced restructuring of North American room air conditioner operations. Gross profits in the first quarter included non-recurring manufacturing costs of $0.4 million to complete production at the Maryland and Tennessee plants subsequent to those facilities ceasing production as part of the restructuring plan.
During the first fiscal quarter, the company also announced that it completed two joint ventures that have expanded the company’s global operations. In October 2001, Fedders International entered into a joint venture, Universal Comfort Products Private Limited, with Voltas Limited, to produce room air conditioners in India.
In November 2001, Fedders’ subsidiary, Melcor Corporation, and Quanzhou Hua Yu Electrical Component Factory formed a joint venture, Quanzhou Melcor Hua Yu Thermoelectric Company Ltd., to manufacture thermoelectric modules, which are used to precisely control temperatures in applications such as fiber-optic communications and biotechnology, in China. Both operations provide the company with a presence in major growth markets in the two most populous countries in the world.