Vancouver's Coast Wholesale Appliances Income Fund (TSX:CWA.UN) reported a 44.4% drop in second-quarter profit for the period ending June 30, 2008.
Quarterly profit fell to $1.8 million from $3.2 million in the same period last year. Rapidly rising fuel prices and freight costs were a significant contributor to the decline. The increased costs eroded second-quarter gross margins by 0.5%, even though company revenue rose to $38.2 million from $30.8 million in the same period in 2007.
Coast Wholesale reported strong contract sales growth with developers and builders, especially in Alberta.
Despite strong growth in the second quarter, the company is more cautious about the near future because of the impact of persistently high fuel costs on consumer discretionary spending. It nonetheless expects continued sales growth in its stores as it continues to explore expansion opportunities in Western Canada.
Coast Wholesale's unit price range during the past week: between $6.60 and $7.15; 52-week high: $10.85; 52-week low: $6.15.