Bang & Olufsen shares drop to lowest in a year

Bang & Olufsen shares drop to lowest in a year

Bang & Olufsen (CPH:BO) stock suffered it biggest drop in over a year today after a withdrawal from car stereo production.

Shares in the Danish company plunged nearly 16% as it announced a loss of  410 million kroner before interest and taxes, compared with a loss of 16 million the year before.

Most of the loss stemmed from the sale of their car radio business to Harman International Industries Inc earlier this year, in order to focus on its high end televisions and Hi-Fi systems. However, demand for those items seems to have dropped, making the quarter “financially challenging”.

The company last paid a dividend for 2008. An analyst at Sydbank A/S told Bloomberg:

“B&O’s problem is that the core clients they used to have are literally dying out. B&O shareholders should be more worried after this quarter than they were in the previous one.”