Onkyo, Pioneer Fiscal Year Ends Soon with Looming Bankruptcy.

[JengaHit]

Makes me wonder just how much that current debt totals....

Yeah. As of Strata-gee's Nov 2020 note, Onkyo's debt was $231.2M. I'm sure interest and penalties have also accrued since then. The scuttled EVO Partners deal yielded just under $11M to retire a fraction of that. Voxx's purchase price of ~$30M is about equal to Onkyo's negative equity value, which means Voxx assumed all of Onkyo's liabilities. So Voxx must have some confidence in a revamped Onkyo's ability to repay that debt, or at a minimum at least being able to make debt-service payments going forward. I hope so. Climbing out of that debt valley is a tall order.

 

[M Code]

1 significant asset of Onkyo/Pioneer besides their brands/trademarks is their capable AVR factory in Malaysia.. Onkyo/Pioneer has been losing $$ since the Gibson debacle and they have accumulated high debt. However, most likely any debt will not be carried over in a buyout situation makes little sense since to buy these brands taking on significant debt. The AVR product category is highly competitive with minimum profit potential...

Just my $0.02...

 

[JengaHit]

1 significant asset of Onkyo/Pioneer besides their brands/trademarks is their capable AVR factory in Malaysia.. Onkyo/Pioneer has been losing $$ since the Gibson debacle and they have accumulated high debt. However, most likely any debt will not be carried over in a buyout situation makes little sense since to buy these brands taking on significant debt. The AVR product category is highly competitive with minimum profit potential...

Just my $0.02...

Agree that, on the face of it, assuming that huge mountain of debt makes little sense. But Voxx's own press release says:

"The total purchase price for the transaction is approximately $30.8 million, plus the assumption of certain liabilities."

Premium Audio Company, LLC, A VOXX International Corporation Subsidiary, Has Signed An Asset Purchase Agreement To Acquire The Audio/Video Business Of Onkyo Home Entertainment Corporation

/PRNewswire/ -- VOXX International Corporation (NASDAQ: VOXX) ("VOXX" or the "Company"), a leading manufacturer and distributor of automotive and consumer...

www.prnewswire.com

So what are those "certain liabilities"?

And note that this is a joint venture with Sharp. Voxx handles sales, marketing, and distribution. Sharp handles manufacturing. Maybe Sharp and Voxx think their risk is mitigated by their mutual partnership. We also don't know what conditions they've demanded re debt restructuring with Onkyo's creditors. [How do we read this? "...subject to...the satisfaction of certain other conditions."] Also, Pioneer and Pioneer Elite aren't part of the deal and have been sold off, according to the release.

 

[JengaHit]

There's also this line in their press release:

"Additionally, future commissions on certain sales would be payable."

So those fees/commissions seem like a before-profit revenue stream for Voxx and Sharp. Maybe that gives them assurance of getting some monies while the new company transitions. But that's also an additional expense and hurdle for the new Onkyo to reach profitability. It reminds me of one of Shark Tank's Kevin O' Leary's deals that saddle entrepreneurs with payable royalty fees on top of all their other operating expenses. But as they say, beggars (Onkyo) can't be choosers.

 

[M Code]

Sometimes when a corporate purchase is done, carry-over losses can be a benefit for the purchaser as a write-off against profits. But only up to a certain point...
Really depends upon multiple factors including the accounting standards and laws in the country for the purchaser where files their corporate financial tax returns... Onkyo has had huge losses and big-time debts, a corporate purchase is only feasible if the liabilities are limited...

Just my $0.02...

 

[Theetjuh]

Found some info from soldiersinc on AVSForum.

Info: https://www.2001audiovideo.com/en/product/684610-onkyo-tx-rz50

Details sheet: https://media.datatail.com/docs/specs/684610_en.pdf

 

[Theetjuh]

For the ones that haven’t seen HDTVtest video yet:

Atleast we know the devices will be shipped!

 

[oltos]

Agree that, on the face of it, assuming that huge mountain of debt makes little sense. But Voxx's own press release says: "The total purchase price for the transaction is approximately $30.8 million, plus the assumption of certain liabilities."

So what are those "certain liabilities"?

And note that this is a joint venture with Sharp. Voxx handles sales, marketing, and distribution. Sharp handles manufacturing. Maybe Sharp and Voxx think their risk is mitigated by their mutual partnership. We also don't know what conditions they've demanded re debt restructuring with Onkyo's creditors. [How do we read this? "...subject to...the satisfaction of certain other conditions."] Also, Pioneer and Pioneer Elite aren't part of the deal and have been sold off, according to the release.

Now that the Voxx's Premium Audio Company and Sharp have acquired the Pioneer Elite line (from Onkyo who due to its huge debt and other weaknesses, mistakes and/or bad fortunes doesn't seem likely to survive in the US market), is there any hope for a return of the Pioneer Elite line of BD players? It was bad enough when Onkyo and/or Pioneer made that horrible blunder of essentially marketing against themselves by releasing their LX500 and the twice as costly LX800. Neither competed well, at least not initially against used top model Oppos and Panasonic's top model 9000. If both players' features were folded into one player things would have been way different. Worst of all, of course, was the COVID induced shutdown of the Pioneer factory (?) and the AKM DAC chip factory fire. If at least one of those disasters could have been averted I've no doubt the LX500 would have emerged as the world's top universal player. Members from all leading high end A/V forums were begging for stock but Pioneer was unable to deliver for weeks if not months. And I was told here that the Pioneer factory is still COVID closed.

Pioneer Elite UDP-LX500 Region Free 4K UHD Multi-Region Blu-ray Player with RS232

Amazing Sound Quality; Built for Audio Lovers Top-Tier 4K UHD Blu-ray Player Region A, B, C Blu-ray and Region-Free DVD Ultra HD Blu-ray Playback Innovative 3-Block Internal Layout Zero Signal Terminal for Less Interference Durable Double-Layered Chassis High Quality Analog Output Options...

www.220-electronics.com

Sometimes when a corporate purchase is done, carry-over losses can be a benefit for the purchaser as a write-off against profits. But only up to a certain point......Onkyo has had huge losses and big-time debts, a corporate purchase is only feasible if the liabilities are limited...
Just my $0.02...

Premium Audio Company never replies to my emails. https://premiumaudiovideo.com/ And the last reply from 11Trading company last month strongly hinted that the brand will concentrate on its AVRs and the Elite BD player line is gone forever. But is that likely true or is there much chance the the Elite BD player line will reemerge once the AKM and/or Pioneer's own factories are fully back online? I was lucky to get my LX500 from a local Best Buy in July last year-and that was no walk in the park dealing with them and COVID protocols. But no BD players can match the LX500's sound quality and features, like fully functional zoom control. So is there much hope for a successor to the LX500 from Pioneer next year?

 

[JengaHit]

Premium Audio Company never replies to my emails. https://premiumaudiovideo.com/ And the last reply from 11Trading company last month strongly hinted that the brand will concentrate on its AVRs and the Elite BD player line is gone forever. But is that likely true or is there much chance the the Elite BD player line will reemerge once the AKM and/or Pioneer's own factories are fully back online? I was lucky to get my LX500 from a local Best Buy in July last year-and that was no walk in the park dealing with them and COVID protocols. But no BD players can match the LX500's sound quality and features, like fully functional zoom control. So is there much hope for a successor to the LX500 from Pioneer next year?

Unfortunately I only know of three "high-end" universal players on the market, including the LX500 (the others being Panasonic and Sony--I don't think Denon or Marantz offer one anymore). It's understandable, as the market tide is streaming and not optical-disc playback. I wonder if companies even see upper-end BD players as profitable, given the shrinking market. Sadly, I wouldn't be surprised to players like this disappear.

 

[Replicant 7]

As of now, in order to get Full use of Dolby vision and the full use of your 4K tv with no less than 400 nits, you have to have a 4K player. That I know of, anyone know of another source that can reproduce ,full 4K HDR other than a 4K disc and 4K player's?

 

[oltos]

Sadly, when there's no more high res BD players with the LX500's zoom, and mine dies for lack of replacement parts, that's when I will be forced to opt for JRiver player. It will take some getting use to the apparent clunkiness of a software player but it's got even Cyberlink beat with more features of any BD player I can find-AND developers who listen to users. Indeed, maybe if at least one high end standalone player brand did the same sales of them would be higher and they wouldn't be on the verge of extinction.

 

[oltos]

As of now, in order to get Full use of Dolby vision and the full use of your 4K tv with no less than 400 nits, you have to have a 4K player. That I know of, anyone know of another source that can reproduce ,full 4K HDR other than a 4K disc and 4K player's?

4K support via JRiver player would as much depend on the optical drive. Though I'm always on the lookout for great new movies, most of my collection are vintage titles on 1080p BD. But as I said JRiver developers strive to upgrade it as much as they can per user request. Let them know your thoughts and concerns! https://yabb.jriver.com/interact/index.php?topic=130229.0

 

[mdinno]

I don't care. I just bought the Pioneer SC-LX 704 to accompany my new LG C1 OLED to replace my Pioneer Elite Kuro plasma. I've always been a Pioneer loyalist. I went with the 2019 model 704. I'm not a gamer so I didn't care for the 8K/HDMI 2.1 features. Besides it's first generation so it will be obsolete soon like first generation 4K was. The 704 is also more efficient and more powerful than the 2021 model at that price point so it was an easy decision.

 

[panteragstk]

As of now, in order to get Full use of Dolby vision and the full use of your 4K tv with no less than 400 nits, you have to have a 4K player. That I know of, anyone know of another source that can reproduce ,full 4K HDR other than a 4K disc and 4K player's?

A lot of the streaming services actually have good quality streams with Dolby Vision and "regular" HDR10. From what I can tell, most of the Dolby Vision content is streaming. Netflix uses it quite a lot, but the quality won't be the same as a disc.

I only have a couple of movies from discs that have Dolby Vision. I forget which ones.

 

[gene]

Despite Bankruptcy Onkyo, Pioneer, Elite AV Drives On!

Onkyo declares bankruptcy after years of financial troubles. But Onkyo Audio-Video, Integra, Pioneer and Elite will continue on as part of the Premium Audio Co, owner of Klipsch, HECO and others.

www.audioholics.com

 

[WookieGR]

At least they went out with a bang by releasing the TX RZ50. It blew away anything currently on the market in its feature/price class. I was really looking forward to replacing my denon in the theater with a potential TX RZ70 but that will never happen.

Im sure things will change after the transition.

 

[Kvn_Walker]

Did Audiovox change its name, or is "Premium Audio Company" a new unrelated thing?

 

[jeffca]

I seem to be a different breed than you cats because, for the most part, I only use my BD player to view concert videos. Those discs, I buy.

As to anything else, I either stream it via Netflix/Amazon or I illegally download it. The ironic part of this is that most of the movies made today really suck. And I mean they suck hard. Netflix is a joke, but Amazon, which has more movies, has more totally crap content than can be imagined.

I'm constantly amazed by the mass of astoundingly terrible movies on Amazon.

Also, the thing that really pisses me off, is the fact that you cannot filter what pops up on the portal so it does not include foreign movies.

I hate having to read subtitles. With a few rare exceptions, I have despised every foreign movie I've ever seen.

Back to topic: I like Onkyo/Pioneer/what ever. If they go out of business, other than their employees, who really cares?

If they tank, so be it. It has no effect on my life.

 

[Wayde Robson]

Did Audiovox change its name, or is "Premium Audio Company" a new unrelated thing?

From what I understand, it's one of those shell games companies play, I assume for good reason. PAC is owned by Voxx and Sharp, I read that it's mostly (75%) owned by Voxx Intl.

In reading up on this, I gather that Sharp is doing the manufacturing for Voxx/Onkyo. I couldn't confirm it so I didn't put it in the article but, I read Sharp makes Onkyo AV gear at a plant in Singapore or maybe it was Malaysia? I get those mixed up, I'll go with Malaysia. The Sharp manufacture contract was shared between Osaka Onkyo and Voxx Onkyo, but since Osaka Onkyo no longer exists the contract is now 100% to Voxx-Onkyo... or just Onkyo now.

The division of corporate labor is confusing. Researching this raised questions I couldn't answer, but maybe there are no clean answers, yet. But when Voxx got Onkyo's AV business, did that include R&D and a team of Onkyo engineers that design things like AV receivers?

So, when Osaka Onkyo sold its interest in AV, I assume that meant Voxx inherited work-in-progress, like the new AV receivers. But I wonder how many years it will take to see a product designed by the "new" Onkyo?

It's probably way too soon for the Sept 2021 sale to result in anything new yet. But I guess we'll have to wait and see if Voxx/Onkyo will be producing interesting stuff. But I assume the RZ50, Onkyo's widely praised new receiver, was already designed before Voxx. But it will be interesting to see if Voxx maintains those standards.

It looks like Voxx is based in Orlando FL, so not far from Gene. Maybe they can ping him to do a LiveStream.

 

[mns3dhm]

The AVR business has been in trouble for years; for most households its either go to the trouble and expense associated with building a dedicated home theater or a buy soundbar and possibly a subwoofer. You don't need an AVR if, like most households I visit, the soundbar was the solution. I would not be at all surprised to see other brands run into financial trouble considering this and all the supply chain issues plaguing the industry at present.