DAYTON, Ohio (AP) — Huffy Corp., the bicyclemaker beloved by generations of American children, filed for Chapter 11 bankruptcy protection Wednesday, citing losses from a Canadian sports equipment company it acquired two years ago.
Huffy's losses have increased steadily in recent years, from $1.4 million in 2002 to $7.5 million in 2003. It has not filed quarterly financial reports in 2004.
The beleaguered company's stock also plummeted from $6.80 a share in December 2003 to 58 cents in August when the New York Stock Exchange suspended trading.
"I am confident that Huffy will emerge as a stronger and more competitive organization, well-positioned to succeed," said John Muskovich, president and chief operating officer.
Huffy's problems began in the late 1990s, when foreign competition began to take its toll. The company closed its last American bicycle plants and moved production to Asia and Mexico.
Huffy bought the Canadian sports equipment company, Gen-X, in 2002 for $19 million plus 5 million shares of Huffy stock.
But the company said transitional expenses and customer returns had exceeded anticipated levels, and in March it sold part of the Gen-X business, which makes equipment for golf, snowboarding, inline skating, skiing and hockey.
Huffy also recently sold its basketball-backboard unit and its customer service division. It will continue making golf products.
Despite its problems, the company said its bicycle division has been performing solidly and has increased its share of the American market in the past two years, now accounting for a third of all bicycles sold in the U.S.