Lifetime brands, inc. reports third quarter 2013 results
Garden city, n.y.--(business wire)--lifetime brands, inc. (nasdaqgs:lcut), a leading global provider of branded kitchenware, tableware and other products used in the home, today reported its financial results for the third quarter ended september 30, 2013. third quarter financial highlights: consolidated net sales were $142.2 million in the quarter ended september 30, 2013; an increase of $14.1 million, or 11.0%, as compared to consolidated net sales of $128.1 million for the corresponding period in 2012. consolidated net sales in the 2013 period included $4.8 million of net sales from fred® & friends, which was acquired in december 2012. gross margin was $51.3 million, or 36.0%, in the quarter ended september 30, 2013 as compared to $44.9 million, or 35.1%, for the corresponding period in 2012. income from operations was $11.7 million, as compared to $7.4 million in the prior year’s quarter. net income was $1.1 million, or $0.08 per diluted share, in the quarter ended september 30, 2013, as compared to net income of $3.9 million, or $0.30 per diluted share, in the corresponding period in 2012. adjusted net income was $6.1 million, or $0.47 per diluted share, in the quarter ended september 30, 2013, as compared to adjusted net income of $5.1 million, or $0.40 per diluted share, in the corresponding period in 2012. consolidated ebitda was $15.1 million, equal to 10.6% of consolidated net sales, in the quarter ended september 30, 2013, as compared to $11.6 million, or 9.0% of consolidated net sales, for the corresponding 2012 period. equity in earnings (losses), net of taxes, was $(5.5) million (including a charge of $5.0 million, net of tax, for the reduction in the fair value of the company’s investment in grupo vasconia sab) for the three months ended september 30, 2013, as compared to equity in earnings of $0.7 million for the three months ended september 30, 2012. nine months financial highlights: consolidated net sales were $337.9 million in the nine months ended september 30, 2013; an increase of $5.9 million, or 1.8%, as compared to consolidated net sales of $332.0 million for the corresponding period in 2012. consolidated net sales in the 2013 period included $12.1 million of net sales from fred® & friends, which was acquired in december 2012. gross margin was $123.9 million, or 36.7%, in the nine months ended september 30, 2013 as compared to $120.7 million, or 36.4%, for the corresponding period in 2012. income from operations was $11.6 million, as compared to $12.8 million in the prior year’s nine months. net loss was $0.1 million, or $0.01 per diluted share, in the nine months ended september 30, 2013, as compared to net income of $5.8 million, or $0.45 per diluted share, in the corresponding period in 2012. adjusted net income was $4.4 million, or $0.34 per diluted share, in the nine months ended september 30, 2013, as compared to adjusted net income of $7.6 million, or $0.60 per diluted share, in the corresponding period in 2012. consolidated ebitda was $22.5 million in the nine months ended september 30, 2013, as compared to $23.4 million for the corresponding 2012 period. equity in earnings (losses), net of taxes, was $(5.1) million (including a charge of $5.0 million, net of tax, for the reduction in the fair value of the company’s investment in grupo vasconia sab) for the nine months ended september 30, 2013, as compared to equity in earnings of $1.6 million for the nine months ended september 30, 2012. jeffrey siegel, lifetime’s chairman and chief executive officer, commented, lifetime’s businesses performed well in the quarter, contributing to increases in consolidated net sales, gross margin percentage, income from operations, adjusted net income and ebitda margin. our core kitchenware products category performed exceptionally well, reflecting the roll-out of new products and programs, as well as the inclusion of fred® & friends, which lifetime acquired in december 2012. i am especially pleased that our home solutions product category, which had been a laggard over the past several quarters, rebounded smartly during the period. our outlook for the fourth quarter remains positive. nevertheless, due to some concerns about the overall strength of the holiday shopping season and the types of products on which consumers will spend their money, we are reducing our sales guidance for the full year to an increase of 3% to 5%. on october 31, 2013, the board of directors declared a cash dividend of $0.0375 per share payable on february 14, 2014 to shareholders of record on january 31, 2014. conference call the company has scheduled a conference call for thursday, november 7, 2013 at 11:00 a.m. et. the dial-in number for the conference call is (877) 703-6109 or (857) 244-7308, passcode #93858826. a replay of the call will also be available through sunday, november 10, 2013 and can be accessed by dialing (888) 286-8010 or (617) 801-6888, conference id #99948684. a live webcast of the conference call will be broadcast in the investor relations section of the company's web site, www.lifetimebrands.com. for those who cannot listen to the live broadcast, an audio replay of the call will also be available on the site. non-gaap financial measures this earnings release contains non-gaap financial measures. for purposes of regulation g, a non-gaap financial measure is a numerical measure of a company's historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with gaap in the statements of income, balance sheets, or statements of cash flows of the company; or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. pursuant to the requirements of regulation g, the company has provided reconciliations of the non-gaap financial measures to the most directly comparable gaap financial measures. these non-gaap measures are provided because management of the company uses these financial measures in evaluating the company's on-going financial results and trends. management uses this non-gaap information as an indicator of business performance. forward-looking statements in this press release, the use of the words “believe,” "could," "expect," "may," "positioned," "project," "projected," "should," "will," "would" or similar expressions is intended to identify forward-looking statements that represent the company’s current judgment about possible future events. the company believes these judgments are reasonable, but these statements are not guarantees of any events or financial results, and actual results may differ materially due to a variety of important factors. such factors might include, among others, the company’s ability to comply with the requirements of its credit agreements; the availability of funding under such credit agreements; the company’s ability to maintain adequate liquidity and financing sources and an appropriate level of debt; changes in general economic conditions which could affect customer payment practices or consumer spending; the impact of changes in general economic conditions on the company’s customers; changes in demand for the company’s products; shortages of and price volatility for certain commodities; significant changes in the competitive environment and the effect of competition on the company’s markets, including on the company’s pricing policies, financing sources and an appropriate level of debt. lifetime brands, inc. lifetime brands is a leading global provider of kitchenware, tableware and other products used in the home. the company markets its products under such well-known kitchenware brands as farberware®, kitchenaid®, casamŌda®, cuisine de france®, fred®, guy fieri®, hoffritz®, kizmos™, misto®, mossy oak®, pedrini®, roshco®, sabatier®, savora™ and vasconia®; respected tableware brands such as mikasa®, pfaltzgraff®, creative tops®, gorham®, international® silver, kirk stieff®, sasaki®, towle® silversmiths, tuttle®, wallace®, v&a® and royal botanic gardens kew®; and home solutions brands, including elements®, melannco®, kamenstein® and design for living™. the company also provides exclusive private label products to leading retailers worldwide. the company’s corporate website is www.lifetimebrands.com. lifetime brands, inc.condensed consolidated statements of operations(in thousands - except per share data)(unaudited) $ $ $ $ lifetime brands, inc.condensed consolidated balance sheets(in thousands - except share data)(unaudited) accounts receivable, less allowances of $4,777 at september 30, 2013 and $3,996 at december 31, 2011 and 2,000,000 shares of series b; none issued and outstanding issued and outstanding: 12,737,557 at september 30, 2013 and 12,754,467 at december 31, 2012 lifetime brands, inc.condensed consolidated statements of cash flows(in thousands)(unaudited) acquisitions) lifetime brands, inc.supplemental information(in thousands) $ reconciliation of gaap to non-gaap operating results consolidated ebitda: september 30,2013 june 30, 2013 march 31, 2013 december 31,2012 lifetime brands, inc.supplemental information(in thousands - except per share data) reconciliation of gaap to non-gaap operating results (continued) consolidated ebitda: september 30,2012 june 30, 2012 march 31, 2012 december 31,2011 adjusted net income and adjusted diluted income per share:
