Lifetime Hoan Announces Second Quarter 2002 Results; New Lines of KitchenAid Bakeware and Cuisinart Cutlery to be Launched in the Fall
Net sales for the quarter increased 6.6% to $29.4 million compared to $27.6 million in the second quarter of 2001. The Company reported net income of $390,000, or $0.04 per diluted share, compared to net income of $204,000, or $0.02 per diluted share, for the same period in 2001.
Jeffrey Siegel, president and chief executive officer, commented, "Lifetime's increased sales reflect the popularity of our high end KitchenAid(R) utensils, which continue to be a great success with both customers and consumers. We have been steadily increasing the number of SKUs in this line and expect it to rise to a total of 600 by year-end. Preparations for the launch of our new line of KitchenAid(R) bakeware are going well, and we expect the roll-out to take place late in the third quarter. We will also begin shipping our new line of premium quality Cuisinart(R) kitchen cutlery in the fall. We have great expectations for both of these lines. In total, we expect to ship over 200 new SKUs from all divisions of the Company in the third and fourth quarters of 2002."
Mr. Siegel continued, "We are making significant progress in the transition to our new, automated warehouse. The software that directs all warehouse activities, including its high-speed sortation system, continues to function smoothly and our order turnaround time has improved considerably. As expected, however, the expenses required for the transition impacted Lifetime Hoan's financial results in the second quarter. We look forward to completing the transition and achieving the full efficiencies the warehouse offers after the fall busy season."
Separately, the Company announced that its Board of Directors declared a regular quarterly cash dividend of $0.0625 per share, payable on August 19, 2002 to shareholders of record on August 5, 2002.
Lifetime Hoan Corporation is a leading designer, marketer and distributor of household cutlery, kitchenware, cutting boards, pantryware and bakeware, marketing its products under various trade names including Farberware(R) and Hoffritz(R). Through the use of various brand names, Lifetime Hoan's products are distributed through almost every major retailer in the U.S.
The information herein contains certain forward-looking statements including statements concerning the Company's future prospects. These statements involve risks and uncertainties, including risks relating to general economic conditions and risks relating to the Company's operations, such as the risk of loss of major customers and risks relating to changes in demand for the Company's products, as detailed from time to time in the Company's filings with the Securities and Exchange Commission.
LIFETIME HOAN CORPORATION
INCOME STATEMENT (Unaudited)
(in 000's, except per share data)
Three Months Ended
June 30, % Increase
2002 2001 (Decrease)
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Net Sales $ 29,400 $ 27,571 6.6%
Cost of Sales 15,666 15,213 3.0%
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Gross Profit 13,734 12,358 11.1%
SG&A 12,935 11,731 10.3%
Interest Expense 281 344 (18.3%)
Other (Income) (233) (148)
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Income Before Taxes 751 431
Tax Provision 361 227
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Net Income $ 390 $ 204
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Basic Earnings Per Share $ 0.04 $ 0.02
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Weighted Average Shares 10,498 10,488
Diluted Earnings Per Share $ 0.04 $ 0.02
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Weighted Average Shares 10,574 10,534
Six Months Ended
June 30, %Increase
2002 2001 (Decrease)
----------- ----------- -----------
Net Sales $ 55,798 $ 58,878 (5.2%)
Cost of Sales 30,060 32,580 (7.7%)
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Gross Profit 25,738 26,298 (2.1%)
SG&A 26,714 24,423 9.4%
Interest Expense 567 548 3.5%
Other (Income) (374) (234)
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(Loss) Income Before Taxes (1,169) 1,561
Tax Provision (362) 718
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Net (Loss) Income $ (807) $ 843
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Basic (Loss) Earnings Per Share $ (0.08) $ 0.08
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Weighted Average Shares 10,495 10,492
Diluted (Loss) Earnings Per Share $ (0.08) $ 0.08
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Weighted Average Shares 10,495 10,547
LIFETIME HOAN CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, Dec. 31,
2002 2001
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ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 266 $ 5,021
Accounts receivable, net 15,515 20,742
Merchandise inventories 48,710 42,303
Prepaid expenses and other current assets 7,055 5,934
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TOTAL CURRENT ASSETS 71,546 74,000
PROPERTY AND EQUIPMENT, net 21,894 22,376
INTANGIBLES, net 24,693 24,888
OTHER ASSETS 2,045 2,106
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TOTAL ASSETS $ 120,178 $ 123,370
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings $ 22,094 $ 22,847
Accounts payable and trade acceptances 7,162 4,955
Other current liabilities 14,385 17,123
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TOTAL CURRENT LIABILITIES 43,641 44,925
MINORITY INTEREST 240 384
STOCKHOLDERS' EQUITY 76,297 78,061
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 120,178 $ 123,370
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CONTACT:
Company Contact:
Lifetime Hoan Corporation
Robert McNally, 516/683-6000
Chief Financial Officer
or
Investor Relations:
Lippert/Heilshorn & Associates, Inc.
Harriet Fried, 212/838-3777
hfried@lhai.com