1999 RESULTS

 

 

WESTBURY, NY, MARCH 7, 2000 -- LIFETIME HOAN CORPORATION (NASDAQ NM: LCUT): a leading marketer of cutlery, kitchenware, cutting boards and bakeware, today announced results for the fourth quarter and full year ended December 31, 1999. Net sales were $39.1 million for the fourth quarter of 1999 versus $39.4 million in the fourth quarter of 1998. Net income for the period was $647,000 as compared to net income of $4.6 million recorded for the same period in 1998. Diluted earnings per share for the 1999 fourth quarter were $0.05 versus $0.36 in the prior year period.

For the year ended December 31, 1999 net sales totaled $106.8 million versus $116.7 million for the comparable period last year. Net income for 1999 was $4.0 million or $0.31 per diluted share compared to $12.6 million or $0.98 per diluted share for the 1998 year.

Lifetime Hoan’s fourth quarter results were negatively impacted by over $4.5 million in year-end pretax adjustments, including certain one-time charges related to problems that arose from the installation of a new warehouse management system early in the year. The fourth quarter charges included, among other things, expenses for software consulting fees, accruals for expected charge backs and returns from customers, and inventory reserves for slow moving and discontinued inventory.

In commenting on the results, Milton L. Cohen, Chairman and Chief Executive Officer said, “Since embarking on our branded strategy we have been very successful. The drop in revenue and earnings in 1999 was primarily attributable to the problems associated with the installation of our new warehouse management system. It is important to note that we have not lost a single major customer as a result of the warehouse situation nor have we seen any softness in demand for Lifetime Hoan’s products. Shipments have been very strong and within the January to February 2000 time frame they are at record levels.”

Mr. Cohen continued, “Going forward, we plan to take advantage of opportunities to expand Lifetime Hoan’s horizons from both a geographic and overall marketing perspective. We are looking forward to a strong year here in the U.S. and will continue to pursue business overseas. Deeper penetration of the German and Italian markets that Lifetime Hoan entered last year will complement our U.S. operations and is strategically important in enabling us to introduce new products within the European Union.”

Lifetime Hoan Corporation is a leading designer, marketer and distributor of household cutlery, kitchenware, cutting boards and bakeware, marketing its products under various trade names including Farberware®, Hoffritz® and Revere®. Through the use of various brand names, Lifetime Hoan’s products are distributed through almost every major retailer in the country including Bed Bath & Beyond, WalMart, Kmart, Target, Macy’s, Saks Inc. and Dayton Hudson.

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.

 

COMPANY CONTACT: INVESTOR RELATIONS: MEDIA RELATIONS:

Robert McNally John Heilshorn/Klea Theoharis Elissa Grabowski

Chief Financial Officer Lippert/Heilshorn & Assocs., Inc. Lippert/Heilshorn & Assocs.

(516) 683-6000 (212) 838-3777 or klea@lhai.com (212) 838-3777 or elissa@lhai.com

 

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LIFETIME HOAN COPORATION

INCOME STATEMENT

(in 000’s, except per share data)

(Unaudited)

 

Three Months Ended December 31,

 

 

						% Increase
		1999		1998		(Decrease)
Net Sales		$ 39,091		$ 39,382		(0.7%)
Cost of Sales		23,036		20,861		10.4%
Gross Profit		16,055		18,521		(13.3%)
SG&A		14,866		10,736		38.5%
Other Expense (Income)		(70)		3
Income Before Taxes		1,259		7,782		(83.8%)
Tax Provision		612		3,147		(80.6%)
Net Income		$ 647		$ 4,635		(86.0%)
Basic Earnings Per Share		$ 0.05		$ 0.37
Weighted Average Shares		12,497		12,585
Diluted Earnings Per Share		$ 0.05		$ 0.36
Weighted Average Shares		12,529		12,809

 

 

 

LIFETIME HOAN COPORATION

INCOME STATEMENT

(in 000’s, except per share data)

(Audited)

 

Year Ended December 31,

 

 

						% Increase
		1999		1998		(Decrease)
Net Sales		$ 106,761		$ 116,746		(8.6%)
Cost of Sales		57,979		60,507		(4.2%)
Gross Profit		48,782		56,239		(13.3%)
SG&A		42,250		35,306		19.7%
Other Expense (Income)		(251)		3
Income Before Taxes		6,783		20,930		(67.6%)
Tax Provision		2,822		8,372		(66.3%)
Net Income		$ 3,961		$ 12,558		(68.5%)
Basic Earnings Per Share		$ 0.32		$ 1.00
Weighted Average Shares		12,572		12,570
Diluted Earnings Per Share		$ 0.31		$ 0.98
Weighted Average Shares		12,671		12,843

 

 

 

 

LIFETIME HOAN COPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

 

 

				December 31, 1999			December 31, 1998
ASSETS
CURRENT ASSETS
Cash and cash equivalents				$ 1,563			$ 9,438
Accounts receivable, net				22,442			13,306
Merchandise inventories				54,046			44,938
Prepaid expenses and other current assets				4,253			4,583
TOTAL CURRENT ASSETS				82,304			72,265
PROPERTY AND EQUIPMENT, net				12,597			11,823
INTANGIBLES, NET				20,185			19,876
OTHER ASSETS				1,173			1,108
TOTAL ASSETS				$ 116,259			$ 105,072
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Short-term borrowings				$ 8,073			--
Accounts payable and trade acceptances				3,783			$ 2,706
Other current liabilities				15,832			11,219
TOTAL CURRENT LIABILITIES				27,688			13,925
MINORITY INTEREST				763			--
STOCKHOLDERS’ EQUITY				87,808			91,147
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY				$ 116,259			$ 105,072

 

 

 

 

 

 

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