Lifetime Hoan Announces Second Quarter 2001 Results; Strong Sales Outlook for Second Half of 2001

WESTBURY, N.Y.--(BUSINESS WIRE)--July 31, 2001--Lifetime Hoan Corporation (Nasdaq NM: LCUT), a leading marketer of housewares, today announced results for the second quarter ended June 30, 2001.

Net sales for the quarter were $27.6 million versus $25.5 million in the second quarter of 2000. The Company reported net income for the second quarter of $204,000, or $0.02 per diluted share, compared to net income of $1.2 million, or $0.10 per diluted share, for the same period in 2000.

Jeffrey Siegel, president and chief executive officer, commented, "Second quarter results were below our expectations due to the soft retail market and a short-term delay in the roll-out of our KitchenAid(R) line. Although shipments of Lifetime Hoan's products were strong in April, shipments in May and June were lower as our customers cut back on their inventory levels in response to the uncertain economic climate. As an example, one of our large customers delayed a $1.5 million order from the second to the fourth quarter. Sales were also impacted by a four week delay in the receipt of our new KitchenAid(R) products from our overseas suppliers. The delay was in large part the result of our very stringent quality requirements for this high value line. The shipments we expected to make in June will be shifting to the third and fourth quarters. Interest in our KitchenAid(R) products remains very strong and we expect solid sales in the second half of 2001."

Mr. Siegel continued, "Although profits declined in the second quarter, Lifetime Hoan is making considerable progress in several key initiatives we undertook to improve operations this year. Our new warehouse, which will help us reduce costs, particularly our cost of distribution, is proceeding according to plan. The warehouse will also help us control our inventory better and operate more efficiently. We will begin shipping from the new facility in August while continuing to operate out of our current warehouse until everything is running smoothly. We are also making progress in our plans to improve margins in the Kamenstein business we acquired in October 2000. One of our goals in acquiring Kamenstein was to leverage our companies' combined sourcing and product development capabilities, a process which is now taking hold."

Mr. Siegel concluded, "While we are disappointed with second quarter results, we are pleased with the progress Lifetime Hoan is making in many areas and we continue to expect 2001 to be a successful year for the Company."

Separately, the Company announced that its Board of Directors declared a regular quarterly cash dividend of $0.0625 per share, payable on August 17, 2001 to shareholders of record on August 3, 2001.

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. COMPANY CONTACT: INVESTOR RELATIONS: Robert McNally Harriet Fried/Klea Theoharis Chief Financial Officer Lippert/Heilshorn & Associates, Inc. (516) 683-6000 (212) 838-3777 or hfried@lhai.com

            LIFETIME HOAN CORPORATION
                INCOME STATEMENT
        (in 000's, except per share data)
                                   Three Months Ended
                                        June 30,
                                      (Unaudited)         % Increase
                          -------------------------------
                               2001            2000        (Decrease)
                          --------------------------------------------
Net  Sales                       $27,571         $25,547      7.9%
Cost of Sales                     15,213          13,252     14.8%
                          -------------------------------
Gross Profit                      12,358          12,295      0.5%

SG&A                              11,731          10,238     14.6%
Other Expense                        196              24     716.7%
                          -------------------------------

Income Before Taxes                  431           2,033    (78.8%)

Tax Provision                        227             870    (73.9%)
                          -------------------------------

Net Income                         $ 204          $1,163    (82.4%)
                          ===============================

Basic Earnings Per Share           $0.02          $ 0.10    (80.0%)
                          ===============================
Weighted Average Shares           10,488          11,115

Diluted Earnings Per Share         $0.02          $ 0.10    (80.0%)
                          ===============================
Weighted Average Shares           10,534          11,235

                                    Six Months Ended
                                        June 30,
                                      (Unaudited)         % Increase
                          -------------------------------
                               2001            2000        (Decrease)
                          --------------------------------------------
Net  Sales                       $58,878         $53,156     10.8%
Cost of Sales                     32,580          27,769     17.3%
                          -------------------------------
Gross Profit                      26,298          25,387      3.6%

SG&A                              24,423          21,001     16.3%
Other Expense/(Income)               314            (33)    1051.5%
                          -------------------------------

Income Before Taxes                1,561           4,419    (64.7%)

Tax Provision                        718           1,883    (61.9%)
                          -------------------------------

Net Income                          $843          $2,536    (66.7%)
                          ===============================

Basic Earnings Per Share           $0.08          $ 0.22    (63.6%)
                          ===============================
Weighted Average Shares           10,492          11,459

Diluted Earnings Per Share         $0.08          $ 0.22    (63.6%)
                          ===============================
Weighted Average Shares           10,547          11,542


                       LIFETIME HOAN CORPORATION
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                            (in thousands)
                                             June 30,   December 31,
                                               2001         2000
                                        ------------------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents                         $   16   $   1,325
Accounts receivable, net                          12,394      18,158
Merchandise inventories                           52,754      45,595
Prepaid expenses and 
  other current assets                             6,537       7,014
                                      --------------------------------
TOTAL CURRENT ASSETS                              71,701      72,092

PROPERTY AND EQUIPMENT, net                       19,785      13,085
INTANGIBLES, net                                  25,368      25,686
OTHER ASSETS                                       2,308       1,256
                                      --------------------------------
TOTAL ASSETS                                   $ 119,162   $ 112,119
                                        ==============================

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings                          $  21,000   $  10,746
Accounts payable and trade acceptances             7,505       6,709
Other current liabilities                         12,978      16,619
                                      --------------------------------
TOTAL CURRENT LIABILITIES                         41,483      34,074

MINORITY INTEREST                                    342         528

STOCKHOLDERS' EQUITY                              77,337      77,517
                                      --------------------------------
TOTAL LIABILITIES AND 
  STOCKHOLDERS' EQUITY                         $ 119,162   $ 112,119