UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
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Date of report (Date of earliest event reported): August 7, 2008 |
Lifetime Brands, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
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0-19254 |
11-2682486 |
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(Commission File Number) |
(IRS Employer Identification No.) |
1000 Stewart Avenue, Garden City, New York 11530
(Address of Principal Executive Offices)(Zip Code)
(Registrant’s Telephone Number, Including Area Code)516-683-6000
(Former Name or Former Address, if Changed Since Last Report)N/A
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operation and Financial Condition
On August 7, 2008, Lifetime Brands, Inc. (the “Company”) issued a press release announcing the Company’s results for the three months ended June 30, 2008. A copy of the Company’s press release is attached as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits
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(d) |
Exhibits |
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Lifetime Brands, Inc. |
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By: |
/s/ Laurence Winoker |
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Laurence Winoker Senior Vice President – Finance, Treasurer |
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Date: August 7, 2008
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LIFETIME BRANDS ANNOUNCES SECOND QUARTER 2008 RESULTS
Company Declares Regular Quarterly Dividend; Postpones Earnings Guidance Update
GARDEN CITY, NY, August 7, 2008 – Lifetime Brands, Inc. (Nasdaq: LCUT), North America’s leading resource for nationally branded kitchenware, tabletop and home décor products, today announced results for the three months ended June 30, 2008.
For the second quarter of 2008, Lifetime’s net sales totaled $92.4 million, as compared to net sales of $91.4 million for the same period in 2007. The Company reported a net loss of $3.2 million, or $0.27 per diluted share, compared to a net loss of $2.0 million, or $0.15 per diluted share, for the second quarter of 2007.
Jeffrey Siegel, Chairman, President and Chief Executive Officer, commented, “Given the weak retail environment, we are pleased with the improvement in sales growth compared to the first quarter. Net wholesale sales rose 3.2%, as compared to the 2007 quarter. Excluding net wholesale sales attributable to Mikasa, which we acquired on June 6, net wholesale sales for the quarter were approximately 1% lower than in the prior year.
“A highlight of the quarter was our acquisition of the business and certain assets of Mikasa, Inc. The addition of this outstanding brand expands our already strong position in the tabletop industry. The purchase price was approximately $20 million, including $5.0 million to be paid on December 15, 2008, as a non-refundable advance against additional payments equal to 5% of the net sales of Mikasa products in 2009, 2010 and 2011. As previously reported, we expect the acquisition to be accretive in 2008.
“During the quarter, we also completed the consolidation of our West Coast distribution facilities. We expect the consolidation of these facilities to generate approximately $1 million in annual savings, beginning in the second half of 2008.
“Our inventory reduction initiative continues to yield results, with inventories as of June 30, 2008, down 19%, or $31 million, on an acquisition-adjusted basis, compared to the prior year.
“The weak retail environment has negatively impacted the results of our Direct-to-Consumer division, especially our retail outlet stores. We are in the process of evaluating our strategic options with regard to the outlet stores.
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“Based on our year-to-date results and the likelihood that the economy will remain weak through the fall selling season, it is clear that we will not achieve the financial results we previously had forecasted. Given the challenges of an uncertain and volatile retail climate, we have concluded that it would not be prudent for us to speculate as to our results for the balance of the year. Consequently, we are not providing updated financial guidance at this time. We will comment on our expectations for the year when we report our results for the third quarter and may provide additional financial guidance at that time.”
Mr. Siegel concluded, “We remain confident that we have the right initiatives in place to meet our long-term strategic objectives and to create long-term shareholder value.”
Separately, the Company announced that its Board of Directors declared a regular quarterly cash dividend of $0.0625 per share, payable on August 15, 2008 to shareholders of record on August 1, 2008.
Lifetime has scheduled a conference call Thursday, August 7, at 11:00 a.m. ET to discuss second quarter 2008 results and additional matters. The dial-in number for the call is (706) 679-7464. A replay of the call will also be available through Thursday, August 14, 2008 and can be accessed by dialing (706) 645-9291, conference ID #55824403. A live webcast of the call will be broadcast at 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.
About Lifetime Brands, Inc.
Lifetime Brands is North America’s leading resource for nationally branded kitchenware, tabletop and home décor products. The Company markets its products under many of the industry’s best known brands, including Farberware®, KitchenAid®, Pfaltzgraff®, Mikasa®, Cuisinart®, Block® China and Crystal, Calvin Klein®, CasaModa®, Cuisine de France®, Gorham®, Hoffritz®, International® Silver, Joseph Abboud™, Kamenstein®, Kirk Stieff®, Melannco®, Nautica®, Pedrini®, Roshco®, Sabatier®, Sasaki®, Towle® Silversmiths, Tuttle®, Wallace® and Vasconia®. Lifetime’s products are distributed through most major retailers in North America.
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.
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COMPANY CONTACT: |
INVESTOR RELATIONS: |
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Christian G. Kasper |
Harriet Fried / Jody Burfening |
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Senior Vice President |
Lippert/Heilshorn & Assoc. |
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(516) 203-3590 |
(212) 838-3777 |
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chris.kasper@lifetimebrands.com |
hfried@lhai.com |
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LIFETIME BRANDS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
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Three Months Ended |
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Six Months Ended |
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2008 |
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2007 |
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2008 |
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2007 |
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Net sales |
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$ |
92,399 |
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$ |
91,371 |
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$ |
190,593 |
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$ |
195,158 |
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Cost of sales |
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55,288 |
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51,906 |
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114,893 |
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113,003 |
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Distribution expenses |
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12,766 |
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11,721 |
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26,156 |
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25,032 |
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Selling, general and administrative expenses |
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31,183 |
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29,494 |
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62,286 |
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59,425 |
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Restructuring expenses |
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107 |
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― |
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2,987 |
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― |
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Loss from operations |
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(6,945 |
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(1,750 |
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(15,729 |
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(2,302 |
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Interest expense |
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(2,053 |
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(1,546 |
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(4,146 |
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(3,081 |
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Loss before income taxes and equity in earnings of Grupo Vasconia, S.A.B. |
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(8,998 |
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(3,296 |
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(19,875 |
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(5,383 |
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Income tax benefit |
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5,108 |
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1,270 |
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9,731 |
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2,074 |
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Equity in earnings of Grupo Vasconia, S.A.B., net of taxes |
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707 |
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― |
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964 |
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― |
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NET LOSS |
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$ |
(3,183 |
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$ |
(2,026 |
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$ |
(9,180 |
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$ |
(3,309 |
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BASIC AND DILUTED LOSS PER COMMON SHARE |
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$ |
(0.27 |
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$ |
(0.15 |
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$ |
(0.77 |
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$ |
(0.25 |
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LIFETIME BRANDS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
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June 30, |
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December 31, |
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2008 |
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2007 |
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(unaudited) |
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ASSETS |
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CURRENT ASSETS |
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Cash and cash equivalents |
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$ |
1,150 |
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$ |
4,172 |
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Accounts receivable, less allowances of $12,529 at 2008 and $16,400 at 2007 |
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52,242 |
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65,030 |
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Inventory |
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160,858 |
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143,684 |
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Deferred income taxes |
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7,983 |
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7,925 |
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Prepaid expenses and other current assets |
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6,455 |
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7,267 |
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Prepaid income taxes |
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9,010 |
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― |
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TOTAL CURRENT ASSETS |
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237,698 |
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228,078 |
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PROPERTY AND EQUIPMENT, net |
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54,351 |
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54,332 |
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GOODWILL |
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27,432 |
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27,432 |
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OTHER INTANGIBLES, net |
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34,887 |
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35,383 |
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INVESTMENT IN GRUPO VASCONIA, S.A.B. |
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24,141 |
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22,950 |
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OTHER ASSETS |
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3,020 |
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3,240 |
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TOTAL ASSETS |
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$ |
381,529 |
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$ |
371,415 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES |
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Short-term borrowings |
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$ |
40,600 |
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$ |
13,500 |
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Accounts payable |
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20,761 |
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21,759 |
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Accrued expenses |
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28,042 |
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31,504 |
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Income taxes payable |
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― |
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4,520 |
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TOTAL CURRENT LIABILITIES |
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89,403 |
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71,283 |
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DEFERRED RENT & OTHER LONG-TERM LIABILITIES |
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15,732 |
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14,481 |
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DEFERRED INCOME TAX |
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8,437 |
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8,211 |
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LONG-TERM DEBT |
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55,200 |
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55,200 |
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CONVERTIBLE NOTES |
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75,000 |
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75,000 |
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STOCKHOLDERS’ EQUITY |
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Common stock, $.01 par value, shares authorized: 25,000,000; shares issued and outstanding: |
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120 |
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120 |
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Paid-in capital |
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115,269 |
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113,995 |
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Retained earnings |
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22,571 |
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33,250 |
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Accumulated other comprehensive loss |
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(203 |
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(125 |
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TOTAL STOCKHOLDERS’ EQUITY |
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137,757 |
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147,240 |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
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$ |
381,529 |
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$ |
371,415 |
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