Raises 2016 Guidance for Second Time,
Reflecting Continued Strong Performance and Prospects
Acme United Corporation (NYSE MKT:ACU) today announced that net
sales for the third quarter ended September 30, 2016 were $31.9
million, compared to $29.9 million in the comparable period of
2015, an increase of 7%. Net sales for the nine months ended
September 30, 2016 were $98.2 million, compared to $86.7 million in
the same period in 2015, an increase of 13%.
Net income for the quarter ended September 30, 2016 was $1.5
million, or $0.40 per diluted share, compared to $1.2 million, or
$0.33 per diluted share, for the 2015 period, a 22% increase in net
income and 21% in earnings per share. Net income for the nine
months ended September 30, 2016 was $5.3 million, or $1.49 per
diluted share, compared to $4.4 million, or $1.18 per diluted
share, in last year’s comparable period, a 22% increase in net
income and 26% in earnings per share.
Chairman and CEO Walter C. Johnsen said, “Our Westcott school,
home, and office product lines all continued to gain market share
and we delivered record back-to-school sales. In addition, we
gained new first aid placement at a number of large food service
chains, a promising source of new business, and grew our industrial
first aid kit business. The Clauss, Camillus, and Cuda product
families added new products and customers, and DMT, whose
sharpening tool business we acquired in February 2016, exceeded our
expectations as we expanded the business and distribution through
our broad customer base.
“We expect continued sales and earnings strength for the rest of
2016, and are therefore raising our guidance for the second time
for fiscal 2016. We now expect to generate revenues of $124 million
and earnings per share of $1.63. Our most recent guidance called
for revenues of $123 million and earnings per share of $1.55, up
from our original forecast of $120 million in revenues and earnings
per share of $1.47.”
In the U.S. segment, net sales for the quarter ended September
30, 2016 increased 9% compared to the same period in 2015 due to
strong sales of Westcott school and office products, and first aid
kits. Revenues from our acquisition of DMT contributed $1.3 million
in the third quarter, and $3.6 million February 2016 to date. Net
sales for the first nine months of 2016 grew 15% over the
comparable period in 2015.
Net sales in Canada for the three months ended September 30,
2016 decreased 5% in U.S. dollars and 4% in local currency compared
to the prior-year period. Net sales for the nine months ended
September 30, 2016 decreased 2% in U.S. dollars but increased 3% in
local currency compared to the same period in 2015.
Net sales in Europe for the three months ended September 30,
2016 decreased 12% in both U.S. dollars and local currency compared
to the comparable period in 2015. The decline in sales was
primarily due to the timing of a shipment of promotional products
to a mass-market customer. In 2015, the promotion occurred in the
third quarter; in 2016, the promotion occurred in the second
quarter. Net sales for the nine months ended September 30, 2016
increased 4% in both U.S. dollars and local currency compared to
last year’s period due to market share gains in the office products
channel.
Gross margin was 37.2% in the three months ended September 30,
2016, compared to 34.5% in the same period in 2015. The higher
gross margin was primarily due to a favorable product mix. Also, in
the third quarter of last year, the Company incurred approximately
$150,000 of one-time moving and severance costs associated with
consolidating its first aid facilities. Gross margin was 36.4% for
the nine months ended September 30, 2016 compared to 36.1% for last
year’s period.
The Company’s long-term debt less cash on September 30, 2016 was
$33.4 million compared to $23.9 million on September 30, 2015.
During the twelve-month period ended September 30, 2016, the
Company paid approximately $7.0 million for the acquisition of the
assets of DMT, spent $1.4 million on stock repurchases and paid
$1.3 million in dividends on its common stock.
Acme United will hold a conference call to discuss its quarterly
results, which will be broadcast over the Internet on Thursday,
October 20, 2016, at 12:00 p.m. EDT. To listen or participate in a
question and answer session, dial 800-768-6570. International
callers may dial 785-830-1942. You may access the live webcast of
the conference call through the Investor Relations section of the
Company’s website, www.acmeunited.com. A replay may be accessed
under Investor Relations, Audio Archives or by logging on to
www.streetevents.com.
ACME UNITED CORPORATION is a leading worldwide supplier
of innovative cutting, measuring and safety products to the school,
home, office, hardware, sporting goods and industrial markets. Its
leading brands include Westcott®, Clauss®, Camillus®, Cuda®,
PhysiciansCare®, First Aid Only®, Pac-Kit® and DMT®. For more
information, visit www.acmeunited.com.
Forward-looking statements in this report, including without
limitation, statements related to the Company’s plans, strategies,
objectives, expectations, intentions and adequacy of resources, are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Investors are cautioned
that such forward-looking statements involve risks and
uncertainties including, without limitation, the following: (i)
changes in the Company’s plans, strategies, objectives,
expectations and intentions, which may be made at any time at the
discretion of the Company; (ii) the impact of uncertainties in
global economic conditions, including the impact on the Company’s
suppliers and customers; (iii) changes in client needs and consumer
spending habits; (iv) the impact of competition and technological
changes on the Company; (v) the Company’s ability to manage its
growth effectively, including its ability to successfully integrate
any business it might acquire; (vi) currency fluctuations; and
(vii) other risks and uncertainties indicated from time to time in
the Company’s filings with the Securities and Exchange
Commission.
ACME UNITED CORPORATION CONDENSED CONSOLIDATED
STATEMENTS OF INCOME THIRD QUARTER REPORT 2016
(Unaudited) Three
Months Ended Three Months Ended Amounts in $000's
except per share data September
30, 2016 September 30, 2015
Net sales $ 31,913 $
29,903 Cost of goods sold 20,050 19,578
Gross profit 11,863 10,325 Selling,
general, and administrative expenses 9,723 8,334
Income from operations 2,140 1,991 Net
interest expense 247 149 Other expense,
net 65 92 Total other expense 312
241 Income before income tax expense 1,828
1,750 Income tax expense 355 542 Net
income $ 1,473 $ 1,208
Shares outstanding - Basic 3,324 3,354
Shares outstanding - Diluted 3,641 3,699
Earnings per share basic $ 0.44
$ 0.36 Earnings per share diluted 0.40
0.33 ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME THIRD QUARTER
REPORT 2016 (cont.) (Unaudited)
Nine Months Ended Nine Months
Ended Amounts in $000's except per share data
September 30, 2016
September 30, 2015 Net sales $
98,198 $ 86,694 Cost of goods sold
62,455 55,398 Gross profit 35,743
31,296 Selling, general, and administrative expenses
28,008 24,603 Income from operations
7,735 6,693 Net interest expense 642
420 Other expense 38 149 Total other
expense 680 569 Income before income tax
expense 7,055 6,124 Income tax expense
1,750 1,771 Net income $ 5,305
$ 4,353 Shares outstanding - Basic
3,329 3,328 Shares outstanding - Diluted
3,562 3,698 Earnings per share basic
$ 1.59 $ 1.31 Earnings per share
diluted 1.49 1.18 ACME UNITED
CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS
THIRD QUARTER REPORT 2016 (Unaudited)
Amounts in $000's
September 30, 2016
September 30, 2015
Assets:
Current assets: Cash and cash equivalents $
6,272 $ 4,621 Accounts receivable, net
25,909 23,587 Inventories 38,117
34,497 Prepaid and other current assets
1,995 2,171 Total current assets
72,293 64,877 Property and equipment,
net 7,893 7,343 Goodwill 1,406
1,375 Intangible assets, net 16,768
12,023 Other assets 1,012
969 Total assets $ 99,372 $
86,586
Liabilities and
stockholders' equity:
Current liabilities Accounts payable $
6,748 $ 7,206 Other current liabilities
6,597 6,759 Total current liabilities
13,345 13,965 Bank debt 39,706
28,551 Other non current liabilities
574 362 53,625 42,878 Total
stockholders' equity 45,747 43,698
Total liabilities and stockholders' equity $
99,372 $ 86,586
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version on businesswire.com: http://www.businesswire.com/news/home/20161020005278/en/
Acme United CorporationPaul G. DriscollPhone: 203-254-6060FAX:
203-254-6521
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