Crown Crafts, Inc. (NASDAQ-CM: CRWS) (the “Company”) today reported
results for the third quarter of fiscal year 2022, which ended
December 26, 2021.
“We saw significant sales and earnings increases
in the third quarter and year-to-date periods as a result of our
strong management team and product development efforts," said E.
Randall Chestnut, Chairman and Chief Executive Officer. “We are
particularly pleased with the progress of our expanded line of
Sassy developmental toys, which have gained placements in retail
markets throughout the country.”
“Sales were up across all product categories,
reflecting the ongoing strength of our legacy businesses as well as
our newer lines,” said Olivia Elliott, President and Chief
Operating Officer. “We will continue to focus on developing new
products to strengthen our Company for the future while we also
navigate the challenges of the current marketplace.”
Financial Results
Net income for the third quarter of fiscal 2022
was $2.4 million, or $0.24 per diluted share, on net sales of $22.7
million, compared with net income of $2.1 million, or $0.21 per
diluted share, on net sales of $19.5 million for the third quarter
of fiscal 2021. Gross profit for the current-year quarter was 27.1%
of net sales, down from 31.6% of net sales in the prior-year
quarter. The prior-year quarter included net sales and a net loss
of $1.1 million and $102,000, respectively, associated with the
Carousel Designs business, which ceased operations in May
2021.
Excluding the impact of Carousel, net sales,
gross margin percentage, net income and diluted earnings per share
would have been $18.4 million, 31.8%, $2.2 million and $0.22,
respectively, for the third quarter of fiscal 2021.
For the nine-month fiscal period, net income was
$7.5 million, or $0.74 per diluted share, on net sales of $61.7
million, compared with net income of $5.8 million, or $0.57 per
diluted share, on net sales of $57.3 million for the first nine
months of fiscal 2021. Current-year net income was impacted
favorably by a pre- and post-tax $1,985,000 gain on extinguishment
of debt related to the forgiveness of the Company’s Paycheck
Protection Program Loan (the “PPP Loan”). The current year also
included net sales and a net loss of $638,000 and $797,000,
respectively, associated with Carousel, while the prior year
included net sales and a net loss of $4.1 million and $38,000,
respectively, associated with Carousel.
Excluding the impacts of the PPP Loan in fiscal
2022 and Carousel in both nine-month periods, current-year net
sales, gross margin percentage, net income and diluted earnings per
share would have been $61.0 million, 28.8%, $6.3 million and $0.63,
respectively, compared to prior-year net sales, gross margin
percentage, net income and diluted earnings per share of $53.2
million, 31.4%, $5.9 million and $0.58, respectively.
Elliott Promoted to Chief Executive
Officer
The Company also announced today that its Board
of Directors has promoted Olivia Elliott to Chief Executive
Officer, effective March 1, 2022. Elliott has been President and
Chief Operating Officer of the Company since January 4, 2021. She
joined the Company in 2001 as Treasurer and served as Chief
Financial Officer from 2008 to 2020. E. Randall Chestnut, who has
been the Company’s Chief Executive Officer since July 2001, will
continue as Chairman of the Board.
“I have worked with Olivia for more than 20
years and have watched her progress from Treasurer to President and
Chief Operating Officer during a time of solid growth and
profitability for the Company,” Chestnut said. “Her contributions
as a leader during that period have been phenomenal, and the Board
believes she is uniquely qualified to step into the role of CEO and
lead the Company to further growth.”
“I am excited to have this opportunity to
continue to work with our outstanding team,” Elliott said. “With
the strengths of our people and our products, Crown Crafts is in an
excellent position to continue achieving profitable growth and
providing long-term value for all of our stakeholders.”
Quarterly Cash Dividend
In addition, the Board of Directors has declared
a quarterly cash dividend on the Company’s Series A common stock of
$0.08 per share, which will be paid on April 8, 2022, to
stockholders of record at the close of business on March 18, 2022.
“Our Board remains committed to delivering solid returns to
shareholders and is confident in the continued strength of our
businesses and management team,” Chestnut said.
Conference Call
The Company will host a teleconference today at
10:00 a.m. Central Standard Time to discuss the Company’s results,
during which interested individuals will be given the opportunity
to ask appropriate questions. To join the teleconference, dial
(844) 861-5504 and ask to be joined into the Crown Crafts, Inc.
call. The teleconference can also be accessed in listen-only mode
by visiting the Company’s website at www.crowncrafts.com. The
financial information to be discussed during the teleconference may
be accessed prior to the call on the investor relations portion of
the Company’s website. A telephone replay of the teleconference
will be available one hour after the end of the call through 4:00
p.m. Central Standard Time on February 16, 2022. To access the
replay, dial (877) 344-7529 in the United States or (412) 317-0088
from international locations and refer to conference number
1478907.
About Crown Crafts, Inc.
Crown Crafts, Inc. designs, markets and
distributes infant, toddler and juvenile consumer products. Founded
in 1957, Crown Crafts is one of America’s largest producers of
infant bedding, toddler bedding, bibs and developmental toys. The
Company operates through its two wholly-owned subsidiaries, NoJo
Baby & Kids, Inc. and Sassy Baby, Inc., which market a variety
of infant, toddler and juvenile products under Company-owned
trademarks, as well as licensed collections and exclusive private
label programs. Sales are made directly to retailers such as mass
merchants, large chain stores and juvenile specialty stores. For
more information, visit the Company’s website at
www.crowncrafts.com.
The foregoing contains forward-looking
statements within the meaning of the Securities Act of 1933, the
Securities Exchange Act of 1934 and the Private Securities
Litigation Reform Act of 1995. Such statements are based upon
management’s current expectations, projections, estimates and
assumptions. Words such as “expects,” “believes,” “anticipates” and
variations of such words and similar expressions identify such
forward-looking statements. Forward-looking statements involve
known and unknown risks and uncertainties that may cause future
results to differ materially from those suggested by the
forward-looking statements. These risks include, among others,
general economic conditions, including changes in interest rates,
in the overall level of consumer spending and in the price of oil,
cotton and other raw materials used in the Company’s products,
changing competition, changes in the retail environment, the
Company’s ability to successfully integrate newly acquired
businesses, the level and pricing of future orders from the
Company’s customers, the extent to which the Company’s business is
concentrated in a small number of customers, the Company’s
dependence upon third-party suppliers, including some located in
foreign countries, customer acceptance of both new designs and
newly-introduced product lines, actions of competitors that may
impact the Company’s business, disruptions to transportation
systems or shipping lanes used by the Company or its suppliers, and
the Company’s dependence upon licenses from third parties.
Reference is also made to the Company’s periodic filings with the
Securities and Exchange Commission for additional factors that may
impact the Company’s results of operations and financial condition.
The Company does not undertake to update the forward-looking
statements contained herein to conform to actual results or changes
in our expectations, whether as a result of new information, future
events or otherwise.
Contact:
Craig J. DemarestVice President and Chief Financial Officer
(225) 647-9118cdemarest@crowncrafts.com
CROWN CRAFTS, INC. AND SUBSIDIARIESCONSOLIDATED
STATEMENTS OF INCOMESELECTED FINANCIAL DATAIn thousands, except
percentages and per share data(Unaudited)
|
|
Three-Month Periods Ended |
|
Nine-Month Periods Ended |
|
|
December 26, 2021 |
December 27, 2020 |
|
December 26, 2021 |
December 27, 2020 |
Net sales |
|
$ |
22,742 |
|
$ |
19,476 |
|
|
$ |
61,674 |
|
$ |
57,340 |
|
Gross profit |
|
|
6,170 |
|
|
6,153 |
|
|
|
16,894 |
|
|
18,270 |
|
Gross profit percentage |
|
|
27.1% |
|
|
31.6% |
|
|
|
27.4% |
|
|
31.9% |
|
Income from operations |
|
|
3,076 |
|
|
2,733 |
|
|
|
7,270 |
|
|
7,668 |
|
Gain on extinguishment of debt |
|
|
- |
|
|
- |
|
|
|
1,985 |
|
|
- |
|
Income before income tax expense |
|
|
3,037 |
|
|
2,723 |
|
|
|
9,289 |
|
|
7,653 |
|
Income tax expense |
|
|
605 |
|
|
582 |
|
|
|
1,806 |
|
|
1,810 |
|
Net income |
|
|
2,432 |
|
|
2,141 |
|
|
|
7,483 |
|
|
5,843 |
|
Basic and diluted earnings per share |
|
$ |
0.24 |
|
$ |
0.21 |
|
|
$ |
0.74 |
|
$ |
0.57 |
|
|
|
|
|
|
|
|
Weighted Average Shares Outstanding: |
|
|
|
|
|
|
Basic |
|
|
10,078 |
|
|
10,208 |
|
|
|
10,045 |
|
|
10,195 |
|
Diluted |
|
|
10,107 |
|
|
10,224 |
|
|
|
10,075 |
|
|
10,200 |
|
|
|
|
|
|
|
|
CONSOLIDATED BALANCE SHEETSSELECTED FINANCIAL
DATAIn thousands
|
|
December 26, 2021 |
|
|
|
(Unaudited) |
|
March 28, 2021 |
Cash and cash equivalents |
|
$ |
2,052 |
|
$ |
613 |
|
Accounts receivable, net of allowances |
|
|
21,002 |
|
|
19,338 |
|
Inventories |
|
|
24,467 |
|
|
20,335 |
|
Total current assets |
|
|
48,915 |
|
|
41,470 |
|
Operating lease right of use assets |
|
|
2,838 |
|
|
4,068 |
|
Finite-lived intangible assets - net |
|
|
2,774 |
|
|
3,163 |
|
Goodwill |
|
|
7,125 |
|
|
7,125 |
|
Total assets |
|
$ |
63,479 |
|
$ |
58,082 |
|
|
|
|
|
Total current liabilities |
|
|
17,569 |
|
|
12,946 |
|
Operating lease liabilities, noncurrent |
|
|
1,274 |
|
|
2,641 |
|
|
|
|
|
Shareholders’ equity |
|
|
43,902 |
|
|
41,865 |
|
Total liabilities and shareholders’ equity |
|
$ |
63,479 |
|
$ |
58,082 |
|
|
|
|
|
Crown Crafts (NASDAQ:CRWS)
Historical Stock Chart
From May 2024 to Jun 2024
Crown Crafts (NASDAQ:CRWS)
Historical Stock Chart
From Jun 2023 to Jun 2024