Crown Crafts Announces Financial Results for First Quarter of Fiscal 2024
August 16 2023 - 6:57AM
Crown Crafts, Inc. (NASDAQ-CM: CRWS) (the “Company”) today reported
results for the first quarter of fiscal year 2024, which ended July
2, 2023.
First Quarter Summary
- Net sales of $17.1 million, an
increase of 9.0% from the prior-year quarter
- Net income of $366,000, or $0.04
per diluted share
- Declared quarterly dividend of $0.08 per share of Series A
common stock
“Our first quarter fiscal 2024 results reflect
the ongoing macroeconomic headwinds and higher costs across our
business. Net sales increased by 9.0% primarily due to our
acquisition of Manhattan Toy in March, which contributed $3.7
million to net sales in the current-year quarter, and helped offset
the lower consumer spending due to inflationary pressures. Despite
these challenges, I am proud that we were able to control costs and
reported another profitable quarter,” said Olivia Elliott,
President and Chief Executive Officer. “The integration of
Manhattan Toy continues, and we expect improved financial results
from this combination throughout fiscal 2024, including better
purchasing terms for Manhattan Toy’s products and greater
distribution opportunities from our broader product offerings.
Overall, we believe Crown Crafts remains well-positioned to
continue to deliver profitable performance in the near-term and
poised for improved top- and bottom-line growth when the economy
becomes more favorable.”
First Quarter Fiscal 2024
Results
Net sales for the first quarter of fiscal 2024
were $17.1 million, compared to $15.7 million in the prior-year
quarter. Gross profit as a percentage of net sales was 27.7% versus
32.8% in the first quarter of fiscal 2023. Marketing and
administrative expenses were $4.0 million versus $3.4 million in
the first quarter of fiscal 2023, and included approximately
$116,000 in expenses related to the acquisition of Manhattan Toy.
Net income was $366,000, or $0.04 per diluted share, compared to
$1.4 million, or $0.14 per diluted share in the prior-year
quarter.
Quarterly Cash Dividend
The Company also announced that its Board of
Directors declared a quarterly cash dividend on the Company’s
Series A common stock of $0.08 per share, which will be paid on
October 6, 2023 to stockholders of record at the close of business
on September 15, 2023.
Conference Call
The Company will host a teleconference today at
8:00 a.m. Central Daylight 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 join the Crown Crafts 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 5:00 p.m.
Central Standard Time on November 16, 2023. To access the replay,
dial (877) 344-7529 in the United States or (412) 317-0088 from
international locations and enter replay access
code 6402523.
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, toys and disposable
products. The Company operates through its four wholly owned
subsidiaries, NoJo Baby & Kids, Inc., Sassy Baby, Inc.,
Manhattan Group, LLC and Manhattan Toy Europe Limited, 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.
Forward-Looking Statements
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
Investor Relations:
Three Part AdvisorsSteven Hooser, Partner, or John Beisler,
Managing Director(817) 310-8776
CROWN
CRAFTS, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF
INCOMESELECTED FINANCIAL DATAIn thousands, except percentages and
per share amounts(Unaudited) |
|
|
|
|
Three-Month
Periods Ended |
|
July 2,
2023 |
July 3,
2022 |
Net sales |
$ |
17,123 |
$ |
15,710 |
Gross
profit |
|
4,742 |
|
5,153 |
Gross profit
percentage |
|
27.7% |
|
32.8% |
Marketing
and administrative expenses |
|
4,046 |
|
3,413 |
Income from
operations |
|
696 |
|
1,740 |
Income
before income tax expense |
|
506 |
|
1,900 |
Income tax
expense |
|
140 |
|
466 |
Net
income |
|
366 |
|
1,434 |
Basic and
diluted earnings per share |
$ |
0.04 |
$ |
0.14 |
|
|
|
Weighted
Average Shares Outstanding: |
|
|
Basic |
|
10,154 |
|
10,076 |
Diluted |
|
10,163 |
|
10,100 |
CONSOLIDATED BALANCE
SHEETSSELECTED FINANCIAL DATAIn
thousands |
|
|
|
|
(Unaudited) |
|
|
July 2,
2023 |
April 2,
2023 |
Cash and cash equivalents |
$ |
765 |
$ |
1,742 |
Accounts
receivable, net of allowances |
|
15,792 |
|
22,808 |
Inventories |
|
37,723 |
|
34,211 |
Total
current assets |
|
55,693 |
|
60,375 |
Operating
lease right of use assets |
|
16,521 |
|
17,305 |
Finite-lived
intangible assets - net |
|
3,327 |
|
3,473 |
Goodwill |
|
7,919 |
|
7,912 |
Total
assets |
$ |
85,513 |
$ |
90,972 |
|
|
|
Total
current liabilities |
|
15,105 |
|
13,057 |
Long-term
debt |
|
6,509 |
|
12,674 |
Operating
lease liabilities, noncurrent |
|
14,112 |
|
14,889 |
|
|
|
Shareholders’ equity |
|
48,959 |
|
49,214 |
Total
liabilities and shareholders’ equity |
$ |
85,513 |
$ |
90,972 |
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