Reaffirms Financial Guidance for
2018
Lifetime Brands, Inc. (NasdaqGS: LCUT), a leading global provider
of branded kitchenware, tableware and other products used in the
home, today reported its financial results for the second quarter
ended June 30, 2018.
Second Quarter Financial
Highlights:
Consolidated net sales were $148.7 million, as
compared to consolidated net sales of $117.4 million for the
corresponding period in 2017. In constant currency, which excludes
the impact of foreign exchange fluctuations, consolidated net sales
increased $30.1 million, or 25.3%, as compared to consolidated net
sales in the corresponding period in 2017.
Gross margin was $52.1 million, or 35.0%, as
compared to $42.8 million, or 36.5%, for the corresponding period
in 2017.
Loss from operations was $3.3 million, as
compared to a loss of $3.1 million for the corresponding period in
2017.
Net loss was $6.1 million, or $0.30 per diluted
share, as compared to a net loss of $2.1 million, or $0.14 per
diluted share, in the corresponding period in 2017.
Adjusted net loss was $5.7 million, or $0.28 per
diluted share, as compared to a loss of $0.8 million, or $0.05 per
diluted share, in the corresponding period in 2017.
Equity in earnings, net of taxes, was $155
thousand, as compared to $458 thousand in the corresponding 2017
period.
Six Months Financial
Highlights:
Consolidated net sales were $266.8 million, as
compared to consolidated net sales of $230.7 million for the
corresponding period in 2017. In constant currency, consolidated
net sales increased 13.8%.
Gross margin was $97.2 million, or 36.4%, as
compared to $86.7 million, or 37.6%, for the corresponding period
in 2017.
Loss from operations was $16.6 million, as
compared to a loss of $5.0 million for the corresponding period in
2017.
Net loss was $17.7 million, or $0.96 per diluted
share, as compared to a net loss of $3.4 million, or $0.24 per
diluted share, in the corresponding period in 2017.
Adjusted net loss was $14.0 million, or $0.76
per diluted share, as compared to a loss of $2.0 million, or $0.14
per diluted share, in the corresponding period in 2017.
Equity in earnings, net of taxes, was $232
thousand, as compared to $998 thousand in the corresponding 2017
period.
Consolidated adjusted EBITDA was $69.2 million
for the twelve months ended June 30, 2018, after giving effect to
the pro forma adjustments, permitted under our debt agreements, for
the acquisition of Filament and projected synergies.
Chief Executive Officer Rob Kay commented, “The
integration of Filament Brands has been proceeding smoothly and we
are ahead of schedule both in terms of identified cost savings and
implementation timing. The meaningful steps we have taken to
optimize the Company’s combined business structure have enabled us
to surpass our original goal of realizing $8.1 million in
annualized synergy savings. We are now on track to realize $10.0
million in savings annually. 2018 is expected to benefit by
the realization of in excess of $2.0 million in savings, and we
expect to realize the full amount of the $10.0 million in annual
savings in 2019. This timing is consistent with our previously
announced plan.
“We continue to expect the combination of
Lifetime and Filament to be transformational, with progress
becoming evident in the second half of this year and becoming more
meaningful in 2019. While to date, our first priority has
been to achieve substantial operational efficiencies, we are also
working hard to evaluate and reposition our product portfolio as
well as enter growth categories and lay the groundwork for
realizing increased profit opportunities worldwide.
Recognizing that today’s retail environment is challenging, we
believe Lifetime’s expanded capabilities, customer base and ability
to evolve will help us achieve these goals.
“Lifetime Brands is executing our plan for 2018,
including the shipment of the largest single order Lifetime has
ever received in the third quarter combined with various other new
programs and promotions. We expect these to have a positive impact
on our financial results in the year’s second half. Accordingly, we
are reaffirming the Company’s financial guidance for 2018, provided
on May 8, 2018.”
Dividend
On Tuesday, July 31, 2018, the Board of
Directors declared a quarterly dividend of $0.0425 per share
payable on November 15, 2018 to shareholders of record on November
1, 2018.
Conference Call
The Company has scheduled a conference call for
August 6, 2018 at 11:00 a.m. ET. The dial-in number for the
conference call is (844) 787-0801 or (661) 378-9632, passcode
#3477586. A live webcast of the conference call will be accessible
through https://edge.media-server.com/m6/p/wzu2m5ei. For those who
cannot listen to the live broadcast, an audio replay of the webcast
will be available.
Non-GAAP Financial Measures
This earnings release contains non-GAAP
financial measures, including consolidated net sales in constant
currency, adjusted net income, adjusted diluted income per common
share, and consolidated adjusted EBITDA. A non-GAAP financial
measure is a numerical measure of a company's historical or future
financial performance, financial position or cash flows that
excludes amounts, or is subject to adjustments that have the effect
of excluding amounts, that are included in the most directly
comparable measure calculated and presented in accordance with GAAP
in the statements of income, balance sheets, or statements of cash
flows of the Company; or includes amounts, or is subject to
adjustments that have the effect of including amounts, that are
excluded from the most directly comparable measure so calculated
and presented. As required by SEC rules, the Company has provided
reconciliations of the non-GAAP financial measures to the most
directly comparable GAAP financial measures. These non-GAAP
financial measures are provided because management of the Company
uses these financial measures in evaluating the Company's on-going
financial results and trends, and management believes that
exclusion of certain items allows for more accurate comparison of
the Company’s operating performance. Management uses this non-GAAP
information as an indicator of business performance. These
non-GAAP financial measures should be viewed as a supplement to,
and not a substitute for, GAAP measures of performance.
Forward-Looking Statements
In this press release, the use of the words
“believe,” "could," "expect," "may," "positioned," "project,"
"projected," "should," "will," "would" or similar expressions is
intended to identify forward-looking statements. Such statements
include all statements regarding our current and projected
financial and operating performance and all guidance related
thereto, our future plans and intentions regarding the Company and
its consolidated subsidiaries, and the expected results of the
combination of Lifetime and Filament. Such statements represent the
Company’s current judgment about possible future events. The
Company believes these judgments are reasonable, but these
statements are not guarantees of any events or financial or
operational results, and actual results may differ materially due
to a variety of important factors. Such factors might include,
among others, the Company’s ability to comply with the requirements
of its credit agreements; the availability of funding under such
credit agreements; the Company’s ability to maintain adequate
liquidity and financing sources and an appropriate level of debt;
the possibility of impairments to the Company’s goodwill; changes
in U.S. or foreign trade or tax law and policy; changes in general
economic conditions which could affect customer payment practices
or consumer spending; the impact of changes in general economic
conditions on the Company’s customers; expenses and other
challenges relating to the integration of the Filament Brands
business and future acquisitions; changes in demand for the
Company’s products; changes in the Company’s management team; the
significant influence of the Company’s largest stockholder;
fluctuations in foreign exchange rates; changes in U.S. trade
policy or the trade policies of nations in which we or our
suppliers do business; shortages of and price volatility for
certain commodities; significant changes in the competitive
environment and the effect of competition on the Company’s markets,
including on the Company’s pricing policies, financing sources and
an appropriate level of debt. The Company undertakes no obligation
to update these forward-looking statements other than as required
by law.
Lifetime Brands,
Inc.
Lifetime Brands is a leading global provider of
kitchenware, tableware and other products used in the home. The
Company markets its products under well-known kitchenware brands,
including Farberware®, KitchenAid®, Sabatier®, Amco Houseworks®,
Chef'n® Chicago™ Metallic, Copco®, Fred® & Friends, Houdini™,
KitchenCraft®, Kamenstein®, Kizmos™, La Cafetière®, MasterClass®,
Misto®, Mossy Oak®, Swing-A-Way® Taylor® Kitchen and Vasconia®;
respected tableware and giftware brands, including Mikasa®,
Pfaltzgraff®, Fitz and Floyd®, Creative Tops®, Empire Silver™,
Gorham®, International® Silver, Kirk Stieff®, Rabbit® Towle®
Silversmiths, Tuttle®, Wallace®, Wilton Armetale®, V&A® and
Royal Botanic Gardens Kew®; and valued home solutions brands,
including Bombay®, BUILT NY®, Taylor® Bath and Taylor® Weather. The
Company also provides exclusive private label products to leading
retailers worldwide.
The Company’s corporate website is
www.lifetimebrands.com.
Contacts:
Lifetime Brands, Inc. Laurence
Winoker, Chief Financial Officer
516-203-3590 investor.relations@lifetimebrands.com
Lippert/Heilshorn& Assoc.Harriet Fried,
SVP212-838-3777hfried@lhai.com
|
LIFETIME BRANDS, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands - except per share data) |
(unaudited) |
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
June 30, |
|
|
June 30, |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
$ |
148,651 |
|
|
$ |
117,393 |
|
|
|
$ |
266,820 |
|
|
$ |
230,749 |
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales |
|
96,573 |
|
|
|
74,596 |
|
|
|
|
169,655 |
|
|
|
144,011 |
|
|
|
|
|
|
|
|
|
|
|
Gross margin |
|
52,078 |
|
|
|
42,797 |
|
|
|
|
97,165 |
|
|
|
86,738 |
|
|
|
|
|
|
|
|
|
|
|
Distribution expenses |
|
14,942 |
|
|
|
12,582 |
|
|
|
|
32,764 |
|
|
|
26,015 |
|
Selling,
general and administrative expenses |
|
40,042 |
|
|
|
33,102 |
|
|
|
|
80,217 |
|
|
|
65,484 |
|
Restructuring expenses |
|
395 |
|
|
|
254 |
|
|
|
|
801 |
|
|
|
254 |
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
(3,301 |
) |
|
|
(3,141 |
) |
|
|
|
(16,617 |
) |
|
|
(5,015 |
) |
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
(4,676 |
) |
|
|
(1,001 |
) |
|
|
|
(6,779 |
) |
|
|
(1,942 |
) |
Loss on early retirement of debt |
|
- |
|
|
|
(110 |
) |
|
|
|
(66 |
) |
|
|
(110 |
) |
|
|
|
|
|
|
|
|
|
|
Loss before
income taxes and equity in earnings |
|
(7,977 |
) |
|
|
(4,252 |
) |
|
|
|
(23,462 |
) |
|
|
(7,067 |
) |
|
|
|
|
|
|
|
|
|
|
Income tax
benefit |
|
1,765 |
|
|
|
1,698 |
|
|
|
|
5,575 |
|
|
|
2,642 |
|
Equity in
earnings, net of taxes |
|
155 |
|
|
|
458 |
|
|
|
|
232 |
|
|
|
998 |
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS |
$ |
(6,057 |
) |
|
$ |
(2,096 |
) |
|
|
$ |
(17,655 |
) |
|
$ |
(3,427 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding - basic |
|
20,327 |
|
|
|
14,456 |
|
|
|
|
18,474 |
|
|
|
14,426 |
|
|
|
|
|
|
|
|
|
|
|
BASIC LOSS PER COMMON
SHARE |
$ |
(0.30 |
) |
|
$ |
(0.14 |
) |
|
|
$ |
(0.96 |
) |
|
$ |
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding - diluted |
|
20,327 |
|
|
|
14,456 |
|
|
|
|
18,474 |
|
|
|
14,426 |
|
|
|
|
|
|
|
|
|
|
|
DILUTED LOSS PER COMMON
SHARE |
$ |
(0.30 |
) |
|
$ |
(0.14 |
) |
|
|
$ |
(0.96 |
) |
|
$ |
(0.24 |
) |
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per common share |
$ |
0.0425 |
|
|
$ |
0.0425 |
|
|
|
$ |
0.085 |
|
|
$ |
0.085 |
|
|
|
|
|
|
|
|
|
|
|
LIFETIME BRANDS, INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(In thousands - except share data) |
|
|
|
|
|
June 30, |
|
December 31, |
|
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
CURRENT ASSETS |
|
|
|
|
Cash and cash equivalents |
$ |
5,999 |
|
|
$ |
7,600 |
|
|
Accounts receivable, less allowances of $6,037 at June 30, 2018
and $6,190 at December 31, 2017 |
|
93,100 |
|
|
|
108,033 |
|
|
Inventory |
|
197,879 |
|
|
|
132,436 |
|
|
Prepaid expenses and other current assets |
|
14,712 |
|
|
|
10,354 |
|
|
Income taxes receivable |
|
4,095 |
|
|
|
- |
|
|
|
TOTAL CURRENT ASSETS |
|
315,785 |
|
|
|
258,423 |
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, net |
|
25,643 |
|
|
|
23,065 |
|
INVESTMENTS |
|
23,501 |
|
|
|
23,978 |
|
INTANGIBLE ASSETS, net |
|
366,198 |
|
|
|
88,479 |
|
DEFERRED INCOME TAXES |
|
8,957 |
|
|
|
5,826 |
|
OTHER ASSETS |
|
1,962 |
|
|
|
1,750 |
|
|
|
|
TOTAL
ASSETS |
$ |
742,046 |
|
|
$ |
401,521 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
CURRENT LIABILITIES |
|
Current maturity of term loan |
$ |
1,247 |
|
|
$ |
- |
|
|
Short term loan |
|
76 |
|
|
|
69 |
|
|
Accounts payable |
|
43,915 |
|
|
|
25,461 |
|
|
Accrued expenses |
|
52,937 |
|
|
|
44,121 |
|
|
Income taxes payable |
|
- |
|
|
|
1,864 |
|
|
|
TOTAL CURRENT LIABILITIES |
|
98,175 |
|
|
|
71,515 |
|
|
|
|
|
|
|
|
DEFERRED RENT & OTHER LONG-TERM LIABILITIES |
|
20,847 |
|
|
|
20,249 |
|
DEFERRED INCOME TAXES |
|
33,968 |
|
|
|
4,423 |
|
INCOME TAXES PAYABLE, LONG-TERM |
|
311 |
|
|
|
311 |
|
REVOLVING CREDIT FACILITY |
|
59,577 |
|
|
|
94,744 |
|
TERM LOAN |
|
263,329 |
|
|
|
- |
|
|
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY |
|
|
|
|
Preferred stock, $1.00 par value, shares authorized: 100 shares
of Series A and 2,000,000 shares of Series B; none issued and
outstanding |
|
- |
|
|
|
- |
|
|
Common stock, $.01 par value, shares authorized: 50,000,000 at
June 30, 2018 and December 31, 2017; shares issued and
outstanding: 20,740,997 at June 30, 2018 and 14,902,527 at
December 31, 2017 |
|
207 |
|
|
|
149 |
|
|
Paid-in capital |
|
256,182 |
|
|
|
178,909 |
|
|
Retained earnings |
|
41,126 |
|
|
|
60,546 |
|
|
Accumulated other comprehensive loss |
|
(31,676 |
) |
|
|
(29,325 |
) |
|
|
TOTAL STOCKHOLDERS’ EQUITY |
|
265,839 |
|
|
|
210,279 |
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
742,046 |
|
|
$ |
401,521 |
|
|
|
|
|
|
|
|
LIFETIME BRANDS, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In thousands) |
(unaudited) |
|
|
|
|
|
Six Months Ended |
|
|
|
|
|
June 30, |
|
|
|
|
|
|
2018 |
|
|
|
2017 |
|
|
OPERATING ACTIVITIES |
|
|
|
|
|
Net loss |
$ |
(17,655 |
) |
|
$ |
(3,427 |
) |
|
|
Adjustments to reconcile net loss to net cash provided by
operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
10,731 |
|
|
|
6,634 |
|
|
|
|
Amortization of financing costs |
|
663 |
|
|
|
282 |
|
|
|
|
Deferred
rent |
|
368 |
|
|
|
(304 |
) |
|
|
|
Stock compensation expense |
|
1,759 |
|
|
|
1,530 |
|
|
|
|
Undistributed equity in earnings, net |
|
(232 |
) |
|
|
(970 |
) |
|
|
|
Loss on early retirement of debt |
|
66 |
|
|
|
110 |
|
|
|
Changes in operating assets and liabilities (excluding the
effects of business acquisitions) |
|
|
|
|
|
|
Accounts receivable |
|
41,441 |
|
|
|
37,950 |
|
|
|
|
Inventory |
|
(39,555 |
) |
|
|
(30,769 |
) |
|
|
|
Prepaid expenses, other current assets and other assets |
|
(185 |
) |
|
|
1,107 |
|
|
|
|
Accounts payable, accrued expenses and other liabilities |
|
5,170 |
|
|
|
(5,291 |
) |
|
|
|
Income taxes receivable |
|
(4,095 |
) |
|
|
(4,279 |
) |
|
|
|
Income taxes payable |
|
(4,242 |
) |
|
|
(6,858 |
) |
|
|
|
|
NET CASH USED IN OPERATING
ACTIVITIES |
|
(5,766 |
) |
|
|
(4,285 |
) |
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
|
Purchases of property and equipment |
|
(3,168 |
) |
|
|
(2,710 |
) |
|
|
Filament acquisition, net of cash acquired |
|
(217,932 |
) |
|
|
- |
|
|
|
|
|
NET CASH USED
IN INVESTING ACTIVITIES |
|
(221,100 |
) |
|
|
(2,710 |
) |
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
|
Proceeds from revolving credit facility |
|
126,283 |
|
|
|
123,534 |
|
|
|
Repayments of revolving credit facility |
|
(161,173 |
) |
|
|
(110,937 |
) |
|
|
Proceeds from Term Loan |
|
275,000 |
|
|
|
- |
|
|
|
Repayment of Term Loan |
|
(688 |
) |
|
|
- |
|
|
|
Repayment of Credit Agreement term loan |
|
- |
|
|
|
(9,500 |
) |
|
|
Proceeds from short term loan |
|
79 |
|
|
|
119 |
|
|
|
Payments on short term loan |
|
(71 |
) |
|
|
(114 |
) |
|
|
Payment of financing costs |
|
(11,154 |
) |
|
|
(30 |
) |
|
|
Payment of equity issuance costs |
|
(936 |
) |
|
|
- |
|
|
|
Payments for capital leases |
|
(24 |
) |
|
|
(49 |
) |
|
|
Payments of tax withholding for stock based compensation |
|
(398 |
) |
|
|
(176 |
) |
|
|
Proceeds from exercise of stock options |
|
- |
|
|
|
1,425 |
|
|
|
Cash dividends paid |
|
(1,535 |
) |
|
|
(1,235 |
) |
|
|
|
|
NET CASH PROVIDED BY FINANCING
ACTIVITIES |
|
225,383 |
|
|
|
3,037 |
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange on cash |
|
(118 |
) |
|
|
197 |
|
|
|
|
|
|
|
|
|
|
DECREASE IN CASH AND CASH EQUIVALENTS |
|
(1,601 |
) |
|
|
(3,761 |
) |
|
Cash and cash equivalents at beginning of period |
|
7,600 |
|
|
|
7,883 |
|
|
CASH AND CASH EQUIVALENTS AT END OF
PERIOD |
$ |
5,999 |
|
|
$ |
4,122 |
|
|
|
|
|
|
|
|
|
|
LIFETIME BRANDS,
INC.Supplemental Information(In
thousands)
Reconciliation of GAAP to Non-GAAP
Operating Results
Consolidated adjusted EBITDA for the twelve months ended
June 30, 2018:
|
|
Consolidated adjusted EBITDA for the Four
Quarters Ended June 30, 2018 |
Three months ended June 30, 2018 |
$ |
3,910 |
|
Three months ended March 31, 2018 |
|
(529 |
) |
Three months ended December 31, 2017 |
|
29,767 |
|
Three months ended September 30, 2017 |
|
26,500 |
|
Pro forma projected synergies |
|
9,595 |
|
|
Total
for the four quarters |
$ |
69,243 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30, 2018 |
|
March 31, 2018 |
|
December 31, 2017 |
|
September
30, 2017 |
|
Twelve months ended June 30, 2018 |
Net income (loss) as reported |
|
$ |
(6,057 |
) |
|
$ |
(11,598 |
) |
|
$ |
1,251 |
|
$ |
4,330 |
|
$ |
(12,074 |
) |
|
Subtract out: |
|
|
|
|
|
|
|
|
|
|
|
|
Undistributed equity in (earnings) losses, net |
|
|
(155 |
) |
|
|
(77 |
) |
|
|
265 |
|
|
326 |
|
|
359 |
|
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit) |
|
|
(1,765 |
) |
|
|
(3,810 |
) |
|
|
8,169 |
|
|
3,505 |
|
|
6,099 |
|
|
|
Interest expense |
|
|
4,676 |
|
|
|
2,103 |
|
|
|
1,177 |
|
|
1,172 |
|
|
9,128 |
|
|
|
Loss on early
retirement of debt |
|
|
- |
|
|
|
66 |
|
|
|
- |
|
|
- |
|
|
66 |
|
|
|
Depreciation and
amortization |
|
|
6,422 |
|
|
|
4,309 |
|
|
|
3,468 |
|
|
4,063 |
|
|
18,262 |
|
|
|
Stock compensation
expense |
|
|
921 |
|
|
|
838 |
|
|
|
908 |
|
|
952 |
|
|
3,619 |
|
|
|
Unrealized (gain) loss
on foreign currency contracts |
|
|
(2,112 |
) |
|
|
393 |
|
|
|
169 |
|
|
897 |
|
|
(653 |
) |
|
|
Other permitted
non-cash charges |
|
|
916 |
|
|
|
287 |
|
|
|
- |
|
|
- |
|
|
1,203 |
|
|
|
Permitted acquisition
related expenses |
|
|
391 |
|
|
|
809 |
|
|
|
2,424 |
|
|
166 |
|
|
3,790 |
|
|
|
Permitted non-recurring
charges |
|
|
673 |
|
|
|
2,825 |
|
|
|
1,331 |
|
|
272 |
|
|
5,101 |
|
|
|
Pro forma Filament
adjustment |
|
|
- |
|
|
|
3,326 |
|
|
|
10,605 |
|
|
10,817 |
|
|
24,748 |
|
|
|
Twelve
Months ended June 30, 2018, Pro forma projected synergies |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
- |
|
|
9,595 |
|
|
Consolidated adjusted EBITDA |
|
$ |
3,910 |
|
|
$ |
(529 |
) |
|
$ |
29,767 |
|
$ |
26,500 |
|
$ |
69,243 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated adjusted EBITDA is a non-GAAP
financial measure which is defined in the Company’s debt
agreements. Adjusted EBITDA is defined as net income (loss),
adjusted to exclude undistributed equity in earnings (losses),
income taxes, interest, losses on early retirement of debt,
depreciation and amortization, stock compensation expense,
unrealized (gain) loss on foreign currency contracts, permitted
non-recurring charges such as severance expense, warehouse
relocation costs, transition expenses and restructuring expenses,
and a non-cash purchase accounting adjustment to step-up the fair
value of acquired inventory. Consolidated adjusted EBITDA includes
pro forma adjustments, permitted under the debt agreements, for the
acquisition of Filament and projected cost savings, operating
expense reductions, restructuring charges and expenses and cost
saving synergies projected by the Company as a result of actions
taken through June 30, 2018 or expected to be taken as of June 30,
2018, net of the benefits realized.
LIFETIME BRANDS,
INC.Supplemental Information(In
thousands- except per share data)
Reconciliation of GAAP to Non-GAAP
Operating Results (continued)
Adjusted net loss and adjusted diluted loss per common
share:
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, 2018, |
|
June 30, 2018, |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
Net loss as
reported |
$ |
(6,057 |
) |
|
$ |
(2,096 |
) |
|
$ |
(17,655 |
) |
|
$ |
(3,427 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
Acquisition related
expenses (adjustments), net |
|
391 |
|
|
|
(9 |
) |
|
|
1,200 |
|
|
|
26 |
|
|
Restructuring
expenses |
|
395 |
|
|
|
254 |
|
|
|
801 |
|
|
|
254 |
|
|
Severance expense |
|
- |
|
|
|
69 |
|
|
|
- |
|
|
|
155 |
|
|
Integration
charges |
|
110 |
|
|
|
- |
|
|
|
145 |
|
|
|
- |
|
|
Warehouse
relocation |
|
168 |
|
|
|
- |
|
|
|
2,552 |
|
|
|
- |
|
|
Loss on early
retirement of debt |
|
- |
|
|
|
110 |
|
|
|
66 |
|
|
|
110 |
|
|
Non-cash purchase
accounting charges |
|
916 |
|
|
|
- |
|
|
|
1,203 |
|
|
|
- |
|
|
Unrealized (gain) loss
on foreign currency contracts |
|
(2,112 |
) |
|
|
1,456 |
|
|
|
(1,719 |
) |
|
|
1,751 |
|
|
Deferred tax for
foreign currency translation for Grupo Vasconia |
|
501 |
|
|
|
(140 |
) |
|
|
306 |
|
|
|
(365 |
) |
|
Income tax effect on
adjustments |
|
9 |
|
|
|
(397 |
) |
|
|
(861 |
) |
|
|
(502 |
) |
Adjusted
net loss |
$ |
(5,679 |
) |
|
$ |
(753 |
) |
|
$ |
(13,962 |
) |
|
$ |
(1,998 |
) |
Adjusted
diluted loss per common share |
$ |
(0.28 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.76 |
) |
|
$ |
(0.14 |
) |
|
|
|
|
|
|
|
|
|
Adjusted net loss in the three and six months
ended June 30, 2018 excludes acquisition related expenses,
restructuring expenses, integration charges, warehouse relocation
expenses, loss on retirement of debt, non-cash purchase accounting
charges, the unrealized gain on foreign currency contracts and the
deferred tax for foreign currency translation for Grupo
Vasconia. Adjusted net loss in the three and six months ended
June 30, 2017 excludes acquisition related expenses, restructuring
expenses, severance expense, the unrealized loss on foreign
currency contracts and the deferred tax for foreign currency
translation for Grupo Vasconia.
LIFETIME BRANDS,
INC.Supplemental Information(In
thousands)
Reconciliation of GAAP to Non-GAAP
Operating Results (continued)
Constant Currency:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported |
|
Constant Currency
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Three Months
Ended |
|
|
|
Year-Over-Year |
|
|
June 30, |
|
June 30, |
|
|
|
Increase (Decrease) |
|
Net
sales |
|
2018 |
|
|
2017 |
|
Increase (Decrease) |
|
|
2018 |
|
|
2017 |
|
Increase (Decrease) |
|
Currency Impact |
|
Excluding Currency |
|
|
Including Currency |
|
|
Currency Impact |
|
|
U.S. Wholesale |
$ |
124,348 |
|
$ |
94,770 |
|
$ |
29,578 |
|
|
$ |
124,348 |
|
$ |
94,784 |
|
$ |
29,564 |
|
|
$ |
14 |
|
31.2 |
|
% |
|
31.2 |
|
% |
|
- |
% |
|
International |
|
19,083 |
|
|
19,365 |
|
|
(282 |
) |
|
|
19,083 |
|
|
20,559 |
|
|
(1,476 |
) |
|
|
1,194 |
|
(7.2 |
) |
% |
|
(1.5 |
) |
% |
|
5.7 |
% |
|
Retail Direct |
|
5,220 |
|
|
3,258 |
|
|
1,962 |
|
|
|
5,220 |
|
|
3,258 |
|
|
1,962 |
|
|
|
- |
|
60.2 |
|
% |
|
60.2 |
|
% |
|
- |
% |
|
Total net
sales |
$ |
148,651 |
|
$ |
117,393 |
|
$ |
31,258 |
|
|
$ |
148,651 |
|
$ |
118,601 |
|
$ |
30,050 |
|
|
$ |
1,208 |
|
25.3 |
|
% |
|
26.6 |
|
% |
|
1.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
Reported |
|
Constant Currency
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended |
|
Six Months
Ended |
|
|
|
Year-Over-Year |
|
|
June 30, |
|
June 30, |
|
|
|
Increase (Decrease) |
|
Net
sales |
|
2018 |
|
|
2017 |
|
Increase (Decrease) |
|
|
2018 |
|
|
2017 |
|
Increase (Decrease) |
|
Currency Impact |
|
Excluding Currency |
|
|
Including Currency |
|
|
Currency Impact |
|
|
U.S. Wholesale |
$ |
215,143 |
|
$ |
182,162 |
|
$ |
32,981 |
|
|
$ |
215,143 |
|
$ |
182,188 |
|
$ |
32,955 |
|
|
$ |
26 |
|
18.1 |
|
% |
|
18.1 |
|
% |
|
- |
% |
|
International |
|
40,929 |
|
|
40,593 |
|
|
336 |
|
|
|
40,929 |
|
|
44,367 |
|
|
(3,438 |
) |
|
|
3,774 |
|
(7.7 |
) |
% |
|
0.8 |
|
% |
|
8.5 |
% |
|
Retail Direct |
|
10,748 |
|
|
7,994 |
|
|
2,754 |
|
|
|
10,748 |
|
|
7,994 |
|
|
2,754 |
|
|
|
- |
|
34.5 |
|
% |
|
34.5 |
|
% |
|
- |
% |
|
Total net
sales |
$ |
266,820 |
|
$ |
230,749 |
|
$ |
36,071 |
|
|
$ |
266,820 |
|
$ |
234,549 |
|
$ |
32,271 |
|
|
$ |
3,800 |
|
13.8 |
|
% |
|
15.6 |
|
% |
|
1.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)"Constant Currency" is determined by applying the 2018
average exchange rates to the prior year local currency net sales
amounts, with the difference between the change in "As Reported"
net sales and "Constant Currency" net sales, reported in the table
as "Currency Impact". Constant currency net sales growth excludes
the impact of currency.
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