PICKERINGTON, Ohio,
May 7, 2013 /PRNewswire/
-- Accessories marketer R.G. Barry Corporation (Nasdaq:
DFZ) today reported strong operating results for its fiscal 2013
third quarter, ended March 30.
On a consolidated quarterly basis, the Company reported:
- Net sales of $25.8 million, up
2.7% from $25.1 million for the third
quarter of fiscal 2012;
- A net earnings increase of 84.8% to $1.5
million, or $0.13 per diluted
share, versus net earnings of $0.8
million, or $0.07 per diluted
share, in the comparable period last year;
- Gross profit as a percent of net sales expanded by 130 basis
points to 45.9% from 44.6% one year ago; and
- Selling, general and administrative expenses were down 2.9%
from the equivalent period last year at $9.6
million.
For the nine months, the Company's consolidated results
included:
- A 7.2% decline in net sales to $121.5
million versus $130.9 million
one year ago;
- Net earnings of $13.0 million, or
$1.13 per diluted share, down from
$14.1 million, or $1.24 per diluted share, in the corresponding
period of fiscal 2012;
- Improved gross profit as a percent of net sales at 43.9%
compared to 43.1% in the equivalent nine-months last year;
and
- Selling, general and administrative expenses down 2.0% from the
comparable nine-month period last year at $32.5 million.
The Company said that net sales in its Footwear segment declined
for both the quarter and nine months. Quarterly net sales of
$16.4 million were down 4.1%,
reflecting fewer shipments to mass and off-price customers.
Nine-month net sales declined 12.1% to $94.2
million, reflecting, in part, the impact of the company's
decision last year to eliminate some under-performing elements of
its footwear business; loss of a seasonal men's slipper business in
a national department store chain; and reduction in the size of
some seasonal club programs versus 2012. Gross profit as a
percentage of net sales in the footwear segment was 40.0% for the
quarter and 40.4% for the nine months, reflecting improvement over
the comparable periods by 60 and 40 bps, respectively. The segment
generated operating profit of $2.5
million for the quarter, up 5.2% from $2.4 million one year ago; and $23.1 million for the nine months, down 14.2%
from $27.0 million in the equivalent
period of fiscal 2012.
In the Company's Accessories segment, quarterly net sales were
$9.4 million, up 17.3% from one year
ago; and nine-month net sales of $27.4
million were up 15.2% versus the comparable period last
year. Segment gross profit as a percentage of net sales for the
quarter expanded by 60 bps to 56.3% versus one year ago; and
nine-month gross profit as a percentage of net sales was 55.7%,
down 150 bps from the comparable period of fiscal 2012. The
Accessories segment generated operating profit of $2.1 million for the quarter, up 44.4%; and
$5.4 million for the nine months, an
increase of 13.3% over the previous year.
The Company's balance sheet reflected:
- Cash and short-term investments increased by 11.4% to
$44.8 million from $40.2 million one year ago;
- Consolidated inventory at $17.3
million was relatively flat versus the equivalent period
last year; and
- Net shareholders' equity of $85.5
million was up from $75.8
million reported at the end of the third quarter in fiscal
2012.
Management Comments
"The strong performance of our
Accessories segment and its contribution to our operating results
combined with benefits realized by eliminating under-performing
components of our Footwear business add to the viability of our
evolving business model and position us for significant growth in
the next three-to-five years," said Greg
Tunney, President and Chief Executive Officer. "We will
continue to focus on meeting challenges in the marketplace through
excellent performance, superior products and our growing portfolio
of great accessories brands."
"Both of our business coalitions performed at or above planned
levels and our quarterly earnings nearly doubled over last year's,
making this the best March-ending quarter in our Company's 66-year
history from a profit perspective," added Jose Ibarra, Senior Vice President Finance and
Chief Financial Officer. "We have clean and current inventories, a
healthy cash position and the strategies necessary to continue
expanding our footprint through organic and acquisition
growth."
Mr. Tunney continued, "While we will not match the record level
of last year's performance, this will be a very good year for our
business. We will end Fiscal 2013 on June
29 as one of our industry's top performers.
"We are focused on the strategies that will drive long-term,
profitable growth. We are investing in our platforms and our
people. We are expanding into new and underserved markets. And, we
are seeking out and acquiring successful accessories brands that
can help propel us to the next level. We are quite confident that
we can achieve our growth and profitability targets for the
businesses," he concluded.
Conference Call/Webcast Today
R.G. Barry Corporation
senior management will conduct a conference call for all interested
parties at 9:00 a.m. Eastern Standard
Time today. Management will discuss the Company's
performance, its plans for the future and will accept questions
from participants. The conference call is available at (800)
860-2442 in the U.S., (866) 605-3852 in Canada and +1 (412) 858-4600 internationally
until five minutes before starting time. To listen via the
Internet, log on at:
http://www.videonewswire.com/event.asp?id=93725.
Replays of the call will be available several hours after its
completion. The audio replay can be accessed through 9 a.m. Eastern Daylight Time, Tuesday, May 21, 2013 at 877.344.7529 (U.S.) and
+1.412.317.0088 (Canada/international); ask for conference
10028237. A written transcript and audio replay of the call will be
posted for at least 12 months at the Investor Room section of
rgbarry.com.
About RG Barry
RG Barry develops great accessories
brands that provide fashionable, solution-oriented products that
touch consumers. Our primary brands include: Dearfoams slippers
dearfoams.com; baggallini handbags, totes and travel accessories
baggallini.com; and Foot Petals premium insoles and comfort
products footpetals.com. To learn more, visit us at
rgbarry.com.
Forward-Looking Statements
Some of the disclosures in
this news release contain forward-looking statements that involve
substantial risks and uncertainties. You can identify these
statements by forward-looking words such as "may," "expect,"
"could," "should," "anticipate," "believe," "estimate," or words
with similar meanings. Any statements that refer to
projections of our future performance, anticipated trends in our
business and other characterizations of future events or
circumstances are forward-looking statements. These
statements, which are forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995,
are based upon our current plans and strategies and reflect our
current assessment of the risks and uncertainties related to our
business. These risks include, but are not limited to: our
continuing ability to source products from third parties located
within and outside North America;
competitive cost pressures; the loss of retailer customers to
competitors, consolidations, bankruptcies or liquidations; shifts
in consumer preferences; the impact of the global financial crisis
and general economic conditions on consumer spending; the impact of
the highly seasonal nature of our footwear business upon our
operations; inaccurate forecasting of consumer demand; difficulties
liquidating excess inventory; disruption of our supply chain or
distribution networks; our ability to secure and protect trademarks
and other intellectual property; our ability to implement new
enterprise resource information systems; a failure in or a breach
of our operational or security systems or infrastructure, or those
of our third-party suppliers and other service providers, including
as a result of cyber-attacks; the unexpected loss of any of the
skills and experience provided by our senior officers; our ability
to successfully integrate any new business acquisitions; and our
investment of excess cash in certificates of deposit and other
variable rate demand note securities. You should read this
news release carefully because the forward-looking statements
contained in it may (1) discuss our future expectations; (2)
contain projections of our future results of operations or of our
future financial condition; or (3) state other "forward-looking"
information. The risk factors described in this news release
and in our filings with the Securities and Exchange Commission (the
"SEC"), in particular "Item 1A. Risk Factors" of Part I of our
Annual Report on Form 10-K for the fiscal year ended June 30, 2012 (the "2012 Form 10-K"), give
examples of the types of uncertainties that may cause actual
performance to differ materially from the expectations we describe
in our forward-looking statements. If the events described in
"Item 1A. Risk Factors" of Part I of our 2012 Form 10-K occur, they
could have a material adverse effect on our business, operating
results and financial condition. You should also know that it
is impossible to predict or identify all risks and uncertainties
related to our business. Consequently, no one should consider any
such list to be a complete set of all potential risks and
uncertainties. Forward-looking statements speak only as of the date
on which they are made, and we undertake no obligation to update
any forward-looking statement to reflect circumstances or events
that occur after the date on which the statement is made to reflect
unanticipated events, except as required by applicable law.
Any further disclosures in our filings with the SEC should also be
considered.
R.G.
BARRY CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF INCOME
|
(in
thousands of dollars, except for per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thirteen
|
|
Thirteen
|
|
|
|
Thirty-nine
|
|
Thirty-nine
|
|
|
|
Weeks
Ended
|
|
Weeks
Ended
|
|
|
|
Weeks
Ended
|
|
Weeks
Ended
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
%
Increase
|
|
(unaudited)
|
|
(unaudited)
|
|
%
Increase
|
|
March 30,
2013
|
|
March 31,
2012
|
|
Decrease
|
|
March 30,
2013
|
|
March 31,
2012
|
|
Decrease
|
Net
sales
|
$
25,803
|
|
$
25,114
|
|
2.7%
|
|
$
121,540
|
|
$
130,943
|
|
-7.2%
|
Cost of
sales
|
13,951
|
|
13,921
|
|
0.2%
|
|
68,217
|
|
74,501
|
|
-8.4%
|
Gross profit
|
11,852
|
|
11,193
|
|
5.9%
|
|
53,323
|
|
56,442
|
|
-5.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (as percent of
net sales)
|
45.9%
|
|
44.6%
|
|
|
|
43.9%
|
|
43.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses
|
9,573
|
|
9,855
|
|
-2.9%
|
|
32,493
|
|
33,150
|
|
-2.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
|
2,279
|
|
1,338
|
|
70.3%
|
|
20,830
|
|
23,292
|
|
-10.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income
|
357
|
|
221
|
|
|
|
821
|
|
396
|
|
|
Interest
expense, net
|
(131)
|
|
(161)
|
|
-18.6%
|
|
(483)
|
|
(604)
|
|
-20.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings, before income
taxes
|
2,505
|
|
1,398
|
|
79.2%
|
|
21,168
|
|
23,084
|
|
-8.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
964
|
|
564
|
|
70.9%
|
|
8,193
|
|
9,009
|
|
-9.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
1,541
|
|
$
834
|
|
84.8%
|
|
$
12,975
|
|
$
14,075
|
|
-7.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
per common share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
0.14
|
|
$
0.07
|
|
100.0%
|
|
$
1.14
|
|
$
1.26
|
|
-9.5%
|
Diluted
|
$
0.13
|
|
$
0.07
|
|
85.7%
|
|
$
1.13
|
|
$
1.24
|
|
-8.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
11,377
|
|
11,245
|
|
|
|
11,344
|
|
11,187
|
|
|
Diluted
|
11,532
|
|
11,444
|
|
|
|
11,510
|
|
11,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
(in
thousands of dollars)
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
March 30,
2013
|
|
March 31,
2012
|
|
|
|
June 30,
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Cash
& short-term investments
|
$
44,753
|
|
$
40,178
|
|
|
|
$
41,711
|
|
|
|
|
Accounts
receivable, net
|
15,686
|
|
14,903
|
|
|
|
13,176
|
|
|
|
|
Inventory
|
17,291
|
|
16,998
|
|
|
|
21,149
|
|
|
|
|
Prepaid
expenses and other current assets
|
2,859
|
|
2,885
|
|
|
|
2,864
|
|
|
|
|
Total current assets
|
80,589
|
|
74,964
|
|
|
|
78,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
property, plant and equipment
|
4,091
|
|
4,364
|
|
|
|
4,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
assets
|
44,055
|
|
45,549
|
|
|
|
45,180
|
|
|
|
|
Total assets
|
$
128,735
|
|
$
124,877
|
|
|
|
$
128,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES & SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
notes payable
|
4,286
|
|
6,035
|
|
|
|
6,036
|
|
|
|
|
Accounts
payable
|
3,950
|
|
2,924
|
|
|
|
10,962
|
|
|
|
|
Other
current liabilities
|
7,099
|
|
7,947
|
|
|
|
5,701
|
|
|
|
|
Total current
liabilities
|
15,335
|
|
16,906
|
|
|
|
22,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
17,143
|
|
21,430
|
|
|
|
20,357
|
|
|
|
|
Accrued
retirement costs and other
|
10,807
|
|
10,696
|
|
|
|
10,803
|
|
|
|
|
Shareholders' equity, net
|
85,450
|
|
75,845
|
|
|
|
74,407
|
|
|
|
|
Total liabilities & shareholders'
equity
|
$
128,735
|
|
$
124,877
|
|
|
|
$
128,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE R.G. Barry Corporation