PICKERINGTON, Ohio,
Sept. 5, 2013 /PRNewswire/ -- Accessories marketer
R.G. Barry Corporation (NASDAQ-GM: DFZ) today reported a
solid performance for its fiscal year ended June 29, 2013.
Annual Results
For the full 2013 fiscal year, the
Company reported on a consolidated basis:
- Net earnings of $13.3 million, or
$1.15 per diluted share, compared to
$14.5 million, or $1.27 per diluted share, reported one-year
ago;
- Year-over-year net sales of $147.0
million versus $156.0 million
in fiscal 2012;
- Gross profit as a percent of net sales of 43.5%, up 40 basis
points from 43.1% in the comparable period one-year ago, primarily
reflecting the net benefit of the discontinuation of lower-margin
and licensed footwear products on mix; and
- SG&A expenses of $43.0
million, or 29% of net sales, compared to $43.8 million, or 28% of net sales, reported for
fiscal 2012.
The Company said that its results reflect a $15 million decline in net sales in its Footwear
segment. Most of the decline was anticipated and resulted
predominantly from the elimination of lower-margin and licensed
business. The decline was partially offset by an increase of more
than $6.0 million year-over-year in
higher-margin net sales in the Company's Accessories segment.
Fourth Quarter Results
For the fourth quarter, the
Company reported on a consolidated basis:
- Net earnings of $281,000, or
$0.02 cents per diluted share, versus
$474,000, or $0.04 cents per diluted share, in the fourth
quarter of fiscal 2012;
- Net sales of $25.5 million, up
from $25.0 million in the comparable
period one-year ago;
- Gross profit as a percent of net sales contracted 120 basis
points to 41.7% from 42.9% in the comparable period last year,
reflecting a shift in sales mix for the quarter; and
- Selling, general and administrative expenses of $10.5 million, or about 41% of quarterly net
sales, compared to $10.6 million, or
42.6% of quarterly net sales, one-year ago.
Financial Strength
The Company remained in a healthy
financial position at year-end.
- Cash and short-term investments were $39.5 million;
- Consolidated inventory was at $24.2
million, up from $21.1 million
at the end of fiscal 2012; and
- Net shareholders' equity rose 17% to $87.1 million from $74.4
million one year ago.
Management Comments
"We are once again among the
best-of-class in our category and we remain solidly positioned to
continue transforming RG Barry Brands into a multi-dimensional
provider of accessories products," said Greg Tunney, President and Chief Executive
Officer. "We plan to meet future marketplace challenges with
superior products, excellent performance and continuing investment
in strengthening and expanding our portfolio of great accessories
brands."
"Our actions last year in eliminating less-productive businesses
reflected our realignment of the Footwear segment for future growth
and enhanced profitability," added Jose
Ibarra, Senior Vice President Finance and Chief Financial
Officer. "Despite facing the formidable combination of retail and
economic headwinds and our strategic decision to eliminate
lower-margin and licensed footwear products in fiscal 2013, we
generated an operating profit in excess of 14% as a percentage of
net sales, making us one of the best performers in our sector."
Mr. Tunney continued, "Looking to fiscal 2014, we expect to
resume our pattern of increasing year-over-year revenue. In the
non-promotional, full-price Accessories businesses we will target a
growth rate in the mid-teens. The objective of our Footwear segment
will be to hit a year-over-year growth target in low single digits,
although at a higher level of profitability than in fiscal 2013. We
also plan to increase investment spending in support of our current
businesses to a level that is more in line with our long-term
growth strategies and profitability profile.
"Our commitment to significant growth through acquisitions
remains strong. We have continued to fine-tune our approach and
have broadened the scope of our search to include prospects in
select international markets and additional business categories
that we believe will fit well with our model and filter. We also
have created a full-time internal position to support our M&A
efforts. We remain very confident that our next growth milestone of
becoming a $200-to-$250 million
company in 3-to-5 years can and will be achieved," he
concluded.
Conference Call/Webcast Today
RG Barry senior
management will conduct a conference call for all interested
parties at 9:00 a.m. Eastern Daylight
Time today. Management will discuss the Company's
performance, its plans for the future and will accept questions
from teleconference participants.
To listen via the Internet, log on
to http://www.videonewswire.com/event.asp?id=95711.
The call will also be available at 800.860.2442 (U.S.) and
+1.412.858.4600 (international) until five minutes before starting
time.
Replays will be available beginning approximately one hour after
the call conclusion and running and through 9 a.m. Eastern Daylight Time, Sept. 20, 2013 at 877.344.7529 (U.S.) and
+1.412.317.0088 (Canada/international); ask for conference
10033161. Replays and a written transcript of the call will be
posted for up to one year in the Investor Room section of
rgbarry.com.
About RG Barry
RG Barry develops accessories brands
that provide fashionable, solution-oriented products for a great
life. 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 general economic conditions
on consumer spending; the impact of the seasonal nature of our
footwear business upon our overall 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 of any of our senior officers; our ability to continue
to identify suitable acquisition candidates to expand our business
and to successfully integrate these acquisitions into our business;
and our investment of excess cash in variable rate demand note
securities and other short-term investments. You should read
this news release carefully, because the forward-looking statements
contained in it (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
most-recent 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 this "Safe Harbor" Statement or in "Item 1A.
Risk Factors" of Part I of our most-recent 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. Any further disclosures in our
filings with the SEC should also be considered.
—financial charts follow—
R.G. BARRY
CORPORATION AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(in thousands of
dollars, except for per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thirteen weeks
ended
|
|
Thirteen weeks
ended
|
|
|
|
Fifty-two weeks
ended
|
|
Fifty-two weeks
ended
|
|
|
|
June 29,
2013
|
|
June 30,
2012
|
|
% Increase
|
|
June 29,
2013
|
|
June 30,
2012
|
|
% Increase
|
|
(unaudited)
|
|
(unaudited)
|
|
(Decrease)
|
|
(unaudited)
|
|
(audited)
|
|
(Decrease)
|
Net sales
|
$
25,472
|
|
$
24,995
|
|
1.9%
|
|
$
147,013
|
|
$
155,938
|
|
-5.7%
|
Cost of
sales
|
14,851
|
|
14,270
|
|
4.1%
|
|
83,069
|
|
88,770
|
|
-6.4%
|
Gross
profit
|
10,621
|
|
10,725
|
|
-1.0%
|
|
63,944
|
|
67,168
|
|
-4.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (as percent of
net sales)
|
41.7%
|
|
42.9%
|
|
|
|
43.5%
|
|
43.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
10,472
|
|
10,644
|
|
-1.6%
|
|
42,964
|
|
43,795
|
|
-1.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
|
149
|
|
81
|
|
84.0%
|
|
20,980
|
|
23,373
|
|
-10.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income
|
320
|
|
255
|
|
|
|
1,141
|
|
651
|
|
|
Interest
expense, net
|
(127)
|
|
(160)
|
|
-20.6%
|
|
(610)
|
|
(764)
|
|
-20.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings, before income
taxes
|
342
|
|
176
|
|
94.3%
|
|
21,511
|
|
23,260
|
|
-7.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
61
|
|
(298)
|
|
-120.5%
|
|
8,254
|
|
8,711
|
|
-5.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
281
|
|
$
474
|
|
-40.7%
|
|
$
13,257
|
|
$
14,549
|
|
-8.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
0.02
|
|
$
0.04
|
|
-50.0%
|
|
$
1.17
|
|
$
1.30
|
|
-10.0%
|
Diluted
|
$
0.02
|
|
$
0.04
|
|
-50.0%
|
|
$
1.15
|
|
$
1.27
|
|
-9.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
11,377
|
|
11,268
|
|
|
|
11,352
|
|
11,207
|
|
|
Diluted
|
11,522
|
|
11,471
|
|
|
|
11,530
|
|
11,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
(in thousands of
dollars)
|
|
|
|
|
|
|
|
|
|
June 29,
2013
|
|
June 30,
2012
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(audited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Cash &
short-term investments
|
$
39,500
|
|
$
41,711
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
16,755
|
|
13,176
|
|
|
|
|
|
|
|
|
Inventory
|
24,239
|
|
21,149
|
|
|
|
|
|
|
|
|
Prepaid expenses and
other current assets
|
3,670
|
|
2,864
|
|
|
|
|
|
|
|
|
Total
current assets
|
84,164
|
|
78,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net property, plant
and equipment
|
4,178
|
|
4,186
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
assets
|
41,911
|
|
45,180
|
|
|
|
|
|
|
|
|
Total
assets
|
$
130,253
|
|
$
128,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES &
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Short-term notes
payable
|
4,286
|
|
6,036
|
|
|
|
|
|
|
|
|
Accounts
payable
|
10,655
|
|
10,962
|
|
|
|
|
|
|
|
|
Other current
liabilities
|
4,899
|
|
5,701
|
|
|
|
|
|
|
|
|
Total current liabilities
|
19,840
|
|
22,699
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
16,071
|
|
20,357
|
|
|
|
|
|
|
|
|
Accrued retirement
costs and other
|
7,165
|
|
10,803
|
|
|
|
|
|
|
|
|
Shareholders' equity,
net
|
87,177
|
|
74,407
|
|
|
|
|
|
|
|
|
Total
liabilities & shareholders' equity
|
$
130,253
|
|
$
128,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE R.G. Barry Corporation