(Source: Business Wire)
Acme United Corporation (NYSE AMEX:ACU) today announced that net sales for the second quarter ended June 30, 2009 were $19.2 million, compared to $22.7 million in the comparable period of 2008, a decrease of 16% (13% in local currency). Net income was $1,341,000, or $.40 per diluted share, for the quarter ended June 30, 2009, compared to $1,730,000 or $.47 per diluted share for the comparable period last year, a decrease of 22% in net income and 15% in diluted earnings per share.
Net sales for the six months ended June 30, 2009 were $30.5 million, compared to $37.0 million in the same period in 2008, a decrease of 18% (14% in local currency). Net income for the six months ended June 30, 2009 was $1,383,000, or $.41 per diluted share, compared to $2,482,000, or $.68 per diluted share in the comparable period last year, a 44% decrease in net income and 40% in diluted earnings per share. The lower net income is primarily the result of lower sales, partially offset by savings resulting from our cost savings plan.
Net sales for the quarter ended June 30, 2009 in the U.S. segment decreased 17% compared to the same period in 2008. Net sales for the six months ended June 30, 2009 in the U.S. segment decreased 19% compared to the same period in 2008. Net sales in Canada for the three and six months ended June 30, 2009 decreased by 12% and 17%, respectively, in U.S. dollars but declined approximately 1% for both periods respectively, in local currency compared to the same periods in 2008. European net sales for the three and six months ended June 30, 2009 decreased 3% and 5%, respectively, in U.S. dollars compared to the same periods in 2008 but increased 11% and 9% respectively, in local currency. Sales in Europe increased (in local currency) primarily due to increased distribution of manicure products.
Gross margins were 37.1% in the second quarter of 2009 versus 39.3% in the comparable period last year. For the first six months of 2009, gross margins were 37.4% compared to 40.3% in the same period in 2008. The gross margin decline for the three and six month periods was primarily due to fixed costs spread over lower sales, the weaker Canadian dollar which raised the cost of products in our Canadian segment and product mix.
Walter C. Johnsen, Chairman and CEO said, "Our sales have been impacted by weak demand due to the economic downturn. We have reduced costs in many areas, but continue to fund new product development. The earnings in the second quarter reflect aggressive attention to costs. Our debt has declined due to working capital reductions and earnings. We believe we are well positioned to take advantage of market opportunities during the coming quarters."
The Company's bank debt less cash on June 30, 2009 was $8.9 million compared to $11.3 million on June 30, 2008. During the 12 month period ended June 30, 2009, Acme purchased 208,065 shares of its common stock for approximately $1.9 million and paid $700,000 in dividends. As of June 30, 2009, there were 124,335 shares that may be purchased under the outstanding stock repurchase programs.
ACME UNITED CORPORATION is a leading worldwide supplier of innovative cutting, measuring and safety products to the school, home, office and industrial markets.
Forward-looking statements in this report, including without limitation, statements related to the Company's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, the following: (i) the Company's plans, strategies, objectives, expectations and intentions are subject to change at any time at the discretion of the Company; (ii) the impact of current uncertainties in global economic conditions and the ongoing financial crisis affecting the domestic and foreign banking system and financial markets, including the impact on the Company's suppliers and customers (iii) currency fluctuations (iv) the Company's plans and results of operations will be affected by the Company's ability to manage its growth, and (v) other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission.
ACME UNITED CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME SECOND QUARTER REPORT 2009 (Unaudited) Quarter Ended Quarter Ended Amounts in $000's except per share data June 30, 2009 June 30, 2008 Net sales $ 19,161 $ 22,708 Cost of goods sold 12,056 13,790 Gross profit 7,105 8,918 Selling, general, and administrative expenses 5,086 6,121 Income from operations 2,019 2,797 Interest expense (44) (121) Interest income 31 31 Net interest expense (13) (90) Other income (expense) 30 (24) Total other income (expense) 17 (114) Pre-tax income 2,036 2,683 Income tax expense 695 953 Net income $ 1,341 $ 1,730 Shares outstanding - Basic 3,325 3,518 Shares outstanding - Diluted 3,388 3,665 Earnings per share basic $ 0.40 $ 0.49 Earnings per share diluted 0.40 0.47 -------------------------------------------------------------------------------
ACME UNITED CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME SECOND QUARTER REPORT 2009 (cont.) (Unaudited) Six Months Ended Six Months Ended Amounts in $000's except per share data June 30, 2009 June 30, 2008 Net sales $ 30,458 $ 36,977 Cost of goods sold 19,056 22,073 Gross profit 11,402 14,904 Selling, general, and administrative expenses 9,302 11,039 Income from operations 2,100 3,865 Interest expense (86) (255) Interest income 66 69 Net interest expense (20) (186) Other income 19 162 Total other (expense) (1) (24) Pre-tax income 2,099 3,841 Income tax expense 716 1,358 Net income $ 1,383 $ 2,483 Shares outstanding - Basic 3,336 3,519 Shares outstanding - Diluted 3,396 3,666 Earnings per share basic $ 0.41 $ 0.71 Earnings per share diluted 0.41 0.68 -------------------------------------------------------------------------------
ACME UNITED CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS SECOND QUARTER REPORT 2009 (Unaudited) Amounts in $000's June 30, 2009 June 30, 2008 Assets: Current assets: Cash $ 3,228 $ 3,703 Accounts receivable, net 18,467 20,852 Inventories 19,299 21,458 Prepaid and other current assets 961 1,121 Total current assets 41,955 47,134 Property and equipment, net 2,249 2,479 Long term receivable 1,919 - Other assets 2,509 1,927 Total assets $ 48,632 $ 51,540 Liabilities and stockholders' equity: Current liabilities Accounts payable $ 4,276 $ 6,623 Other current liabilities 6,131 4,631 Bank debt due June 30, 2010 12,122 - Total current liabilities 22,529 11,253 Bank debt due June 30, 2010 - 14,992 Other non current liabilities 1,995 551 24,524 26,796 Total stockholders' equity 24,108 24,744 Total liabilities and stockholders' equity $ 48,632 $ 51,540 -------------------------------------------------------------------------------
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