FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 For the transition period from: to Commission file number: 01-07698 ACME UNITED CORPORATION (Exact Name of Registrant as Specified in Its Charter) Connecticut 06-0236700 State or Other Jurisdiction ...

SHELTON, Conn., July 30, 2025 (GLOBE NEWSWIRE) -- Acme United Corporation (NYSE American: ACU), a global leader in cutting tools, and school, home and office products, proudly announces the launch of National Scissors Day™, taking place for the first time on August 1, 2025. Debuting by Westcott®, the #1 scissor brand in the USA, this national day celebrates the essential tool that cuts across classrooms, homes, offices and creative spaces everywhere. As the market leader in scissors, with over a century of ...

Financial Data and Key Metrics Changes - Acme United Corporation reported net sales of $54 million for the second quarter of 2025, a decrease of 3% compared to $55.4 million in the same quarter of 2024 [3][9] - Net income increased to $4.8 million, up 7% from $4.5 million in the prior year, resulting in earnings per share of $1.16 compared to $1.09 [3][12] - For the first six months of 2025, net income was $6.4 million, a 57% increase from $6.1 million in the same period of 2024 [12] Business Line Data and Key Metrics Changes - The U.S. segment experienced a 6% decrease in sales during the second quarter due to canceled back-to-school orders linked to high tariffs [9] - Sales in Canada increased by 28% in the quarter, driven by higher sales of first aid products [11] - The gross margin remained stable at 41% for the second quarter of 2025, consistent with the previous year [11] Market Data and Key Metrics Changes - Sales in Europe decreased by 6% in local currency for both the quarter and the first six months, primarily due to shipment timing [10] - The company faced challenges in the U.S. market due to exceptionally high tariffs, which led to order cancellations [9][10] Company Strategy and Development Direction - Acme United is shifting production from China to other countries such as Malaysia, Thailand, Vietnam, and Egypt to mitigate tariff impacts [6] - The company plans to continue supplying customers with competitive total costs while maintaining service quality [6] - Acme United is investing in automation and expanding capacity in its facilities, particularly in the MedNap and Spill Magic segments [7][34] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging market environment due to tariffs and supply chain disruptions but expressed optimism for growth in the third and fourth quarters [8][20] - The company is working with customers to recover delayed programs and anticipates that demand will not significantly decline [20] - Management noted that while there are concerns about overall customer spending due to price increases, they have adequate stock at good values [20] Other Important Information - Acme United's bank debt decreased to $23 million from $33 million year-over-year, and the company generated approximately $12 million in free cash flow [12] - A new facility for Spill Magic was purchased for $6 million, which will enhance production capabilities [7] Q&A Session Summary Question: What can be expected for the third and fourth quarters? - Management indicated that some delayed orders from the second quarter may come in the third and fourth quarters, and they are looking for growth rather than declines in sales [20] Question: Are competitors faring better or worse? - Management noted that one competitor had a disastrous quarter, while Acme United managed the tariff situation effectively [22] Question: Will the company consider cutting the dividend? - Management confirmed that they just raised the dividend and are comfortable maintaining it, supported by strong cash flow and reduced debt [22] Question: Are there capacity constraints in healthcare lines? - Management stated that the MedNap facility is experiencing increased demand and is working on productivity improvements and capacity expansion [32][33]

Financial Data and Key Metrics Changes - Acme United Corporation reported net sales of $54 million for the second quarter of 2025, a decrease of 3% compared to $55.4 million in the same quarter of 2024 [3][10] - Net income increased to $4.8 million, up 7% from $4.5 million in the prior year, with earnings per share rising to $1.16 from $1.09 [3][13] - For the first six months of 2025, net income was $6.4 million, a 57% increase compared to $6.1 million in the same period of 2024 [13] Business Line Data and Key Metrics Changes - The U.S. segment saw a 6% decrease in sales for the second quarter due to canceled back-to-school orders linked to high tariffs [10] - Sales in Europe decreased by 6% in local currency for both the quarter and the first six months, primarily due to shipment timing [11] - Canadian sales increased by 28% in the quarter and 21% year-to-date, driven by higher first aid product sales [12] Market Data and Key Metrics Changes - The gross margin remained stable at 41% for the second quarter of 2025, compared to 40% for the first six months of 2024 [12] - SG&A expenses for the second quarter were $15.8 million, or 29% of sales, down from $16.3 million in the same period of 2024 [12] Company Strategy and Development Direction - The company is shifting production from China to other countries such as Malaysia, Thailand, Vietnam, and Egypt to mitigate tariff impacts [6] - Acme United plans to continue supplying customers with competitive total costs while maintaining service quality [6] - The company is investing in automation and productivity improvements in its MedNap facility to support growth in the healthcare sector [33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging market environment due to high tariffs and supply chain disruptions but expressed optimism for growth in the third and fourth quarters [9][20] - The company has adequate stock and is working with customers to recover delayed programs, expecting no declines in sales [20] - Management noted that while some competitors faced difficulties, Acme United managed to navigate the tariff challenges effectively [22] Other Important Information - The company generated approximately $12 million in free cash flow over the past twelve months and reduced bank debt from $33 million to $23 million [13][22] - A new facility for Spill Magic was purchased for $6 million, which will enhance production capabilities starting in the first quarter of 2026 [8] Q&A Session Summary Question: What can be expected for the third and fourth quarters? - Management indicated that some delayed orders from the second quarter may come through in the latter half of the year, and they anticipate growth rather than declines in sales [20] Question: Are competitors faring better or worse? - Management noted that one competitor had a disastrous quarter, while Acme United managed the tariff situation effectively [22] Question: Will a potential interest rate cut by the Federal Reserve lower interest expenses? - Management confirmed that a drop in interest rates would benefit the company, particularly on floating rate debt [30] Question: Is there any capacity constraint in healthcare similar to Spill Magic? - Management acknowledged that the MedNap facility is under stress but is actively working on productivity improvements and expansion plans [33] Question: Which segment was most affected by the tariff increase? - The Westcott cutting tool segment was more significantly impacted due to canceled back-to-school orders, while the first aid segment managed to maintain more stable pricing [41]

[Q2 2025 Earnings Announcement](index=1&type=section&id=ACME%20UNITED%20REPORTS%20RECORD%20NET%20INCOME%20FOR%20SECOND%20QUARTER%20OF%202025) Acme United reported record Q2 2025 net income and diluted EPS growth despite a slight sales decrease, driven by strategic inventory and supply chain management [Financial Highlights](index=1&type=section&id=Financial%20Highlights) For the second quarter of 2025, Acme United reported a 3% decrease in net sales to $54.0 million, but achieved a record net income of $4.8 million, a 7% increase year-over-year, with diluted EPS growing by 6% to $1.16, while for the first six months, net sales were nearly flat at $100.0 million, net income increased by 5% to $6.4 million, and diluted EPS was up 7% to $1.57 Q2 2025 vs Q2 2024 Financial Performance | Metric | Q2 2025 ($ millions) | Q2 2024 ($ millions) | Change | | :--- | :--- | :--- | :--- | | Net Sales | $54.0 | $55.4 | -3% | | Net Income | $4.8 | $4.5 | +7% | | Diluted EPS | $1.16 | $1.09 | +6% | H1 2025 vs H1 2024 Financial Performance | Metric | H1 2025 ($ millions) | H1 2024 ($ millions) | Change | | :--- | :--- | :--- | :--- | | Net Sales | $100.0 | $100.4 | -0.4% | | Net Income | $6.4 | $6.1 | +5% | | Diluted EPS | $1.57 | $1.47 | +7% | [Management Commentary](index=1&type=section&id=Management%20Commentary) The CEO, Walter C. Johnsen, stated that Q2 2025 was the most profitable quarter in the company's history, achieved despite tariff-related uncertainties managed by holding extra inventory, and the company is actively diversifying its supply chain beyond China to locations like India, Malaysia, and Vietnam to ensure optimal cost and service for its customers - Achieved a **record profitable quarter** by proactively managing inventory to support customers amid tariff uncertainty, which caused order delays and cancellations[4](index=4&type=chunk) - The company is actively diversifying its supply base, leveraging its sourcing presence in China, India, Malaysia, Thailand, Vietnam, and Egypt to mitigate risks and enhance competitiveness[5](index=5&type=chunk) - The company has made **10 acquisitions** of manufacturers in the U.S. and Canada as part of its supply base diversification strategy[4](index=4&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Performance) Analysis of net sales changes across U.S., European, and Canadian segments, highlighting regional drivers and challenges [U.S. Segment](index=2&type=section&id=U.S.%20Segment) Net sales in the U.S. segment decreased by 5% in Q2 2025 and 2% in the first half of the year, with the decline attributed to the cancellation of some back-to-school orders due to high tariffs and the non-recurrence of a large initial order for new kitchen sharpeners that occurred in Q2 2024 U.S. Segment Net Sales Change (YoY) | Period | Change vs. Prior Year | | :--- | :--- | | Q2 2025 | -5% | | H1 2025 | -2% | - The sales decrease was caused by cancelled back-to-school orders due to high tariffs and a large, non-recurring order to a major retailer in Q2 2024[6](index=6&type=chunk) [European Segment](index=2&type=section&id=European%20Segment) European net sales for Q2 2025 declined 3% in U.S. dollars and 6% in local currency, primarily because some customer shipments were delayed into the third quarter, and for the first six months, sales decreased 5% in U.S. dollars and 6% in local currency European Segment Net Sales Change (YoY) | Period | Change in U.S. Dollars | Change in Local Currency | | :--- | :--- | :--- | | Q2 2025 | -3% | -6% | | H1 2025 | -5% | -6% | - The sales decline was mainly due to the delay of certain customer shipments into the third quarter[7](index=7&type=chunk) [Canadian Segment](index=2&type=section&id=Canadian%20Segment) The Canadian segment demonstrated significant growth, with Q2 2025 net sales increasing 28% year-over-year in both U.S. dollars and local currency, and for the first half of 2025, sales grew 18% in U.S. dollars and 21% in local currency, driven by strong performance in first-aid products Canadian Segment Net Sales Change (YoY) | Period | Change in U.S. Dollars | Change in Local Currency | | :--- | :--- | :--- | | Q2 2025 | +28% | +28% | | H1 2025 | +18% | +21% | - The increase in sales for both periods was attributed to strong sales of first-aid products[8](index=8&type=chunk) [Financial Health and Operations](index=2&type=section&id=Financial%20Health%20and%20Operations) The company improved gross margin and significantly reduced net bank debt, demonstrating strong free cash flow generation [Gross Margin and Balance Sheet](index=2&type=section&id=Gross%20Margin%20and%20Balance%20Sheet) Gross margin slightly improved to 41.0% in Q2 2025 from 40.8% in Q2 2024, and the company strengthened its balance sheet, reducing net bank debt to $22.8 million from $33.1 million a year prior, while generating approximately $12.0 million in free cash flow and paying $2.2 million in dividends over the last twelve months Gross Margin Comparison | Period | 2025 | 2024 | | :--- | :--- | :--- | | Q2 (Three Months) | 41.0% | 40.8% | | H1 (Six Months) | 40.1% | 39.9% | - Bank debt less cash was reduced to **$22.8 million** as of June 30, 2025, compared to **$33.1 million** on June 30, 2024[9](index=9&type=chunk) - Over the twelve months ending June 30, 2025, the company generated approximately **$12.0 million** in free cash flow and distributed **$2.2 million** in dividends[10](index=10&type=chunk) [Corporate Information and Disclosures](index=3&type=section&id=Corporate%20Information%20and%20Disclosures) Details on the upcoming earnings call, an overview of Acme United's business, and a cautionary note on forward-looking statements and associated risks [Conference Call and Webcast Information](index=3&type=section&id=Conference%20Call%20and%20Webcast%20Information) Acme United will host a conference call and webcast on Wednesday, July 23, 2025, at 12:00 p.m. ET to discuss its quarterly results, with the report providing dial-in details and a link to the webcast on the company's investor relations website - A conference call to discuss quarterly results is scheduled for Wednesday, July 23, 2025, at **12:00 p.m. ET**[11](index=11&type=chunk) [About Acme United](index=3&type=section&id=About%20Acme%20United) Acme United Corporation is a leading global supplier of innovative safety solutions and cutting technology for school, home, office, and industrial markets, with a portfolio including well-known brands such as First Aid Only®, Westcott®, Clauss®, and DMT® - The company is a leading worldwide supplier of safety solutions and cutting technology with major brands including First Aid Only®, First Aid Central®, PhysiciansCare®, Westcott®, and Clauss®[12](index=12&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward%20Looking%20Statements) This section serves as a safe harbor warning, advising that statements in the report are subject to risks and uncertainties, including changes in global economic conditions, international trade policies and tariffs, inflation, supply chain disruptions, and competition, which could cause actual results to differ materially from expectations - The report contains forward-looking statements made under the 'safe harbor' provisions of the Private Securities Litigation Reform Act of 1995[13](index=13&type=chunk)[15](index=15&type=chunk) - Key risks include global economic uncertainties, trade policies (tariffs), inflation, supply chain disruptions, competition, and changes in consumer spending habits[16](index=16&type=chunk) [Condensed Consolidated Financial Statements](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) Presents the unaudited condensed consolidated income statements and balance sheets for comparative analysis of financial performance and position [Condensed Consolidated Statements of Income](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME) This section presents the unaudited condensed consolidated statements of income for the three and six-month periods ending June 30, 2025, and 2024, detailing revenues, cost of goods sold, operating expenses, and net income, providing a comparative view of the company's profitability Condensed Consolidated Statement of Income (Three Months Ended) | Amounts except per share data | June 30, 2025 ($000s) | June 30, 2024 ($000s) | | :--- | :--- | :--- | | Net sales | $ 53,996 | $ 55,425 | | Gross profit | 22,149 | 22,627 | | Operating income | 6,390 | 6,375 | | Net income | $ 4,752 | $ 4,452 | | Earnings per share - diluted | $ 1.16 | $ 1.09 | Condensed Consolidated Statement of Income (Six Months Ended) | Amounts except per share data | June 30, 2025 ($000s) | June 30, 2024 ($000s) | | :--- | :--- | :--- | | Net sales | $ 99,954 | $ 100,382 | | Gross profit | 40,066 | 40,024 | | Operating income | 8,816 | 8,934 | | Net income | $ 6,404 | $ 6,089 | | Earnings per share - diluted | $ 1.57 | $ 1.47 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) This section provides the unaudited condensed consolidated balance sheets as of June 30, 2025, compared to June 30, 2024, outlining the company's financial position by detailing assets (current and non-current), liabilities, and stockholders' equity Condensed Consolidated Balance Sheet Highlights | Account | June 30, 2025 ($000s) | June 30, 2024 ($000s) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $ 3,641 | $ 3,791 | | Inventories | 57,309 | 56,621 | | Total current assets | 101,341 | 106,148 | | Total assets | $ 171,147 | $ 173,541 | | **Liabilities & Equity** | | | | Total current liabilities | 23,494 | 27,993 | | Long-term debt | 16,352 | 26,419 | | Total liabilities | 57,425 | 69,584 | | Total stockholders' equity | 113,722 | 103,957 |

Core Insights - Acme United Corporation reported a net sales decrease of 3% for Q2 2025 compared to Q2 2024, totaling $54.0 million [1] - The company achieved a net income of $4.8 million for Q2 2025, reflecting a 7% increase from $4.5 million in Q2 2024 [2] - The CEO highlighted the company's successful navigation through tariff uncertainties and the completion of the most profitable quarter in its history [3] Financial Performance - Net sales for the six months ended June 30, 2025, were $100.0 million, a slight decrease from $100.4 million in the same period in 2024 [1] - Gross margin improved to 41.0% in Q2 2025 from 40.8% in Q2 2024, and for the six-month period, it was 40.1% compared to 39.9% in 2024 [6] - The company generated approximately $12.0 million in free cash flow and distributed about $2.2 million in dividends during the twelve months ended June 30, 2025 [7] Segment Performance - U.S. segment net sales decreased by 5% in Q2 2025, primarily due to cancellations of back-to-school orders linked to high tariffs [3] - European net sales for Q2 2025 decreased by 3% in U.S. dollars and 6% in local currency, attributed to shipment delays [4] - Canadian net sales increased significantly by 28% in Q2 2025, driven by strong sales of first-aid products [5] Strategic Initiatives - The company has diversified its supply base through acquisitions in the U.S. and Canada and is actively shifting production to optimize costs and service [3] - Acme United's sourcing team maintains a presence in multiple countries, including China, India, and Vietnam, to enhance supply chain resilience [3]

Core Points - Acme United Corporation will release its financial results for Q2 2025 on July 23, 2025, at 6:30 AM Eastern Time [1] - A conference call to discuss these results will take place on the same day at 12:00 PM Eastern Time, with dial-in options provided [1] - The company is a leading supplier of safety solutions and cutting technology across various markets, including school, home, office, and industrial sectors [3] Financial Information - The financial results announcement is scheduled for July 23, 2025, at 6:30 AM Eastern Time [1] - The conference call for discussing the results will be held at 12:00 PM Eastern Time on the same day [1] Company Overview - Acme United Corporation specializes in innovative safety solutions and cutting technology [3] - The company’s notable brands include First Aid Only®, Westcott®, and Spill Magic® among others [3] - More information about the company can be found on its website [3]

Core Viewpoint - Acme United Corporation has announced the acquisition of a manufacturing and distribution center in Mt. Pleasant, Tennessee for approximately $6 million, aimed at expanding its Spill Magic business and enhancing operational efficiency [1][2][3]. Group 1: Acquisition Details - The newly acquired property spans 77,000 square feet of manufacturing and warehouse space on 12 acres, with the potential for expansion by an additional 60,000 square feet [2]. - The facility is fully air-conditioned and meets FDA-approved food-grade specifications, indicating a commitment to quality and safety standards [2]. Group 2: Business Expansion - The facility will primarily serve Spill Magic, a company acquired by Acme United in 2017, which has outgrown its current leased space [2]. - Walter C. Johnsen, Chairman and CEO, expressed enthusiasm for the growth of Spill Magic and plans to invest in capital improvements focused on automation to enhance operational efficiency [3]. Group 3: Company Overview - Acme United Corporation is recognized as a leading supplier of innovative safety solutions and cutting technology across various markets, including school, home, office, and industrial sectors [4]. - The company’s prominent brands include First Aid Only®, Spill Magic®, and Westcott®, among others, showcasing a diverse product portfolio [4].

Group 1 - Acme United Corporation declared a cash dividend of 16 cents per share, payable on July 24, 2025, to stockholders of record on July 3, 2025 [1] - This marks the fifteenth dividend increase since 2004, indicating the company's optimistic outlook for the future and commitment to returning value to shareholders [2] - Acme United is a leading supplier of safety solutions and cutting technology across various markets, with notable brands including First Aid Only®, Westcott®, and Clauss® [2] Group 2 - The company emphasizes its innovative approach in providing safety solutions and cutting technology to diverse sectors such as education, home, and industrial markets [2] - The forward-looking statements made by the company are based on current beliefs and assumptions, highlighting the potential for future growth and development [3][4] - Investors are advised that forward-looking statements involve risks and uncertainties that could affect the company's business and financial results [5]

Group 1 - The article discusses the challenges of investing, emphasizing that patience is required as investments may take time to yield returns [1] - Crude Value Insights is highlighted as a company that provides an investment service focused on the oil and natural gas sector, emphasizing cash flow generation as a key factor for value and growth prospects [1] - The company offers subscribers access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live chat discussions about the sector [2] Group 2 - A promotional offer is mentioned, allowing potential subscribers to sign up for a two-week free trial to explore the oil and gas investment opportunities [3]