Lifetime Brands(LCUT) - 2024 Q1 - Quarterly Report

Financial Performance - Consolidated net sales for Q1 2024 were $142.2 million, a decrease of$3.2 million, or 2.2%, compared to $145.4 million in Q1 2023[154]. - U.S. segment net sales for Q1 2024 were$130.5 million, down $3.0 million, or 2.2$133.5 million in Q1 2023[155]. - International segment net sales for Q1 2024 were $11.7 million, a decrease of$0.2 million, or 1.7%, compared to $11.9 million in Q1 2023[159]. - U.S. segment's Kitchenware product category net sales were$83.5 million in Q1 2024, a decrease of $2.2 million, or 2.6$85.7 million in Q1 2023[156]. - U.S. segment's Tableware product category net sales increased to $25.8 million in Q1 2024, up$1.8 million, or 7.5%, from $24.0 million in Q1 2023[157]. Profitability and Margins - Gross margin for Q1 2024 was$57.5 million, or 40.5%, an increase from $53.8 million, or 37.0$4.2 million, or 35.9%, in Q1 2024, down from $5.0 million, or 42.0$16.2 million, a decrease from $16.9 million in Q1 2023, with distribution expenses as a percentage of net sales at 11.4$39.5 million, an increase of $1.6 million or 4.2$30.8 million for Q1 2024, representing 23.6% of net sales, up from 21.9% in Q1 2023[166]. - International segment selling, general and administrative expenses were $4.2 million for Q1 2024, accounting for 35.9$4.6 million, down from $16.2 million at December 31, 2023[176]. - Total liquidity as of March 31, 2024 was$125.1 million, consisting of cash, availability under the ABL Agreement, and funding under the Receivables Purchase Agreement[176]. - Net cash provided by operating activities was $10.5 million for the three months ended March 31, 2024, compared to$12.1 million for the same period in 2023[206]. - Net cash used in financing activities was $21.4 million for the three months ended March 31, 2024, compared to net cash provided of$5.7 million for the same period in 2023[208]. Debt and Interest - Interest expense increased to $5.6 million in Q1 2024 from$5.3 million in Q1 2023 due to higher interest rates on outstanding borrowings[170]. - The interest rate on outstanding borrowings under the Term Loan at March 31, 2024, was 10.94%[191]. - The company has a maximum borrowing capacity of $200.0 million under the ABL Agreement, which may increase to$250.0 million if certain conditions are met[185]. Future Outlook - The Company expects elevated inflation and high interest rates to negatively impact consumer spending and buying patterns in 2024[145]. Other Financial Metrics - The Company’s adjusted EBITDA for the trailing twelve months ended March 31, 2024, was $59.5 million[194]. - Capital expenditures for the three months ended March 31, 2024, were$0.6 million[195]. - As of March 31, 2024, $23.8 million of accounts receivables were available for sale to HSBC, net of applicable charges[200]. - The Company did not sell receivables to HSBC during the three months ended March 31, 2024, and March 31, 2023[200]. - The aggregate gross notional value of foreign exchange contracts at March 31, 2024, was$7.0 million[204]. - The Company has an uncommitted Receivables Purchase Agreement with HSBC, allowing for the sale of eligible accounts receivable up to $30.0 million[199]. - The remaining dollar amount available for stock repurchases under the Board authorized plan was$11.1 million as of March 31, 2024[209]. Equity and Losses - Equity in losses from Vasconia was $2.1 million for Q1 2024, up from$0.7 million in Q1 2023, with Vasconia reporting a loss from operations of $6.9 million[173][174].