Crown Crafts(CRWS) - 2026 Q1 - Quarterly Results

Introduction Announcement Crown Crafts, Inc. announced its financial results for the first quarter of fiscal year 2026, which concluded on June 29, 2025 - Crown Crafts, Inc. reported financial results for the first quarter fiscal year 2026, ending June 29, 2025[1][2] First Quarter Fiscal 2026 Summary CEO Commentary CEO Olivia Elliott noted that Q1 results aligned with fiscal year 2025 themes, highlighting the $2.1 million sales contribution from the Baby Boom acquisition, but also the persistent negative impact of tariffs on consumers and suppliers, leading to a modest decline in sales and gross profit - Baby Boom acquisition added $2.1 million in net sales during Q1 FY26[4] - Tariffs and uncertainty negatively impacted consumers and suppliers, leading to a modest decline in sales and gross profit[4] - Company strategy focuses on navigating the tariff environment, mitigating impact, and increasing sales and market share[4] Key Financial Highlights The first quarter saw a decrease in net sales to $15.5 million, a decline in gross profit percentage to 22.7%, and an increased net loss of ($1.10 million) or ($0.10) per share, primarily due to increased tariffs First Quarter Fiscal 2026 Key Financial Highlights | Metric | Q1 FY26 (June 29, 2025) | Q1 FY25 (June 30, 2024) | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $15.5 million | $16.2 million | ($0.7 million) | -4.5% | | Gross Profit % | 22.7% | 24.5% | -1.8% | -7.3% | | Net Loss | ($1.10 million) | ($0.3 million) | ($0.8 million) | -266.7% | | Loss Per Share | ($0.10) | ($0.03) | ($0.07) | -233.3% | - Q1 results reflect the impact of increased tariffs[7] - Declared quarterly dividend of $0.08 per share of Series A common stock[7] Detailed Financial Results Net Sales Performance Net sales for Q1 FY26 decreased by 4.5% to $15.5 million from $16.2 million in the prior year, impacted by inventory shortages despite a $2.1 million contribution from the Baby Boom acquisition Net Sales Performance (Q1 FY26 vs Q1 FY25) | Metric | Q1 FY26 | Q1 FY25 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $15.5 million | $16.2 million | ($0.734 million) | -4.5% | - Baby Boom acquisition added $2.1 million in net sales[5] - Sales of bedding and diaper bags increased by $540,000, while sales of bibs, toys, and disposable products decreased by $1.3 million[5] - Sales across all categories were negatively affected by inventory shortages due to the company's strategy to minimize high tariff impacts[5] Gross Profit Analysis Gross profit decreased by $448,000, resulting in a gross profit percentage decline to 22.7% from 24.5%, primarily due to increased tariff costs on imported products Gross Profit Performance (Q1 FY26 vs Q1 FY25) | Metric | Q1 FY26 | Q1 FY25 | Change | | :--- | :--- | :--- | :--- | | Gross Profit | $3,518 thousand | $3,966 thousand | ($448 thousand) | | Gross Profit Percentage | 22.7% | 24.5% | -1.8% | - Decrease in gross profit primarily due to increased tariff costs associated with products imported from China[6] Marketing and Administrative Expenses Marketing and administrative expenses increased by $454,000 to 30.5% of net sales, driven by higher costs from the Baby Boom acquisition and increased advertising expenditures Marketing and Administrative Expenses (Q1 FY26 vs Q1 FY25) | Metric | Q1 FY26 | Q1 FY25 | Change | | :--- | :--- | :--- | :--- | | Marketing and Administrative Expenses | $4,717 thousand | $4,263 thousand | $454 thousand | | As % of Net Sales | 30.5% | 26.3% | +4.2% | - Increased costs associated with the acquisition of Baby Boom and increased advertising costs contributed to the rise in expenses[8] Corporate Actions Quarterly Cash Dividend The Board of Directors declared a quarterly cash dividend of $0.08 per share for Series A common stock, payable on October 3, 2025 - Quarterly cash dividend of $0.08 per share declared for Series A common stock[9] - Dividend payable on October 3, 2025, to stockholders of record on September 12, 2025[9] Conference Call Details Crown Crafts hosted a teleconference on August 13, 2025, to discuss Q1 results, with a replay available until November 13, 2025 - Teleconference held on August 13, 2025, at 8:00 a.m. CDT to discuss results[10] - Telephone replay available until November 13, 2025[10] Company Information About Crown Crafts, Inc. Crown Crafts, Inc., founded in 1957, is a leading designer, marketer, and distributor of infant, toddler, and juvenile consumer products through various brands and channels - Crown Crafts, Inc. designs, markets, and distributes infant, toddler, and juvenile consumer products, founded in 1957[11] - Operates through wholly owned subsidiaries NoJo Baby & Kids, Inc. and Sassy Baby, Inc., marketing products under company-owned trademarks (Sassy®, Manhattan Toy®, NoJo®, Baby Boom®, Neat Solutions®) and licensed/private label programs[11] - Sales channels include mass merchants, large chain stores, juvenile specialty stores, value channel stores, grocery and drug stores, restaurants, wholesale clubs, internet-based retailers, and direct-to-consumers via company websites[11] Forward-Looking Statements The report contains forward-looking statements based on management's expectations, subject to various known and unknown risks including economic conditions, tariffs, and competition - Forward-looking statements are based on management's current expectations and involve known and unknown risks and uncertainties[12] - Key risks include general economic conditions, impact of U.S. tariffs, changes in interest rates, consumer spending, raw material prices, competition, retail environment, ability to integrate acquisitions, customer concentration, dependence on third-party suppliers (including foreign), and third-party licenses[12] - The Company does not undertake to update forward-looking statements[12] Contact Information Contact details are provided for Crown Crafts' VP and CFO, Claire Spencer, and for Investor Relations via Three Part Advisors - Contact for Crown Crafts: Claire Spencer, VP and CFO (cspencer@crowncrafts.com)[13] - Investor Relations contact: Three Part Advisors (Steven Hooser, John McNamara - jmcnamara@threepa.com)[13] Financial Statements Consolidated Statements of Operations The consolidated statements of operations show a net loss of ($1.104 million) for Q1 FY26, significantly higher than the ($0.322 million) loss in Q1 FY25, driven by decreased net sales, lower gross profit percentage, and increased marketing and administrative expenses Consolidated Statements of Operations (Selected Data) | Metric (in thousands) | Three-Month Period Ended June 29, 2025 | Three-Month Period Ended June 30, 2024 | | :--- | :--- | :--- | | Net sales | $15,478 | $16,212 | | Gross profit | $3,518 | $3,966 | | Gross profit percentage | 22.7% | 24.5% | | Marketing and administrative expenses | $4,717 | $4,263 | | Loss from operations | ($1,199) | ($297) | | Loss before income tax benefit | ($1,383) | ($386) | | Income tax benefit | ($279) | ($64) | | Net loss | ($1,104) | ($322) | | Basic and diluted loss per share | ($0.10) | ($0.03) | | Weighted Average Shares Outstanding (Basic & Diluted) | 10,570 | 10,311 | Consolidated Balance Sheets As of June 29, 2025, total assets were $76.023 million, down from $81.154 million on March 30, 2025, with key changes in cash, accounts receivable, and inventories Consolidated Balance Sheets (Selected Data) | Metric (in thousands) | June 29, 2025 | March 30, 2025 | | :--- | :--- | :--- | | Cash and cash equivalents | $227 | $521 | | Accounts receivable, net | $17,204 | $24,508 | | Inventories | $31,572 | $27,800 | | Total current assets | $51,242 | $55,303 | | Total assets | $76,023 | $81,154 | | Total current liabilities | $17,797 | $15,505 | | Long-term debt | $11,890 | $16,512 | | Shareholders' equity | $37,869 | $39,619 | | Total liabilities and shareholders' equity | $76,023 | $81,154 |