Lifetime Brands(US:LCUT)2025-11-06 21:15Financial Performance - Consolidated net sales for Q3 2025 were $171.9 million, a decrease of $11.9 million, or 6.5%, compared to $183.8 million in Q3 2024[165]. - U.S. segment net sales for Q3 2025 were $158.1 million, down $12.1 million, or 7.1%, from $170.2 million in Q3 2024[166]. - Consolidated net sales for the nine months ended September 30, 2025 were $443.9 million, a decrease of $23.8 million, or 5.1%, compared to $467.7 million for the same period in 2024[187]. - U.S. segment net sales for the nine months ended September 30, 2025 were $406.0 million, a decrease of $25.2 million, or 5.8%, compared to $431.2 million for the same period in 2024[188]. - International segment net sales for the nine months ended September 30, 2025 were $37.9 million, an increase of $1.4 million, or 3.8%, compared to $36.5 million for the same period in 2024[192]. Gross Margin - Gross margin for Q3 2025 was $60.4 million, or 35.1%, compared to $67.4 million, or 36.7%, in Q3 2024[171]. - Gross margin for the nine months ended September 30, 2025 was $161.9 million, or 36.5%, down from $179.5 million, or 38.4%, for the same period in 2024[193]. - U.S. segment gross margin for the nine months ended September 30, 2025 was $148.9 million, or 36.7%, down from $166.5 million, or 38.6%, for the same period in 2024[194]. - International segment gross margin for the nine months ended September 30, 2025 was $13.0 million, or 34.3%, unchanged from $13.0 million, or 35.6%, for the same period in 2024[195]. Expenses - Distribution expenses for the nine months ended September 30, 2025 were $53.3 million, an increase of $2.0 million, or 3.9%, compared to $51.3 million for the same period in 2024[196]. - Selling, general and administrative expenses for the nine months ended September 30, 2025 were $104.5 million, a decrease of $12.1 million, or 10.4%, compared to $116.6 million for the same period in 2024[199]. Cash Flow and Liquidity - As of September 30, 2025, the Company had cash and cash equivalents of $12.1 million, an increase from $2.9 million at December 31, 2024, with working capital rising to $236.4 million[213]. - Net cash provided by operating activities was $3.9 million for the nine months ended September 30, 2025, compared to a net cash used of $1.7 million for the same period in 2024[243]. - Net cash used in investing activities increased to $3.1 million for the nine months ended September 30, 2025, from $1.6 million in 2024, driven by equipment purchases for the Hagerstown Facility[244]. - Net cash provided by financing activities was $8.3 million for the nine months ended September 30, 2025, compared to net cash used of $6.9 million in 2024, due to higher net proceeds from the revolving credit facility[245]. Capital Expenditures and Investments - The Hagerstown Facility will require capital expenditures of approximately $9.0 million and start-up costs of about $7.0 million[156]. - Capital expenditures for the nine months ended September 30, 2025, totaled $3.2 million[230]. Debt and Interest - Interest expense for the three months ended September 30, 2025 was $5.0 million, a decrease from $5.8 million for the same period in 2024[183]. - Interest expense decreased to $15.0 million for the nine months ended September 30, 2025, down from $16.6 million in 2024, due to lower average outstanding borrowings and interest rates[206]. - The interest rate on outstanding borrowings under the Term Loan was 9.75% as of September 30, 2025[226]. - The Company was in compliance with the covenants of the Debt Agreements at September 30, 2025, and expects to continue borrowing based on working capital needs[228]. Other Financial Metrics - Adjusted EBITDA for the trailing twelve months ended September 30, 2025, was $47.2 million[229]. - The effective income tax benefit rate for the nine months ended September 30, 2025, was 0.14%, compared to a provision rate of (8.2)% in 2024, primarily due to a partial valuation allowance on U.S. deferred tax assets[209]. Inventory and Receivables - Inventory turnover for the three months ended September 30, 2025, was 2.0 times (181 days), slightly down from 2.1 times (175 days) in the same period of 2024[214]. - As of September 30, 2025, $13.6 million of accounts receivables were available for sale to HSBC[235]. Strategic Initiatives - The company launched Project Concord in January 2025 to improve growth and streamline costs in its International operations[157].