Quarterly Net Income Increases 22%
Quarterly Earnings Per Share Increase 20%
Year-to-Date Net Income Increases 30%
Year-to-Date Earnings Per Share Advances 27%
EL PASO, Texas, Oct. 10 /PRNewswire-FirstCall/ --
Helen of Troy Ltd. (Nasdaq: HELE), designer, developer and worldwide marketer
of brand-name personal care products, today reported record earnings for the
second quarter and six months ended Aug. 31, 2002.
Second quarter sales were $111,058,000, versus sales of $112,688,000 for
the same period of the prior year. Second quarter net income increased
22 percent to $8,876,000 or 30 cents per diluted share, compared with
$7,303,000, or 25 cents per diluted share for the same period a year earlier.
First half sales climbed 5 percent to a record $213,541,000 from sales of
$204,071,000 for last year's first half. Net income for the first half of
this year was $15,467,000 or 52 cents per diluted share, versus $11,895,000,
or 41 cents per diluted share in the comparable period last year, representing
a 30 percent increase in net earnings.
Gerald J. Rubin, Chairman, Chief Executive Officer and President,
commenting on the results for the quarter stated, "Last quarter was a
challenging one in the retail marketplace. Overall sales for the quarter were
down slightly compared with last year's second quarter, however, sales in
Helen of Troy's distribution channels increased by approximately 12 percent.
Tactica International also posted increased sales in their wholesale
distribution channel, with a decline in sales in their direct response
distribution channel principally in the Epil-Stop product line. Considering
the softness in the overall retail market this past quarter, we are extremely
pleased with our results. We expect second half sales to increase over first
half sales, as we enter the holiday selling season. For the full fiscal year,
we also expect our consolidated company sales to exceed prior year sales as
well.
"Our on-going efforts in the area of cost controls were an essential
element in our ability to increase net earnings by 22 percent and earnings per
share by 20 percent for the quarter, and by 30 and 27 percent respectively for
the six month period. We continue to believe, that for fiscal year 2003,
ending February 28, 2003, earnings per share will be in the $1.15 to
$1.20 range. This represents a 15 to 20 percent increase over our prior year
earnings per share of $1.00, led primarily by contributions from Helen of
Troy's product sales.
"We saw sales growth in most major categories, excluding Tactica's direct
response channel, with increases in the hair care appliance category of Vidal
Sassoon products, the health and wellness category of Dr. Scholl's products,
international sales in the United Kingdom, France and the Pacific Rim, and
brush and accessory categories of Karina and Nandi accessory products. We
also continue to experience double-digit increases in our professional
division sales, led by our HOT Tools and Wigo brands. Some of our new
products that are doing very well in the marketplace include the Wave Rage
product line specially designed for teens, our new line of hair straighteners
and our new and expanded line of Ion technology products, marketed under both
our Revlon and Vidal Sassoon trade names. We believe being first to market
with several of these new products has allowed us to increase our market share
over the past several quarters. Our Sunbeam personal care products of home
hair clippers and hair care appliances also continue to do well.
"Gross margins for the quarter were 45.8 percent compared to 49.3 for the
same quarter in the prior year. The decline was due to changes in our sales
mix related primarily to less direct response sales from Tactica
International. Year-to-date gross margins were 47.0 percent versus
47.8 percent for the previous year. Second quarter operating income increased
to 11.1 percent of net sales, from 9.7 percent of net sales in the second
quarter of last year, an increase of 1.4 percentage points. For the six
months, operating income increased to 10.4 percent of net sales, from
8.9 percent of net sales during the prior year, an increase of 1.5 percentage
points.
"The balance sheet continues to remain strong with cash of $85 million,
versus $11 million a year ago, and accounts receivable of $80 million. Our
inventory is approximately $98 million, which is $51 million or 34 percent
less than the comparable period in the prior year. EBITDA for the quarter was
$13.6 million, compared to last year's $13.4 million. As of August 31, 2002,
book value per common share outstanding was $9.44.
"Sales have increased in 31 of the past 34 quarters, with net income
increasing in 30 of these 34 quarters, demonstrating a consistent financial
performance over the past eight and a half years.
We are very pleased and excited to have entered into a definitive
agreement to acquire directly and through license agreements six well known
consumer brand names from The Procter and Gamble Company. The brands include
Condition 3-in-1, a line of hairstyling products; Final Net, a hairspray;
Vitalis, a line of men's hair grooming products; Ammens, a body powder; Sea
Breeze brand of astringent and Vitapointe, another hair grooming product. The
transaction is scheduled to close within ninety days. We look forward to
adding these six strong consumer brands to our already impressive list of
consumer products,
Rubin concluded.
The Company will conduct a teleconference in conjunction with today's
release. The teleconference begins at 11 a.m. ET today, Thursday,
October 10, 2002. Members of the news media, investors and the general public
are invited to access a live broadcast of the conference call via the Investor
Relations page of the Company's website at www.hotus.com or via CCBN's
Investor Distribution Network at www.companyboardroom.com for individual
investors and www.streetevents.com for institutional investors. The event
will be archived and available for replay through November 30, 2002.
Helen of Troy Limited is a leading designer, producer and marketer of
brand name personal care consumer products. The Company's products include
hair dryers, curling irons, hair setters, women's shavers, brushes, combs,
hair accessories, home hair clippers, mirrors, foot baths, body massagers and
paraffin baths. The Company's products are sold by mass merchandisers, drug
chains, warehouse clubs and grocery stores under licensed trade names
including Vidal Sassoon, licensed from Procter & Gamble Co., the trademark
Revlon®, licensed from Revlon Consumer Products Corporation, Dr.
Scholl's®, licensed from Schering-Plough HealthCare Products, Inc., and
Sunbeam® licensed from Sunbeam Corporation. Helen of Troy's owned trade
names include Dazey®, Caruso®, Karina® and DCNL. The Company also
markets hair and beauty care products under the Helen of Troy®, Hot
Tools®, Hot Spa®, Salon Edition®, Gallery Series®, Wigo® and
Ecstasy® trademarks to the professional beauty salon industry.
This press release may contain certain forward-looking statements, which
are subject to change. A number of risks or uncertainties could cause actual
results to differ materially from historical or anticipated results.
Generally, the words anticipates,
believes
, expects
and other similar
words identify forward-looking statements. The Company cautions readers to
not place undue reliance on forward-looking statements. The actual results
may differ materially from those described in any forward-looking statements.
The Company intends its forward-looking statements to speak only as of the
time of such statements, and does not undertake to update or revise them as
more information becomes available. Additional information concerning
potential factors that could affect the Company's financial results are
included in the Company's Form 10-K for the year ended February 28, 2002,
under the heading
Risk Factors contained in the
Management's Discussion
and Analysis of Financial Condition and Results of Operations" section of the
Form 10-K. In addition to the factors described in the Company's Form 10-K
the following additional factor could also affect the Company's financial
results that are described in this press release:
There has been a work slowdown by longshoremen in certain ports where we
import most our goods and if such work slowdown is not resolved our sales may
be adversely affected -
Substantially all of our products sold in the United States are imported
from factories in the Far East. Longshoremen at major ports on the West Coast
of the United States have been involved in a work slowdown that has resulted
in a lockout of those workers by port authorities. We are currently
experiencing delays in receiving deliveries of some of our products as a
result of this work slowdown. The U.S. government has taken action to re-open
the ports, and the unions for the longshoremen continue to negotiate revised
labor contracts. It is not possible at this time to determine whether the
government's actions or the labor negotiations will effectively conclude the
work slowdown or to quantify the effects on our business. The work slowdown
may result in our inability to receive shipments of our products in a timely
manner which would result in our inability to deliver products to our
customers and thereby adversely affect our sales.
HELEN OF TROY LIMITED Comparative Analysis (Unaudited)
(In thousands, except shares and earning per share)
For the Three Months Ended For the Six Months Ended
8/31/02 8/31/01 8/31/02 8/31/01
Net Sales $111,058 $112,688 $213,541 $204,071
Cost of Sales 60,148 57,086 113,116 106,490
Gross profit 50,910 55,602 100,425 97,581
Selling, general
and administrative
expenses 38,636 44,671 78,140 79,357
Operating Income 12,274 10,931 22,285 18,224
Other income (expenses):
Interest expense (953) (1,111) (2,020) (2,170)
Interest income 548 153 856 305
Other income, net (133) 237 (128) 247
Total other income
(expense) (538) (721) (1,292) (1,618)
Earnings before
income taxes 11,736 10,210 20,993 16,606
Income tax expense 2,860 2,907 5,526 4,711
Net earnings $8,876 $7,303 $15,467 $11,895
Earnings per share
- diluted $.30 $.25 $.52 $.41
Weighted average
shares used in
computation 29,538,000 29,337,000 29,643,000 28,938,000
SELECTED CONSOLIDATED BALANCE SHEET INFORMATION
8/31/02 8/31/01
Cash $85,015,000 $11,264,000
Short Term Market Investments 1,665,000 173,000
Accounts receivable 79,584,000 74,682,000
Inventory 98,343,000 149,490,000
Total current assets 275,392,000 249,700,000
Total assets 384,955,000 363,291,000
Total current liabilities 63,836,000 76,181,000
Total long term liabilities 55,000,000 55,000,000
Stockholders' equity $266,119,000 $232,110,000
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SOURCE Helen of Troy Limited
-0- 10/10/2002
/CONTACT: Robert D. Spear, Vice President and CIO of Helen of Troy
Limited, +1-915-225-4748/
/Company News On-Call: http://www.prnewswire.com/comp/132519.html /
/Web site: http://www.companyboardroom.com
http://www.streetevents.com /
/Web site: http://www.hotus.com /
(HELE)
CO: Helen of Troy Limited
ST: Texas
IN: HOU
SU: ERN ERP CCA MAV
GN-CJ
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5119 10/10/2002 07:30 EDT http://www.prnewswire.com