ONEIDA, N.Y., Aug. 15, 2001 (PRIMEZONE) -- Oneida Ltd. (NYSE:OCQ) today announced sales of $119 million for the second fiscal quarter ended July 28, 2001, up 15% from $104 million for the same period a year ago. Earnings were $ 0.10 per share, compared to $ 0.20 per share (before restructuring charges) for the 2000 second fiscal quarter. For the first six months of fiscal 2001, earnings were $ 0.13 per share vs. $ 0.65 (before restructuring charges) for the same period last year. First-half sales of $246 million were up 11%, compared to $222 million for the 2000 fiscal first half.
For the third consecutive quarter, Oneida posted substantial improvements in its balance sheet. Debt levels during the second quarter were down by $12 million, while inventories were reduced by another $10 million and were down by a total of $19 million for the first six months of fiscal 2001.
"Even in this difficult business climate, we have been able to achieve significant inventory and debt reductions -- in contrast to the substantial inventory and debt increases we historically have experienced during the first half of the year," said Peter J. Kallet, Oneida Chairman and Chief Executive Officer. "We are successfully carrying out previously announced strategic initiatives to reduce inventory and improve our cash flow, despite very trying economic conditions. These measures will bolster our company for the long term and better position us to overcome the short-term issues we are facing."
FUTURE OPTIMISM AFTER CHALLENGING FIRST HALF
"Our second quarter results reflected the continued effects of the general economic slowdown, including the impact of weak consumer spending combined with reduced inventories by our customers. Looking forward, we are cautiously optimistic about the opportunities we see in our consumer business for the second half of this year," Mr. Kallet said.
"We have continued to gain market share and achieve further product placements with the help of our new sales and marketing initiatives, including merchandising offers, product displays, gift packaging and a broader range of products from our recent acquisitions. In our foodservice unit, during the second quarter we successfully completed the integration of Delco International Ltd. following its acquisition, including a consolidation of distribution facilities that will bolster our efficiencies."
"We were pleased by the results in our international unit, which is on pace to reach new sales milestones this year," Mr. Kallet added. "Through our steady growth in the global market, we are capitalizing on a sector that offers significant potential for us, and provides a greater balance to our overall business mix."
IMPROVED BALANCE SHEET STRENGTHENS OPERATIONS
"The continued improvement in our balance sheet stems in part from a reduction in stock keeping units (SKUs) -- from 30,000 at the beginning of 2000 to less than 9,000 at the end of the 2001 second quarter," Mr, Kallet commented. "Our inventory reduction is beginning to lower our warehousing costs, and has decreased our leased warehouse space by more than a third."
"This balance sheet progress represents a fundamental strengthening of our operations, and is a vital factor in our strategic plan to build upon our position as the world's most complete tabletop supplier," he added.
OUTLOOK FOR THE BALANCE OF 2001
"Historically, Oneida has posted stronger sales and operating results in the second half of the fiscal year due to increased consumer spending during the holiday seasons. It is difficult to make projections in the present economic environment, but barring a further weakening of the economy below current levels, we anticipate a stronger performance in the second half of fiscal 2001 compared to the first six months," Mr. Kallet noted.
Oneida Ltd. is a leading manufacturer and marketer of flatware and dinnerware for both the consumer and foodservice industries worldwide. Oneida also is a leading marketer of a variety of crystal, glassware and metal serveware for those industries.
Statements contained in this press release that state that certain results are "expected" or "anticipated" to occur, or otherwise state the company's predictions for the future, are forward-looking statements. These particular forward-looking statements and all other statements that are not historical facts, are subject to a number of risks and uncertainties, and actual results may differ materially. Such factors include, but are not limited to: general economic conditions in the Company's markets; difficulties or delays in the development, production and marketing of new products; the impact of competitive products and pricing; unforeseen increases in the cost of raw materials or shortages of raw materials; significant increases in interest rates or the level of the Company's indebtedness; major slowdowns in the retail, travel or entertainment industries; the loss of several of the Company's major customers; underutilization of the Company's plants and factories; and the amount and rate of growth of the Company's selling, general and administrative expenses.
ONEIDA LTD.
CONDENSED CONSOLIDATED INCOME STATEMENT
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
FOR THE FOR THE
THREE MONTHS ENDED SIX MONTHS ENDED
July 28, July 29, July 28, July 29,
2001 2000 2001 2000
-------- -------- ------- --------
Net Sales $ 119.4 $ 104.0 246.2 $ 222.2
Cost of Sales (a) 77.6 90.1 162.9 162.5
-------- -------- ------- --------
Gross Profit 41.8 13.9 83.3 59.7
Operating Revenues 0.3 1.3 0.7 1.5
Selling, Distribution
& Administrative 34.1 29.8 68.1 61.0
Restructuring/Unusual
Charges (a) -- 8.0 -- 8.0
-------- -------- -------- --------
Operating Income
(Loss) 8.0 (22.6) 15.9 (7.8)
Other (Income)
Expense - Net (0.6) 0.1 (0.5) 0.1
Interest Expense 5.9 4.1 13.0 7.0
-------- -------- -------- --------
Income (Loss)
before Income Taxes 2.7 (26.8) 3.4 (14.9)
Provision (Credit)
for Income Taxes 1.0 (10.0) 1.3 (5.6)
-------- -------- -------- --------
Net Income (Loss) $ 1.7 ($ 16.8) $ 2.1 ($ 9.3)
======== ======== ======== ========
Net Income (loss)
per share:
Basic:
Reported $ 0.10 ($ 1.04) $ 0.13 ($ 0.58)
Core Earnings (b) $ 0.10 $ 0.20 $ 0.13 $ 0.65
Diluted:
Reported $ 0.10 ($ 1.04) $ 0.13 ($ 0.58)
Core Earnings (b) $ 0.10 $ 0.20 $ 0.13 $ 0.65
Weighted Average
Shares:
Outstanding 16,459 16,209 16,433 16,286
Diluted 16,553 16,209 16,519 16,286
NOTE a: The earnings for the three and six months ended July 29, 2000 include the impact of the following special charges: restructuring costs of $8 million (principally severance and impairment of assets related to manufacturing tools and other product procurement assets) and an inventory writedown of $24 million related to product rationalization as a result of acquisitions, as well as significant other stock keeping unit reductions.
NOTE b: Core earnings represent earnings from operations, net of restructuring and unusual charges.
ONEIDA LTD.
CONDENSED BALANCE SHEET
(Millions of dollars)
ASSETS July 28, 2001 January 29, 2001
------ ------------- ----------------
Cash $ 2.7 $ 2.2
Accounts Receivable - Net 87.8 90.0
Inventory 196.8 215.9
Other Current Assets 14.6 16.7
------ ------
Total Current Assets 301.9 324.8
Plant and Equipment - Net 110.1 112.4
Intangibles 136.3 139.7
Other Assets 34.7 33.7
------ ------
Total Assets $ 583.0 $ 610.6
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LIABILITIES
Accounts Payable &
Accrued Liabilities $ 75.4 $ 95.4
Short-Term Debt 9.7 8.0
Current Portion
of Long-Term Debt 8.6 9.2
------ ------
Total Current Liabilities 93.7 112.6
Long-Term Debt 280.1 282.8
Other Liabilities 86.3 90.9
Shareholders' Equity 122.9 124.3
------ ------
Total Liabilities & Equity $ 583.0 $ 610.6
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CONDENSED CASH FLOW STATEMENT
JULY 2001/2000
(Millions of dollars)
Six months ended Six months ended
July 2001 July 2000
--------- ---------
Net income (loss) $ 2.1 $ (9.3)
Add: depreciation &
amortization 9.4 7.6
Net working capital
charges 5.7 (23.3)
Capital expenditures (5.7) (6.2)
Purchase of subsidiaries -- (60.5)
Stock sales/(purchases)
- net 1.1 (4.1)
Proceeds/(payments)
of debt (1.6) 100.7
Dividends paid (1.7) (3.3)
Other - net (8.8) 0.3
----- ------
Increase in Cash $ 0.5 $ 1.9
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