GREENWICH, Conn., Nov. 29, 2001 (PRIMEZONE) -- Blyth, Inc. (NYSE:BTH) reported today third quarter Net Sales of $319.2 million compared with $324.4 a year earlier. Operating Profit was $45.1 million versus $51.8 million in the prior year period. Net Earnings for the quarter were $25.9 million versus $29.9 million a year earlier. Diluted Net Earnings Per Share for the third quarter were $0.55 compared to $0.63 for the same period last year.
Net sales for the nine months ended October 31, 2001 totaled $830.0 million versus $864.5 million reported a year ago. Operating profit through the first nine months was $94.8 million as compared to $121.3 million last year. Net earnings were $54.4 million as compared to $68.4 million for the prior year period. Diluted Net Earnings Per Share were $1.15 versus $1.42 for last year's first nine months.
Commenting on the third quarter results, Robert B. Goergen, Chairman of the Board and CEO, said, "Like most businesses, the tragic events of September 11 had an immediate effect on the Blyth family of companies, negatively impacting what management believes were continued improvements in several key business units. However, this effect had diminished by early October, particularly at PartyLite. We remain cautiously optimistic that, despite the significant negative impact that PartyLite experienced mid-quarter, results in this important business unit continue to improve."
On a segment basis, Net Sales in the Candles and Home Fragrance Products businesses were $237.2 million, compared to $271.3 million in the prior year period. Operating income for this segment was $29.4 million, compared to $40.3 million in last year's third quarter.
Sales for PartyLite, Blyth's worldwide direct selling business unit, declined about 11% as compared to the third quarter last year, though improvement was evident in the beginning weeks of September, which management attributes to a strong new holiday product line and catalogue. Show activity, particularly in the United States, experienced a temporary and dramatic interruption in the weeks immediately following September 11, but an upward trend resumed beginning in October, such that PartyLite's U.S. and European companies all experienced record sales that month.
Within Blyth's North American consumer wholesale businesses, delays and caution in holiday stocking by retailers, due to uncertain consumer demand, resulted in slower third quarter shipments versus last year. Blyth's sales declined by approximately 14% in the premium channel and by approximately 20% in the mass channel. As expected, and as noted in the Company's second quarter earnings release and teleconference, over-capacity and pricing pressure resulting from increased competition in the mass channel continued into the third quarter. This was only temporarily offset by the increase in candle sell-through noted after September 11 due to vigils and memorials following the tragedy.
Sales in Blyth's European consumer wholesale and retail businesses increased by approximately 5%, led by solid gains in the U.K.-based Colony Group, which continues to increase its position in the growing premium market for fragranced candles and accessories. Sales were flat for the Germany-based Gies Group as increases in fragranced products offset declines in the Company's core business of unscented candles.
Net sales in the Creative Expressions and Foodservice businesses totaled $82.0 million versus $53.2 million one year ago, and operating income in this segment was $15.7 million compared to $11.5 million in the prior year period. Increases in this segment of Blyth's business were largely attributable to the inclusion of Midwest of Cannon Falls, which was acquired by Blyth in April. Sales of decorative gift bags and related seasonal decorations of JMC Impact increased approximately 6% versus last year, whereas shipments of Sterno(r) brand and tabletop products to restaurants and hotels declined, reflecting the reduced travel and corporate entertaining that resulted from both the overall weak economic environment and the aftermath of September 11. The sum of the segment amounts does not necessarily equal that reported for the quarter due to rounding.
The Company noted that 47,300 shares of Blyth stock were repurchased in the third quarter, for approximately $1.0 million, bringing total repurchased shares to $58.5 million since the program was first implemented in fiscal year 1999.
Management will conduct a conference call today at 10 a.m. (eastern), which will be broadcast live over the Internet at www.blythinc.com. The call will be archived on Blyth's Website.
Blyth, Inc., headquartered in Greenwich, Conn., designs, manufactures and markets an extensive line of candles and home fragrance products including scented candles, potpourri and other fragranced products, and markets a broad range of related candle accessories. Its products are sold direct to the consumer under the PartyLite(r) brand, to retailers in the mid-tier and premium retail channels, under the Colonial Candle of Cape Cod(r), Kate's Original Recipe(tm) and Carolina Designs(r) brands and in the mass retail channel under the Florasense(r), Ambria(tm) and FilterMate(r) brands. In Europe, its products are also sold under the Gies, Colony and Wax Lyrical brands. Blyth also markets a broad range of Creative Expressions and Foodservice products, including seasonal and home decor products under the Midwest of Cannon Falls(r) brand, decorative seasonal products under the Impact(tm) brand, paper-related products under the Jeanmarie(r) brand and tabletop illumination products and portable heating fuel for the hotel, restaurant and catering trade, under the Ambria(tm), Sterno(r) and HandyFuel(r) brand names. Net Sales for the twelve months ended October 31, 2001 totaled $ 1,163.0 million.
Blyth, Inc. may be found on the Internet at www.blythinc.com.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements which are other than statements of historical facts. Actual results could differ materially due to various factors, including the risk of a continuing weakness of the retail and overall economic environment, the effects of our restructuring, the risk of maintaining the Company's growth rate, the Company's ability to respond to increased product demand, the risks (including foreign currency fluctuations) associated with international sales and foreign products, the risks of being able to recruit new independent sales consultants, dependence on key management personnel, competition in terms of price and new product introductions, and other factors described in this press release, in the Company's Quarterly Report on Form 10-Q for the quarter ended July 31, 2001 and in the Company's Annual Report on Form 10-K for the year ended January 31, 2001.
BLYTH, INC.
Consolidated Statement of Earnings
(In thousands except per share data)
(Unaudited)
Three Months Nine Months
Ended October 31, Ended October 31,
2001 2000 2001 2000
-------- -------- -------- --------
Net sales $319,151 $324,430 $829,989 $864,486
Cost of goods sold 157,504 157,524 404,982 406,898
-------- -------- -------- --------
Gross profit 161,647 166,906 425,007 457,588
Selling and shipping 90,433 91,456 254,014 264,335
Administrative 24,777 22,609 72,859 68,802
Amortization of goodwill 1,345 1,048 3,356 3,144
-------- -------- -------- --------
116,555 115,113 330,229 336,281
-------- -------- -------- --------
Operating profit 45,092 51,793 94,778 121,307
-------- -------- -------- --------
Other expense (income)
Interest expense 4,214 4,180 12,312 12,521
Interest income
and other (585) 25 (4,640) (1,139)
Equity in earnings
of investee 268 (64) 443 723
-------- -------- -------- --------
3,897 4,141 8,115 12,105
-------- -------- -------- --------
Earnings before income
taxes, minority interest
and cumulative effect of
accounting change 41,195 47,652 86,663 109,202
Income tax expense 15,324 17,718 32,238 40,758
-------- -------- -------- --------
Earnings before minority
interest and cumulative
effect of accounting
change 25,871 29,934 54,425 68,444
Minority interest -- -- -- (1,084)
-------- -------- -------- --------
Earnings before
cumulative effect of
accounting change 25,871 29,934 54,425 69,528
Cumulative effect of
accounting change
(SAB 101), net of taxes -- -- -- (1,153)
-------- -------- -------- --------
Net Earnings $ 25,871 $ 29,934 $ 54,425 $ 68,375
======== ======== ======== ========
Basic:
Net earnings per common
share before cumulative
effect of accounting
change $ 0.55 $ 0.63 $ 1.16 $ 1.45
Cumulative effect of
accounting change
(SAB 101) 0.00 0.00 0.00 (0.02)
-------- -------- -------- --------
$ 0.55 $ 0.63 $ 1.16 $ 1.43
======== ======== ======== ========
Weighted average number
of shares outstanding 47,060 47,531 47,071 47,817
Diluted:
Net earnings per common
share before cumulative
effect of accounting
change $ 0.55 $ 0.63 $ 1.15 $ 1.44
Cumulative effect of
accounting change
(SAB 101) 0.00 0.00 0.00 (0.02)
-------- -------- -------- --------
$ 0.55 $ 0.63 $ 1.15 $ 1.42
======== ======== ======== ========
Weighted average number
of shares outstanding 47,201 47,747 47,234 48,105
Consolidated Balance Sheets
(In thousands)
(Unaudited)
October 31,
2001 2000
-------- --------
Assets
Cash and Cash Equivalents $ 32,799 $ 27,176
Accounts Receivable, Net 170,380 125,789
Inventories 224,523 230,225
Property, Plant & Equipment, Net 258,180 265,220
Other Assets 152,044 129,981
-------- --------
$837,926 $778,391
======== ========
Liabilities and Stockholders' Equity
Bank Debt $ 82,034 $ 69,478
Senior Notes 14,286 17,857
Bond Debt 150,000 150,000
Other Liabilities 131,978 134,008
Stockholders' Equity 459,628 407,048
-------- --------
$837,926 $778,391
======== ========