Lifetime Brands (LCUT) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were $183.8 million, down 4.1% year-over-year, mainly due to end market softness, retailer destocking, and delayed shipments; nine-month sales were $467.7 million, down 3.3% from 2023.

• Gross margin for Q3 2024 was 36.7%, slightly down from 37.0% in Q3 2023, but remained above 36% for the seventh consecutive quarter; nine-month gross margin improved to 38.4% from 37.4% last year.

• Q3 2024 net income was $0.3 million ($0.02/share), compared to $4.2 million ($0.20/share) in Q3 2023; adjusted net income was $4.5 million ($0.21/share), down from $7.7 million ($0.36/share) last year.

• A $14.2 million non-cash loss on the Vasconia investment drove a nine-month net loss of $24.1 million.

• The company declared a quarterly dividend of $0.0425 per share, payable in February 2025, and remains focused on market share gains, operational resilience, and strategic M&A opportunities.

Financial highlights

• U.S. segment Q3 net sales declined 5.1% to $170.2 million; international segment sales rose 10.6%–10.9% to $13.6 million.

• Q3 operating income was $8.6 million, down from $13.6 million in Q3 2023; adjusted EBITDA for the trailing twelve months ended September 30, 2024 was $53.9 million.

• Interest expense increased to $5.8 million in Q3 2024 due to higher rates; mark to market loss on interest rate derivatives was $0.9 million in Q3.

• Cash and cash equivalents at September 30, 2024 were $6.0 million; liquidity was approximately $76 million, including ABL availability and receivables funding.

Outlook and guidance

• Full-year 2024 guidance: net sales of $680–$700 million, adjusted income from operations of $44–$47 million, adjusted net income of $11–$13 million, and adjusted EBITDA of $54–$57 million.

• Management expects continued uncertainty in 2024 due to inflation, high interest rates, and global supply chain disruptions, but anticipates a rebound in demand and stronger impact from new programs and international placements in 2025.

• Expects continued market share gains and growth in e-commerce and international segments.