UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 15, 2020
Luvu Brands, Inc.
(Exact name of registrant as specified in Charter)
Florida | 000-53314 | 59-3581576 | ||
(State or other jurisdiction of incorporation) |
(Commission File No.) | (IRS Employer Identification No.) |
2745 Bankers Industrial Drive
Atlanta, GA 30360
(Address of Principal Executive Offices)
(770) 246-6400
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition |
On May 15, 2020, Luvu Brands, Inc. (“Luvu” or “the Company”) issued a press release announcing its financial results for the third fiscal quarter ended March 31, 2020. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
The information included in this Item 2.02, as well as Exhibits 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
ExhibitNo. | Description | |
99.1 | Press release, dated May 15, 2020, reporting financial results for the third fiscal quarter ended March 31, 2020. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
Luvu Brands, Inc. (Registrant) | ||
Date: May 15, 2020 | By: | /s/ Ronald P. Scott |
Ronald P. Scott Chief Financial Officer |
EXHIBIT 99.1
Luvu Brands Announces Third Quarter 2020 Financial Results
Reports Third Quarter Net Sales of $4 million; Year-to-Date Net Sales $12.9 million
Atlanta, Georgia, May 15, 2020 – Luvu Brands, Inc. (OTCQB: LUVU), a designer, manufacturer and marketer of a portfolio of consumer lifestyle brands and medical PPE, announced today its financial and operational results for the third quarter and nine months ended March 31, 2020.
For the nine months ended March 31, 2020, compared to the nine months ended March 31, 2019:
For the three months ended March 31, 2020, compared to the three months ended March 31, 2019:
Louis Friedman, Chairman and Chief Executive Officer, commented, “The COVID-19 pandemic negatively impacted our supply chain and sales channels during the third quarter, but I’m encouraged by the current sales and order trends. Due to our diversity of brands, preliminary internal unaudited net sales for April 2020 were 34% higher than April 2019, of which sales of medical PPE masks and gowns accounted for approximately 60% of the increase. We continue to see growing demand for our Avana PPE products and, to that end, we have acquired additional sewing equipment and increased our sewing and packaging personnel to keep pace with the demand.”
Forward-Looking Statements
Certain matters discussed in this press release may be forward-looking statements. Such forward-looking statements can be identified by the use of words such as ''should,'' ''may,'' ''intends,'' ''anticipates,'' ''believes,'' ''estimates,'' ''projects,'' ''forecasts,'' ''expects,'' ''plans,'' and ''proposes.'' These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including, without limitation, statements regarding our preliminary unaudited net sales for April 2020, statements made with respect to the our ability to continue as a going concern, the impact of the COVID-19 pandemic on our company, our ability to continue to generate revenues and report profitable operations, our ability to repay outstanding promissory notes, our ability to pay our operating expenses and lack of access to additional capital, our ability to effectively compete and the lack of an active trading market for our common stock. You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended June 20, 2019 as filed with the Securities and Exchange Commission (the "SEC") on October 11, 2019 and our other filings with the SEC. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are generally outside the control of Luvu Brands, Inc. and are difficult to predict. Luvu Brands, Inc. does not undertake any duty to update any forward-looking statements except as may be required by law. The information which appears on our websites and our social media platforms is not part of this press release.
Use of Non-GAAP Measure – *Adjusted EBITDA
Luvu Brands’ management evaluates and makes operating decisions using various financial metrics. In addition to the Company's GAAP results, management also considers the non-GAAP measure of Adjusted EBITDA. While Adjusted EBITDA is not a measure of performance in accordance with GAAP, management believes that this non-GAAP measure provides useful information about the Company's operating results. The table below provides a reconciliation of this non-GAAP financial measure with the most directly comparable GAAP financial measure.
As used herein, Adjusted EBITDA income represents net income before interest income, interest expense, income taxes, depreciation, amortization, and stock-based compensation expense.
Reconciliation of net income to Adjusted EBITDA income for the nine months ended March 31, 2020 and 2019:
(Dollars in thousands) | Nine months ended March 31, | |||||||
2020 | 2019 | |||||||
Net income | $ | 64 | $ | 164 | ||||
Plus interest expense, net | 465 | 423 | ||||||
Plus depreciation and amortization expense | 117 | 124 | ||||||
Plus stock-based compensation | 15 | 17 | ||||||
Adjusted EBITDA income | $ | 661 | $ | 728 |
About Luvu Brands
Luvu Brands, Inc. designs, manufactures and markets a portfolio of consumer lifestyle brands through the Company’s websites, online mass / drug merchants and specialty retail stores worldwide. Brands include: Liberator®, a brand category of iconic products for enhancing sensuality and intimacy; Avana®, medical and personal PPE products and inclined bed therapy products, assistive in relieving medical conditions associated with acid reflux, surgery recovery and chronic pain; and Jaxx®, a diverse range of casual fashion daybeds, sofas and beanbags made from virgin and re-purposed polyurethane foam. Headquartered in Atlanta, Georgia, the Company occupies a 140,000 square foot vertically-integrated manufacturing facility and employs over 180 people. The Company's brand sites include: www.liberator.com, www.jaxxliving.com, www.avanacomfort.com plus other global e-commerce sites. For more information about Luvu Brands, please visit www.luvubrands.com.
Company Contact:
Luvu Brands, Inc.
Ronald Scott
Chief Financial Officer
770-246-6426
ron@LuvuBrands.com