EX-99 3 atx-20130425xex99.htm EX-99 form8k1q2013ex99

Exhibit 99

AT_Cross_Co_Logo_Blue PMS296U_RGB                    News Release

 

 

 

Company Contact:
Kevin F. Mahoney
Senior Vice President, Finance and
Chief Financial Officer
401-335-8470

Investor Relations:
Dave Mossberg
Three Part Advisors, LLC
817-310-0051

 

FOR IMMEDIATE RELEASE          

 

A.T. Cross Company Reports Sales and Profit Increases in First Quarter 2013

·

Q1 2013 net sales increased 6% 

·

Q1 2013 operating income increased 10% 

·

Q1 2013 EPS increased from $0.12 to $0.13

·

Cross Optical Group revenue and operating income increased 19% and 29%, respectively 

LINCOLN, R.I., April 25, 2013 - A.T. Cross Company (ATX) today announced financial results for the first quarter ended March 30, 2013.

David G. Whalen, President and Chief Executive Officer of A.T. Cross said, "A. T. Cross continued to grow in the first quarter of 2013 with revenue up 6% and operating income higher by 10%. The Cross Optical Group (COG) continued its strong performance as its revenue and operating income increased 19% and 29%, respectively. As our sunglass business enters its peak selling season, it is clear that it has maintained its momentum from 2012 and we expect a strong performance as we move through the spring."

Mr. Whalen continued, "The Cross Accessory Division's (CAD) revenue declined 6% in the first quarter. Two-thirds of the decline was related to the substantially weaker Japanese Yen and decreased sales of low margin discontinued product. Having said that, while our trend in the European market improved in Q1, we did experience softness in the America and Asia markets which we are addressing."

First Quarter 2013 Results

Sales for the first quarter of 2013 increased by 5.9% to $44.4 million compared to $41.9 million in the first quarter of 2012. The Cross Optical Group reported sales of $23.8 million, an increase of 19.1% compared to last year's first quarter. The Cross Accessory Division recorded revenue of $20.6 million, down 6.2% from last year.

Gross margin was 56.1% in 2013, versus 56.2% in 2012.

Operating expenses were $22.3 million, or 50.2% of sales in the 2013 first quarter, versus $21.2 million, or 50.5% of sales for the same period a year ago.

Operating income in the first quarter of 2013 was $2.6 million, compared to $2.4 million in the first quarter of last year.

Net income for the first quarter was $1.6 million, or $0.13 per diluted share, compared to net income of $1.5 million, or $0.12 per diluted share, last year.


 

Strategic Alternatives

On February 4, 2013, the Company announced that it is exploring strategic alternatives for its Cross Accessory Division. Costs associated with the process totaled approximately $240,000, or $0.01 per share, in the first quarter of 2013.

Guidance

In January, the Company provided 2013 guidance of earnings between $0.78 and $0.82 per share. The Company is confirming that guidance. The guidance will be reviewed again in July, once the peak sunglass season concludes.

Conference Call

The Company's management will host a conference call today, April 25, 2013 at 4:30 PM Eastern Time. Parties interested in participating in the conference call may dial-in at (877) 303-2912, while international callers may dial-in at (408) 427-3877. The conference call will be webcast and can be accessed at www.cross.com. A replay of the webcast will be archived on the Company's website for 60 days.

About A.T. Cross Company

Building on the rich tradition of its award-winning writing instruments and reputation for innovation and craftsmanship, A.T. Cross Company is a designer and marketer of branded personal and business accessories. A.T. Cross provides a range of distinctive products that appeal to a growing market of consumers seeking to enhance their image and facilitate their lifestyle. A.T. Cross products, including award-winning quality writing instruments, timepieces, non prescription reading glasses, business accessories and Costa and Native Eyewear premium sports sunglasses, are distributed in retail and corporate gift channels worldwide. For more information, visit the A.T. Cross website at www.cross.com, the Costa website at www.costadelmar.com and the Native Eyewear website at www.nativeyewear.com.

Statements contained in this release that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (including but not limited to statements relating to the expected operating results for COG during the spring season and the expected overall results for A.T. Cross). In addition, words such as "believes," "anticipates," "expects," and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to risks and uncertainties, including but not limited to the continued success of the Optical Group's business model, the expectation that CAD will address revenue weakness in Asia, the potential effect of economic uncertainty on consumer confidence and, consumers' willingness to continue to participate in the writing instrument category and to purchase discretionary items. These forward-looking statements are not guarantees since there are inherent difficulties in predicting future results. Actual results could differ materially from those expressed or implied in the forward-looking statements. The information contained in this document is as of April 25, 2013. The Company assumes no obligation to update any forward-looking statements contained in this document as a result of new information or future events or developments. Additional discussion of factors that could cause actual results to differ materially from management's expectations is contained in the Company's filings under the Securities Exchange Act of 1934.

 

 

(Tables to follow)


 

A. T. CROSS COMPANY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

 

March 30, 2013

 

March 31, 2012

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

44,401 

 

$

41,946 

 

 

 

Cost of goods sold

 

19,476 

 

 

18,376 

 

 

 

Gross Profit

 

24,925 

 

 

23,570 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

19,600 

 

 

18,475 

 

 

 

Service and distribution costs

 

2,000 

 

 

2,048 

 

 

 

Research and development expenses

 

707 

 

 

660 

 

 

 

Operating Income

 

2,618 

 

 

2,387 

 

 

 

Interest and other expense

 

(132)

 

 

(132)

 

 

 

Income Before Income Taxes

 

2,486 

 

 

2,255 

 

 

 

Income tax provision

 

846 

 

 

717 

 

 

 

Net Income

$

1,640 

 

$

1,538 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income per Share:

 

 

 

 

 

 

 

 

Basic

 

$
0.13 

 

 

$
0.13 

 

 

 

Diluted

 

$
0.13 

 

 

$
0.12 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Shares Outstanding:

 

 

 

 

 

 

 

 

Basic

 

12,246 

 

 

12,288 

 

 

 

Diluted

 

12,979 

 

 

12,893 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

 

March 30, 2013

 

March 31, 2012

 

 

 

Segment Data:  Cross Accessory Division

 

 

 

 

 

 

 

 

Net Sales

$

20,565 

 

$

21,929 

 

 

 

Operating Loss

 

(1,066)

 

 

(462)

 

 

 

 

 

 

 

 

 

 

 

 

Segment Data:  Cross Optical Group

 

 

 

 

 

 

 

 

Net Sales

$

23,836 

 

$

20,017 

 

 

 

Operating Income

 

3,684 

 

 

2,849 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

A. T. CROSS COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 30, 2013

 

March 31, 2012

Assets

 

 

 

 

 

Cash and cash equivalents

$

12,630 

 

$

14,817 

Short-term investments

 

271 

 

 

202 

Accounts receivable

 

34,106 

 

 

32,173 

Inventories

 

42,391 

 

 

40,354 

Deferred income taxes

 

3,409 

 

 

4,154 

Other current assets

 

8,933 

 

 

7,476 

Total Current Assets

 

101,740 

 

 

99,176 

 

 

 

 

 

 

Property, plant and equipment, net

 

13,964 

 

 

13,206 

Goodwill

 

15,279 

 

 

15,279 

Intangibles and other assets

 

10,308 

 

 

11,151 

Deferred income taxes

 

10,994 

 

 

10,894 

 

 

 

 

 

 

   Total Assets

$

152,285 

 

$

149,706 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

Accounts payable and other current liabilities

$

25,150 

 

$

25,205 

Line of credit

 

15,000 

 

 

Retirement plan obligations

 

2,577 

 

 

2,405 

Income taxes payable

 

178 

 

 

267 

Total Current Liabilities

 

42,905 

 

 

27,877 

 

 

 

 

 

 

Long-term debt

 

 

 

18,221 

Retirement plan obligations

 

19,737 

 

 

19,703 

Deferred gain on sale of real estate

 

1,564 

 

 

2,086 

Other long-term liabilities

 

706 

 

 

473 

Accrued warranty costs

 

1,256 

 

 

1,430 

Shareholders' equity

 

86,117 

 

 

79,916 

 

 

 

 

 

 

  Total Liabilities and Shareholders' Equity

$

152,285 

 

$

149,706