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UNITED STATES |
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FORM 8-K |
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CURRENT REPORT |
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Date of Report (Date of earliest event reported): October 21, 2009 |
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A. T. CROSS COMPANY |
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Rhode Island (State or other jurisdiction of incorporation) |
1-6720 File Number) |
05-0126220 (IRS Employer Identification No.) |
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One Albion Road, Lincoln, Rhode Island (Address of principal executive offices) |
02865 (Zip Code) |
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Registrant 's telephone number, including area code (401) 333 1200N/A |
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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: |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Section 2 - Financial Information
Item 2.02 - Results of Operations and Financial Condition.
On October 21, 2009, the registrant issued the following press release announcing financial results for the three and nine month periods ended October 3, 2009:
News Release
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CONTACT: |
Kevin F. Mahoney |
FOR IMMEDIATE RELEASE
A.T. CROSS COMPANY REPORTS
THIRD QUARTER AND NINE MONTH PROFIT
Lincoln, RI - October 21, 2009 - A.T. Cross Company (NASDAQ: ATX) today announced financial results for the third quarter ended October 3, 2009.
Net income for the third quarter was $0.9 million or $0.06 per basic and diluted share. Net income for the nine month period ending October 3, 2009 was $0.6 million or $0.04 per basic and diluted share. Included in the 2009 nine month results were $0.05 per share of restructuring charges related to the consolidation of both the Company's manufacturing operations and the reduction of its European support structure. In the third quarter of 2008, the Company earned $0.12 per basic share, and for the nine month period of 2008 the Company earned $0.28 per basic share.
Consolidated net sales for the third quarter declined 12.4% to $34.1 million. Net sales for the nine month period of $102.3 million declined 13.6% from the prior year. For the nine month period, Cross Optical Group sales were up 5% while Cross Accessory Division sales were down 23%.
Operating expenses were 10% lower in the third quarter and 9% lower in the first nine months of 2009 compared to 2008, excluding restructuring.
David G. Whalen, President and Chief Executive Officer of A.T. Cross said, "While our three brands each delivered better revenue trends than they did in the first half of the year, the business environment during the third quarter continued to be difficult. Our response was to invest in our brands, focus on cost reduction and tightly manage our assets. Importantly, we reduced inventory by over $2 million from a year ago and increased our net cash position by $4.4 million. As a result, we believe that we are well positioned to take advantage of market opportunities and grow revenue and profit as the economy turns around."
Guidance
The Company expects 2009 earnings per share to be between $0.11 and $0.15. This range is net of $0.08 per share of restructuring charges.
Conference Call
The Company's management will host a conference call today, October 21, 2009 at 4:30 PM Eastern Time. Parties interested in participating in the conference call may dial-in at (888) 539-3612, while international callers may dial-in at (719) 457-2708. A live webcast of the call will be accessible on the Company's website at www.cross.com. The webcast will be archived for 30 days on this site, while a telephone replay of the call will be available beginning at 7:30 PM Eastern Time on October 21, 2009 through October 27, 2009 at (888) 203-1112 or (719) 457-0820 for international callers, and entering the pass code of 2644378.
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. 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, business accessories and Costa Del Mar and Native Eyewear 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 Del Mar 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 impact of the Company's strategies to invest in its brands, reduce costs and tightly manage assets). 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 depth and severity of the economic crisis and consumers' willingness to purchase discretionary items, and 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 October 21, 2009. 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)
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A. T. CROSS COMPANY |
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CONSOLIDATED STATEMENTS OF OPERATIONS |
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(in thousands, except per share amounts) |
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(unaudited) |
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Three Months Ended |
Nine Months Ended |
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October 3, |
September 27, |
October 3, |
September 27, |
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2009 |
2008 |
2009 |
2008 |
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Net sales |
$34,129 |
$38,974 |
$102,275 |
$118,439 |
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Cost of goods sold |
16,184 |
16,741 |
47,172 |
51,862 |
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Gross Profit |
17,945 |
22,233 |
55,103 |
66,577 |
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Selling, general and administrative expenses |
15,090 |
17,161 |
47,553 |
52,559 |
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Service and distribution costs |
1,664 |
1,783 |
5,003 |
5,301 |
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Research and development expenses |
745 |
605 |
1,940 |
1,817 |
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Restructuring charges |
252 |
219 |
1,049 |
219 |
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Operating Income (Loss) |
194 |
2,465 |
(442 |
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6,681 |
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Interest and other income (expense) |
408 |
(243 |
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(366 |
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(612 |
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Income (Loss)Before Income Taxes |
602 |
2,222 |
(808 |
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6,069 |
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Income tax (benefit) provision |
(324 |
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462 |
(1,420 |
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1,834 |
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Net Income |
$ 926 |
$ 1,760 |
$ 612 |
$ 4,235 |
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Net Income per Share: |
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Basic |
$0.06 |
$0.12 |
$0.04 |
$0.28 |
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Diluted |
$0.06 |
$0.11 |
$0.04 |
$0.27 |
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Weighted Average Shares Outstanding: |
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Basic |
14,578 |
14,999 |
14,823 |
15,023 |
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Diluted |
14,646 |
15,335 |
14,825 |
15,411 |
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Three Months Ended |
Nine Months Ended |
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October 3, |
September 27, |
October 3, |
September 27, |
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2009 |
2008 |
2009 |
2008 |
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Segment Data: |
Cross Accessory Division |
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Net Sales |
$21,246 |
$26,633 |
$60,773 |
$79,057 |
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Operating (Loss) Income |
(1,418 |
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621 |
(6,350 |
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(685 |
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Segment Data: |
Cross Optical Group |
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Net Sales |
$12,883 |
$12,341 |
$41,502 |
$39,382 |
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Operating Income |
1,612 |
1,844 |
5,908 |
7,366 |
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A.T. CROSS COMPANY |
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October 3, 2009 |
September 27, 2008 |
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Assets |
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Cash and cash equivalents |
$ 10,372 |
$ 13,963 |
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Short-term investments |
6,009 |
- |
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Accounts receivable |
24,930 |
28,303 |
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Inventories |
30,232 |
32,279 |
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Deferred income taxes |
4,339 |
5,302 |
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Other current assets |
6,805 |
8,745 |
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Total Current Assets |
82,687 |
88,592 |
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Property, plant and equipment, net |
15,267 |
16,946 |
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Goodwill |
15,279 |
17,230 |
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Intangibles and other assets |
12,544 |
14,325 |
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Deferred income taxes |
11,439 |
7,893 |
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Total Assets |
$ 137,216 |
$ 144,986 |
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Liabilities and Shareholders' Equity |
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Accounts payable and other current liabilities |
$ 18,611 |
$ 21,089 |
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Retirement plan obligations |
2,504 |
2,431 |
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Total Current Liabilities |
21,115 |
23,520 |
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Long-term debt |
19,721 |
21,721 |
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Retirement plan obligations |
14,751 |
3,977 |
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Deferred gain on sale of real estate |
3,389 |
3,911 |
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Other long term liabilities |
1,863 |
3,112 |
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Accrued warranty costs |
1,298 |
1,397 |
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Shareholders' equity |
75,079 |
87,348 |
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Total Liabilities and Shareholders ' Equity |
$ 137,216 |
$ 144,986 |
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For information at A. T. Cross contact: |
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Kevin F. Mahoney |
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Senior Vice President, Finance and Chief Financial Officer |
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(401) 335-8470 |
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kmahoney@cross.com |
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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, thereunto duly authorized.
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A. T. CROSS COMPANY |
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Date: October 22, 2009 |
KEVIN F. MAHONEY Senior Vice President, Finance Chief Financial Officer |