Decline in sales of disposable apparel at Alpha Pro Tech

06 Aug '11

4 min read

Alpha Pro Tech Ltd, a leading manufacturer of products designed to protect people, products and environments, including disposable protective apparel and building products, announced financial results for the three and six months ended June 30, 2011.

Consolidated sales for the second quarter decreased 8.4% to $10.3 million from $11.2 million in the comparable quarter of 2010. Sales for the Disposable Protective Apparel segment for the three months ended June 30, 2011 decreased by 40.7% to $2.9 million, compared to $4.8 million for the same period of 2010. Building Supply segment sales for the three months ended June 30, 2011 increased by 30.7% to a record $6.4 million, compared to $4.9 million for the same period of 2010, and increased 36.2% sequentially from $4.7 million in the first quarter ended March 31, 2011.

The sales mix of the Building Supply segment for the three months ended June 30, 2011 was 69% for synthetic roof underlayment and 31% for housewrap. This compared to 68% for synthetic roof underlayment and 32% for housewrap for the second quarter of 2010. Infection Control segment sales for the three months ended June 30, 2011 decreased by 30.5% to $1.1 million, compared to $1.5 million for the same period of 2010. Mask sales were down by 38.7% to $670,000, and shield sales were up by 37.1% to $381,000.

Al Millar, President of Alpha Pro Tech, commented, “The decrease in Disposable Protective Apparel segment sales is partially due to a decline in sales of disposable apparel to our former exclusive private label distributor that began in the first quarter of 2010. In that quarter, the distributor informed us that it had decided to launch a competing private label line of disposable protective apparel. However, it was not until the second quarter of 2010 that we started to experience the significant impact of this change."

"In addition, sales to our major international supply chain partner were also down in the second quarter of 2011, as compared to the same quarter of 2010, due to the significant demand last year to fill its inventory needs. Although sales to this partner were down compared to the same quarter last year, sales in the second quarter of 2011 were higher than the average of the past three quarters, and, in addition, this partner's same quarter sales to its end users were up 39%, demonstrating a strong demand for our products.”

Mr. Millar concluded, “Building Supply segment sales for the three months ended June 30, 2011 increased to a quarterly record of $6.4 million, and we surpassed our previous quarterly record of $5.3 million by over 20%. In the fourth quarter of 2010, we launched our new REX™ Wrap Fortis housewrap, our ICC-ES approved non-perforated breathable housewrap. The non-perforated breathable housewrap market accounts for the majority of the total housewrap market, so this new product should increase our housewrap sales and market share. The product has been slowly gaining momentum through the first half of the year, and we are increasing sales efforts, as initial customer response has been positive."

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