Apparel labeling to provide solid foundation for future growth, Checkpoint
Checkpoint Systems Inc reported financial results for the fourth quarter and full year ended December 26, 2010. Net revenues for the fourth quarter of 2010 were $235.5 million compared to net revenues for the fourth quarter of 2009 of $237.8 million. Net earnings attributable to Checkpoint Systems, Inc. for the fourth quarter of 2010 were $7.7 million, or $0.19 per diluted share, compared to net earnings attributable to Checkpoint Systems, Inc. for the fourth quarter of 2009 of $18.6 million, or $0.47 per diluted share.
Net revenues for the year 2010 were $834.5 million compared to net revenues for the year 2009 of $772.7 million.
"For the fourth quarter 2010, our revenues were effectively unchanged from last year," said Rob van der Merwe, Chairman, President and Chief Executive Officer of Checkpoint Systems. "We continued to realize excellent organic revenue in our Alpha(R) and CheckView businesses. Apparel Labeling Solutions increased nicely from last quarter as we started to experience top-line synergies from Brilliant Label. And the EAS systems business, although still below last year, continues to narrow the gap from comparable period revenues. However, our EAS consumables business, which had been very strong during the first half of the year, slowed as expected due to the completion of a significant Hard Tag @ Source program in the third quarter. We believe this business will be back on track by early 2011."
Mr. van der Merwe continued, "Gross profit margin for the quarter declined, principally due to the impact of the reduced Hard Tag @ Source business and to a lesser degree start-up costs associated with some of our recent product introductions.
"For the year just concluded we moved forward on many fronts to better position the Company for the future," said van der Merwe. "We continued to leverage our innovative capabilities, introducing new products and solutions; we completed the integration of sales and operations at Brilliant Label and thus established a more product and geographically diverse business; we strengthened our balance sheet as we restructured our credit facility; we are meeting our aggressive internal timetable to move to a common ERP platform; and we commenced a broad-based SG&A restructuring plan."
Mr. van der Merwe concluded, "I am confident that the progress we made in 2010, our recently announced definitive agreement to acquire Shore to Shore and our continuing focus on the converging fields of shrink management, merchandise visibility and apparel labeling will provide a solid foundation for future growth."
Net revenues decreased 0.9%. Foreign currency effects resulted in a 1.8% net revenues decline driven principally by the strengthened dollar versus the euro. This decrease was partially offset by organic growth of 0.9%, driven by the Apparel Labeling Solutions segment and to a lesser degree the Shrink Management Solutions segment, notably the CheckView and Alpha High Theft Solutions businesses.