Lakeland reports Q1 FY 2008 net income per share of $.10
08 Jun '07
3 min read
We expect to reopen this Indian facility by July 2007 so third quarter glove sales should benefit from such a re-opening. Sales in our fire gear and gloves declined by $558,000 compared to the same period last year.
The decline in fire gear sales was due to all new NFPA standards and delayed Underwriter's Laboratory (UL) certifications for this newly designed fire gear, which hurt the entire industry in the first quarter. The decline in glove sales was due to the loss of two customers, one of whom went out of business.
Gross profit decreased $1.3 million, or 20.0%, to $5.2 million for the three months ended April 30, 2007 from $6.5 million for the three months ended April 30, 2006.
Gross profit as a percentage of net sales decreased to 20.4% for the three months ended April 30, 2007 from 24.0% for the three months ended April 30, 2006, primarily due to a sales rebate program to meet competitive conditions resulting in a $392,000 reduction in sales, higher Tyvek fabric costs (resulting from Tyvek purchased at no rebate charged to the month of April resulting in approximately $250,000 higher cost.
Such cost is expected to continue for the month of May. The supply of this higher cost raw material would then be exhausted), start-up costs related to the new foreign subsidiaries of approximately $173,000, partially offset by ongoing cost reduction programs in component and service-purchasing, shifting production from the U.S. to China and Mexico, and a one time plant restructuring charge in Mexico of $500,000 pretax, or approximately $0.09 per share, rework expenses on a chemical suit contract, and lower volumes in fire gear and gloves.