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Lakeland reports fiscal 2009 Q3 financial results
16 Dec '08
6 min read
Net sales were a record $25.2 million in the third quarter of fiscal 2009, up 7.3% from the $23.5 million posted in the comparable fiscal 2008 period. The increase in revenue was primarily due to contributions from the Company's foreign expansion. Brazil sales included in the current quarter were $2.4 million, reflecting the Company's recent acquisition. External sales from China increased by $0.2 million, or 21%, to $1.2 million, driven by sales to the Company's new Australian distributor.
UK sales increased by 15% to $1.0 million, while Chile sales decreased by 21% to $0.3 million. U.S. domestic sales decreased by $1.1 million, or 5.6%, to $19.5 million due to difficult operating conditions in September and October.
Gross profit increased by $1.5 million, or 26%, to $7.2 million for the third quarter of fiscal 2009, as compared with $5.7 million for the same period in fiscal 2008. Gross profit as a percentage of net sales for the quarter ended October 31, 2008 rose to 28.5%, a record level for the third fiscal quarter and the second highest level in the Company's history, and increased from 24.3% in the same period of fiscal 2008. This improvement was primarily due to the inclusion of the Company's Brazilian operations, which posted a 49.3% gross margin, and the end of the prior year's sales rebate program to meet competitive conditions, offset slightly by late stage start-up losses in India.
Operating profit increased by $0.7 million, or 50%, to $2.1 million, versus $1.4 million recorded in the third quarter of fiscal 2008. Operating income as a percentage of net sales increased to 8.2% for the third quarter of fiscal 2009, up from 5.8% for the same period in fiscal 2008. EBITDA was 9.8% of sales for 3Q09 -- a level not seen in nearly three years.
The improvement in operating profit and margins is due to the increased level of total revenues including high margin contributions from Brazil, the use of lower-cost raw materials in production of garments outside of the United States where in-country and external revenues are increasing, new product introductions, new customers, and the end of the rebate program initiated early in fiscal year 2008.
Interest expenses increased by $0.2 million for the three months ended October 31, 2008 as compared to the three months ended October 31, 2007 due to higher borrowing levels outstanding, primarily reflecting funding for the Company's Brazil acquisition, partially offset by lower interest rates in the current year.
Net sales increased $9.2 million, or 13%, to $80.0 million for the nine months ended October 31, 2008 from $70.8 million for the nine months ended October 31, 2007. The net increase was mainly due to international growth. Gross profit increased $5.8 million, or 36%, to $22.0 million for the nine months ended October 31, 2008 from $16.2 million for the nine months ended October 31, 2007.
Gross profit as a percentage of netsales increased to 27.5% in fiscal 2009 from 22.9% in fiscal 2008, primarily due to the inclusion of the Company's Brazilian operations, the end of the prior year's sales rebate program to meet competitive conditions, the Mexican restructuring program in the prior year, and favorable claims experience in our medical insurance program.
Operating profit increased 75% to $5.7 million for the nine months ended October 31, 2008 from $3.3 million for the nine months ended October 31, 2007. Year-to-date, the Company posted an operating margin of 7.1%, versus 4.6% last year.
UK sales increased by 15% to $1.0 million, while Chile sales decreased by 21% to $0.3 million. U.S. domestic sales decreased by $1.1 million, or 5.6%, to $19.5 million due to difficult operating conditions in September and October.
Gross profit increased by $1.5 million, or 26%, to $7.2 million for the third quarter of fiscal 2009, as compared with $5.7 million for the same period in fiscal 2008. Gross profit as a percentage of net sales for the quarter ended October 31, 2008 rose to 28.5%, a record level for the third fiscal quarter and the second highest level in the Company's history, and increased from 24.3% in the same period of fiscal 2008. This improvement was primarily due to the inclusion of the Company's Brazilian operations, which posted a 49.3% gross margin, and the end of the prior year's sales rebate program to meet competitive conditions, offset slightly by late stage start-up losses in India.
Operating profit increased by $0.7 million, or 50%, to $2.1 million, versus $1.4 million recorded in the third quarter of fiscal 2008. Operating income as a percentage of net sales increased to 8.2% for the third quarter of fiscal 2009, up from 5.8% for the same period in fiscal 2008. EBITDA was 9.8% of sales for 3Q09 -- a level not seen in nearly three years.
The improvement in operating profit and margins is due to the increased level of total revenues including high margin contributions from Brazil, the use of lower-cost raw materials in production of garments outside of the United States where in-country and external revenues are increasing, new product introductions, new customers, and the end of the rebate program initiated early in fiscal year 2008.
Interest expenses increased by $0.2 million for the three months ended October 31, 2008 as compared to the three months ended October 31, 2007 due to higher borrowing levels outstanding, primarily reflecting funding for the Company's Brazil acquisition, partially offset by lower interest rates in the current year.
Net sales increased $9.2 million, or 13%, to $80.0 million for the nine months ended October 31, 2008 from $70.8 million for the nine months ended October 31, 2007. The net increase was mainly due to international growth. Gross profit increased $5.8 million, or 36%, to $22.0 million for the nine months ended October 31, 2008 from $16.2 million for the nine months ended October 31, 2007.
Gross profit as a percentage of netsales increased to 27.5% in fiscal 2009 from 22.9% in fiscal 2008, primarily due to the inclusion of the Company's Brazilian operations, the end of the prior year's sales rebate program to meet competitive conditions, the Mexican restructuring program in the prior year, and favorable claims experience in our medical insurance program.
Operating profit increased 75% to $5.7 million for the nine months ended October 31, 2008 from $3.3 million for the nine months ended October 31, 2007. Year-to-date, the Company posted an operating margin of 7.1%, versus 4.6% last year.
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