UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (date of earliest event reported): April 20, 2017
ACME UNITED CORPORATION
(Exact name of registrant as specified in its charter)
__________________
| Connecticut | 001-07698 | 06-0236700 |
| (State or other jurisdiction of incorporation or organization) |
(Commission file number)
|
(I.R.S. Employer Identification No.) |
|
55 Walls Drive, Fairfield, Connecticut |
06824 | |
| (Address of principal executive offices) | (Zip Code) | |
Registrant’s telephone number, including area code: (203) 254-6060
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:
| □ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| □ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| □ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| □ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On April 20, 2017, Acme United Corporation (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2017. A copy of the press release is attached as Exhibit 99.1 to this current report.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
| Exhibit Number | Description |
| 99.1 | Press release dated April 20, 2017. |
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 hereunto duly authorized.
| ACME UNITED CORPORATION | ||
| By | /s/ Walter C. Johnsen | |
| Walter C. Johnsen | ||
| Chairman and | ||
| Chief Executive Officer | ||
| Dated: April 20, 2017 | ||
| By | /s/ Paul G. Driscoll | |
| Paul G. Driscoll | ||
| Vice President and | ||
| Chief Financial Officer | ||
| Dated: April 20, 2017 | ||
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EXHIBIT INDEX
| Exhibit Number | Description | |
| 99.1 | Press release dated April 20, 2017. |
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Exhibit 99.1
| ACME UNITED CORPORATION | NEWS RELEASE | |||
| CONTACT: | Paul G. Driscoll | Acme United Corporation | 55 Walls Drive | Fairfield, CT 06824 |
| Phone: (203) 254-6060 | FAX: (203) 254-6521 | |||
| FOR IMMEDIATE RELEASE April 20, 2017 |
ACME
UNITED CORPORATION REPORTS FIRST QUARTER SALES INCREASE OF 10%
AND 13% INCREASE IN EPS
FAIRFIELD, CONN. – April 20, 2017 – Acme United Corporation (NYSE MKT:ACU) today announced that net sales for the quarter ended March 31, 2017 were $27.7 million, compared to $25.3 million in the first quarter of 2016, an increase of 10%.
Net income was $659,000 or $0 .18 per diluted share for the quarter ended March 31, 2017, compared to $565,000 or $0.16 per diluted share for the comparable period last year, an increase of 17% in net income and 13% in earnings per share.
On February 1, 2017, the Company acquired the assets of Spill Magic, Inc. for $7.2 million in cash. Spill Magic products are leaders in absorbents that encapsulate spills into dry powders that can be safely disposed, helping to avoid slips and falls on our customers’ premises. Spill Magic had sales of $6.3 million in 2016. The Company’s first quarter 2017 revenues included approximately $1.1 million from the sales of Spill Magic products.
Walter C. Johnsen , Chairman and CEO said, “Our team executed well and delivered solid growth in both sales and earnings. We began shipping our proprietary Westcott glue guns, expanded our distribution of Camillus hunting knives and Cuda fishing tools, and realized robust growth of first aid components and Smart Compliance kits. Our DMT sharpener business, which we acquired in February 2016, continued to expand. We are pleased to welcome the management of Spill Magic to our company and look forward to building our business together.”
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For the first quarter of 2017, net sales in the U.S. segment increased 9% compared to the same period in 2016. Net sales in Canada were constant in U.S. dollars and decreased 3% in local currency compared to the same period in 2016. European net sales increased 38% in both U.S. dollars and local currency compared to the first quarter of 2016 mainly due to new customers in the office products channel and sales of DMT products.
Gross margin was 38% in the first quarter of 2017 versus 36% in the comparable period last year. The higher gross margin was primarily due to efficiency improvements in the Company’s first aid operations and a better product mix.
Mr. Johnsen reiterated guidance for 2017 of approximately $137 million in revenues, $6.7 million in net income, and $1.76 earnings per share.
The Company’s bank debt less cash on March 31, 2017 was $38 million compared to $34 million on March 31, 2016. During the twelve month period ended March 31, 2017, the Company paid approximately $7.2 million for the acquisition of the assets of Spill Magic and distributed $1.3 million in dividends on its common stock. During the twelve month period, the Company generated $6.3 million in free cash flow.
Acme United will hold a conference call to discuss its quarterly and results, which will be broadcast over the Internet on Thursday, April 20, 2017, at 12:00 p.m. EDT. To listen or participate in a question and answer session, dial 800-768-6570. International callers may dial 785-830-1942. You may access the live webcast of the conference call through the Investor Relations section of the Company’s website, www.acmeunited.com. A replay may be accessed under Investor Relations, Audio Archives or by logging on to www.streetevents.com.
ACME UNITED CORPORATION is a leading worldwide supplier of innovative cutting, measuring and safety products to the school, home, office, hardware, sporting goods and industrial markets. Its leading brands include Westcott®, Clauss®, Camillus®, Cuda®, PhysiciansCare®, First Aid Only®, Pac-Kit®, DMT® and Spill Magic®. For more information, visit www.acmeunited.com.
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Forward-looking statements in this report, including without limitation, statements related to the Company’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, the following: (i) changes in the Company’s plans, strategies, objectives, expectations and intentions, which may be made at any time at the discretion of the Company; (ii) the impact of uncertainties in global economic conditions, including the impact on the Company’s suppliers and customers; (iii) changes in client needs and consumer spending habits; (iv) the impact of competition and technological changes on the Company; (v) the Company’s ability to manage its growth effectively, including its ability to successfully integrate any business it might acquire; (vi) currency fluctuations; (vii) potential increases in the cost of borrowings resulting from rising interest rates and (viii) other risks and uncertainties indicated from time to time in the Company’s filings with the Securities and Exchange Commission.
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ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FIRST QUARTER REPORT 2017
(unaudited)
| Quarter Ended | Quarter Ended | |||||||
| Amounts in 000's except per share data | March 31, 2017 | March 31, 2016 | ||||||
| Net sales | $ | 27,745 | $ | 25,288 | ||||
| Cost of goods sold | 17,181 | 16,103 | ||||||
| Gross profit | 10,564 | 9,185 | ||||||
| Selling, general and administrative expenses | 9,372 | 8,230 | ||||||
| Income from operations | 1,192 | 955 | ||||||
| Interest expense, net | 263 | 184 | ||||||
| Other income, net | (9 | ) | (38 | ) | ||||
| Pre-tax income | 938 | 809 | ||||||
| Income tax expense | 279 | 244 | ||||||
| Net income | $ | 659 | $ | 565 | ||||
| Shares outstanding - Basic | 3,329 | 3,336 | ||||||
| Shares outstanding - Diluted | 3,730 | 3,572 | ||||||
| Earnings per share - basic | $ | 0.20 | $ | 0.17 | ||||
| Earnings per share - diluted | 0.18 | 0.16 | ||||||
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ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
FIRST QUARTER REPORT 2017
(Unaudited)
Amounts in $000's
| March 31, 2017 | March 31, 2016 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | 6,175 | $ | 1,474 | ||||
| Accounts receivable, net | 21,251 | 19,118 | ||||||
| Inventories | 37,285 | 37,551 | ||||||
| Prepaid and other current assets | 2,878 | 2,733 | ||||||
| Total current assets | 67,589 | 60,876 | ||||||
| Property and equipment, net | 8,381 | 7,745 | ||||||
| Intangible assets, less amortization | 19,525 | 14,682 | ||||||
| Goodwill | 3,948 | 3,948 | ||||||
| Other assets | 761 | 1,039 | ||||||
| Total assets | $ | 100,204 | $ | 88,290 | ||||
| Liabilities and stockholders' equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 5,731 | $ | 6,279 | ||||
| Other current liabilities | 3,204 | 2,854 | ||||||
| Total current liabilities | 8,935 | 9,133 | ||||||
| Long-term debt | 44,382 | 35,696 | ||||||
| Other non-current liabilities | 284 | 316 | ||||||
| Total liabilities | 53,601 | 45,145 | ||||||
| Total stockholders' equity | 46,603 | 43,145 | ||||||
| Total liabilities and stockholders' equity | $ | 100,204 | $ | 88,290 | ||||
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