Acme United Corporation Reports Record Quarterly Earnings

July 19, 2013 at 9:01 AM EDT

FAIRFIELD, Conn.--(BUSINESS WIRE)--Jul. 19, 2013-- Acme United Corporation (NYSE MKT: ACU) today announced record quarterly net income of $2,210,000, or $.68 per diluted share, for the quarter ended June 30, 2013, compared to $2,061,000 or $.66 per diluted share for the comparable period in 2012, an increase of 7% in net income and 3% in diluted earnings per share.

Net income for the six months ended June 30, 2013 was $2,520,000, or $.78 per diluted share, compared to $2,320,000, or $.74 per diluted share in the comparable period last year, a 9% increase in net income and 5% increase in diluted earnings per share.

Net sales for the six months ended June 30, 2013 were $46.1 million, compared to $44.5 million in the same period in 2012, an increase of 4%. Net sales for the second quarter ended June 30, 2013 were $28.4 million, compared to $27.6 million in the comparable period of 2012, an increase of 3%.

Net sales for the quarter ended June 30, 2013 in the U.S. segment increased 5% compared to the same period in 2012 due to increased back to school sales and additional sales resulting from the acquisition of the C-Thru Ruler Company in June 2012. Net sales for the six months ended June 30, 2013 in the U.S. segment increased 8% compared to the same period in 2012 due to additional sales resulting from the acquisition of the C-Thru Ruler Company in June 2012, increased back to school sales and higher sales of Camillus knives.

Net sales in Canada for the three months ended June 30, 2013 decreased 5% in U.S. dollars and 3% in local currency compared to the same period in 2012. Net sales for the six months ended June 30, 2012 in Canada decreased 4% in U.S. dollars and 3% in local currency compared to the same period in 2012.

Net sales in Europe for the three months ended June 30, 2013 increased 3% in U.S. dollars and 2% in local currency compared to the same period in 2012. Net sales for the six months ended June 30, 2013 in Europe decreased 18% in both U.S. dollars and local currency compared to the same period in 2012 primarily due to the bankruptcy and liquidation of a large customer in Germany in the second quarter of 2012.

Gross margins were 35.5% in the second quarter of 2013 compared to 35.6% in the second quarter of 2012. Gross margins were 35.8% for the six months ended June 30, 2013 compared to 35.4% for the comparable period last year.

Walter C. Johnsen, Chairman and CEO said, “We had the best quarterly sales and earnings in the Company’s history during the second quarter of 2013, an achievement especially significant as last year’s second quarter was also a record. Our back-to-school products continue to sell well and make market share inroads.” Mr. Johnsen added that sales of Camillus knives, PacKit first aid kits, and our gardening tools appear to be broadening the Company’s earnings base and may strengthen the second half performance.

ACME UNITED CORPORATION is a leading worldwide supplier of innovative cutting, measuring and safety products to the school, home, office, hardware and industrial markets. Its leading brands include Westcott®, Clauss®, Camillus®, PhysiciansCare ® and Pac-Kit®.

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; and (vii) other risks and uncertainties indicated from time to time in the Company’s filings with the Securities and Exchange Commission.

ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SECOND QUARTER REPORT 2013
(Unaudited)

		Three Months Ended			Three Months Ended
Amounts in 000's except per share data		June 30, 2013			June 30, 2012


Net sales	$	28,412		$	27,594
Cost of goods sold		18,331			17,773
Gross profit		10,081			9,821
Selling, general, and administrative expenses		6,889			6,743
Income from operations		3,192			3,078
Interest expense		114			91
Interest income		(40	)		(29	)
Net interest expense		74			62
Other expense		25			43
Total other expense		99			105
Pre-tax income		3,093			2,973
Income tax expense		883			912
Net income	$	2,210		$	2,061

Shares outstanding - Basic		3,156			3,103
Shares outstanding - Diluted		3,265			3,144

Earnings per share basic	$	0.70		$	0.66
Earnings per share diluted		0.68			0.66

ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SECOND QUARTER REPORT 2013 (cont.)
(Unaudited)

		Six Months Ended			Six Months Ended
Amounts in 000's except per share data		June 30, 2013			June 30, 2012

Net sales	$	46,063		$	44,472
Cost of goods sold		29,554			28,707
Gross profit		16,509			15,765
Selling, general, and administrative expenses		12,803			12,229
Income from operations		3,706			3,536
Interest expense		241			193
Interest income		(98	)		(76	)
Net interest expense		143			117
Other expense		28			86
Total other expense		171			203
Pre-tax income		3,535			3,333
Income tax expense		1,015			1,013
Net income	$	2,520		$	2,320

Shares outstanding - Basic		3,144			3,118
Shares outstanding - Diluted		3,233			3,142

Earnings per share basic	$	0.80		$	0.74
Earnings per share diluted		0.78			0.74

ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
SECOND QUARTER REPORT 2013
(Unaudited)

Amounts in 000's		June 30, 2013		June 30, 2012

Assets:
Current assets:
Cash	$	8,458	$	7,141
Accounts receivable, net		25,420		23,857
Inventories		29,450		26,681
Prepaid and other current assets		2,115		1,859
Total current assets		65,443		59,538

Property and equipment, net		2,353		2,377
Long term receivable		1,669		1,734
Intangible assets, less amortization		4,156		4,288
Other assets		1,115		1,217
Total assets	$	74,736	$	69,154

Liabilities and stockholders' equity:
Current liabilities
Accounts payable	$	9,092	$	9,968
Other current liabilities		5,401		5,612
Total current liabilities		14,493		15,580
Bank debt		26,012		23,005
Other non current liabilities		1,021		1,130
		41,526		39,715
Total stockholders' equity		33,210		29,439
Total liabilities and stockholders' equity	$	74,736	$	69,154

Source: Acme United Corporation

Acme United Corporation
Paul G. Driscoll, 203-254-6060
FAX: 203-254-6521

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Acme United Corporation Reports Record Quarterly Earnings