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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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): July 18, 2008
ACME UNITED CORPORATION
(Exact name of registrant as specified in its charter)
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Connecticut 001-07698 06-0236700
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) file number) Identification No.)
60 Round Hill Road, 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))
(1)
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On July 18, 2008, Acme United Corporation (the "Company") issued a press release
announcing its financial results for the three and six months ended June 30,
2008. 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
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99.1 Press release dated July 18, 2008.
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
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Walter C. Johnsen
Chairman and
Chief Executive Officer
Dated: July 18, 2008
By /s/ PAUL G. DRISCOLL
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Paul G. Driscoll
Vice President and
Chief Financial Officer
Dated: July 18, 2008
(2)
EXHIBIT INDEX
Exhibit Number Description
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99.1 Press release dated July 18, 2008.
(3)
EXHIBIT 99.1
ACME UNITED CORPORATION NEWS RELEASE
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CONTACT: Paul G. Driscoll
Acme United Corporation
60 Round Hill Road Fairfield, CT 06824
Phone: (203) 254-6060 FAX: (203) 254-6521
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FOR IMMEDIATE RELEASE July 18, 2008
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ACME UNITED CORPORATION REPORTS RECORD SECOND QUARTER SALES AND EARNINGS
FAIRFIELD, CONN. - July 18, 2008 - Acme United Corporation (AMEX:ACU)
today announced that net sales for the quarter ended June 30, 2008 were $22.7
million, compared to $19.0 million in the same period in 2007, an increase of
20% (17% in local currency). Net sales for the six months ended June 30, 2008
were $37.0 million, compared to $31.2 million in the same period in 2007, an
increase of 18% (15% in local currency).
Net income was $1,730,000 or $.47 per diluted share for the second
quarter ended June 30, 2008, compared to $1,522,000 or $.41 per diluted share
for the comparable period last year, an increase of 14% in net income and 15% in
diluted earnings per share. Net income for the six months ended June 30, 2008
was $2,482,000, or $.68 per diluted share, compared to $2,172,000, or $.59 per
diluted share in the comparable period last year, a 14% increase in net income
and 15% in diluted earnings per share.
Net sales for the quarter ended June 30, 2008 in the U.S. segment
increased 23% as a result of market acceptance of new anti-microbial school
scissors, rulers, and math kits and iPoint pencil sharpeners. Net sales for the
six months ended June 30, 2008 in the U.S. segment increased 21%. Net sales in
Canada in the first six months of 2008 increased by 5% in U.S. dollars but
declined 6% in local currency due to soft demand in the overall office products
market. European net sales in the first six months of 2008 increased 18% in U.S.
dollars and 3% in local currency.
Gross margins were 39.3% in the second quarter of 2008 versus 42.0% in
the comparable period last year. For the first six months of 2008, gross margins
were 40.3% compared to 42.6% in the same period in 2007. The gross margin
declines were due to increased costs of material, labor, and energy, and the
appreciation of the Chinese currency against the U.S. dollar. Also, in the
second quarter of 2008, the company gained market share in the highly
competitive back to school segment which reduced gross margins.
(1)
Walter C. Johnsen, Chairman and CEO, said "The second quarter and year
to date sales demonstrate the strength of our new products, and the values they
deliver to our customers. Acme's base of business has broadened during the past
several years, with growth in the mass market, office superstores, independent
dealers, and hardware and industrial markets. Our international sales base has
also grown. The broadening of our customer base and international sales has
offset weakness in some domestic accounts."
The Company's bank debt less cash on June 30, 2008 was $11.3 million
compared to $9.6 million on June 30, 2007. The increase in bank debt during the
twelve month period was primarily due to an increase in borrowings for inventory
and accounts receivables for the back to school season as well as share
repurchases, partially offset by earnings. Based on anticipated cash flow, the
debt level is expected to decline during the second half of the year. During the
12 month period ended June 30, 2008, Acme purchased 67,600 shares of its common
stock for approximately $900,000 under its previously announced repurchase
program. As of June 30, 2008, there were 182,400 shares that may be purchased
under the outstanding stock repurchase programs.
ACME UNITED CORPORATION is an innovative supplier of cutting devices,
measuring instruments, and safety products for school, home, office and
industrial use. Its leading brands include Westcott(R), Clauss(R), and
PhysiciansCare (R).
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) the Company's
plans, strategies, objectives, expectations and intentions are subject to change
at any time at the discretion of the Company; (ii) the Company's plans and
results of operations will be affected by the Company's ability to manage its
growth, and (iii) other risks and uncertainties indicated from time to time in
the Company's filings with the Securities and Exchange Commission.
# # #
(2)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SECOND QUARTER REPORT 2008
(Unaudited)
Quarter Ended Quarter Ended
Amounts in $000's except per share data June 30, 2008 June 30, 2007
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Net sales $ 22,708 $ 18,999
Cost of goods sold 13,790 11,020
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Gross profit 8,918 7,979
Selling, general, and administrative expenses 6,121 5,435
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Income from operations 2,797 2,544
Interest expense 90 156
Other expense 24 41
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Pre-tax income 2,683 2,347
Income tax expense 953 825
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Net income $ 1,730 $ 1,522
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Shares outstanding - Basic 3,518 3,527
Shares outstanding - Diluted 3,665 3,698
Earnings per share basic $ 0.49 $ 0.43
Earnings per share diluted 0.47 0.41
(3)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
SECOND QUARTER REPORT 2008 (cont.)
(Unaudited)
Six Months Ended Six Months Ended
Amounts in $000's except per share data June 30, 2008 June 30, 2007
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Net sales $ 36,977 $ 31,240
Cost of goods sold 22,073 17,927
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Gross profit 14,904 13,313
Selling, general, and administrative expenses 11,039 9,593
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Income from operations 3,865 3,720
Interest expense 187 310
Other (income) expense (162) 14
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Pre-tax income 3,840 3,396
Income tax expense 1,358 1,224
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Net income $ 2,482 $ 2,172
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Shares outstanding - Basic 3,519 3,527
Shares outstanding - Diluted 3,666 3,698
Earnings per share basic $ 0.71 $ 0.62
Earnings per share diluted 0.68 0.59
(4)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
SECOND QUARTER REPORT 2008
(Unaudited)
Amounts in $000's June 30, 2008 June 30, 2007
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Assets:
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Current assets:
Cash $ 3,703 $ 3,057
Accounts receivable, net 20,852 18,056
Inventories 21,458 17,079
Prepaid and other current assets 1,121 1,287
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Total current assets 47,134 39,479
Property and equipment, net 2,479 2,506
Other assets 1,927 1,016
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Total assets $ 51,540 $ 43,001
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Liabilities and stockholders' equity:
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Current liabilities
Accounts payable 6,623 4,639
Other current liabilities 4,631 4,309
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Total current liabilities 11,253 8,948
Long-term debt 14,992 12,697
Other non current liabilities 551 687
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26,796 22,332
Total stockholders' equity 24,744 20,669
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Total liabilities and stockholders' equity $ 51,540 $ 43,001
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