acme_10q93009.htm
+
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
__________________
FORM
10-Q
____________________________________
[X] QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the
quarterly period ended September 30,
2009
OR
[
] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES
EXCHANGE ACT OF 1934
For the
transition period from ______ to ______
__________________
Commission
file number 001-07698
ACME
UNITED CORPORATION
(Exact
name of registrant as specified in its charter)
__________________
CONNECTICUT
|
06-0236700
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer 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
Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports) and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [
]
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T ( 232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files). Yes [
] No [ ]
Indicate
by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company. See
definition of “accelerated filer and large accelerated filer” in Rule 12b-2
of the Exchange Act (Check one).
Large
accelerated filer [ ] Accelerated
filer [
] Non-accelerated filer [
] Smaller reporting company [X]
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes [
] No [X]
As of
November 2, 2009, the registrant had outstanding 3,258,368 shares of its $2.50
par value Common Stock.
ACME
UNITED CORPORATION
Part I — FINANCIAL
INFORMATION |
|
Page |
|
Item 1.
Financial Statements (Unaudited)
|
|
|
|
|
Condensed
Consolidated Balance Sheets as of September 30, 2009 and December
31, 2008 |
|
4 |
|
|
Condensed
Consolidated Statements of Operations for the three and nine
months ended September 30, 2009 and 2008 |
|
6 |
|
|
Condensed
Consolidated Statements of Cash Flows for the nine months ended
September 30, 2009 and 2008 |
|
7 |
|
|
Notes to Condensed
Consolidated Financial Statements |
|
8 |
|
Item 2.
Management’s Discussion and Analysis of Financial Condition and
Results of Operations |
|
12 |
|
Item 3. Quantitative
and Qualitative Disclosure About Market Risk |
|
16 |
|
Item 4T. Controls
and Procedures |
|
16 |
|
|
|
|
|
Part II — OTHER
INFORMATION |
|
|
|
Item 1. Legal
Proceedings |
|
17 |
|
Item 1A. Risk
Factors |
|
17 |
|
Item 2. Unregistered
Sales of Equity Securities and Use of Proceeds |
|
17 |
|
Item 3. Defaults
Upon Senior Securities |
|
17 |
|
Item 4. Submission
of Matters to a Vote of Security Holders |
|
17 |
|
Item 5. Other
Information |
|
17 |
|
Item 6. Exhibits |
|
18 |
|
Signatures |
|
19 |
ACME
UNITED CORPORATION
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(all
amounts in thousands)
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
2009
|
|
|
2008
|
|
|
|
(unaudited)
|
|
|
(Note
1)
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$ |
6,599 |
|
|
$ |
5,225 |
|
Accounts
receivable, less allowance
|
|
|
11,846 |
|
|
|
10,564 |
|
Inventories:
|
|
|
|
|
|
|
|
|
Finished
goods
|
|
|
16,906 |
|
|
|
20,825 |
|
Work
in process
|
|
|
106 |
|
|
|
21 |
|
Raw
materials and supplies
|
|
|
838 |
|
|
|
923 |
|
|
|
|
17,850 |
|
|
|
21,769 |
|
Prepaid
expenses and other current assets
|
|
|
1,207 |
|
|
|
1,088 |
|
Total
current assets
|
|
|
37,502 |
|
|
|
38,646 |
|
Property,
plant and equipment:
|
|
|
|
|
|
|
|
|
Land
|
|
|
175 |
|
|
|
167 |
|
Buildings
|
|
|
2,579 |
|
|
|
2,966 |
|
Machinery
and equipment
|
|
|
8,116 |
|
|
|
7,455 |
|
|
|
|
10,870 |
|
|
|
10,587 |
|
Less
accumulated depreciation
|
|
|
8,710 |
|
|
|
8,318 |
|
|
|
|
2,160 |
|
|
|
2,269 |
|
Note
receivable
|
|
|
1,905 |
|
|
|
2,000 |
|
Other
assets
|
|
|
2,504 |
|
|
|
2,508 |
|
Total
assets
|
|
$ |
44,071 |
|
|
$ |
45,424 |
|
|
|
|
|
|
|
|
|
|
See notes
to condensed consolidated financial statements.
ACME
UNITED CORPORATION
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (continued)
|
|
(all
amounts in thousands, except share amounts)
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
2009
|
|
|
2008
|
|
|
|
(unaudited)
|
|
|
(Note
1)
|
|
LIABILITIES
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$ |
3,305 |
|
|
$ |
3,669 |
|
Other
accrued liabilities
|
|
|
4,680 |
|
|
|
5,158 |
|
Bank
debt, due June 30, 2010
|
|
|
9,324 |
|
|
|
- |
|
Total
current liabilities
|
|
|
17,309 |
|
|
|
8,827 |
|
Bank
debt, due June 30, 2010
|
|
|
- |
|
|
|
11,719 |
|
Other
|
|
|
1,990 |
|
|
|
1,991 |
|
Total
liabilities
|
|
|
19,299 |
|
|
|
22,536 |
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
Common
stock, par value $2.50:
|
|
|
|
|
|
|
|
|
authorized
8,000,000 shares;
|
|
|
|
|
|
|
|
|
issued
- 4,313,024 shares in 2009
|
|
|
|
|
|
|
|
|
and
4,293,024 shares in 2008,
|
|
|
|
|
|
|
|
|
including
treasury stock
|
|
|
10,781 |
|
|
|
10,733 |
|
Additional
paid-in capital
|
|
|
4,114 |
|
|
|
3,906 |
|
Retained
earnings
|
|
|
20,098 |
|
|
|
18,319 |
|
Treasury
stock, at cost - 1,054,656 shares
|
|
|
|
|
|
|
|
|
in
2009 and 949,656 shares in 2008
|
|
|
(9,275 |
) |
|
|
(8,407 |
) |
Accumulated
other comprehensive income:
|
|
|
|
|
|
|
|
|
Translation
adjustment
|
|
|
329 |
|
|
|
(388 |
) |
Unrecognized
pension costs
|
|
|
(1,275 |
) |
|
|
(1,275 |
) |
|
|
|
(946 |
) |
|
|
(1,663 |
) |
Total
stockholders’ equity
|
|
|
24,772 |
|
|
|
22,888 |
|
Total
liabilities and stockholders’ equity
|
|
$ |
44,071 |
|
|
$ |
45,424 |
|
|
|
|
|
|
|
|
|
|
See notes
to condensed consolidated financial statements.
ACME
UNITED CORPORATION
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(UNAUDITED)
|
|
(all
amounts in thousands, except share and per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
Nine
Months Ended
|
|
|
|
|
|
|
September
30
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
Net
sales
|
|
$ |
15,269 |
|
|
$ |
19,158 |
|
|
$ |
45,727 |
|
|
$ |
56,135 |
|
Cost
of goods sold
|
|
|
9,771 |
|
|
|
11,288 |
|
|
|
28,827 |
|
|
|
33,361 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
5,498 |
|
|
|
7,870 |
|
|
|
16,900 |
|
|
|
22,774 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses
|
|
|
4,864 |
|
|
|
5,651 |
|
|
|
14,166 |
|
|
|
16,690 |
|
Operating
income
|
|
|
634 |
|
|
|
2,219 |
|
|
|
2,734 |
|
|
|
6,084 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-operating
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(38 |
) |
|
|
(135 |
) |
|
|
(124 |
) |
|
|
(389 |
) |
Interest
income
|
|
|
31 |
|
|
|
15 |
|
|
|
97 |
|
|
|
83 |
|
Interest
expense, net
|
|
|
(7 |
) |
|
|
(120 |
) |
|
|
(27 |
) |
|
|
(306 |
) |
Other
income (expense), net
|
|
|
461 |
|
|
|
(138 |
) |
|
|
480 |
|
|
|
23 |
|
Total
other income (expense)
|
|
|
454 |
|
|
|
(258 |
) |
|
|
453 |
|
|
|
(283 |
) |
Income
before income taxes
|
|
|
1,088 |
|
|
|
1,961 |
|
|
|
3,187 |
|
|
|
5,801 |
|
Income
tax expense
|
|
|
360 |
|
|
|
610 |
|
|
|
1,076 |
|
|
|
1,968 |
|
Net
income
|
|
$ |
728 |
|
|
$ |
1,351 |
|
|
$ |
2,111 |
|
|
$ |
3,833 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share
|
|
$ |
0.22 |
|
|
$ |
0.38 |
|
|
$ |
0.64 |
|
|
$ |
1.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share
|
|
$ |
0.22 |
|
|
$ |
0.37 |
|
|
$ |
0.63 |
|
|
$ |
1.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
denominator
used for basic per share computations
|
|
|
3,290 |
|
|
|
3,515 |
|
|
|
3,318 |
|
|
|
3,517 |
|
Weighted
average number of dilutive stock options
|
|
|
|
|
|
|
|
|
|
|
|
|
|
outstanding
|
|
|
63 |
|
|
|
135 |
|
|
|
45 |
|
|
|
137 |
|
Denominator
used for diluted per share computations
|
|
|
3,353 |
|
|
|
3,650 |
|
|
|
3,363 |
|
|
|
3,654 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
declared per share
|
|
$ |
0.05 |
|
|
$ |
0.04 |
|
|
$ |
0.15 |
|
|
$ |
0.12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
notes to condensed consolidated financial statements.
|
|
|
|
|
|
|
|
|
ACME
UNITED CORPORATION
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(UNAUDITED)
|
|
(all
amounts in thousands)
|
|
|
|
Nine
Months Ended
|
|
|
|
September
30,
|
|
|
|
2009
|
|
|
2008
|
|
Operating
Activities:
|
|
|
|
|
|
|
Net
income
|
|
$ |
2,111 |
|
|
$ |
3,833 |
|
Adjustments
to reconcile net income
|
|
|
|
|
|
|
|
|
to
net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
594 |
|
|
|
666 |
|
Amortization
|
|
|
85 |
|
|
|
81 |
|
Stock
compensation expense
|
|
|
214 |
|
|
|
220 |
|
Change
in estimated cost of environmental remediation
|
|
|
(460 |
) |
|
|
|
|
Changes
in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(983 |
) |
|
|
(3,444 |
) |
Inventories
|
|
|
4,275 |
|
|
|
(1,551 |
) |
Prepaid
expenses and other current assets
|
|
|
(18 |
) |
|
|
251 |
|
Accounts
payable
|
|
|
(400 |
) |
|
|
(799 |
) |
Other
accrued liabilities
|
|
|
(39 |
) |
|
|
857 |
|
Total
adjustments
|
|
|
3,268 |
|
|
|
(3,719 |
) |
Net
cash provided by operating activities
|
|
|
5,379 |
|
|
|
114 |
|
|
|
|
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
Purchase
of property, plant, and equipment
|
|
|
(443 |
) |
|
|
(611 |
) |
Purchase
of patents and trademarks
|
|
|
(81 |
) |
|
|
(173 |
) |
Net
cash used by investing activities
|
|
|
(524 |
) |
|
|
(784 |
) |
|
|
|
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
Net
(repayment) borrowing of bank debt
|
|
|
(2,395 |
) |
|
|
2,760 |
|
Proceeds
from issuance of common stock
|
|
|
44 |
|
|
|
133 |
|
Distributions
to stockholders
|
|
|
(500 |
) |
|
|
(422 |
) |
Purchase
of treasury stock
|
|
|
(868 |
) |
|
|
(1,000 |
) |
Net
cash (used) provided by financing activities
|
|
|
(3,719 |
) |
|
|
1,471 |
|
|
|
|
|
|
|
|
|
|
Effect
of exchange rate changes
|
|
|
238 |
|
|
|
(304 |
) |
Net
change in cash and cash equivalents
|
|
|
1,374 |
|
|
|
497 |
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents at beginning of period
|
|
|
5,225 |
|
|
|
4,988 |
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents at end of period
|
|
$ |
6,599 |
|
|
$ |
5,485 |
|
|
|
|
|
|
|
|
|
|
See
notes to condensed consolidated financial statements.
|
|
|
|
|
|
|
|
|
NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note
1 — Basis of Presentation
In the
opinion of management, the accompanying condensed consolidated financial
statements include all adjustments necessary to present fairly the financial
position, results of operations and cash flows of Acme United Corporation (the
“Company”). These adjustments are of a normal, recurring
nature. However, the financial statements do not include all of the
disclosures normally required by accounting principles generally accepted in the
United States of America or those normally made in the Company's Annual Report
on Form 10-K. Please refer to the Company's Annual Report on Form 10-K for the
year ended December 31, 2008 for such disclosures. The condensed
consolidated balance sheet as of December 31, 2008 was derived from the audited
consolidated balance sheet as of that date. The results of operations
for interim periods are not necessarily indicative of the results to be expected
for the full year. The information included in this Quarterly Report
on Form 10-Q should be read in conjunction with the Management’s Discussion and
Analysis of Financial Condition and Results of Operations and financial
statements and notes thereto, included in the Company’s 2008 Annual Report on
Form 10-K.
The
Company has evaluated events and transactions subsequent to September 30,
2009 through November 13, 2009, the date these consolidated financial
statements were included in this Form 10-Q and filed with the SEC. The
Company has not identified any events that occurred subsequent to
September 30, 2009 and through November 13, 2009, that require
recognition or disclosure in the consolidated financial statements.
Note
2 — Contingencies
The
Company is involved from time to time in disputes and other litigation in the
ordinary course of business and may encounter other contingencies, which may
include environmental and other matters. The Company presently
believes that none of these matters, individually or in the aggregate, would be
likely to have a material adverse impact on its financial position, results of
operations or liquidity, as set forth in these financial
statements.
In
December 2008, the Company sold property it owned in Bridgeport, Connecticut to
B&E Juices, Inc. for $2.5 million. The property consists of
approximately four acres of land and 48,000 sq. feet of warehouse
space. The property was the site of the original Acme United scissor
factory which opened in 1887 and was closed in 1996.
Under the
terms of the sale agreement, and as required by the Connecticut Transfer Act,
the Company is responsible to remediate any environmental contamination on the
property. During 2008, the Company hired an independent environmental consulting
firm to conduct environmental studies in order to identify the extent of the
environmental contamination on the property and to develop a remediation plan.
As a result of those studies and the estimates prepared by the independent
environmental consulting firm, the Company recorded an undiscounted liability of
approximately $1.8 million related to the remediation of the property. This
accrual includes the costs of required investigation, remedial activities, and
post-remediation operating and maintenance.
Remediation
work on the project began in the third quarter of 2009 and a major portion of
the work has been completed. The Company expects to have significantly all of
the remediation work completed by year end. As of September 30, 2009, the
Company paid approximately $311,000 for work related to the remediation and has
approximately $953,000 remaining in its accrual for environmental remediation,
of which approximately $550,000 was classified as a current liability. The
Company expects to pay approximately $500,000 in the fourth quarter for
remediation work on the site.
In
addition to the remediation work, the Company, with the assistance of its
independent environmental consulting firm, must continue to monitor contaminant
levels on the property to ensure they comply with set governmental standards.
The Company expects that the monitoring period could last a minimum of three
years from the completion of the remediation work.
In
connection with the remediation work completed in the third quarter of 2009, the
environmental study was updated by the independent environmental consulting
firm. The results of this study produced a remedial action plan with a more
narrow scope which allowed the Company, along with its environmental consulting
firm, to refine the original project plan resulting in a new estimate of costs
to complete the project. The change in estimated costs resulted in a benefit of
approximately $460,000 which the Company recorded as other income during the
three months ended September 30, 2009.
The
change in the accrual for environmental remediation for the nine months ended
September 30, 2009 follows (in
thousands):
Balance
at
December
31, 2008
|
Payments
|
Change
in
Estimate
|
Balance
at
September
30, 2009
|
|
|
|
|
$ 1,724
|
$ (311)
|
$ (460)
|
$ 953
|
|
|
|
|
Note 3 — Pension
Components
of net periodic pension cost are as follows:
|
|
Three
Months Ended September 30,
|
|
|
Nine
Months Ended September 30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components
of net periodic benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
cost
|
|
$ |
43,750 |
|
|
$ |
41,611 |
|
|
$ |
131,250 |
|
|
$ |
131,611 |
|
Service
cost
|
|
|
3,750 |
|
|
|
3,750 |
|
|
|
11,250 |
|
|
|
18,750 |
|
Expected
return on plan assets
|
|
|
(37,500 |
) |
|
|
(39,428 |
) |
|
|
(112,500 |
) |
|
|
(151,928 |
) |
Amortization
of prior service costs
|
|
|
2,250 |
|
|
|
1,959 |
|
|
|
6,750 |
|
|
|
6,459 |
|
Amortization
of actuarial loss
|
|
|
18,750 |
|
|
|
15,983 |
|
|
|
56,250 |
|
|
|
53,483 |
|
|
|
$ |
31,000 |
|
|
$ |
23,875 |
|
|
$ |
93,000 |
|
|
$ |
58,375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
Company’s funding policy with respect to its qualified plan is to contribute at
least the minimum amount required by applicable laws and regulations. In 2009,
the Company is required to contribute approximately $120,000, of which the
Company has contributed approximately $108,000 through September 30, 2009 and
expects to make contributions to the plan as required during the remainder of
the year.
Note
4 —Debt and Shareholders Equity
The
Company’s revolving loan agreement, as amended, provides for borrowings up to
$20 million, with all principal amounts outstanding thereunder required to be
repaid in a single amount on June 30, 2010. In addition, the Company’s revolving
loan agreement requires monthly interest payments. As of September
30, 2009 and December 31, 2008, the Company had outstanding borrowings of
$9,324,000 and $11,719,000, respectively, under the revolving loan
agreement. Based on the scheduled payment date for the principal, the
Company has classified all borrowings under the revolving loan agreement as of
September 30, 2009 as a current liability. For
additional details regarding the bank debt please Item 3 - Liquidity and
Capital Resources.
During
the first nine months of 2009, the Company issued 20,000 shares of common stock
upon the exercise of outstanding stock options and received total proceeds of
$43,775. During the same period, the Company also repurchased 105,000
shares of common stock for its treasury. These shares were purchased
at fair market value, with a total cost to the Company of $868,200.
Note
5— Segment Information
The
Company reports financial information based on the organization structure used
by management for making operating and investment decisions and for assessing
performance. The Company’s reportable business segments consist of (1) United
States; (2) Canada and (3) Europe. The activities of the Company’s Asian
operating segment are closely linked to those of the U.S. operating segment;
accordingly, management reviews the financial results of both segments on a
consolidated basis, and the results of the Asian operating segment have been
aggregated with the results of the United States operating segment to form one
reportable segment called the “United States operating segment”. Each reportable
segment derives its revenue from the sales of cutting devices, measuring
instruments and safety products for school, office, home and industrial
use.
The chief
operating decision maker evaluates the performance of each operating segment
based on segment revenues and operating income. Segment amounts are presented
after converting to U.S. dollars and consolidating eliminations.
Financial
data by segment:
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended
September
30,
|
|
|
Nine
months ended
September
30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
Sales
to external customers: |
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
$ |
11,145 |
|
|
$ |
15,117 |
|
|
$ |
34,520 |
|
|
$ |
44,053 |
|
Canada
|
|
|
1,770 |
|
|
|
1,906 |
|
|
|
5,680 |
|
|
|
6,592 |
|
Europe
|
|
|
2,354 |
|
|
|
2,135 |
|
|
|
5,527 |
|
|
|
5,490 |
|
Consolidated
|
|
$ |
15,269 |
|
|
$ |
19,158 |
|
|
$ |
45,727 |
|
|
$ |
56,135 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
$ |
593 |
|
|
$ |
2,107 |
|
|
$ |
2,833 |
|
|
$ |
5,741 |
|
Canada
|
|
|
80 |
|
|
|
183 |
|
|
|
325 |
|
|
|
762 |
|
Europe
|
|
|
(39 |
) |
|
|
(71 |
) |
|
|
(424 |
) |
|
|
(419 |
) |
Consolidated
|
|
$ |
634 |
|
|
$ |
2,219 |
|
|
$ |
2,734 |
|
|
$ |
6,084 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense, net
|
|
|
(7 |
) |
|
|
120 |
|
|
|
(27 |
) |
|
|
306 |
|
Other
income (expense), net
|
|
|
461 |
|
|
|
(138 |
) |
|
|
480 |
|
|
|
23 |
|
Consolidated
income before taxes
|
|
$ |
1,103 |
|
|
$ |
1,961 |
|
|
$ |
3,242 |
|
|
$ |
5,801 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
|
2009
|
|
|
2008
|
|
|
United
States
|
|
$ |
32,785 |
|
|
$ |
33,719 |
|
|
Canada
|
|
|
5,639 |
|
|
|
5,890 |
|
|
Europe
|
|
|
5,647 |
|
|
|
5,815 |
|
|
Consolidated
|
|
$ |
44,071 |
|
|
$ |
45,424 |
|
|
Note
6 – Stock Based Compensation
The Company recognizes share-based
compensation at fair value of the equity instrument on the grant date.
Compensation expense is recognized over the required service period. Share-based
compensation expense was $67,618 and $53,606 for the quarters ended September
30, 2009 and September 30, 2008, respectively. Share-based compensation expense
was $214,006 and $219,869 for the nine months ended September 30, 2009 and
September 30, 2008, respectively. The Company did not issue options during the
three months ended September 30, 2009. During the nine months ended
September 30, 2009, the Company issued 151,000 options with a weighted average
fair value of $2.34 per share. During the three and nine months ended September
30, 2008, the Company issued 68,000 and 80,500 options with a weighted average
fair value of $3.86 and $3.62 per share, respectively. The assumptions used to
value option grants for the three and nine months ended September 30, 2009
and September 30, 2008 are as follows:
|
Three
months ended
September
30,
|
|
|
Nine
months ended
September
30,
|
|
|
2009
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
Expected
life in years
|
NA
|
|
|
5 |
|
|
|
5 |
|
|
|
5 |
|
Interest
rate
|
NA
|
|
|
3.30% |
|
|
|
1.82%
- 2.95% |
|
|
|
2.95%
- 3.30% |
|
Volatility
|
NA
|
|
|
0.29 |
|
|
|
0.384
– 0.386 |
|
|
|
0.29
- 0.31 |
|
Dividend
yield
|
NA
|
|
|
1.2% |
|
|
|
2.5% |
|
|
|
1.2% |
|
As of
September 30, 2009, there was a total of $596,431 of unrecognized compensation
cost related to non-vested share –based payments granted to the Company’s
employees. The remaining unamortized expense is expected to be
recognized over a weighted average period of approximately three
years.
Note
7 – Comprehensive Income
Comprehensive
income for the three and nine months ended September 30, 2009 and September 30,
2008 consisted of the following:
(in thousands)
|
|
Three
Months Ended
|
|
|
Nine
Months Ended
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$ |
728 |
|
|
$ |
1,351 |
|
|
$ |
2,111 |
|
|
$ |
3,833 |
|
Other
comprehensive income / (loss) -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation
|
|
|
530 |
|
|
|
(532 |
) |
|
|
717 |
|
|
|
(548 |
) |
Comprehensive
income
|
|
$ |
1,258 |
|
|
$ |
819 |
|
|
$ |
2,829 |
|
|
$ |
3,285 |
|
Note
8 – Fair Value Measurements
The
carrying value of bank debt is a reasonable estimate of fair value because of
its short term nature. The carrying value of the Company’s note receivable
approximates fair value. Fair value was determined using a discounted cash flow
analysis.
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF
FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Item
2. – Management’s Discussion and Analysis of Financial Condition and
Results of Operations
Forward-Looking
Information
The
Company may from time to time make written or oral “forward-looking statements”
including statements contained in this report and in other communications by the
Company, which are made in good faith by the Company pursuant to the “safe
harbor” provisions of the Private Securities Litigation Reform Act of
1995.
These forward-looking statements
include statements of the Company’s plans, objectives, expectations, estimates
and intentions, which are subject to change based on various important factors
(some of which are beyond the Company’s control). The following factors, in
addition to others not listed, could cause the Company’s actual results to
differ materially from those expressed in forward looking statements: the
strength of the domestic and local economies in which the Company conducts
operations, the impact of current uncertainties in global economic conditions
and the ongoing financial crisis affecting the domestic and foreign banking
systems and financial markets, including the impact on the Company’s supplier
and customers, currency fluctuations, the continued availability of credit on
terms satisfactory to the Company, changes in client needs and consumer spending
habits, the impact of competition and technological change on the Company, and
the Company’s ability to manage its growth effectively, including its ability to
successfully integrate any business which it might acquire. A more detailed
discussion of risk factors is set forth in Item 1A, “Risk Factors”, included in
the Company’s Annual Report on Form 10-K for the fiscal year ended December 31,
2008. All forward-looking statements in this report are
based upon information available to the Company on the date of this
report. The Company undertakes no obligation to publicly update or
revise any forward-looking statement, whether as a result of
new information, future events, or otherwise, except as required by
law.
Critical
Accounting Policies
There
have been no material changes to our critical accounting policies and estimates
from the information provided in Item 7, Management’s Discussion and Analysis of
Financial Condition and Results of Operations, included in our Annual Report on
Form 10-K for the fiscal year ended December 31, 2008.
Results
of Operations
Net
sales
Consolidated
net sales for the three months ended September 30, 2009 were $15,269,000
compared with $19,158,000 in the same period in 2008, a 20% decrease (19% at
constant currency). Consolidated net sales for the nine months ended September
30, 2009 were $45,727,000, compared with $56,135,000 for the same period in
2008, a 19% decrease (16% at constant currency). Net sales for the three and
nine months ended September 30, 2009 in the U.S. segment decreased 26% and 22%,
respectively, compared with the same periods in 2008. Net sales in
Canada for the three and nine months ended September 30, 2009 decreased by 7%
and 14%, respectively, in U.S. dollars and approximately 2% in local currency
compared with the same periods in 2008. The declines in net sales for the three
and nine months in the U.S. and Canadian segments are primarily due to a
reduction in customer orders across all of our product lines as a result of the
continued economic downturn. Also contributing to the decline in the
U.S. operating segment in the three and nine months ended September 30, 2009 was
the fact that a large special new order in the third quarter 2008 of
approximately $1.2 million from a major retailer for product for the back to
school market did not reoccur this year. European net sales for the three months
ended September 30, 2009 increased 10% in U.S. dollars and 16% in local
currency. European net sales for the nine months ended September 30, 2009
increased 1% in U.S. dollars but increased 12% in local currency compared with
the same periods in 2008. The increase in net sales in Europe for the
three and nine months were primarily due to higher sales of manicure products,
which include scissors, clippers and other related items. Also contributing to
the increase in the three months ended September 30, 2009 were higher sales of
the iPoint pencil sharpener.
Traditionally,
the Company’s sales are stronger in the second and third quarters, and weaker in
the first and fourth quarters of the fiscal year, due to the seasonal nature of
the back-to-school market.
Gross
profit
Gross
profit for the three months ended September 30, 2009 was $5,498,000 (36.0% of
net sales) compared to $7,870,000 (41.0% of net sales) for the same period in
2008. Gross profit for the nine months ended September 30, 2009 was
$16,900,000 (36.9% of net sales) compared to $22,774,000 (40.5% of net sales) in
the same period in 2008. The gross margin declines for the three and nine months
ended September 30, 2009 were primarily due to fixed costs spread over lower
sales, the weaker Canadian dollar, which raised the cost of our products in the
Canadian operating segment, and a product mix which consisted of a higher
proportion of sales of our lower cost, lower margin products.
Selling,
general and administrative expenses
Selling,
general and administrative ("SG&A") expenses for the three months ended
September 30, 2009 were $4,864,000 (31.9% of net sales) compared with $5,651,000
(29.5% of net sales) for the same period of 2008, a decrease of $787,000.
SG&A expenses for the nine months ended September 30, 2009 were $14,166,000
(31.0% of net sales) compared with $16,690,000 (29.7% of net sales) in the
comparable period of 2008, a decrease of $2,524,000. The decrease in SG&A
expenses for the three and nine months ended September 30, 2009, compared to the
same periods in 2008, was primarily the result of cost cutting initiatives,
lower freight and commission costs as a result of lower sales and a lower impact
from foreign currency translation as a result of a weaker Euro and Canadian
dollar.
Operating
income
Operating
income for the three months ended September 30, 2009 was $634,000 compared with
$2,219,000 in the same period of 2008. Operating income for the nine months
ended September 30, 2009 was $2,734,000 compared to $6,084,000 in the same
period of 2008. Operating income in the U.S. segment decreased by
$1,516,000 and $2,909,000 for the three and nine months, respectively, compared
to the same periods in 2008. Operating income in the Canadian segment decreased
by $103,000 and $437,000 for the three and nine months, respectively, compared
to the same periods in 2008. The decline in operating income for the
three and nine months in the U.S. and Canadian segments is principally due to
the lower sales and associated gross profits partially offset by lower selling,
general and administrative costs. The operating loss in Europe decreased by
$32,000 for the three months ended September 30, 2009 compared to the same
period in 2008. The operating loss in Europe increased by $5,000 for the nine
months ended September 30, 2009 compared to the same period in
2008.
Interest
expense, net
Interest
expense, net for the three months ended September 30, 2009 was $7,000, compared
with $120,000 for the same period of 2008, a $113,000
decrease. Interest expense, net for the nine months ended September
30, 2009 was $27,000 as compared to $306,000 for the same period in 2008, a
$279,000 decrease. The decrease in interest expense, net for both the three and
nine months ended September 30, 2009 was primarily the result of lower interest
rate on the Company’s debt outstanding under its revolving loan agreement. The
Company also received $29,539 and $89,212 of interest income for the three and
nine months ended September 30, 2009, respectively, related to the mortgage on
the Bridgeport property.
Other
income (expense), net
Net other
income was $461,000 in the three months ended September 30, 2009 as compared to
net other expense of $138,000 in the same period of 2008. Net other
income was $480,000 in the first nine months of 2009 compared to $23,000 in the
first nine months of 2008. The increase in other income, net for the
three and nine months ended September 30, 2009 was primarily due to the $460,000
benefit recorded for the change in estimated costs associated with the
remediation of the Bridgeport property. Refer to Note 2 – Contingencies, for
further details related to the Bridgeport property.
Income
taxes
The
effective tax rate for each of the three and nine month periods ended September
30, 2009 was 33% and 34% compared to 31% and 34%, respectively, in the same
periods of 2008.
Financial
Condition
Liquidity
and Capital Resources
The
Company continues to experience the effects of the ongoing global recession.
This economic downturn has softened demand for the Company’s products and caused
our customers to reduce their inventory levels which have negatively impacted
our sales and earnings. In response to these circumstances, management has cut
expenses where possible, including incentive pay, travel, professional service
fees and other discretionary spending. The Company has also implemented a freeze
on salary increases and hiring employees. Despite the weak economic conditions,
management believes it has sufficient access to the credit market. Management
has had preliminary negotiations with its current bank and other potential
lending institutions regarding the refinancing of its current credit facility.
Based on these negotiations, management expects to complete a refinancing
early in 2010. However, given the current economic environment, there can be no
assurance that the terms of a new loan agreement will be as favorable as the
current agreement.
During
the first nine months of 2009, working capital decreased by approximately $9.6
million compared to December 31, 2008, principally due to the reclassification
of all bank debt, due June 30, 2010 (approximately $9.3 million) as short-term,
compared to long-term at December 31, 2008. Inventory decreased by approximately
$3.9 million at September 30, 2009 compared to December 31, 2008. The inventory
decline is principally related to the Company managing inventory levels to
compensate for lower sales in the trailing twelve months ended September 30,
2009 as compared to the twelve months ended December 31, 2008. Inventory
turnover, calculated using a twelve month average inventory balance, decreased
to 1.8 at September 30, 2009 from 2.0 at December 31, 2008.
Receivables
increased approximately $1.3 million at September 30, 2009 compared to December
31, 2008 primarily as a result of the seasonal nature of the back to school
business where sales are typically higher in the second and third quarters as
compared to the first and fourth quarters. The average number of days sales
outstanding in accounts receivable was 63 days at September 30, 2009 compared to
64 days at December 31, 2008.
During
the first nine months of 2009, total debt outstanding under the Company’s
Modified Loan Agreement, (referred to below) decreased by approximately $2.4
million compared to total debt at December 31, 2008. As of September 30, 2009,
$9,324,000 was outstanding and $10,676,000 was available for borrowing under the
Modified Loan Agreement.
On June
23, 2008, the Company modified its revolving loan agreement (the “Modified Loan
Agreement”) with Wachovia Bank. The Modified Loan Agreement amends certain
provisions of the original revolving loan agreement. The amendments
include (a) an increase in the maximum borrowing amount from $15 million to $20
million; (b) an extension of the maturity date of the loan from June 30, 2009 to
June 30, 2010; (c) a decrease in the interest rate to LIBOR plus 7/8% (from
LIBOR plus 1.0%) and (d) modification of certain covenant
restrictions. Funds borrowed under the Modified Loan Agreement are
used for working capital, general operating expenses, share repurchases and
certain other purposes.
As
discussed in Note 2, in the three months ended September 30, 2009, the Company
recorded a benefit of approximately $460,000 related to a reduction in the
estimated costs to complete the remediation and monitoring of the Bridgeport
property which was sold to B & E Juices in December 2008. Also during the
third quarter of 2009, the Company hired an independent environmental firm and
began the remediation work on the property. As of September 30, 2009, the
Company paid approximately $310,000 for costs related to the remediation of the
Bridgeport property and has approximately $950,000 remaining in its accrual for
environmental remediation. The Company expects to pay approximately $500,000 in
the fourth quarter for remediation work on the site. The Company will use cash
flow from operations or borrowings under its loan agreement to pay for these
costs. The Company does not believe that payment of such remediation costs will
have a material adverse affect on its ability to implement its business plan. In
addition, the buyer of the property has financed the purchase by providing the
Company with a $2.0 million mortgage at 6 percent interest. Payments on the
mortgage are due monthly and will also help fund the remediation.
Cash
expected to be generated from operating activities, together with funds
available under the revolving loan agreement are expected, under current
conditions, to be sufficient to finance the Company’s planned operations over
the next twelve months.
Recently
Issued Accounting Standards
In June
2009, the Financial Accounting Standards Board (FASB) issued FASB Accounting
Standards Codification (ASC) 105, Generally Accepted Accounting Principles,
which established the FASB Accounting Standards Codification as the sole source
of authoritative generally accepted accounting principles. Pursuant to the
provisions of the FASB ASC 105, the Company has updated references to GAAP in
its financial statements issued for the period ended September 30, 2009. The
adoption of FASB ASC 105 did not impact the Company’s financial position or
results of operations.
In April
2009, the FASB issued authoritative guidance requiring publicly traded companies
to include certain fair value disclosures related to financial instruments in
their interim financial statements. This guidance, which was
incorporated into ASC Topic 825, “Financial Instruments,” was effective for
interim periods ending after June 15, 2009. The adoption did not have
a material impact on the Company’s consolidated financial
statements.
Item
3. Quantitative and Qualitative Disclosure About Market Risk
Not
applicable.
Item
4T. Controls and Procedures
(a) Evaluation
of Disclosure Controls and Procedures
Under the
supervision and with the participation of our management, including the Chief
Executive Officer and Chief Financial Officer, we have evaluated the
effectiveness of our disclosure controls and procedures as required by Exchange
Act Rule 13a-15(b) as of September 30, 2009. Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer have concluded that these
disclosure controls and procedures are effective.
(b) Changes
in Internal Control over Financial Reporting
During
the quarter ended September 30, 2009, there were no changes in our internal
control over financial reporting that materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.
PART
II. OTHER INFORMATION
Item
1 — Legal Proceedings
The
Company is involved from time to time in disputes and other litigation in the
ordinary course of business. The Company presently believes that none
of these matters, individually or in the aggregate, would be likely to have a
material adverse impact on its financial position, results of operations, or
liquidity.
Item
1A – Risk Factors
See Risk
Factors set forth in Part I, Item 1A of the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 2008.
Item
2 — Unregistered Sales of Equity Securities and Use of Proceeds
Issuer
purchases of equity securities
|
|
|
|
|
|
|
|
|
|
|
Period
|
|
Total
Number of
Shares
Purchased
|
|
|
Average
Price Paid
per
Share
|
|
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or
Programs
|
|
|
Maximum
Number of Shares that may yet be Purchased Under the
Programs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7/1/09
- 7/31/09
|
|
|
10,000 |
|
|
$ |
8.17 |
|
|
|
10,000 |
|
|
|
114,335 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8/1/09
- 8/31/09
|
|
|
65,000 |
|
|
|
8.80 |
|
|
|
65,000 |
|
|
|
49,335 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9/1/09
- 9/30/09
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
75,000 |
|
|
$ |
8.72 |
|
|
|
75,000 |
|
|
|
49,335 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Shares
repurchased during the three months ended September 30, 2009 were
repurchased under the Company’s repurchase program which was approved by
the board of directors and announced on December 16, 2008. That program
allows for the repurchase of up to 150,000 shares and does not have an
expiration date. There are 49,335 shares available for repurchase under
this program. The Company also has 200,000 shares available for repurchase
under a plan approved by the board of directors and announced on October
7, 2009.
|
Item
3. —Defaults Upon Senior Securities
None.
Item
4 — Submission of Matters to a Vote of Security Holders
None.
Item
5 — Other Information
None.
Item
6 — Exhibits
Documents
filed as part of this report.
Exhibit 31.1 Certification of Walter C.
Johnsen pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2 Certification of Paul G. Driscoll
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1 Certification Pursuant to 18
U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
Exhibit 32.2 Certification Pursuant to 18
U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
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 thereunto
duly authorized.
ACME UNITED CORPORATION
By |
/s/ Walter C.
Johnsen |
|
|
|
Walter C.
Johnsen |
|
|
|
Chairman of
the Board and |
|
|
|
Chief
Executive Officer |
|
|
|
|
|
|
Dated: November
13, 2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By |
/s/ PAUL
G. DRISCOLL |
|
|
|
Paul G.
Driscoll |
|
|
|
Vice President
and |
|
|
|
Chief
Financial Officer |
|
|
|
|
|
|
Dated: November
13, 2009 |
|
|
|
|
|
|
|
|
|
|
acme_10q93009ex311.htm
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION
302 OF THE SARBANES-OXLEY ACT OF 2002
I, WALTER
C. JOHNSEN, certify that:
I have
reviewed this Quarterly Report on Form 10-Q of Acme United
Corporation;
Based on
my knowledge, this report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
Based on
my knowledge, the financial statements, and other financial information included
in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
The
registrant's other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act
Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))
for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed
such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most recent fiscal
quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
The
registrant's other certifying officer(s) and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the registrant's ability to record, process, summarize and
report financial information; and
(b) Any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant's internal control over financial
reporting.
By |
/s/ Walter C.
Johnsen |
|
|
|
Walter C.
Johnsen |
|
|
|
Chairman of
the Board and |
|
|
|
Chief
Executive Officer
Dated: November 13, 2009
|
acme_10q93009ex312.htm
Exhibit
31.2
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION
302 OF THE SARBANES-OXLEY ACT OF 2002
I, PAUL
G. DRISCOLL, certify that:
I have
reviewed this Quarterly Report on Form 10-Q of Acme United
Corporation;
Based on
my knowledge, this report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
Based on
my knowledge, the financial statements, and other financial information included
in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
The
registrant's other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act
Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))
for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed such
internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally
accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over
financial reporting that occurred during the registrant's most recent fiscal
quarter that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting;
and
The
registrant's other certifying officer(s) and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably likely to
adversely affect the registrant's ability to record, process, summarize and
report financial information; and
(b) Any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant's internal control over financial
reporting.
By |
/s/ PAUL
G. DRISCOLL |
|
|
|
Paul G.
Driscoll |
|
|
|
Vice President
and |
|
|
|
Chief
Financial Officer
Dated: November 13, 2009
|
acme_10q93009ex321.htm
Exhibit
32.1
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002
The
undersigned officer of Acme United Corporation (the “Company”) hereby certifies
to my knowledge that the Company’s quarterly report on Form 10-Q for the
quarterly period ended September 30, 2009 (the “Report”), as filed with the
Securities and Exchange Commission on the date hereof, fully complies with the
requirements of section 13(a) or 15(d), as applicable, of the Securities
Exchange Act of 1934, as amended, and that the information contained in the
Report fairly presents, in all material respects, the financial condition and
results of operations of the Company. This certification is provided
solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002, and shall not be deemed to be a part of the
Report or “filed” for any purpose whatsoever.
By |
/s/ Walter C.
Johnsen |
|
|
|
Walter C.
Johnsen |
|
|
|
Chairman of
the Board and |
|
|
|
Chief
Executive Officer |
Dated: November
13, 2009
A signed
original of this written statement required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature that
appears in typed form within the electronic version of this written statement
required by Section 906, has been provided to Acme United Corporation and
will be retained by Acme United Corporation and furnished to the Securities and
Exchange Commission or its staff upon request.
acme_10q93009ex322.htm
Exhibit
32.2
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002
The
undersigned officer of Acme United Corporation (the “Company”) hereby certifies
to my knowledge that the Company’s quarterly report on Form 10-Q for the
quarterly period ended September 30, 2009 (the “Report”), as filed with the
Securities and Exchange Commission on the date hereof, fully complies with the
requirements of section 13(a) or 15(d), as applicable, of the Securities
Exchange Act of 1934, as amended, and that the information contained in the
Report fairly presents, in all material respects, the financial condition and
results of operations of the Company. This certification is provided
solely pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002, and shall not be deemed a part of the Report or
“filed” for any purpose whatsoever.
By |
/s/ PAUL
G. DRISCOLL |
|
|
|
Paul G.
Driscoll |
|
|
|
Vice President
and |
|
|
|
Chief
Financial Officer |
Dated: November
13, 2009
A signed
original of this written statement required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature that
appears in typed form within the electronic version of this written statement
required by Section 906, has been provided to Acme United Corporation and
will be retained by Acme United Corporation and furnished to the Securities and
Exchange Commission or its staff upon request.