lcut-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________

FORM 10-Q

__________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2024


☐			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: 0-19254

__________________________

LIFETIME BRANDS, INC.

(Exact name of registrant as specified in its charter)

__________________________


Delaware			11-2682486
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

1000 Stewart Avenue, Garden City, New York 11530

(Address of principal executive offices) (Zip Code)

(516) 683-6000

(Registrant’s telephone number, including area code)

__________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange
on which registered

Common Stock, $.01 par value

LCUT

The Nasdaq Global Select Market

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☒

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s common stock outstanding as of April 30, 2024 was 22,073,256.

Table of Contents

LIFETIME BRANDS, INC.

FORM 10-Q

FOR THE QUARTER ENDED MARCH 31, 2024

INDEX


		Page No.

Part I.	Financial Information

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets – March 31, 2024 (unaudited) and December 31, 2023	2

	Condensed Consolidated Statements of Operations (unaudited) – Three Months Ended March 31, 2024 and 2023	3

	Condensed Consolidated Statements of Comprehensive Loss (unaudited) – Three Months Ended March 31, 2024 and 2023	4

	Condensed Consolidated Statements of Stockholders’ Equity (unaudited) –Three Months Ended March 31, 2024 and 2023	5

	Condensed Consolidated Statements of Cash Flows (unaudited) – Three Months Ended March 31, 2024 and 2023	6

	Notes to Condensed Consolidated Financial Statements (unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39

Item 4.	Controls and Procedures	39

Part II.	Other Information

Item 1.	Legal Proceedings	39

Item 1A.	Risk Factors	39




Item 5.	Other Information	40

Item 6.	Exhibits	41

Signatures		42

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

LIFETIME BRANDS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	March 31, 2024		December 31, 2023
	(unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	4,639	$	16,189
Accounts receivable, less allowances of $15,177 at March 31, 2024 and $15,952 at December 31, 2023	113,645		155,180
Inventory	189,820		188,647
Prepaid expenses and other current assets	13,915		16,339

TOTAL CURRENT ASSETS	322,019		376,355
PROPERTY AND EQUIPMENT, net	16,356		16,970
OPERATING LEASE RIGHT-OF-USE ASSETS	66,662		69,756
INVESTMENTS	—		1,826
INTANGIBLE ASSETS, net	195,343		199,133
OTHER ASSETS	2,286		3,102

TOTAL ASSETS	$	602,666	$	667,142
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Current maturity of term loan	$	10,652	$	4,742


Accounts payable	32,855		54,154
Accrued expenses	64,697		78,356
Income taxes payable	567		641
Current portion of operating lease liabilities	14,251		14,075
TOTAL CURRENT LIABILITIES	123,022		151,968
OTHER LONG-TERM LIABILITIES	9,257		9,126
INCOME TAXES PAYABLE, LONG-TERM	1,493		1,493
OPERATING LEASE LIABILITIES	66,278		70,009
DEFERRED INCOME TAXES	7,429		7,438
REVOLVING CREDIT FACILITY	40,860		60,395
TERM LOAN	130,626		135,834
STOCKHOLDERS’ EQUITY
Preferred stock, $1.00 par value, shares authorized: 100 shares of Series A and 2,000,000 shares of Series B; none issued and outstanding	—		—
Common stock, $0.01 par value, shares authorized: 50,000,000 at March 31, 2024 and December 31, 2023; shares issued and outstanding: 22,073,256 at March 31, 2024 and 21,813,266 at December 31, 2023	221		218
Paid-in capital	277,496		277,728
Accumulated deficit	(20,771)		(13,568)
Accumulated other comprehensive loss	(33,245)		(33,499)
TOTAL STOCKHOLDERS’ EQUITY	223,701		230,879
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	602,666	$	667,142

See accompanying notes to unaudited condensed consolidated financial statements.

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LIFETIME BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)


	Three Months Ended March 31,
	2024		2023
Net sales	$	142,242	$	145,435
Cost of sales	84,695		91,593
Gross margin	57,547		53,842
Distribution expenses	16,181		16,885
Selling, general and administrative expenses	39,536		37,907
Restructuring expenses	—		856

Income (loss) from operations	1,830		(1,806)
Interest expense	(5,614)		(5,336)
Mark to market loss on interest rate derivatives	(174)		(234)

Loss before income taxes and equity in losses	(3,958)		(7,376)
Income tax (provision) benefit	(210)		1,348
Equity in losses, net of taxes	(2,092)		(2,777)
NET LOSS	$	(6,260)	$	(8,805)
BASIC LOSS PER COMMON SHARE	$	(0.29)	$	(0.41)
DILUTED LOSS PER COMMON SHARE	$	(0.29)	$	(0.41)

See accompanying notes to unaudited condensed consolidated financial statements.

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LIFETIME BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(unaudited)


	Three Months Ended March 31,
	2024		2023
Net loss	$	(6,260)	$	(8,805)
Other comprehensive income, net of taxes:
Translation adjustment	40		1,561
Net change in cash flow hedges	201		(1,153)
Effect of retirement benefit obligations	13		12
Other comprehensive income, net of taxes	254		420
Comprehensive loss	$	(6,006)	$	(8,385)

See accompanying notes to unaudited condensed consolidated financial statements.

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LIFETIME BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(unaudited)


	Common stock			Paid-in capital		Accumulated deficit		Accumulated other comprehensive loss		Total
	Shares	Amount
BALANCE AT DECEMBER 31, 2023	21,813	$	218	$	277,728	$	(13,568)	$	(33,499)	$	230,879

Net loss	—	—		—		(6,260)		—		(6,260)



Other comprehensive income, net of taxes	—	—		—		—		254		254
Performance shares issued to employees	152	2		(2)		—		—		—
Net issuance of restricted shares granted to employees	213	2		(2)		—		—		—
Stock compensation expense	—	—		799		—		—		799


Shares effectively repurchased for required employee withholding taxes	(105)	(1)		(1,027)		—		—		(1,028)

Dividends (1)	—	—		—		(943)		—		(943)
BALANCE AT MARCH 31, 2024	22,073	$	221	$	277,496	$	(20,771)	$	(33,245)	$	223,701


	Common stock			Paid-in capital		Retained earnings (accumulated deficit)		Accumulated other comprehensive loss		Total
	Shares	Amount
BALANCE AT DECEMBER 31, 2022	21,780	$	218	$	274,579	$	1,145	$	(35,854)	$	240,088

Net loss	—	—		—		(8,805)		—		(8,805)



Other comprehensive income, net of taxes	—	—		—		—		420		420

Performance shares issued to employees	120	1		(1)		—		—		—
Net issuance of restricted shares granted to employees	185	2		(2)		—		—		—
Stock compensation expense	—	—		866		—		—		866

Shares effectively repurchased for required employee withholding taxes	(74)	(1)		(438)		—		—		(439)
Stock repurchase	(320)	(3)		—		(2,536)		—		(2,539)
Dividends (1)	—	—		—		(930)		—		(930)
BALANCE AT MARCH 31, 2023	21,691	$	217	$	275,004	$	(11,126)	$	(35,434)	$	228,661

(1) Cash dividends declared per share of common stock were $0.0425 and $0.0425 in the three months ended March 31, 2024 and 2023, respectively.

See accompanying notes to unaudited condensed consolidated financial statements.

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LIFETIME BRANDS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands) (unaudited)


	Three Months Ended March 31,
	2024		2023
OPERATING ACTIVITIES
Net loss	$	(6,260)	$	(8,805)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	4,939		4,870

SEC Form 10-Q filed by Lifetime Brands Inc.