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A.T. CROSS COMPANY REPORTS SECOND QUARTER NET LOSS INCLUDING RESTRUCTURING CHARGE AND LOSS ON SALE OF MARK CROSS SUBSIDIARY

 LINCOLN, R.I., July 22 /PRNewswire/ -- A.T. Cross Company (ASE: ATX.A), a major international manufacturer of fine writing instruments, had a net loss of $10.0 million, or 59 cents per share, in its second quarter ended June 30, 1993, compared with net income of $2.9 million, or 17 cents per share, one year earlier, Russell A. Boss, president and chief executive officer, reported. The net loss was primarily due to a restructuring charge and a loss on sale of the company's Mark Cross subsidiary. Net sales from continuing operations for the latest period were $37.3 million, compared with $43.5 million in the 1992 second quarter.
 For the six months ended June 30, 1993, net sales from continuing operations were $73.8 million with a net loss of $9.8 million, or 58 cents per share. In the same period of the previous year, Cross had sales of $86.5 million and net income of $5.1 million, or 30 cents per share.
 Included in the second quarter and year-to-date results was a pretax restructuring charge of $9.6 million ($6.2 million after tax, or 36 cents per share). In addition, the sale of the company's Mark Cross subsidiary resulted in a second quarter after-tax loss on disposal amounting to $2.5 million and a loss from operations of $728,000 ($1.5 million for the year to date).
 "Our second quarter and first half operating results," said Mr. Boss, "reflect less worldwide demand for fine writing instruments. The United States economic recovery has been slower than anticipated and many economists now believe that a recovery in Europe and the Far East will not begin until mid-1994. Sales were especially hard hit by domestic retailers' conservative inventory ordering patterns, caused by low consumer spending, and by the recession in Europe and the slowdown in the Far East, regions where Cross had been enjoying good growth. Although we have been achieving considerable gains in manufacturing efficiency and reductions in expense levels, the volume of sales has been insufficient to produce a turnaround in profits, and we do not expect sales or earnings growth for 1993.
 "The restructuring charge is the result of various programs that have streamlined our manufacturing and new product development processes. Our cellular manufacturing initiatives have greatly increased efficiency, enabling us to significantly reduce writing instrument inventory levels by improving product cycle time while maintaining quality. These improvements, combined with the sale of Mark Cross, have eliminated the need for a separate distribution center and have allowed us to consolidate our Lincoln manufacturing and distribution facilities. We also have increased productivity and reduced the number of employees at all levels. As stated in the past, we intend to aggressively introduce new products. This will initially result in the discontinuance of certain products, but will ultimately increase our worldwide market share.
 "On June 30, 1993, Cross completed the sale of the Mark Cross trade name and selected assets, primarily certain inventory, to Sara Lee Corp. for approximately $8 million. As part of the transaction, Sara Lee assumed the leases on certain Mark Cross stores. Some other stores have already been closed, and the remaining stores will be closed no later than December 31, 1993.
 "The sale of the Mark Cross operation will result in a more sharply focused A.T. Cross Company and has eliminated a business that has been unprofitable for the last several years. Now that we are out of the retail store business, we can devote our resources to the manufacturing and selling of high-quality writing instruments, and through our Manetti-Farrow subsidiary, the distribution of Fendi leather products.
 "The last few years have been very tough for many companies, especially high-quality consumer goods manufacturers such as Cross. During this period, our management and employees have been part of the most sweeping changes in Cross history. We will continue to make whatever changes are necessary to meet the challenges of ever-increasing worldwide competition. This program, combined with our debt-free financial position, will make us a stronger company in the years ahead."
 A.T. CROSS COMPANY
 CONSOLIDATED SUMMARY OF OPERATIONS
 (in thousands, except per share amounts)
 (unaudited)
 Three months Six months
 ended ended
 June 30 June 30
 1993 1992 1993 1992
 Net sales $37,294 $43,514 $73,769 $86,497
 Cost of goods sold 22,602 24,987 45,812 50,603
 Gross profit 14,692 18,527 27,957 35,894
 Selling, general and
 administrative
 expenses 16,135 14,689 28,710 28,933
 Restructuring
 charges 9,610 -- 9,610 --
 Operating Income/
 (Loss) (11,053) 3,838 (10,363) 6,961
 Interest and other
 income 547 730 1,273 1,495
 Income/(Loss) From
 Continuing Operations
 Before Income Taxes (10,506) 4,568 (9,090) 8,456
 Income Taxes (3,720) 1,277 (3,249) 2,432
 Income/(loss) From
 Continuing Operations(6,786) 3,291 (5,841) 6,024
 Loss from discontinued
 operations, net of
 income taxes
 Loss from operations (728) (343) (1,500) (934)
 Loss on disposal (2,500) -- (2,500) --
 Net income/(loss) (10,014) 2,948 (9,841) 5,090
 Income/(loss) Per Share:
 From continuing
 operations (0.40) 0.19 (0.35) 0.36
 From discontinued
 operations (0.19) (0.02) (0.23) (0.06)
 Total (0.59) 0.17 (0.58) 0.30
 Average number of
 shares outstanding 16,926 16,894 16,925 16,890
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (in thousands, except per share amounts)
 (unaudited)
 June 30,
 1993 1992
 Assets
 Cash and short-
 term investments $75,159 $66,950
 Receivables 18,926 20,883
 Inventories 21,331 49,822
 Other current
 assets 6,145 5,039
 Total current assets 121,561 142,694
 Property and
 equipment, net 34,419 39,477
 Other assets 9,106 9,337
 Total assets 165,086 191,508
 Liabilities and
 Shareholders'
 Equity
 Current liabilities 24,975 26,344
 Accrued warranty costs 4,109 3,860
 Shareholders' equity
 (per share $8.03 and $9.55) 136,002 161,304
 Total liabilities and
 Shareholders' Equity 165,086 191,508
 -0- 7/22/93
 /CONTACT: Michael El-Hillow, vice president-finance, chief financial officer of A.T. Cross, 401-333-1200/
 (ATX)


CO: A.T. Cross Company ST: Rhode Island IN: HOU SU: ERN

LG-MG -- NY056 -- 4646 07/22/93 14:22 EDT
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Date:Jul 22, 1993
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