GREENWICH, Conn., Nov. 30, 2000 -- Blyth, Inc. (NYSE:BTH) reported today that third quarter Net Sales increased by 7.5% to $316,597,000 compared with $294,441,000 a year earlier. Operating Profit rose to $52,488,000 when compared to $52,162,000 in the prior year period. Net Earnings for the quarter increased to $30,372,000 from $29,888,000 a year earlier. Diluted Net Earnings Per Share for the third quarter were $0.64 per share, up 4.9% from $0.61 per share for the same period last year.
Net sales for the nine months ended October 31, 2000 totaled $826,885,000, a 7.6% increase over the $768,577,000 reported a year ago. Operating profit through nine months increased 5.6% from $114,843,000 to $121,309,000. Net earnings of $69,551,000 increased 7.2% compared to $64,855,000 for the prior year period. Diluted Net Earnings Per Share were $1.45, up 9.0% compared to $1.33 for last year's first nine months.
Commenting on the third quarter results, Robert B. Goergen, Chairman of the Board and CEO, said, "We are very pleased to report record sales and earnings for the third quarter despite the current challenging retail environment throughout North America and Europe, as well as the effects of deteriorating European currencies. We believe that our results confirm that continued new product development, the strong leadership of our management teams and reaching consumers through multiple channels of distribution, continue to offer the best combination for increasing shareholder value."
Several factors were noted with respect to third quarter growth. Sales outside of North America, currently totaling approximately 26% of Blyth's total sales on an annualized basis, continue to grow above the North American growth rates. The impact of a sharply lower euro and pound sterling, both of which hit new low levels during the third quarter, has a significant, ongoing impact on the Company's overall sales growth rate. While Blyth has continued to experience double-digit sales growth as measured in local European currencies, the average euro and pound sterling values during the third quarter declined 14% and 8% respectively, year-to-year versus the U.S. dollar, reducing consolidated sales growth by more than 2 full percentage points.
The growth rate for Blyth's direct sales channel in European markets was double-digit in local currencies. But, due to the deteriorated euro and British pound referenced above, this growth translated into a slight decline year-to-year on a dollar basis. Key operating indicators in European and North American markets were largely reflected in the increased sales performance. PartyLite in North America experienced solid single-digit sales growth, consistent with the increased numbers of consultants and leaders.
Substantial growth of greater than 15% over the prior year period in the U.S. premium retail channel was led by the Colonial Candle of Cape Cod(r) brand. Colonial's sub-brand, Colonial at HOME(tm), experienced exceptional growth, and the Company continues to track to its goal of 8,000 new rooftops for this sub-brand by year-end.
Blyth continued to outpace the IRI-measured portion of the mass channel for candles for the sixth consecutive quarter, experiencing a slight increase in sales versus double-digit declines for its larger competitors, as reported by IRI. Weak retail sales impacted the category significantly in the third quarter, though stronger sales were reported for the 52-week period with Blyth showing gains of greater than 20%. Certain portions of the non-IRI-measured mass channel experienced sales declines, reflecting the weak retail environment and discontinuance of certain product lines; whereas sales of non-fragranced seasonal and decorative products were strong.
European retail sales continue to track well, as reported in local currencies, with 80% of targeted accounts carrying the Ambria(tm) brand product line. Mr. Goergen noted that, "We are very encouraged by the Ambria(tm) product line's sell-through at retail and are pleased to be introducing a line of new products for this brand at the major gift shows in January, which should be available to consumers next spring."
The Company noted that 921,000 shares of Blyth stock were repurchased in the third quarter, for approximately $21.0 million, bringing total repurchased shares to 2,357,000, since the program was first implemented in fiscal year 1999.
Management will conduct a conference call today at 10 a.m. (eastern), which will be broadcast live over the Internet, at www.blythinc.com.
Blyth, Inc., headquartered in Greenwich, designs, manufactures and markets an extensive line of candles and home fragrance products including scented candles, potpourri and environmental fragrance products, and markets a broad range of related candle accessories and decorative seasonal products. Its products are sold in the United States under various brand names, including Colonial Candle of Cape Cod(r), PartyLite(r), Kate's Original Recipe(tm), Carolina Designs(r), Ambria(tm), Florasense(r), Jeanmarie(r) and FilterMate(r) and in Europe under the Gies, Liljeholmens and Colony brands. It is also a leading producer of portable heating fuel products sold under the Sterno(r) and Handy Fuel(r) brand names. Net Sales for the twelve months ended October 31, 2000 totaled $1,155,758,000.
Blyth, Inc. can be found on the Internet at www.blythinc.com.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical facts. Actual results could differ materially due to various factors, including the risk of maintaining the Company's growth rate, the Company's ability to respond to increased product demand, the risks (including foreign currency fluctuations) associated with international sales and foreign products, the risks of being able to recruit new independent sales consultants in North America, dependence on key management personnel, competition in terms of price and new product introductions, and other factors described in this press release, and in the Company's Quarterly Report on Form 10-Q for the quarter ended July 31, 2000, and in the Company's Annual Report on Form 10-K for the year ended January 31, 2000.
BLYTH, INC.
Consolidated Statement of Earnings
(In thousands except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
October 31, October 31,
2000 1999 2000 1999
--------- --------- --------- ---------
Net sales $ 316,597 $ 294,441 $ 826,885 $ 768,577
Cost of goods sold 139,919 131,003 350,808 332,994
--------- --------- --------- ---------
Gross profit 176,678 163,438 476,077 435,583
Selling and shipping 99,273 88,991 281,050 252,781
Administrative 23,869 21,470 70,574 65,869
Amortization of
goodwill 1,048 815 3,144 2,090
--------- --------- --------- ---------
124,190 111,276 354,768 320,740
--------- --------- --------- ---------
Operating profit 52,488 52,162 121,309 114,843
--------- --------- --------- ---------
Other expense(income)
Interest expense 4,180 3,679 12,521 8,055
Interest income/other 25 (256) (1,139) (440)
Equity in earnings
of investee (64) 273 723 1,549
--------- --------- --------- ---------
4,141 3,696 12,105 9,164
--------- --------- --------- ---------
Earnings before
income taxes and
minority interest 48,347 48,466 109,204 105,679
Income tax expense 17,975 18,426 40,737 40,396
--------- --------- --------- ---------
Earnings before
minority interest 30,372 30,040 68,467 65,283
Minority interest 152 (1,084) 428
--------- --------- --------- ---------
Net earnings $ 30,372 $ 29,888 $ 69,551 $ 64,855
========= ========= ========= =========
Basic:
Net earnings per
common share $ 0.64 $ 0.62 $ 1.45 $ 1.34
Weighted average
number of shares
outstanding 47,531 48,365 47,817 48,558
Diluted:
Net earnings per
common share $ 0.64 $ 0.61 $ 1.45 $ 1.33
Weighted average
number of shares
outstanding 47,747 48,748 48,105 48,925
Consolidated Balance Sheets
(In thousands)
(Unaudited)
October 31,
2000 1999
-------- --------
Assets
Cash and Cash Equivalents $ 27,176 $ 13,533
Accounts Receivable, Net 137,964 122,623
Inventories 224,890 231,333
Property, Plant & Equipment, Net 265,220 270,129
Other Assets 129,981 110,195
-------- --------
$785,231 $747,813
======== ========
Liabilities and Stockholders' Equity
Bank Debt $ 69,478 $ 75,615
Senior Notes 17,857 21,429
Bond Debt 150,000 150,000
Other Liabilities 139,672 144,170
Stockholders' Equity 408,224 356,599
-------- --------
$785,231 $747,813
======== ========