ONEIDA, N.Y., May 13, 2003 (PRIMEZONE) -- Oneida Ltd. (NYSE:OCQ) today announced that operating results for the first quarter ended April 26, 2003 included a net loss of $3.4 million, equal to a loss of $0.21 per share on sales of $103.9 million. This compares to year-ago net income of $1.6 million, equal to earnings of $0.10 per share on sales of $115 million, for the first quarter of the fiscal year that ended January 2003.
EXTERNAL FACTORS HAVE SIGNIFICANT IMPACT
"While our business levels often are affected by external factors over which we have little or no control, several developments combined to have a negative impact on our first quarter performance," said Peter J. Kallet, Oneida Chairman and Chief Executive Officer. "We continued to be hampered by declining consumer confidence. Our retail accounts faced a lack of in-store traffic, which in turn slowed order flows for our products. The decrease in personal and business travel as well as less dining out continued to hurt our hotel, restaurant and resort accounts. Aggravating these conditions was the recent conflict in Iraq, which further eroded consumer confidence, and exceptionally bad weather conditions in February and March which discouraged consumer spending. Over the latter part of the quarter, the outbreak of the SARS virus affected our international operations by curtailing foreign travel and related economic activity. All of these factors magnified the impact of an already weak economy, limiting the demand for our products in both consumer and foodservice channels."
ADDRESSING THE CHALLENGES
"To address these challenges, we will continue to aggressively reduce expenses and streamline operations wherever possible as the year progresses," Mr. Kallet said. "Our streamlining efforts include the successful implementation on May 9 of the first production line in a new lean manufacturing system at our main flatware factory in Sherrill, N.Y. This system, to be completed in 2004, is expected to substantially reduce inventory costs while enhancing the performance and competitiveness of our domestic manufacturing. Additionally, in April we eliminated approximately 80 positions companywide. We recognize the hardships this action caused for our employees, but it was essential to balance staffing levels with current product demand to help maintain our competitiveness. Our long-term commitment is to reduce internal costs, including inventory and debt, and improve our cash flow.
"Equally important for overcoming these difficult times is to continue to leverage the enduring strength of our brand, and our complete range of product offerings," Mr. Kallet added. "We recently introduced several promising new designs at a major consumer products tradeshow, along with upgrades in gift packaging, promotions and displays. Such offerings, marketed in tandem with the overall public awareness of the Oneida name, will help support our strategy to continue to gain market share in all of our divisions."
CONFERENCE CALL ON MAY 14
Oneida's management will host a conference call with analysts and investors on Wednesday, May 14, 2002 at 9 a.m. EST to discuss the first quarter results and operating performance. The conference call will be broadcast live over the Internet at www.oneida.com. To access the webcast, participants should visit the Investor Relations section of the website at least 15 minutes prior to the start of the conference call to download and install any necessary audio software. A replay of the webcast can be accessed one hour after the conference call, and will be available for 30 days.
Oneida Ltd. is a leading manufacturer and marketer of flatware and dinnerware for both the consumer and foodservice industries worldwide. Oneida also is a leading marketer of a variety of crystal, glassware and metal serveware for those industries.
Statements contained in this press release that state that certain results are "expected" or "anticipated" to occur, or otherwise state the company's predictions for the future, are forward looking statements. These particular forward-looking statements and all other statements that are not historical facts, are subject to a number of risks and uncertainties, and actual results may differ materially. Such factors include, but are not limited to: changes in national or international political conditions; terrorist attacks; general economic conditions in the Company's own markets and related markets; difficulties or delays in the development, production and marketing of new products; the impact of competitive products and pricing; certain assumptions related to consumer purchasing patterns; significant increases in interest rates or the level of the Company's indebtedness; foreign currency fluctuations; major slowdowns in the retail, travel or entertainment industries; the loss of several of the Company's major customers; underutilization of the Company's plants and factories; impact of changes in accounting standards; potential legal proceedings; changes in pension and retiree medical costs; and the amount and rate of growth of the Company's selling, general and administrative expenses.
ONEIDA LTD.
CONDENSED CONSOLIDATED INCOME STATEMENT
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
FOR THE
THREE MONTHS ENDED
April 26, April 27,
2003 2002
--------- ---------
Net Sales $ 103.9 $ 115.0
Cost of Sales 74.4 77.5
---- ----
Gross Profit 29.5 37.5
Operating Revenues .4 .4
Selling, Distribution & Administrative 31.6 31.6
---- ----
Operating Income (Loss) (1.7) 6.3
Other (Income) Expense - Net .2 ( .4)
Interest Expense 3.5 4.1
----- -----
Income before Income Taxes (5.4) 2.6
(Provision) Benefit for Income Taxes 2.0 (1.0)
----- ----
Net Income (Loss) $ (3.4) $ 1.6
Net Income (Loss) per share:
Basic $ (.21) $ .10
Diluted $ (.21) $ .10
Weighted Average Shares:
Basic 16,556 16,530
Diluted 16,566 16,558
ONEIDA LTD.
CONDENSED BALANCE SHEET
(Millions of dollars)
April 26, January 25,
2003 2003
ASSETS --------- -----------
Cash $ 3.2 $ 2.6
Accounts Receivable - Net 70.5 78.0
Inventory 175.4 167.6
Other Current Assets 8.9 9.3
------ ------
Total Current Assets 258.0 257.5
Plant and Equipment - Net 101.3 102.4
Intangibles 133.7 133.9
Other Assets 32.4 31.3
------ ------
Total Assets $ 525.4 $ 525.1
LIABILITIES
Accounts Payable
& Accrued Liabilities $ 56.6 $ 59.9
Short-Term Debt 8.9 8.5
Current Portion of Long-Term Debt 7.6 6.4
------ ------
Total Current Liabilities 73.1 74.8
Long-Term Debt 226.0 219.0
Other Liabilities 100.5 101.9
Shareholders' Equity 125.8 129.4
------ ------
Total Liabilities & Equity $ 525.4 $ 525.1
CONDENSED CASH FLOW STATEMENT
APRIL 2003/2002
(Millions of dollars)
Quarter ended Quarter ended
April 2003 April 2002
---------- ----------
Net income (Loss) $ (3.4) $ 1.6
Add: depreciation & amortization 4.0 4.1
Net working capital changes (3.3) 6.4
Capital expenditures (2.2) (1.9)
Stock sales and purchases - net .1 .1
Proceeds (payments) of debt 8.6 (15.2)
Dividends paid (.4) (.4)
Other - net (2.8) (1.2)
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Increase (Decrease) in Cash $ .6 $ (6.5)