Lakeland(US:LAKE)2022-12-07 16:00Financial Performance - Net sales for the three months ended October 31, 2022, were $28.4 million, a decrease of $1.6 million or 5.3% compared to $30.0 million for the same period in 2021[81]. - Gross profit for the three months ended October 31, 2022, was $12.3 million, a decrease of $0.5 million or 3.9%, with gross profit as a percentage of net sales improving to 43.3% from 42.5% year-over-year[82]. - Operating expenses increased by 18.8% to $10.1 million for the three months ended October 31, 2022, compared to $8.5 million for the same period in 2021, with operating expenses as a percentage of net sales rising to 35.5% from 28.4%[83]. - Net income for the three months ended October 31, 2022, was $1.4 million, a decline of $1.5 million from $2.9 million for the same period in 2021[86]. - For the nine months ended October 31, 2022, net sales were $83.8 million, a decrease of $7.8 million or 8.5% compared to $91.6 million for the same period in 2021[87]. - Gross profit for the nine months ended October 31, 2022, was $35.0 million, a decrease of $5.4 million or 13.4%, with gross profit as a percentage of net sales decreasing to 41.7% from 44.1% year-over-year[89]. - Operating expenses for the nine months ended October 31, 2022, increased by $4.0 million or 15.7% to $29.5 million, with operating expenses as a percentage of net sales rising to 35.2% from 27.8%[90]. - Net income for the nine months ended October 31, 2022, decreased by $9.2 million to $1.7 million from $10.9 million for the same period in 2021[94]. Investments and Acquisitions - The company acquired UK-based Eagle Technical Products Limited for approximately $10.8 million, enhancing its product portfolio and expanding its sales presence in the Middle East and Europe[75]. - The Company invested $1.3 million in office and manufacturing equipment purchases and an additional $3.1 million in Bodytrak for the nine months ended October 31, 2022[96]. - The Company acquired Eagle in an all-cash transaction valued at approximately $10.8 million on December 2, 2022, enhancing its product portfolio and expanding sales presence[102]. Cash Flow and Capital Expenditures - Cash and cash equivalents decreased by $17.8 million to approximately $34.9 million as of October 31, 2022, primarily due to treasury stock purchases of $5.4 million and investments in Bodytrak[99]. - Net cash used in operating activities was $5.2 million for the nine months ended October 31, 2022, primarily due to an increase in current assets of $12.5 million[101]. - Capital expenditures for the first nine months of FY23 were $1.3 million, with an anticipated total of approximately $1.8 million for the fiscal year[109]. - The Company expects to repatriate $25.9 million from China during FY23, with a potential 10% withholding tax of $2.0 million accrued[100]. Stock and Debt Management - The stock repurchase program allows for the repurchase of up to $5 million of outstanding common stock, with $2.3 million spent on repurchases in the three months ended October 31, 2022[108]. - As of October 31, 2022, the Company had $363,998 remaining available for repurchase under the New Share Repurchase Program[116]. - The Company was in compliance with all debt covenants as of October 31, 2022, maintaining a Funded Debt to EBITDA ratio of 3.0 to 1.0 or less[106]. - The Company anticipates that its current cash balance and cash flow from operations will be sufficient to meet projected working capital and planned capital expenditures[103]. Reporting and Governance - The financial statements for the quarter ended October 31, 2022, include condensed consolidated statements of operations and cash flows, formatted in Inline XBRL[101]. - The report was signed by Charles D. Roberson, Chief Executive Officer, and Allen E. Dillard, Chief Operating and Financial Officer, on December 8, 2022[123].