Lakeland Industries Inc. (LAKE, Financial) filed Quarterly Report for the period ended 2009-10-31.
LAKELAND INDUSTRIES, INC. has five divisions and three wholly-owned subsidiaries: One large division manufactures disposable/limited use garments and the four smaller divisions, Chemland, manufactures suits for use by toxic waste clean up teams; Fireland Fyrepel Products, manufactures fire and heat protective apparel and protective systems for personnel; Highland, manufactures specialty safety and industrial work gloves and Uniland, manufactures industrial and medical woven cloth garments. Lakeland Industries Inc. has a market cap of $41.4 million; its shares were traded at around $7.6 with a P/E ratio of 19.5 and P/S ratio of 0.4. Lakeland Industries Inc. had an annual average earning growth of 5.1% over the past 10 years.
At October 31, 2009 the Company had an outstanding loan balance of $14.2 million under its facility with Wachovia Bank, N.A. compared with $24.4 million at January 31, 2009, with the decrease mainly due to reductions in the Company s inventory levels. Total stockholders equity increased principally due to the foreign exchange gains from the Brazilian operations, and offset by the Company s stock repurchase program of purchases of $0.1 million in FY10 and the net loss for the period of $0.1 million.
Net Sales. Net sales decreased $2.9 million, or 11.4% to $22.3 million for the three months ended October 31, 2009 from $25.2 million for the three months ended October 31, 2008. The net decrease was comprised of a 26% decrease in domestic sales partially offset by a 25% increase in foreign sales. Qualytextil sales increased by $0.9 million or 38.5%. External sales from China increased by $0.4 million, or 24%, driven by sales to the new Australian distributor. Canadian sales increased by $0.1 million, or 3.5%, UK sales increased by $0.2 million, or 23.8%, Chile sales increased by $0.2 million, or 78.9%. US domestic sales decreased by $5.2 million or 26.6%.
Net Sales. Net sales decreased $10.7 million, or 13.4% to $69.3 million for the nine months ended October 31, 2009 from $80 million for the nine months ended October 31, 2008. The net decrease was comprised of a $14.4 million decrease in domestic sales or 23.5%, partially offset by a $3.7 million increase in foreign sales or 19.8%. Qualytextil sales included in the current year were $9.2 million, while prior years sales of $5.5 million included Q2 and Q3. External sales from China increased by $1.1 million, or 24%, driven by sales to the new Australian distributor. Canadian sales were flat, UK sales decreased by $0.4 million, or 11.7%, Chile sales increased by $0.7 million, or 76%.
Net Income. Net income decreased $4.0 million to a loss of $0.1 million for the nine months ended October 31, 2009 from income of $3.9 million for the nine months ended October 31, 2008. The decrease in net income primarily resulted from a decrease in sales, larger losses in India and reduction in gross margins and extremely aggressive pricing environment in disposables and margin reduction and cost buildups in Brazil, a $350,000 allowance against deferred taxes resulting from the India restructuring, the reclassification from Other Comprehensive Loss of $297,000 resulting from the anticipated buy out of the interest rate swap, offset by management s cost reduction program.
Cash Flows. As of October 31, 2009, we had cash and cash equivalents of $4.8 million and working capital of $47.9 million; an increase of $2.0 million and a decrease of $23.0 million, respectively, from January 31, 2009. Our primary sources of funds for conducting our business activities have been cash flow provided by operations and borrowings under our credit facilities described below. We require liquidity and working capital primarily to fund increases in inventories and accounts receivable associated with our net sales and, to a lesser extent, for capital expenditures.
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LAKELAND INDUSTRIES, INC. has five divisions and three wholly-owned subsidiaries: One large division manufactures disposable/limited use garments and the four smaller divisions, Chemland, manufactures suits for use by toxic waste clean up teams; Fireland Fyrepel Products, manufactures fire and heat protective apparel and protective systems for personnel; Highland, manufactures specialty safety and industrial work gloves and Uniland, manufactures industrial and medical woven cloth garments. Lakeland Industries Inc. has a market cap of $41.4 million; its shares were traded at around $7.6 with a P/E ratio of 19.5 and P/S ratio of 0.4. Lakeland Industries Inc. had an annual average earning growth of 5.1% over the past 10 years.
Highlight of Business Operations:
Cash increased by $2.1 million as borrowings under the revolving credit facility decreased by $10.2 million at October 31, 2009, mainly due to the reduction in inventory levels. Accounts receivable increased by $2.9 million mainly resulting from government agency receivables in Brazil. Inventory decreased by $13.0 million, mainly due to lower levels of raw material purchasing and lower production in its China plants. Accounts payable increased by $0.7 million due to an increase in Brazil payables and a large vendor credit at January 31, 2009 which was subsequently applied. Other assets increased by $1.6 million, mainly due to currency exchange fluctuation in Brazil.At October 31, 2009 the Company had an outstanding loan balance of $14.2 million under its facility with Wachovia Bank, N.A. compared with $24.4 million at January 31, 2009, with the decrease mainly due to reductions in the Company s inventory levels. Total stockholders equity increased principally due to the foreign exchange gains from the Brazilian operations, and offset by the Company s stock repurchase program of purchases of $0.1 million in FY10 and the net loss for the period of $0.1 million.
Net Sales. Net sales decreased $2.9 million, or 11.4% to $22.3 million for the three months ended October 31, 2009 from $25.2 million for the three months ended October 31, 2008. The net decrease was comprised of a 26% decrease in domestic sales partially offset by a 25% increase in foreign sales. Qualytextil sales increased by $0.9 million or 38.5%. External sales from China increased by $0.4 million, or 24%, driven by sales to the new Australian distributor. Canadian sales increased by $0.1 million, or 3.5%, UK sales increased by $0.2 million, or 23.8%, Chile sales increased by $0.2 million, or 78.9%. US domestic sales decreased by $5.2 million or 26.6%.
Net Sales. Net sales decreased $10.7 million, or 13.4% to $69.3 million for the nine months ended October 31, 2009 from $80 million for the nine months ended October 31, 2008. The net decrease was comprised of a $14.4 million decrease in domestic sales or 23.5%, partially offset by a $3.7 million increase in foreign sales or 19.8%. Qualytextil sales included in the current year were $9.2 million, while prior years sales of $5.5 million included Q2 and Q3. External sales from China increased by $1.1 million, or 24%, driven by sales to the new Australian distributor. Canadian sales were flat, UK sales decreased by $0.4 million, or 11.7%, Chile sales increased by $0.7 million, or 76%.
Net Income. Net income decreased $4.0 million to a loss of $0.1 million for the nine months ended October 31, 2009 from income of $3.9 million for the nine months ended October 31, 2008. The decrease in net income primarily resulted from a decrease in sales, larger losses in India and reduction in gross margins and extremely aggressive pricing environment in disposables and margin reduction and cost buildups in Brazil, a $350,000 allowance against deferred taxes resulting from the India restructuring, the reclassification from Other Comprehensive Loss of $297,000 resulting from the anticipated buy out of the interest rate swap, offset by management s cost reduction program.
Cash Flows. As of October 31, 2009, we had cash and cash equivalents of $4.8 million and working capital of $47.9 million; an increase of $2.0 million and a decrease of $23.0 million, respectively, from January 31, 2009. Our primary sources of funds for conducting our business activities have been cash flow provided by operations and borrowings under our credit facilities described below. We require liquidity and working capital primarily to fund increases in inventories and accounts receivable associated with our net sales and, to a lesser extent, for capital expenditures.
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