EXHIBIT 99.1
FOR: Home Products International, Inc.
APPROVED BY: James R. Tennant, Chairman & CEO
Home Products International, Inc.
FOR IMMEDIATE RELEASE (773) 890-1010
---------------------
CONTACT: Investor Relations:
James Winslow, Executive VP & CFO
Home Products International, Inc.
(773) 890-1010
HOME PRODUCTS INTERNATIONAL REPORTS
FIRST QUARTER OPERATING RESULTS
SIGNIFICANTLY AHEAD OF LAST YEAR
Chicago, IL, April 30, 2002 _ Home Products International, Inc. (Nasdaq
SmallCap: HOMZ), a leader in the housewares industry, today announced
financial results for the first quarter of its 2002 fiscal year.
The Company reported net earnings of $1.4 million ($0.18 per share) for
the first quarter ended March 30, 2002 as compared to a net loss a year ago
of $4.1 million ($0.55 per share). The 2001 result included sales and
earnings from the Company's servingware product line ("PI") which was sold
in July 2001 as well as restructuring and other charges. On a pro forma
basis that excludes the 2001 restructuring charges and earnings from PI, the
2001 first quarter loss would have been $0.5 million or a loss of ($0.07 per
share). Changes in required accounting practices to eliminate goodwill
amortization improved 2002 results by $0.5 million or $0.07 per share over
last year's pro forma results.
Sales in the quarter were $51 million versus a pro forma $57 million a
year ago. The sales decrease was primarily due to the negative impact of
several customers who declared bankruptcy during 2001 and 2002, including
Kmart. The Company reported positive cash flow during the first quarter of
$1.2 million as debt levels were reduced. This compares favorably to a year
ago when debt levels increased by $1.2 million. The Company also noted that
total debt, net of cash, declined to $128 million from $220 million a year
ago. The significant reduction in debt was due to the net proceeds from the
2001 sale of PI as well as positive cash flow from operations. In the last
12 months, the Company has generated over $22 million of positive cash flow
from operations. The Company continues to be in compliance with all of its
loan covenants.
Commenting on results, James R. Tennant, chairman and chief executive
officer, stated, "We are very pleased with our operating results. Sales to
most of our major customers increased significantly in the quarter as the
HOMZ brand and our key private labels continue to gain market share and
momentum. Adding to our positive sales and marketing profile was enhanced
profitability due to our continuous improvement programs which focus on
reducing costs and improving efficiencies."
Mr. Tennant concluded, "In today's ever consolidating housewares and
retail environment, HPI consistently ranks as one of the best performing
partners for our most important customers. This, coupled with the seniority
of our very long-term customer relationships, gives us confidence that along
with increased profitability will come increased organic growth."
Our first quarter conference call will take place Wednesday, May 1, 2002,
starting at 10:00 a.m. Eastern Time (9:00 a.m. CT, 8:00 a.m. MT, and
7:00 a.m. PT). Dial 1-800-289-0437 (international, dial 1-913-981-5508)
approximately 10 minutes prior to conference time.
A replay of our first quarter conference call will be available from 1:00 PM
Eastern Time May 1, 2002 through midnight ET May 7, 2002. Dial 1-888-203-
1112 (international, dial 1-719-457-0820), then enter confirmation code
357113.
Home Products International, Inc. is an international consumer products
company specializing in the manufacture and marketing of diversified
housewares products. The Company sells its products to all the largest
national retailers.
Some of the statements made in this press release are forward-looking and
concern the Company's future growth, product development, markets and
competitive position. While management will make its best efforts to be
accurate in making these forward-looking statements, any such statements are
subject to risks and uncertainties that could cause the Company's actual
results to vary materially. These include market risks such as increased
competition for both the Company and its end users and changes in retail
distribution channels; economic risks; financial risks such as fluctuations
in the price of raw materials, future liquidity and access to debt and
equity markets. Should one or more of these risks or uncertainties
materialize, actual results may vary materially from those anticipated,
expected or projected. The Company undertakes no obligation to update any
such factors or to announce the results of any revision to any of the
forward-looking statements contained herein to reflect future events or
developments.
Home Products International, Inc.
Consolidated Balance Sheets
($ in thousands)
(Unaudited)
March 30, December 29,
2002 2001
-------- --------
Cash $ 1,380 $ 1,091
Accounts receivable, net 36,395 36,577
Inventory, net 19,802 17,043
Prepaid expenses and other current assets 1,809 2,275
-------- --------
Current assets 59,386 56,986
-------- --------
Fixed assets, net 41,002 42,631
Patents and non-compete agreements, net 1,490 1,616
Other intangibles, net 74,759 74,759
Other non-current assets 11,179 11,351
-------- --------
Total assets $ 187,816 $ 187,343
======== ========
Accounts payable $ 15,546 $ 16,834
Accrued liabilities 34,978 33,916
Current maturities of long term debt 158 158
-------- --------
Current liabilities 50,682 50,908
-------- --------
Long term debt 129,539 130,447
Other non-current liabilities 3,200 3,168
-------- --------
Long term debt and other non-current liabilities 132,739 133,615
-------- --------
Stockholders' equity 4,395 2,820
-------- --------
Total liabilities and stockholders equity $ 187,816 $ 187,343
======== ========
Home Products International, Inc.
Consolidated Statement of Operations
($ in thousands, except share amounts)
(unaudited)
Thirteen-weeks Thirteen-weeks
ended ended
March 30, 2002 March 31, 2001
--------------- ---------------
Net sales $ 51,007 100.0% $ 64,126 100.0%
Cost of goods sold 38,234 75.0% 49,918 77.8%
Special charges, net - - 110 0.2%
--------------- ---------------
Gross profit 12,773 25.0% 14,098 22.0%
--------------- ---------------
Operating expenses 7,626 15.0% 9,299 14.5%
Amortization of intangibles 130 0.3% 929 1.4%
Restructuring and other charges - - 2,483 3.9%
--------------- ---------------
Operating profit (loss) 5,017 9.7% 1,387 2.2%
Interest (expense) (3,484) (6.8%) (5,479) (8.5%)
Other income (expense) 21 0.0% 76 0.1%
--------------- ---------------
Earnings (loss) before
income taxes 1,554 2.9% (4,016) (6.2%)
--------------- ---------------
Income tax (expense) (124) (0.2%) (67) (0.1%)
--------------- ---------------
Net earnings (loss) $ 1,430 2.7% $ (4,083) (6.3%)
=============== ===============
Net earnings (loss) per share:
Basic $0.19 ($0.55)
Diluted $0.18 ($0.55)
Number of weighted average
common shares outstanding :
Basic 7,702,229 7,428,549
Diluted 8,075,198 7,428,549
EBITDA (excluding special
items and restructuring
charges) $ 7,574 14.8% $ 8,042 12.5%