EXHIBIT 99.1
ACME UNITED CORPORATION NEWS RELEASE
- --------------------------------------------------------------------------------
CONTACT: Paul G. Driscoll
Acme United Corporation
60 Round Hill Road Fairfield, CT 06824
Phone: (203) 254-6060 FAX: (203) 254-6521
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE March 2, 2006
ACME UNITED CORPORATION REPORTS 15% SALES INCREASE AND PROFORMA EPS GROWTH
OF 20%
FAIRFIELD, CT. - March 2, 2006 - Acme United Corporation (AMEX:ACU)
today announced that net sales for the year ended December 31, 2005 were $49.9
million compared to $43.4 million in 2004, an increase of 15%. Net sales for
2005 in the U.S. and Hong Kong increased 16% due to the sale of new products,
principally the patented titanium bonded scissors. International sales increased
by 13%, and 8% in local currency. Net sales for the quarter ended December 31,
2005 were $11.1 million, compared to $10.9 million in the same period in 2004,
an increase of 1%.
Fourth quarter 2005 sales were negatively impacted by customer
inventory reductions, delayed shipments of new programs and an overall sluggish
economy.
Net income for the year ended December 31, 2005 was $2.9 million, or
$.78 per diluted share compared to $3.2 million or $.85 per diluted share in
2004. Excluding the non-recurring charge of $1.5 million which was disclosed and
recorded in the third quarter of 2005 relating to the demolition of some former
manufacturing buildings, net income would have been $3.9 million or $1.02 per
diluted share, a 20% increase over 2004. Non-GAAP, or pro forma, results are
presented to provide additional information to the reader to provide comparisons
to results in 2004. For the fourth quarter ended December 31, 2005, net income
was $773,000, or $.21 per diluted share, compared to $754,000, or $.19 per
diluted share for the same period in 2004.
Gross margins were 45% for both 2005 and 2004. Improvements from
increased sales of new products were essentially offset by higher airfreight and
raw material costs.
(1)
The Company's bank debt on December 31, 2005 was $5.6 million compared
to $1.4 million on December 31, 2004. During 2005, the Company added $4.1
million of inventory in order to meet forecasted growth requirements. In
addition, the Company repurchased 243,000 shares of its common stock at a cost
of $3.6 million and paid dividends of $.4 million.
Walter C. Johnsen, President and CEO, said, "Acme United continued to
make significant business progress during 2005. Our efforts to penetrate a
number of global retailers and superstores are succeeding and we look forward to
their contribution this year. Our new products, including an expanded titanium
scissor line, new Clauss cutting items, and new proprietary pencil sharpeners
lay the ground work for future growth in 2006."
ACME UNITED CORPORATION is a specialized supplier of cutting devices,
measuring instruments, and safety products for school, home, office and
industrial use.
Forward-looking statements in this report, including without
limitation, statements related to the Company's plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that such forward-looking statements involve risks and
uncertainties including without limitation the following: (i) the Company's
plans, strategies, objectives, expectations and intentions are subject to change
at any time at the discretion of the Company; (ii) the Company's plans and
results of operations will be affected by the Company's ability to manage its
growth, and (iii) other risks and uncertainties indicated from time to time in
the Company's filings with the Securities and Exchange Commission.
# # #
(2)
ACME UNITED CORPORATION
CONSOLIDATED STATEMENT OF INCOME
YEAR END REPORT 2005
Quarter Ended Quarter Ended
December 31, 2005 December 31, 2004
Amounts in $000's except per share data (Unaudited) (Unaudited)
- --------------------------------------------------------------------------------------------------------
Net Sales $ 11,059 $ 10,921
Gross Profit 4,596 4,962
Selling, General, and Administrative Expenses 3,058 3,874
Interest Expense 96 27
Other Expense (Income) 109 (133)
Pre-Tax Income 1,333 1,194
Income Tax Expense 560 440
Net Income 773 754
Earnings Per Share Diluted 0.21 0.19
(3)
ACME UNITED CORPORATION
CONSOLIDATED STATEMENT OF INCOME
YEAR END REPORT 2005
Year Ended Year Ended
Amounts in $000's except per share data December 31, 2005 December 31, 2004
- --------------------------------------------------------------------------------------------------------
Net Sales $ 49,946 $ 43,381
Gross Profit 22,355 19,653
Selling, General, and Administrative Expenses 15,512 14,162
Interest Expense 235 158
Other Expense (Income) 342 (7)
Non-Recurring Charge 1,500 -
Pre-Tax Income 4,766 5,340
Income Tax Expense 1,829 2,102
Net Income 2,937 3,238
Earnings Per Share Diluted 0.78 0.85
Reconciliation to reported Net Income (GAAP)
Pre-Tax Income as reported (GAAP) 4,766 5,340
Non-Recurring Charge 1,500 -
Pre-Tax Income as adjusted 6,266 5,340
Income Tax Expense as adjusted 2,399 2,102
Net Income as adjusted 3,867 3,238
Earnings Per Share Before Non-Recurring Charge 1.02 0.85
(4)
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
YEAR END REPORT 2005
Amounts in $000's December 31, 2005 December 31, 2004
- --------------------------------------------------------------------------------------------------------
Assets
Current Assets:
Cash $ 1,076 $ 1,888
Accounts Receivable, Net 9,392 8,885
Inventories 12,530 8,389
Prepaid and Other Current Assets 867 764
----------------------------------------------
Total Current Assets 23,865 19,926
Property and Equipment, Net 2,786 2,295
Other Assets 1,543 746
----------------------------------------------
Total Assets $ 28,194 $ 22,967
==============================================
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable 2,174 2,316
Other Current Liabilities 5,356 4,682
----------------------------------------------
Total Current Liabilities 7,530 6,998
Long-Term Debt 5,587 1,434
Other Non Current Liabilities 1,012 552
----------------------------------------------
14,129 8,984
Total Stockholders' Equity 14,065 13,983
----------------------------------------------
Total Liabilities and Stockholders' Equity $ 28,194 $ 22,967
==============================================
(5)