Summer Infant reverses loss, reports $256K profit in 2Q

SUMMER INFANT Inc. reported $256,000 in profit, or 1 cent per diluted share, in the second quarter that ended July 2, reversing the second quarter 2015 loss of $3.5 million, or 19 cents per diluted share.
SUMMER INFANT Inc. reported $256,000 in profit, or 1 cent per diluted share, in the second quarter that ended July 2, reversing the second quarter 2015 loss of $3.5 million, or 19 cents per diluted share.

WOONSOCKET – Summer Infant Inc. reported $256,000 in profit, or 1 cent per diluted share, in the second quarter that ended July 2. The gain reversed a second quarter 2015 loss of $3.5 million, or 19 cents per diluted share.
The juvenile-product maker reported second quarter earnings Tuesday, showing a 2.4 percent drop in revenue, to $50.6 million from $51.8 million a year ago.
The company’s new president and CEO, Mark Messner, said he was pleased with the results. Messner was appointed to the position July 13, taking over for Robert Stebenne.
“While I personally can’t take credit for the greatly improved results this quarter – including solid gross profit, lower G&A, reduced interest expense and our first positive EPS in over a year – I am proud to be part of such an incredible company in the juvenile space. … We will continue to transform Summer Infant into a responsive, nimble, profitable innovator with brands that inspire millennial parents and bring passion to our investors,” Messner said in a statement.
Adjusted EBITDA – earnings before interest, taxes, depreciation and amortization –climbed to $3.4 million compared with $2.2 million in second quarter 2015.

General and administrative expenses were $10 million compared with $12 million last year; the second quarter of 2016 included $800,000 of legal expenses, versus $1.4 million in first quarter 2016 and $1.7 million in second quarter 2015. Excluding litigation costs, general and administrative expenses in the 2016 second quarter would have been $9.2 million, a 10.5 percent drop from the prior-year period (also excluding legal expenses). Lower general and administrative expenses reflect cost-reduction strategies and other operational initiatives.
The company said it expects to achieve $4 million in annualized savings this year.
The litigation costs stem from a lawsuit filed in spring 2015. Summer Infant sued former CEO Carol Bramson, as well as two other former company executives and company consultants in federal court, alleging theft and misappropriation of trade secrets. Summer Infant claimed they were trying to create a competing company.
A confidential settlement with two defendants who were former consultants to the company has since been reached.

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