WOONSOCKET – Summer Infant Inc. saw its loss widen significantly in its full-year and fourth-quarter earnings report released Wednesday, in a year that was marked by a lawsuit involving former executives.
The baby product maker said the loss for the year that ended Jan. 2 was $8.7 million, or 47 cents per diluted share, compared with a loss of $245,000, or 1 cent per share, a year earlier.
The fourth-quarter loss was $3.1 million, or 17 cents per share, compared with a loss of $611,000, or 3 cents per share, in the prior-year quarter.
Revenue grew slightly year over year, by 0.22 percent, to $205.8 million from $205.4 million. However, revenue slightly fell in the last three months of the year to $50.8 million from $51 million in the same 2014 period.
CEO Bob Stebenne called 2015 a year of “transition and transformation” for Summer Infant.
The baby product maker was in the news for suing former executives, including its previous CEO, for trade secret theft, and reaching a confidential settlement with two other defendants that were former consultants to the company.
The company said it incurred $6.3 million in legal costs in fiscal 2015 and $400,000 in costs related to an employee termination settled in the second quarter. Including those costs, general and administrative expenses increased to $46.1 million in fiscal 2015 from $40.3 million in fiscal 2014; the company blamed the legal costs on the increase.
Fourth-quarter results also included $1 million of legal expenses in connection with the ongoing litigation.
Despite the ongoing litigation, Stebenne was optimistic for the year ahead.
“We’re pleased with a number of accomplishments that set the stage for stronger results in the quarters to come,” Stebenne said in a statement.
“We successfully refinanced our credit facilities, exited non-core product areas such as furniture, streamlined the company’s overhead and eliminated excess inventory, all underscored by a new management team intent on achieving higher top line growth and improved financial performance.
“Our strategic decision to focus the company on new product development and strengthened brands has already led to numerous industry awards and increased interest by our retail customers both in stores and online. We ended 2015 with core brand growth, on a constant currency basis, of 6.1 percent, reflective of our marketing initiatives. We also generated $9.3 million in cash from operations last year – as compared to a $6.3 million use of cash in 2014 – equating to an improvement of $15.6 million. We begin 2016 with lower debt, a stronger balance sheet, and a host of new and innovative products about to hit the shelves,” he said.
He said company officials feel positive that bottom-line results – and shareholder returns – will improve going forward.
