Summer Infant reports sales decline, widens loss in 3Q

WOONSOCKET – Summer Infant Inc. reported third-quarter results on Thursday, showing a dip in sales and widening its loss when compared with the prior year period.
The baby products maker reported $50.2 million in sales for the quarter that ended Oct. 3, a 1.6 percent decline from $51 million reported in the prior year quarter that ended Sept. 30.
It said it had a loss of $1.8 million, or 10 cents per diluted share, compared with a loss of $138,000, or a penny a share, a year ago.
Selling expenses were $4.1 million in the third quarter compared with $4.5 million last year, the company said, noting the expenses reflect lower sales and cost controls.
General and administrative expenses rose to $13 million in the third quarter compared with $10 million a year ago, mostly due to $3.7 million in legal costs from the company’s lawsuit against its former CEO and several other former employees for alleged theft of trade secrets.
On Wednesday, the company announced that it was dropping its complaint against two defendants; those two defendants were from Rest Devices Inc., a company that did consulting work for Summer Infant.
“Summer Infant continued to focus on long-term fundamentals this quarter, and in that regard we accomplished a great deal,” Bob Stebenne, Summer Infant CEO, said in a statement. “Core-branded revenue grew slightly year over year, but this only tells part of the story. Investments in new product development and category expansion have laid the groundwork for accelerated growth expected in the quarters to come. We saw a high amount of enthusiasm for our brand extensions, new product introductions and ‘smart nursery’ at industry events in both Cologne, Germany, and Las Vegas, at the ABC Kids Expo, where we also received five awards for design and innovation.”
Stebenne said inventory levels are not yet in line with company goals, however. But other strategies are underway to improve operations, he said.

“The headcount reductions and other streamlining initiatives previously announced are already underway and have had a positive impact this year. Overall, the company is executing a plan to improve margins, drive higher growth and become a stronger name in the juvenile space, positioning us well for 2016 and beyond,” Stebenne said.

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