WOONSOCKET – Juvenile health, safety and wellness product maker Summer Infant Inc. posted lower net revenue but narrowed its loss in the second quarter of 2013, the company announced Wednesday after the close of the markets.
Net revenue for the quarter ended June 30 dropped to $53.8 million, a 12.9 percent decrease from $61.7 million in the second quarter of 2012. Summer Infant blamed the drop on lower sales to a large customer as well as lower sales across most categories, excluding safety, due to discontinued non-profitable and low margin products. The company also noted the phasing out of license agreements as a reason for the lower net revenue.
Summer Infant reported a net loss of $304,000, or 2 cents per diluted share, which narrowed by 28.3 percent the net loss of $424,000, or 2 cents per diluted share, in the second quarter of 2012.
Excluding add-back charges permitted by the company’s loan agreement for items such as certain close-out sales, severance costs, Board fees and special projects, which totaled $551,000, the company’s adjusted net income totaled $247,000, or 1 cent per diluted share. There were no permitted add-back charges in the second quarter of 2012.
“We have made progress in our effort to further diversify our customer base and expand distribution of key products,” said President and CEO Jason Macari in a statement. “While our mass merchants account for the majority of our business, sales to small- and mid-sized specialty customers, as well as alternative channels, including home centers, increased 20.5 percent year over year.”
Macari also highlighted Summer Infant’s reductions in administrative costs of 14.6 percent and selling costs of 27.8 percent, which he credited to “the aggressive steps we have taken to lower our cost structure.”
“While we are significantly lowering spending in these areas, we continue to selectively invest in brand marketing and advertising with a goal of generating greater awareness and sales of our higher-margin core Summer and Born Free branded products,” Macari said in a statement.
The company said in a release it plans to further streamline operations in the second half of 2013 and launch new products expected to draw more revenue.