WOONSOCKET – Summer Infant Inc., doing business as SUMR Brands, recorded a $4.2 million loss in 2019, a 2.4% improvement year over year, according to a company filing on Wednesday.
Revenue for the year was $173.2 million, a decline from $173.6 million in 2018.
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Loss per diluted share for 2019 was $1.98, compared with $2.04 one year prior.
The infant and juvenile products company has recently implemented restructuring efforts led by interim CEO Stuart Noyes, who recently agreed to extend his tenure with the company. SUMR Brands had been significantly impacted by the closure of Toys R Us and Babies R Us in 2018, as well as by tariffs placed on goods from China.
“We believe that we have mitigated most of the effect of tariffs during fiscal 2019 through increased wholesale price increases, cost concessions, and moving certain production to other countries,” the company said in its filing.
SUMR Brands noted that the Office of the U.S. Trade Representative announced the exclusion of tariffs on metal gates effective immediately, retroactive to September 2018; as a result, the company recorded a $1.8 million receivable and a $1.5 million benefit to cost of goods sold during the fourth quarter.
“My belief in this company’s future is underscored by my commitment to stay on and oversee the numerous steps being undertaken to reduce costs and position the organization to grow, de-lever, and achieve sustained profitability,” said Noyes. “Of the $7.5 million of anticipated annualized savings, approximately $6 million is expected to positively impact this year’s financial results, and the implementation of these plans during the first two months of 2020 has exceeded our expectations.”
The potential impact of the coronavirus was also acknowledged by the company.
“We are currently assessing the potential impact of the coronavirus outbreak on our business, including on our suppliers outside of the U.S. and on our distribution center located in California,” the filing said. “We expect that we may experience delays in shipment of our products to the U.S. and some delays in manufacturing of products. These potential delays may adversely affect our financial condition and results of operations in the near term, however, at this point, the extent of such impact is uncertain.”
The company also announced the implementation of a 1 for 9 reverse stock split in March. The move was part of efforts to avoid being delisted on the NASDAQ due to a sustained low share price.
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
