Full Press Release Details
Lakeland Industries,
Inc. Reports Fiscal 2021 Second Quarter Financial
Second Quarter Records Set for Revenues, Operating Income, and Free
Driven by COVID-19 Demand and New Industrial
Gross Margins of 49.5% at Highest Level in Company
Improved Profitability Measures and Operating
Efficiencies/Leverage Deliver 269% Increase in Operating
Visibility Raised for Sustained Improvements
Second Quarter Ends with Cash of $34.9 Million Up 49% from End of
AL September 9, 2020 -- Lakeland Industries, Inc. (NASDAQ:
LAKE) (the Company or Lakeland ), a
leading global manufacturer of protective clothing for industry,
healthcare and to first responders on the federal, state and local
levels, today announced financial results for its fiscal 2021
second quarter ended July 31, 2020.
Fiscal 2021 Second Quarter Financial Results
of $35.0 million, up 27.5% as compared with 2Q20 of $27.5
2Q21 of $17.3 million, compared with 2Q20 of $10.4
percentage of net sales in 2Q21 was 49.5%, compared to 37.9% in
of $7.6 million in 2Q21, down from $7.8 million in
$9.7 million in 2Q21, up from $2.6 million in 2Q20
million or $1.17 per basic common share in 2Q21, up from $1.4
million or $0.17 per basic common share in 2Q20
before interest, taxes, depreciation and amortization (EBITDA)* of
$10.5 million, compared with $2.6 million in 2Q20
expenditures for 2Q21 of $0.5 million, up from $0.4 million in
million at 7/31/20, up 49% from 4/30/20 and 139% from
7/31/20, down from $1.2 million at beginning of fiscal
equity of $103.4 million at 7/31/20, up $18.3 million from $85.1
in 2Q21 as part of $2.5 million stock repurchase program approved
EBITDA is a non-GAAP financial measure. Reconciliation is provided
in the tables of this press release.
Management's Comments
D. Roberson, President and Chief Executive Officer of Lakeland
Industries, stated, Our Company has just set a new standard
of excellence for PPE manufacturers anywhere in the world.
Following our fiscal 2021 first quarter that was extraordinary with
record setting financial results, we just exceeded that as measured
by key performance measures. Against a backdrop of very challenging
times, I am very proud of the efforts and achievements of our
global team. We are delivering for our existing and new customers
alike, our shareholders, and, perhaps most importantly, for the
health and safety of people around the world as we all contend with
the continued COVID-19 pandemic.
the third consecutive quarter, we experienced increased demand for
our products relating to COVID-19. We estimate 35% of our fiscal
2021 second quarter sales were related to COVID-19 demand. Because
of our unique business structure, owning our manufacturing in
diverse geographic locations and having long-term relationships
with multiple raw material suppliers, we have avoided raw materials
shortages experienced by many of our competitors. As a result,
virtually all of these orders were booked, manufactured and
delivered within the quarter.
to the first quarter, we continued to operate our factories that
make disposable and chemical products at near maximum capacity, a
running schedule of 6-days a week; 12 hours per day through out the
second quarter. As a result, we were able to deliver products when
our competitors many of whom use third party contractors --
could not. This led to the establishment of 55 new customer
relationships for traditional industrial products, with several
placing container-sized orders for significant business that we
believe may be retained, in whole or in part, going
all of the impact of COVID-19 on Lakeland is positive. Automotive
manufacturing plants were closed for a significant portion of the
second quarter and this negatively impacted our sales for a few of
our product lines. The oil/gas industry has been materially
weakened given the price of oil and reduced travel, so spending
within this vertical market has been reduced. Based on our channel
checks, municipalities lack requisite funding for additional
protective garments such as turnout gear, so the California
wildfires do not appear to have contributed to our sales in the
second quarter and the utility sector is working smaller crews
resulting in a reduction or postponement of purchasing new
protective clothing.
have not yet resumed production of a number of disposable and
chemical SKUs or product variations that had been curtailed or
eliminated in the first quarter but anticipate that we will begin
to slowly add additional SKUs in the coming quarters. The
reintroduction of these products to our manufacturing schedule will
be metered and managed so that we emerge from COVID-19 with a
rationalized product offering that preserves the majority of the
manufacturing efficiencies we have realized, and the resultant
impact on margins. This rationalization means we expect to offer
far fewer products than we have previously offered. This
streamlining has led to reduced customer lead-times, more
efficient, higher volume manufacturing, and stronger gross margins.
Gross margin as a percentage of net sales in the second quarter set
a record for any quarter at 49.5%, which compares to 37.9% in the
same quarter last year and 48.6% in the first quarter of this
gross margins in the second quarter benefited from COVID-19
manufacturing, we believe a significant amount of the increase from
the prior year period will continue given the process enhancements
and other programs implemented to strengthen our profitability.
Overall, we view this in the context of the sustainability of our
financial performance exclusive of COVID-19 contributions. Aiding
our initiatives to permanently strengthen our gross margins is the
enhanced focus on new, high growth rate, high margin, market
verticals, specifically Critical Environment and the Utilities
markets. Both of these markets have significant barriers to entry
in terms of product testing/verification and the technical