Q3 2024 Lifetime Brands Inc Earnings Call
Unknown Executive, Robert Kay
Speaker Change: Good morning, ladies and gentlemen, and welcome to Lifetime Brand's 3rd Quarter 2024 Earnings Conference Call. At this time, I would like to inform all participants that their lines will be in a listen-only mode.
Speaker Change: After the speaker's remarks, there will be a question and answer portion of the call. If you would like to ask a question during this time, please press star one on your telephone keypad. I would now like to introduce your host for today's conference, Rory Vermoor. Ms. Vermoor, you may begin.
Unknown Executive, Robert Kay
Speaker Change: Thank you. Good morning, and thank you for joining Lifetime Brand's third quarter 2024 earnings call. With us today from management are Rob Kay, our Chief Executive Officer, and Larry Winoker, our Chief Financial Officer.
Speaker Change: by the Private Securities Litigation Reform Act. Any such statements are not guarantees of future performance, and factors that could influence our results are highlighted in our earnings release, and other factors are contained in our filings with the Securities and Exchange Commission.
Speaker Change: Such statements are based upon information available to the company as of the date hereof and are subject to change for future development.
Speaker Change: Accept as required by law, the company does not undertake any obligation to update such statements.
Speaker Change: Our remarks this morning and in our earnings release also contain non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission.
Speaker Change: Included in such release is a reconciliation of these non-GAAP financial measures with a comparable financial measure calculated in accordance with GAAP. With that introduction, I'd like to turn the call over to Rob Kay. Please go ahead, Rob.
Good morning, everyone, and thank you for joining us today.
Rob Kay: On today's call, I'd like to first briefly touch on our third quarter financial results.
Rob Kay: Second, discuss the factors that contributed to the reduction in our guidance for full year 2024, the strong performance in our e-commerce channel and progress in our international and professional food services division, and touch on anticipated M&A.
Rob Kay: or provide an update on the supply chain. And lastly, I will touch on the balance sheet.
Unknown Executive, Robert Kay
Robert Kay: For the third quarter, 2024, we delivered net sales of $183.8 million compared to $191.7 million for the same period last year.
Robert Kay: Sales were largely impacted by softness in the end markets that drove slower volume at point-of-sale and contributed to de-stocking in our core U.S. business, most notably in the mass channel.
Robert Kay: Specifically with reference to Dollar General reporting a decline in their year-to-date revenues and store traffic.
Robert Kay: They've made the decision to delay the second phase of the Dolly Parton program, which has originally slated to begin shipping in 2024 and is now planned to be shipped in the first quarter of 2025.
Unknown Executive, Robert Kay
Robert Kay: With this pushout in shipments, we now anticipate $4 million of our previously forecast $10 million in sales from the dollar store to be recognized in the first quarter of 2025.
Unknown Executive, Robert Kay
Robert Kay: At the time we reported our second quarter results in early August.
Robert Kay: We did not have this line of sight and today issued an update to our full year 2024 outlook to reflect this and other updates in our business.
Robert Kay: The uncertainties signaled in prior quarters have intensified with relatively weak end market conditions combined with slower restocking that has contributed to weaker than expected shipments.
Additionally, while a small overall impact.
Robert Kay: The overall downturn in the food service market has resulted in fewer shipments than anticipated.
Unknown Executive, Robert Kay
Robert Kay: While these macroeconomic headwinds were factored into our previous guidance, we did not factor in de-stocking and delayed shipments into 2025, which has had the largest impact on our outlook.
Unknown Executive, Robert Kay
Robert Kay: Further cementing the soft third quarter, our channels experience weakness in the seasonal back-to-school consumer demand.
Robert Kay: However, we are cautiously optimistic expecting this holiday season to be consistent with the forecasted increases by major retailers and third party data, which we consider when calculating our internal expectations.
Robert Kay: Factoring in these delays, we now expect full year sales of $680 million to $700 million.
Robert Kay: compared to six hundred and eighty seven million dollars in two thousand and twenty three
Unknown Executive, Robert Kay
Speaker Change: Despite challenges in the operating environment, we believe in the resilience of our business model is clear, and we are pleased to have delivered another quarter of steady gross margins.
Unknown Executive, Robert Kay
Speaker Change: Importantly, we experience robust market share growth across our categories in e-commerce during the third quarter.
Speaker Change: Consolidated e-commerce sales increased to $34.4 million, or 18.7% of total sales year-over-year.
Speaker Change: and to $86.3 million or 18.4% of total sales for the year to date period.
Unknown Executive, Robert Kay
Speaker Change: U.S. e-commerce sales reported notably strong growth with an increase of 10.7% in the third quarter year over year.
Unknown Executive, Robert Kay
Speaker Change: During the third quarter of 2024, Lifetime outperformed across the majority of our categories at Amazon, reinforced by our October 2024 Prime Day sales, which increased 21% year-over-year Prime Day across all categories.
Speaker Change: To put this into context, Amazon reported a 3% increase in year-over-year October Prime Day sales.
Unknown Executive, Robert Kay
Speaker Change: Overall, our comprehensive portfolio of well-recognized brands and our targeted go-to-market approach of meeting the consumer where they shop continues to resonate and resulted in valuable market share gains.
Unknown Executive, Robert Kay
Speaker Change: Turning to our international segment, which we understand remains under the microscope for many.
Sales increased 10.9% from the comparable prior year quarter.
Speaker Change: This quarter's positive sales performance is a result of successful execution of our repurposed go-to-market strategy and reorganization within this business.
Speaker Change: While we recognize an operating loss in international, we have experienced higher gross margins and incremental listings with larger retailers in targeted channels, which we believe is an early indication that our turnaround strategy is working.
Speaker Change: The ability to turn the international business back to profitability is an opportunity to add an incremental 10 million dollars in annual EBITDA compared to our performance in fiscal year 2023.
Speaker Change: This should not be discounted and one of the key reasons behind our focus on restoring international.
Unknown Executive, Robert Kay
Speaker Change: Overall demand in the UK and markets remain soft and our third quarter growth was driven by our strategic shift into new markets and new channels.
Speaker Change: In particular, we've gained traction with national retailers and grocers as we shifted the legacy focus from independence, which has been a declining channel.
Unknown Executive, Robert Kay
Speaker Change: On the European continent, we continue to gain new placement at large retailers such as Leclerc and Carrefour in France, Etica in Germany, and Emarco in Denmark.
Speaker Change: As these are all placements that we generated in 2024, we expect that the bigger financial impact of these wins will be in 2025.
Unknown Executive, Robert Kay
Speaker Change: In Asia Pacific, we are experiencing favorable traction with the expansion of our listings in multiple brands and with expanded retailers in Australia and New Zealand.
Speaker Change: Further, we have completed the second phase of our two-step process in our infrastructure turnaround in this market and finalized the build-out of our own infrastructure.
Speaker Change: We now are in the process of establishing a fully direct APAC sales strategy.
Speaker Change: which we expect to be complete by the end of 2024.
Unknown Executive, Robert Kay
Speaker Change: We anticipate that not only will this allow us to grow top line, it will be at a more profitable growth and contribution margin.
Unknown Executive, Robert Kay
Speaker Change: Outside of the top line growth in international, we are pleased with the incredible success of the first phase of our Dolly Parton program.
Unknown Executive, Robert Kay
Speaker Change: The first program of four exceeded all expectations and positions lifetime for further growth with the Dolly Parton brand and Fits our original strategy with more lifetime products and brands available at Dollar General and other retailers
Unknown Executive, Robert Kay
Speaker Change: With the push out in shipments I previously mentioned, we now anticipate the incremental revenue impacts to be seen in the first quarter of 2025 and still expect this program to well exceed $10 million.
Unknown Executive, Robert Kay
Building on initial consumer momentum for the Dolly Parton brand.
Speaker Change: We are already in discussions with additional customers and channel partners for 2025 shipments and have received placement in a few accounts already.
Unknown Executive, Robert Kay
As I mentioned a few moments ago.
Speaker Change: Our strategic goal with the Dolly Parton license was to first use this brand to enter the dollar channel and penetrate across several of our product categories including home decor, cutlery and tabletop.
As we continue this collaboration.
Speaker Change: We have an ongoing dialogue to expand our market share in this channel with additional lifetime products and brands.
Unknown Executive, Robert Kay
Speaker Change: In our food service business, we experienced a slight downturn this quarter driven by a downturn in this market, which has led market participants to delay capital projects and purchasing decisions.
However, we continue to gain share in this segment.
through national account networks and food service distributors.
Speaker Change: and remain optimistic based upon the continued new listings that we've won to expect growth this year and robust growth in 2025.
Unknown Executive, Robert Kay
Speaker Change: In late September, we expanded our MACASA Hospitality product offering to include premium glassware brands Royal Leardom and Onis.
Unknown Executive, Robert Kay
Speaker Change: This new product line will begin shipping in 2025, rather than late in the fourth quarter as previously indicated.
Speaker Change: And we expect a revenue contribution in our commercial food services division beginning in the first quarter of 2025.
Unknown Speaker 0
In terms of our M&A pipeline.
We believe that the current market opportunities are strong.
Speaker Change: We continue to actively pursue numerous M&A opportunities that are currently in our pipeline and are evaluating targets in many areas including our core business, new project adjacencies,
and our food service business.
Unknown Executive, Robert Kay
Speaker Change: We are hopeful to make meaningful progress in terms of pursuing an opportunity. However, we will not do so if it means compromising our financial discipline.
Unknown Speaker 0
Speaker Change: Meanwhile, as we previously disclosed, we are rigorously evaluating targets in new categories such as the outdoor sector that are accretive to profitability and a catalyst to achieve our long-term performance objective at an accelerated pace.
Speaker Change: We expect to continue to advance discussion regarding these potential opportunities and will keep the market updated on all strategic initiatives.
Speaker Change: On this topic we recorded one-time acquisition related expenses of 0.2 million in the quarter and 0.9 million in the year-to-date period related to our due diligence in pursuit of a potential acquisition target that did not come to fruition.
These one-time expenses will not impact our future financial results.
The important takeaway relating to our M&A activity.
Speaker Change: is that we will not sacrifice our long-term vision for the company to accept short-term goals.
Speaker Change: We believe there remains significant opportunity here. However, I can assure you we are waiting for the right opportunities.
Speaker Change: We will perform the due diligence and properly vet prior to committing or announcing potential targets that will not be properly suited for our business.
Unknown Executive, Robert Kay
Turning to our supply chain.
While ocean freight costs have stabilized at attractive levels.
Speaker Change: We have incurred a notable but manageable increase in domestic trucking costs.
In order to manage costs and overall COGS.
Speaker Change: We have sourced products at reduced costs, which have provided the ability to maintain favorable margins of approximately 37% in the quarter.
Speaker Change: Despite the brevity of the longshoreman strike, we did experience a delay in moving goods in the region.
Speaker Change: In addition, climate conditions, including the drought in the Panama Canal and U.S. hurricane events, resulted in business disruption and caused delayed shipments.
Speaker Change: In Europe, the geopolitical turmoil that has caused challenges throughout 2024 continues to divert shipments out of the Red Sea, prompting a longer route to Europe.
Speaker Change: We've successfully mitigated any business interruption as far as inventory and have met customer and consumer demand.
Speaker Change: In Mexico, our plastics manufacturing facility remains on schedule to reach full production capacity, and we will begin shipping an expanded product assortment by the end of the fourth quarter of this year.
Speaker Change: We have taken a measured approach to ramp up this facility to ensure we achieve high quality output.
Speaker Change: and build an appropriate product mix being produced in this facility.
Unknown Executive, Robert Kay
Speaker Change: This and other initiatives are helping us progress in our efforts to have approximately 25% of our spend on goods being sourced outside of China in the near term.
In addition to this Mexico initiative.
We remain primarily focused on Southern and Eastern Asia.
Speaker Change: and expect to expand this initiative in 2025 with the good progress we have made to date.
Speaker Change: Our manufacturing partners in the region are working with us and setting up new facilities outside of China to accommodate this expansion in several countries.
Speaker Change: One example of this is our recent transfer of the manufacturer of our largest SKU by volume to Cambodia.
Unknown Executive, Robert Kay
Speaker Change: I'll turn to some high level color around our balance sheet, which Larry will discuss in greater detail shortly.
Speaker Change: In preparation for any uncertainties following the outcome of the presidential election.
Speaker Change: We have taken defensive operational measures and increased inventory levels to protect against the potential for increased tariffs post-election.
Speaker Change: In our experience we've determined this to be a prudent operational action.
Speaker Change: This was critical to avoid a business interruption and to control retention of our market share with ample reserves to a higher inventory level as we position for increased sales volume and end market demand in 2025.
Speaker Change: Importantly, this investment was strategic, and we will be able to monetize this reserve inventory at full value.
Speaker Change: Overall, we are comfortable with holding a higher level of inventory as a hedge against the material impact from potential tariffs.
Speaker Change: As noted in the second quarter, we placed certain customers on credit hold to mitigate risk based upon the headwinds at retailers, which was a component of the decrease in sales from the prior year period and a contributor to the revised 2024 sales forecast.
Unknown Executive, Robert Kay
Speaker Change: One example is Big Lots, which we had on credit hold and therefore did not ship orders that we had received over the last two quarters.
Speaker Change: They have since filed bankruptcy, and we have now begun shipping on a post-petition basis while avoiding the credit liability that existed pre-bankruptcy filing.
Speaker Change: We continue to believe this is another hedge to reduce risk that is in our control.
Speaker Change: We are comfortable with our leverage ratio and pleased with our cast generation levels despite headwinds in the environment.
Unknown Executive, Robert Kay
Speaker Change: As we look ahead to the remainder of the year, we believe we are well positioned to continue to grow market share and create value as we anticipate a rebound in demand in 2025.
Speaker Change: We have a strong foundation in place, thanks to the significant work completed over the past several years, which has resulted in our resilient business model, something I take great pride in.
Speaker Change: We look forward to keeping you updated on our progress as we continue expanding our leading portfolio of brands, driving innovation, and delivering operational excellence.
With that, I'll now turn the call over to Larry.
Thanks, Rob.
Speaker Change: with $300,000 or $0.02 per diluted share as compared to $4.2 million or $0.20 per diluted share in the third quarter of 2023. Justin's net income was $4.5 million for the third quarter of 2024 or $0.21 per diluted share as compared to $7.7 million or $0.36 per diluted share.
Speaker Change: Income from operations was $8.6 million in the third quarter of 24 versus $13.6 million in the 23 period. Adjusted income from operations
Speaker Change: for the third quarter. 24 was 13.2 million compared to 17.7 million in the 2023 period and adjusted EBITDA for the trailing 12-month period ended September 30th of 2024 was $53.9 million.
Speaker Change: Adjusted Net Income, Adjusted Net Income from Operations, and Adjusted EBITDA are non-GAAP financial measures which are reconciled to our GAAP financial measures in the earnings release.
Speaker Change: Following comments over the third quarter of 2024 versus 2023 unless stated otherwise.
Speaker Change: Consolidated sales declined by 4.1% to 183.8 million. U.S. segment sales decreased 5.1% to 170.2 million.
Speaker Change: As Rob commented, sales were adversely affected by end market softness that drove slower volume at point of sale and contributed to retailers destocking, including delaying programs.
Speaker Change: Within this segment, the product lines most affected by these factors were tableware, kitchen tools, and hydration. These declines are partially offset by increases for cutlery and home decor products.
Speaker Change: And while brick and mortar retail demand declined, U.S. e-commerce sales increased from 15.7% to 18.3% of total U.S. sales.
Speaker Change: International segment sales increased by 10.9%, 1.3 million, 1.1 million in constant US dollars to 13.6 million.
Speaker Change: The increase came from UK national and export accounts to continental Europe, in part driven by new placement at large retailers.
Speaker Change: The decline was due to product mix, an international gross margin increased to 34.6% from 32.5% driven by customer and product mix.
Speaker Change: U.S. segment distribution expenses as a percentage of goods shipped from its warehouses, excluding non-recurring expenses, were 9.1% in both periods.
Speaker Change: increases for licensing fees for our new warehouse management system and higher labor rates were offset by lower freight out expenses
Speaker Change: For international distribution expenses as a percentage of goods shipped from its warehouses were 24.2% versus 22.4%, reflecting general inflation factors and the impact of our new direct APAC sales strategy.
Speaker Change: Selling general and administrative expenses decreased by 3.5% to $38.8 million. In the US segment, expenses decreased by $1.6 million to $30 million.
Speaker Change: as a percentage of net sales expenses was 17.6% in both periods. The decrease was driven by lower employee costs, the largest component of SG&A, primarily due to lower incentive compensation.
Other decreases included lower allowances for doubtful accounts.
This is Partially Offset by General Inflationary Factors.
Speaker Change: For international, SG&A increased by $800,000 to $4.5 million, and as a percentage of net sales, it increased to 33.1% from 30.1%. The increase was driven by higher employee expenses and certain regulatory expenses.
Speaker Change: Unallocated corporate expenses decreased by $600,000 to $4.3 million due to lower incentive compensation, partially offset by higher professional fees.
Speaker Change: As mentioned in our release, included in FD&A expenses was diligence-related expenses for an abandoned acquisition transaction of $300,000 and $900,000 for Q3 and the nine-month period, respectively.
Speaker Change: For interest expense, excluding market adjustment for swaps, the increase was $600,000 due to higher interest rates on our debt, partially offset by lower average debt balances.
Speaker Change: The effective income tax rate for the quarter and prior periods differ from the federal statutory income tax rate, primarily due to farm losses for which no tax benefit is recognized.
Speaker Change: and looking at our debt and liquidity position, how balance sheet continues to be strong. As of September 30th of this year, our liquidity was approximately $76 million, which included cash plus availability under our credit facility and receivable purchase agreement.
Speaker Change: Products expected to be shipped in the first quarter of 2025 and to mitigate some risk against potential tariff increases.
Speaker Change: As provided in our release, we updated our financial guidance for the full year of 24, which is as follows, net sales of $680 million to $700 million, adjusted income from operations from $44 to $47 million.
Speaker Change: Adjusted Net Income from $11M to $13M and Adjusted EBITDA of $54M to $57M.
Speaker Change: This concludes our prepared comments. Operator, please open the line for questions.
Speaker Change: Thank you. We will now be conducting a question and answer session.
Unknown Executive, Robert Kay
Unknown Executive, Robert Kay
Unknown Executive, Robert Kay
Speaker Change: Good morning and thank you for taking the questions. So I guess we'll first wanted to
Speaker Change: Drill down on the 3Q sales shortfall. So maybe if you could separate the impact of the delayed shipments for, I believe, mass retail was the biggest.
Speaker Change: sales channel that you saw the performance, but then look at that versus the Dolly Parton shipments that got delayed. So maybe if you could just kind of parse out those two, and I have a couple of other questions as well.
Unknown Executive, Robert Kay
Thank you for having me.
Unknown Speaker 23. Okay. Unknown Speaker 24.
Speaker Change: Yes, so the big miss in the quarter, some of the timing is, you know, in the mass channel where
Speaker Change: There was just softness and the orders weren't there. The guidance was driven also because that didn't the dollar
Speaker Change: shipments of Dali were not in the third quarter. Um, but there was a fair amount in the fourth quarter, as we said, a little over four million, which is being pushed there.
Speaker Change: Choice so it'll ship in the first quarter, but it won't ship in this quarter and that helped drive the change in our guidance
Unknown Executive, Robert Kay
Speaker Change: Unknown Speaker All right, that's helpful, Rob. And then in terms of the distribution expenses, they were up 17% from last year. I think Larry, you touched on that a little bit, but that's a bigger
Speaker Change: Spiked and then what you guys typically have in a quarter So maybe if you could just drill down into some more details about that and what are your expectations going forward?
Speaker Change: Yeah, so when I cited the percentage that they were even with last year, they did exclude.
Two items that won't repeat.
Speaker Change: The one of them is that because something we periodically assess is what's called that sort of time and obligations and folks look at all your facilities and determine when those. I kind of expired what kind of.
Speaker Change: Restitution of the condition of those properties you need to pay for. So we periodically assessed it. We had a fairly large assessment this quarter.
That won't occur going forward.
Speaker Change: The other one is, as I also mentioned, we do have a new warehouse management system. It's not CAPEX. It's all licensing. However, we did have some efficiencies in the implementation.
Speaker Change: It's all completed for one of our facilities, which is on the West Coast, in the Alco. That's all done, but there was some inefficiencies.
Speaker Change: that won't, I don't expect that to repeat because it's running smoothly, and a Reefs Coast facility in New Jersey where we're now doing implementation, we have all the learnings of doing the West Coast first, so we don't anticipate anything unusual.
Speaker Change: Just know that the actual retirement obligation is, not to get into arcane here, but you put up an asset and a liability and then you depreciate the asset. So in our financials for the quarter, it's depreciation expense, it wasn't any cash outlay.
Unknown Executive, Robert Kay
Speaker Change: Gotcha. And just to follow up on that, so in terms of just the distribution expenses, so roughly a $3 million increase on a year-over-year basis. So how much of that would you say is non-recurring of that increase?
Unknown Speaker 0
Unknown Executive, Robert Kay
Yeah, approximately 2 million at that.
Speaker Change: Okay, that's very helpful. Okay, and my last question before I pass it on to others. So as far as the international segments, definitely nice to see improved results there. What are you assuming now for this segment? So what's embedded in your new guidance now for the year, you know, in terms of your
Speaker Change: Operating income or net income, however you want to address that, but just wondering, what are you factoring into the international segment now? And it sounds like you expect that to improve next year, but any thoughts on that? That'd be helpful.
Speaker Change: Yeah, we really haven't broken that out, but it's consistent with what we've said in the past, so it won't make a profit this year. It will be.
Speaker Change: The performance and the bottom line and top line will improve year over year, which is in our guidance for this year, but we'll see the bigger impact next year, which, you know, when we release that we'll discuss.
Unknown Executive, Robert Kay
Thank you very much and best of luck.
Thank you.
Speaker Change: Once again, if you would like to ask a question, please press star one on your telephone keypad.
Speaker Change: Next question comes from Brian McNamara with Panacord Genuity. Please go ahead.
Unknown Executive, Robert Kay
Speaker Change: Good morning, this is Madison Calinan on for Brian. Thanks for taking our questions. First, we're just curious what drives the hockey stick improvement in sales in Q4 with guidance calling for 9% growth at the midpoint. Thanks.
Well,
Speaker Change: Well, you characterize it as a hockey stick, we just see it as, you know, the fourth quarter is strong. You know, we did mention there are some programs that were delayed at the retailer's direction, so we expect that to shift in the fourth quarter.
Unknown Executive, Robert Kay
Speaker Change: Unknown Speaker A lot of it is just timing and look in our business you can have programs that shift one quarter versus the next, right? So it's for the full year, it's moved out, you know, in one quarter may be different versus the quarter, you know, year over year versus another quarter, but the full year it's moved out. And that's historically what you see with our business.
The End.
Unknown Speaker 0
Speaker Change: Great. And then secondly, after a few lean years with tough end markets, what will it take to sustainably grow the business again long term? Any color around that? Thanks.
Unknown Executive, Robert Kay
Speaker Change: Yeah, there's so much noise out there. It's an interesting question. So, you know, it's
Speaker Change: Consumer confidence and consumer demand drives our business, you know, like most consumer products. You know, so if you look at the market over the last, you know, couple of years, we've maintained or gained market share.
Unknown Speaker The overall market hasn't been growing.
Speaker Change: In the consumer, you know, in the food service part of our business. It's it's been a good growth business We're really just gaining a lot of share But that market is down right this year
Speaker Change: as inflationary and other, you know, particularly food inflation and the cost of dining has gone up, people haven't been dining as much and therefore the industry has not opened as many stores.
Speaker Change: and has delayed decisions on capital spend, in other words, new dinnerware and glassware and the like. So, but that is...
Running a 6% growth industry, we expect that to come.
Speaker Change: In the near term, back to those levels. And if you look at Circona data, if you look at NRF and other big organizations, they're expecting
Speaker Change: Pantop demand to be released in a robust Holiday season we'll see soon enough, right? And but if there's increased stimulus
Speaker Change: which may happen in the year that definitely benefits consumer spending as we saw back in the big stimulus in 21 right people use that money to spend so that would be a big benefit for our business
Speaker Change: But we continue to gain share so that's why you know in that environment you see us
Speaker Change: Growing 11% this quarter and that you know should continue to drive our performance Internationally because we're just gaining share In a market though that isn't doing well with a growth in that and market right we will go that much better
Speaker Change: So a lot of it is going to be consumer confidence, the general state of the economy and consumer spending.
Unknown Executive, Robert Kay
Unknown Executive, Robert Kay
Thank you very much.
Next question, Christina Chouet with DEA Davidson. Please go ahead.
Unknown Executive, Robert Kay
Hi, it's Christina Ong for Lunar Bold and Wiser.
Speaker Change: So a clarifying question. I was wondering like for the $4 million. Was it is there something planned for third quarter or fourth quarter that got delayed to the first quarter of 25 and maybe on the new commercial?
Speaker Change: Food Product Line. Like, so obviously, retailers were kind of like locked in to put in the order. So like, how are the retailers accepting the new commercial food product line based on the conversation that you have recently? Unknown Speaker
Speaker Change: Hi, I'm on the first piece. I think you're asking about dollar general. It's a dollar general. Excuse me.
Speaker Change: The shipment of shift of a little over $4 million is really a 4Q to 1Q shift. It will ship.
Speaker Change: So, but the shift is from Q4 into Q1 and that had a big impact in why we revised guidance.
Speaker Change: So that's just the timing and, you know, that program is.
solely at Dollar General. Dollar General had softness.
is in public. Um, so
Speaker Change: it's actually a good opportunity because our relationship is really strengthening with them but as a result they didn't move stuff into store which they originally were going to do.
Unknown Executive, Robert Kay
Speaker Change: I think the second question had to do with our food service, nothing to do with retail. So in the food service, so in that segment, hotels, restaurants, it's, you know,
Unknown Executive, Robert Kay
drive our business because, you know, if you need new.
Speaker Change: tabletop and for that matter, the back of the house, you know, scale, the momentum, timers. so it's just down in the industry is expected to rebound next year, but we're gaining share.
you know, in there. So a lot of
Speaker Change: Share that we've gained in wins because of the delay they're not shipping, but that'll ship
Speaker Change: starting in 25 with all these new wins just because they're going to have to buy stuff. And the other piece we had announced
Speaker Change: Unknown Speaker Our partnership with a Dutch company to gain a very prestigious line that already has existed and been sold for years.
Speaker Change: crested zone. Thinking about logistics , logistics , dispersion . As a result of . It needs to be available for different areas. Isolated very
Speaker Change: Put that in place. It caused a delay in our shipping that product, which we originally hoped and anticipated to ship that product starting in Q4. Now that'll start shipping in Q1.
Unknown Executive, Robert Kay
Unknown Executive, Robert Kay
Unknown Executive, Robert Kay
Speaker Change: That concludes today's call. Thank you all for joining. You may now disconnect.
Thank you, everyone.
Unknown Executive, Robert Kay
Transcripts provided by Transcription Outsourcing, LLC.