Crown Crafts (CRWS) 2027财年第一季度业绩电话会议：销售额增长8%，利润率提升

Crown Crafts（NASDAQ：CRWS）公布2027财年第一季度销售额上升、调整后毛利率扩大，并实现扭亏为盈。存货可供应量的改善支撑了营收，而关税退款则对GAAP收益和现金流产生带来显著提振。

核心要点

• 净销售额达到1680万美元，同比增长8%。尽管消费者支出疲软，但存货水平的改善使Crown Crafts能够更好地满足需求。
• 调整后毛利润为430万美元，调整后毛利率同比上升290个基点至25.6%，这得益于定价举措和毛利率更高的产品组合。
• GAAP净利润为210万美元，即每股0.19美元；相比之下，上年同期净亏损为110万美元，即每股亏损0.10美元。
• 关税退款在本季度使已售产品成本减少了370万美元。该公司表示，在扣除关税相关收益后，公司同样实现了盈利。
• 经营活动现金流总计为550万美元，而债务已从财年初的1400多万美元减少至960万美元季度末水平。
• 管理层表示，重新推出的Groovy Girls销售超出预期，这主要受加拿大市场的推动，而欧洲和亚马逊平台的推出计划于秋季展开。

核心财务数据

业务与运营表现

存货水平的改善是销售额增长的主要驱动力。管理层表示，与上一财年的关税不稳定时期相比，Crown Crafts现在能够更好地满足需求。

即使扣除关税退款，毛利率的改善趋势依然延续。公司将调整后毛利率的扩大归因于战略性定价以及高毛利产品组合的比重日益增加。成本控制也降低了归一化营销及管理费用占销售额的比重。

重新推出的Manhattan Toy Groovy Girls系列在加拿大市场表现尤为出色。需求异常强劲，以至于Crown Crafts开始调配原本面向美国市场的库存。管理层提到了其加拿大分销商以及Indigo Bookstores营销和发布活动带来的支持。

国际销售额还受益于Crown Crafts新的加拿大分销商，该分销商在全渠道负责Manhattan Toy和Sassy两个产品线。自上年秋季以来新增的欧洲分销商带来了进一步改善。

公司正在推进运营整合和债务削减。其仓库整合预计需要约18个月，计划于2028年5月完成。管理层表示，2027财年不太可能发生相关支出，可能将在下一个财年开始。

Crown Crafts还合理调整了其季度股息规模，以保留更多现金用于增长性投资和还债。管理层表示，调整后的股息提供了约4%的股息率。

管理层展望与时间线

管理层计划于9月通过德国的K&J面向欧洲市场推出Groovy Girls。亚马逊平台的上线时间仍定于10月，不过强劲的加拿大需求可能会使亚马逊初始上线的产品局限于部分产品线。

预计当前的资本支出仍将集中于IT、ERP升级以及塑料玩具模具等常规项目。与仓库相关的资本支出预计最早将于下一个财年开始。

位于明尼苏达州的Manhattan Toy办公租赁合同将于明年3月底到期且不再续约。管理层正在考虑让当地的少量员工居家办公，或租赁包含摄影工作室的较小办公场所。

风险与关注事项

• 管理层指出，在高利率、通货膨胀和全球地缘政治不确定性的背景下，消费者支出表现疲软。
• 虽然第一财季GAAP收益显著受益于关税退款，但管理层表示在调整后基础上公司仍保持盈利。
• Crown Crafts申请了560万至570万美元的关税退款，已收到并入账约470万美元。约有90万美元尚未收到且未入账。
• 加拿大对Groovy Girls的强劲需求使得需要调配原本面向美国市场的库存，这可能会限制亚马逊初始上架的产品丰富度。
• 仓库整合将需要前期投资以及大约18个月的实施期。

分析师问答亮点

管理层表示，Groovy Girls在加拿大的表现超出了预期。分销商与Indigo Bookstores的关系以及配套的营销活动可能有助于产品推出，但管理层未明确指出该品牌在加拿大表现尤为出色的更广泛原因。

在已入账的约470万美元关税退款中，大部分已于7月收到。截至季度末，该金额记录在其他流动资产而非应收账款中。

管理层预计仓库整合项目将于深秋或初冬启动，目标是2028年5月完成。本财年的资本支出应主要用于常规的IT、ERP及产品模具支出。

全新的Motherhood品牌妈咪包已开始在亚马逊上线发售，但初期推广较为缓慢。Crown Crafts还有两款NoJo品牌的包袋（包括一款通过沃尔玛销售），并继续在该品类进行拓展。

业绩电话会议完整文字记录

完整财报电话会议逐字稿

管理层陈述

Operator

Good afternoon, everyone. everyone and welcome to the Crown Crafts Fiscal Year 2027 First Quarter Conference Call. During today's call, the company may make certain forward-looking statements, and actual results may differ materially from those expressed or implied. These statements are subject to risks and uncertainties that may be beyond Crowncraft's control, and the company is under no obligation to update these statements. For more information about the company's risk factors and other uncertainties, please refer to the company's filings with the Securities and Exchange Commission, including its annual report on Form 10-K. With that, I would now like to turn the call over to President and Chief Executive Officer Olivia Elliott. Please go ahead.

Olivia Elliott

Thank you, Operator, and thank you, everyone, for joining this afternoon's call. Today, after the close, Crown Crafts reported very solid quarterly results, given the still-solved demand environment. We accomplished this by focusing on what we can control, and our team did a terrific job executing on our strategy. We were able to grow our net sales 8% despite the uncertainty that consumers continue to feel around high interest rates, inflation, and global geopolitical events. Improved inventory levels account for most of the growth, as we were able to better meet demand than during last year's tariff instability. Just as important, we were able to drive a higher gross margin, both on a GAAP basis and also when adjusting for tariff refunds, as Claire will walk us through in a moment. On an adjusted basis, our growth margin for the quarter climbed nearly three full percentage points year over year to 25.6%.

As a result, we were able to produce positive net income versus the loss reported in the prior year period, and we once again generated positive operating cash flow of nearly $5 million, similar to the March quarter. Combined with a significant reduction in our debt balance during the quarter, our balance sheet is significantly strengthened. As we mentioned on our last call, during the June quarter, we relaunched Manhattan Toy Brands Groupie Girl. pleased to say that so far, sales of this iconic line of fashion dolls has exceeded our expectations, largely driven by the Canadian market. And we believe this bodes well for continued success of this retro-inspired beloved brand. Next, I'll provide an update on our strategic initiatives to grow both our top and bottom line. Our priority is our ongoing innovative internal product development to expand our product offering. Another initiative is to build on our recent margin expansion to further drive profitability.

We're moving towards a favorable mix of higher margin products and, of course, our relentless spending disciplines. We're also striving to consolidate certain internal operations for greater efficiency, reduce our debt levels, and over the next two years, we'll be working on warehouse consolidation to further enhance our operating structure. These initiatives to create long-term value can often require upfront investment, and to that end, our Board has elected to right-size our quarterly dividend, which will provide us strategic access to a greater portion of our cash flow. That will also allow us to pay down debt and build the balance sheet strength that will support Crowncraft's growth well into the future. In essence, our new quarterly dividend allows for a well-balanced capital allocation approach that includes investing in growth initiatives and maintaining a solid balance sheet, while still rewarding our valued shareholders with what is now approximately a 4% attractive dividend yield. In closing, we had a solid quarter as we continued to execute on our business plan. While leveraging our inherent strengths, including our brands, our licenses, and our valued retail and licensing partners, our multi-pronged strategy that covers internal development of new products, reinvigorated marketing efforts, tight cost controls, and the strategic allocation of capital, positions as well for the creation of long-term shareholder value.

And now I'll turn it over to Claire to provide additional details around our quarterly results before we take your questions.

Unknown Speaker

Thank you, Olivia, and welcome everyone once again to the call. Our first quarter net sales of $16.8 million were up 8% over the prior quarter as improved inventory levels helped us capitalize on still soft consumer spending. As Olivia mentioned, we had strong growth margin performance. During the quarter, tariff refunds reduced our cost of products sold by $3.7 million. Even adjusting for this benefit, our gross profit of $4.3 million was above the prior year's $3.5 million and equates to a gross profit margin of 25.6%, which was up 290 basis points year-over-year. This section of our adjusted growth margin reflects both our strategic pricing initiatives and an increasingly favorable mix of higher margin products. We recorded marketing and administrative expense of $5.2 million for the first quarter as compared to $4.7 million a year earlier, although this quarter's figure includes just over half a million dollars of accrued incentive and compensation associated with tariff refunds.

On a normalized basis, we reduced marketing and administrative expense as a percent of net sales to 28% versus 30.5% in the first quarter of fiscal 2026, which speaks to our sharp focus on cost efficiencies, as Olivia mentioned. Moving down the income statement, we also successfully reduced net interest expense to only $190,000, well below the year ago $283,000 as a result of our efforts to reduce debt over the past year. From a GAAP perspective, we reported net income of $2.1 million, or $0.19 per share, well above the prior year loss of $1.1 million, or $0.10 per share. While first quarter net income benefited from the tariff-related adjustments described, I'll again note that on an adjusted basis, we still generated the first quarter profit versus the prior year quarter's net. loss. Turning to our balance sheet, as of June 28, we had total liquidity of $12.1 million, including cash and equivalents and availability on our revolving line of credit. During the first quarter, we significantly reduced our debt from more than 14 million at the start of the fiscal year to just 9.6 million at the end of the quarter. Not only do we reduce outstanding debt, but our net cash from operating activities of $5.5 million served to further support our balance sheet strength, putting us in a strong position to capitalize on future growth opportunities in a disciplined manner.

In summary, this was another quarter of strong execution in which we focused on what we can control while economic conditions remained soft. Even adjusted for tariff refunds, we grew revenues, expanded our growth margin, and generated stronger earnings per share than in the year-ago quarter. further strengthen our balance sheet and are well positioned to make progress against our strategic initiatives as we move through the new fiscal year. And now And now, operator, if you could please open the lines, Olivia and I would be happy to take questions. Thank you.

Operator

We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. and again that is star 1 if you would like to ask a question and our first question will come from Doug Ruth with Lenox Financial Services.

Unknown Speaker

Olivia and Claire, congratulations, fabulous report. I have several questions, so if you like I'm asking too many and I'll mind getting back in the queue. Could you give us a...

Olivia Elliott

offer some commentary of what you think is happening with Groovy Girls? So Groovy Girls has done phenomenally well in Canada. And as we look back on history, even when, you know, before we acquired Manhattan Toy, the first time they launched Groovy Girls, it appears that it took off in Canada first then as well. So, yes. We have actually sold so much in Canada at this point in time that we're having to divert inventory that should be coming to the US to go to Canada. So we're really excited about the opportunity there. And then we'll be launching Groovy Girls at K&J in Germany for the European markets in September.

Unknown Speaker

Okay. Is there a theory of why the Canadians like Groovy Girls so much?.

Olivia Elliott

We don't know. I can tell you that our distributor, they are partnered with Indigo Bookstores who really put some marketing efforts behind it and they hosted an event so that probably helped with it to.

Unknown Speaker

have such a large partner to launch with. Okay. What about, you had previously mentioned that ultimately the Groovy Girls will be on Amazon. Is there like a date that that might happen?.

Olivia Elliott

We are still hoping to launch early fall the inventory having it take off faster than we expected, it may not be the full line, but we're still targeting October sometime with at least part of the line.

Unknown Speaker

Okay, very good. And then could you explain to us what the status is of the I think you had told us there was maybe around 5 million, maybe 5 and 1 half million.

Olivia Elliott

expecting more money or do you think that's it or we're hoping to get more money so we had Requested reimbursement for 5.6 to 5.7 million in tariffs. And so far we've received about 4.7 million. And that is the portion that we booked. Most of that was received in July. A very, very small portion had been received in the first quarter. There's about 900,000.

Unknown Speaker

we still haven't received and we have not booked okay and then how is the balance sheet changed from or are you able to tell us anything about you know where the balance sheet is now versus where it was you know based on maybe tariff money.

Olivia Elliott

You mean as of today versus the quarter end? Yes. It's certainly improved by getting $4-plus million in cash in in the month of July, but that's about all we can really tell you. Oh, okay. I didn't realize the $4 million came in in July. Okay, very good. Yes. So it was booked as other current assets as opposed to a trade receivable at quarter end and quarter end.

Unknown Speaker

I see. So that's the other current asset that's on the balance sheet. Yes, and I think there's more information Claire just pointed out in – Footnote four. Footnote four. Okay, good. Okay, and then what can you tell us about the warehouse?.

Olivia Elliott

We'll be starting that project sometime in late fall or early winter. It's about an 18-month process and the plan is to get it consolidate sometime in May of 2028. So that process is not quite started yet.

Unknown Speaker

Okay and can you provide any additional details about capital expenditures and what you're thinking and how much you might be spending?.

Olivia Elliott

As of right now, our capital expenditures should just be the normal capital expenditures, which is mainly IT, so it would be any ERP upgrades that we're going through right now. molds for plastic toys, anything for the warehouse is unlikely to be spent in this fiscal year. It'll probably start sometime in the next fiscal year.

Unknown Speaker

Okay. All right. And then how about the international sales are doing so well. Can you share anything that's happening and why they're doing so well or what you're doing and the kind of.

Olivia Elliott

stuff. A lot of that's Groovy Girls in Canada, but it's more than that in Canada as well. We had two different distributors in Canada previously and starting in this calendar year, maybe a little bit in December of 25. we got a new distributor that is handling both the Manhattan Toy and Sassy product lines and taking that to all channels. So we've seen a pretty good improvement there across the board. Groovy Girls certainly added to it. And then we did starting when we went to K&J last fall, we did pick up some new distributors that started buying product maybe later in the fall, early winter. So a little bit in Europe, a little improvement as well.

Unknown Speaker

Okay. And then what can you tell us about Legoland? And we know we got that big new facility or I guess it's a year old now in Shanghai. What's happening with Legoland?.

Olivia Elliott

I don't think there's been any changes with Legoland. That was the last new park of any size and a little A lot of the parks for Legoland actually start winding down and closing for the winter. So there are some that are open, I know like Florida and California stay open year round, but a lot of them close maybe sometime in October. So those are more seasonal sales than year round.

Unknown Speaker

Okay. And then how about the Manhattan Toy Office in Minnesota? Is there any thoughts or updates on that at all?.

Olivia Elliott

That lease expires at the end of March next year. So we'll obviously not renew that lease. We're still kind of thinking about what we need, if anything at all, in Minneapolis. If we do get a lease, I mean there's two trains of thought there, we can either let, it's very small staff so they can either work from home full-time or we may need some small lease that can just hold a few people and some like a photography studio but but we will not be renewing the.

Unknown Speaker

very expensive lease that we're in right now. Okay. And my last question, is there Any new thoughts or ideas on diaper bags and how the company might proceed with that business?.

Olivia Elliott

We're still working on that product line. We did just start selling the new motherhood diaper bags. Very slow start at this point in time. It's only on Amazon. We're working on that. We have a couple of No-Joe bags, No-Joe branded, one of which is in Walmart. That's really it right now but we haven't given up on diaper bags we're just still working on it.

Unknown Speaker

Okay. You just did a fabulous job and thank you for what you did on behalf of the shareholders.

Operator

Thank you. And this now concludes our question and answer session. I would like to turn the floor back over to Olivia Elliott for closing comments.

Olivia Elliott

Thank you, Operator, and again, we appreciate everyone being on the call. We look forward to building on the early success of Groovy Girl and our other innovative products on the way. We appreciate your continued interest in Crown Crafts and will keep you posted on our progress as we move through the new fiscal year. Please feel free to reach out with any additional questions, and thanks again for your time.

Operator

for being with us. Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines and have a wonderful day.

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