Lakeland Industries, Inc. (LAKE) research, news, and more from GeoInvesting

Company description

Wed, 19 May 2010 04:00:00 GMT

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market. The Company’s products are sold by a direct sales force and through independent sales representatives to a network of over 1,000 safety and mill supply distributors. These distributors in turn supply end user industrial customers such as chemical/petrochemical, automobile, steel, glass, construction, smelting, janitorial, pharmaceutical, and high technology electronics manufacturers, as well as hospitals and laboratories. In addition, Lakeland supplies federal, state, and local government agencies, fire and police departments, airport crash rescue units, the Department of Defense, the Centers for Disease Control and Prevention, and may other federal and state agencies.

Research

Wed, 10 Dec 2025 16:08:20 GMT

**Call To Action

Removing LAKE From Our Select Coverage Universe Model Portfolio On Very Poor Q3 (on that note, since we are at end of year, we will be going through all the model portfolios to see if any other stocks need to be removed. (We’ll keep you posted).

–

** Notable News/Commentary On Model Portfolio Holdings

Lakeland Industries, Inc. (NASDAQ:LAKE) ($15.01; $143.7M market cap) announced Q3 2026 results:

Q3 sales of $47.6 million vs. $45.8 million in the prior year, below analyst estimates of $56.6 million
Q3 2026 loss per share: ($1.64) vs. EPS of $0.01 in the prior year, below analyst estimates of $0.26. Adjusted net loss for the quarter was $0.61 vs $0.01 in the prior year.
Completed acquisitions of California PPE and Arizona PPE for $9.8M
Signed $5.6M 3-year contract with Hong Kong Fire Services Department
Suspended quarterly cash dividend (previously $0.03/share)
Withdrew FY2026 financial guidance and will not provide future guidance

Management Commentary:

“The third quarter was underscored by the acquisitions of Arizona PPE Recon and California PPE Recon, with 4% net sales revenue growth to $47.6 million... Revenue during the quarter was led by a 31% increase in Fire Services to $25.3 million. A large $5.6 million three-year contract to provide advanced decontamination, managed care and maintenance services for the Hong Kong Fire Services Department also contributed materially... The strategic acquisitions... expanded our global fire footprint... and added approximately $5 million of annual recurring revenue...”

“Several macroeconomics factors... contributed to the quarter’s results, including tariffs, freight, raw material inflation and rising supply-chain costs... Our acquired businesses also came in below our plan due to timing, certification delays, and material flow issues... While revenue has grown, margin pressure has driven a decline in adjusted EBITDA...”

“These challenges have affected our forecasting ability and, as a result, we are withdrawing our previously issued financial guidance for FY2026 and will not be providing financial guidance going forward.”

“Looking ahead, we are focused on... growing top-line revenue in our fire services and industrial verticals and implementing operating and manufacturing efficiencies... We are driving a substantial inventory reduction... and prioritizing liquidity and debt reduction... We remain confident that Lakeland is well-positioned to capitalize on long-term industry and structural shifts... We see a clear path to scaling our business profitably, achieving record levels of revenue, margin, and free cash flow...”

Our Quick Take:

In October 2023 we initiated coverage on LAKE at $14.70 on the heels of a strong 3 year growth objective in revenue and EBITDA margin improvement to the high teens. Although the stock had a good run reaching highs of $27.28, they have not been able to execute on their margin expansion plan over the last 18 months. They also had troubles integrating a series of acquisitions.

However, the company had at least been growing the topline nicely and maintaining decent guidance. Obviously the script has completely changed after this quarter. At this point, especially given the company’s debt position which it had accumulated from recent acquisitions we do not feel it is deserving to be in any of our model portfolios.

We don’t believe that there is any actionable information arbitrage at this point. Reference this tear sheet for a summary of the call and other takeaways.

Lakeland Industries, Inc. manufactures and sells protective clothing and accessories for industrial, emergency, and public safety use.

Research

Tue, 10 Jun 2025 17:34:08 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($19.36; $184.1M market cap) announced Q1 2026 results:

Q1 2026 sales of $46.7 million vs. $36.3 million
EPS: Q1 2026 loss of ($0.41) vs. $0.22
Contract renewal with Fire and Emergency New Zealand for up to 12 years
FY 2026 guidance reaffirmed:
- Revenue: $210–$220 million
- Adjusted EBITDA (ex-FX): $24–$29 million (expects to be low end)

“The first quarter of fiscal 2026 was highlighted by continued sales revenue growth of 29%, led by a 100% increase in Fire Services revenue and ongoing momentum from our recent acquisitions,” said Jim Jenkins, President, Chief Executive Officer and Executive Chairman. “Robust growth in our U.S. Fire Services Segment – both organic and acquisition-driven – was partially offset by softness in Latin America and Canada, where margins are typically above our corporate average... We believe that with the four recently completed acquisitions... We are well-positioned to grow our global head-to-toe fire portfolio in this fragmented market. We look forward to sharing upcoming milestones in weeks and months ahead,” concluded Mr. Jenkins.

…We maintain a strong balance sheet... We anticipate that [a sale-leaseback transaction] will be closed during the current fiscal year.

Despite margin pressure in Q1, we remain confident in our long-term trajectory and current year outlook... We continue to target EBITDA margins to expand incrementally... reaching the mid-to-high teens...,” concluded Shannon.”

Our Quick Take:

The company has clearly had issues meeting its communicated financial guidance, mainly the EBITDA. When we resumed coverage on LAKE in October 2023, we stated the company’s turnaround hinged on two factors—revenue growth through acquisitions and EBITDA margins reaching the high teens.

Almost two years later, the company has delivered on revenue growth through acquisitions but has still not proven that it can meet EBITDA margin goals.

Unfortunately, financial guidance still only implies around 10% EBITDA margins. On the positive side, if the company actually meets its guidance it could imply three strong quarters of top and bottom line growth.

The current low end EBITDA guidance implies EPS of roughly $1.25 for full year fiscal 2026 or a price range of $18.75 to $31.25 using P/E of 15 to 25.

Lakeland Industries, Inc. manufactures and sells protective clothing and accessories for industrial, emergency, and public safety use.

Research

Thu, 10 Apr 2025 14:09:57 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($18.35, $135.8M market cap) announced fiscal Q4 2025 results:

Sales of $46.6 million vs $31.2 million in the prior year
Non-GAAP EPS of $0.28 vs a loss of $0.03 in the prior year
Full year sales of $167.2 millin vs $124.7 in the prior year
Full year non-GAAP EPS of $0.90 vs $0.86

As we have mentioned on several occasions, patience will be required for those investing in LAKE, as it can report with lumpy financial quarters, due to order timing issues. One thing we are still waiting on is for EBITDA margins to approach management’s target range of high teens vs. the current low teens performance (10% to 13%. Full year and Q4).

Tariffs

“The tariffs the current Presidential administration has imposed on a growing number of countries and trading partners are on the top of everyone’s mind. To that end, we have taken several steps to help mitigate the effects these tariffs will or might have. First, in anticipation of the potential tariffs, we strategically pre-positioned certain Asian-produced inventory into the U.S., which also helps support our planned fiscal year 2026 growth. While developments on the ground seemingly change by the day, we are focusing on production shifts to incur the lowest possible tariffs on our products. In Asia, these measures include moving certain production from China to Vietnam and exploring other lower tariff regions for manufacturing industrial products and price increases. We are continuing to closely monitor the Vietnam tariff situation as a significant portion of our US disposable products are manufactured at our Vietnam facility, and we are hopeful that a reduced tariff agreement will soon be reached with that country. In the meantime, we are continuing to assess the possibility of manufacturing disposable products at our newly acquired US manufacturing facilities or other Lakeland facilities around the world.

“Looking ahead, we are focused on new M&A opportunities, particularly within the fire suit rental, decontamination and services business, to further consolidate the fragmented fire market with the newly raised capital and our accelerating free cash flow to support this acquisition strategy. We are growing top-line revenue in our fire services and industrial verticals, combined with operating and manufacturing efficiencies, to achieve higher margins. I look forward to sharing exciting new milestones in the year to come,” concluded Mr. Jenkins.

Acquisition Integration

“Net cash used in operating activities was $15.9 million in the year ended January 31, 2025, compared to net cash provided of $10.9 million in the year ended January 31, 2024. The increase was driven by increases in working capital, primarily due to inventory buildup in preparation for forecasted increases in sales in the first half of fiscal 2026, a significant increase in accounts receivable resulting from LHD’s catch-up of a multi-year backlog, and the delayed shipment of a large boot order from Jolly. As we collect on these sales, we expect this cash to be recovered in the first half of fiscal 2026.”

Q4 Conference Call Comments

“While increasing tariff pressures and broader economic uncertainties exist, we view these as opportunities to further strengthen our operations and adaptability.

Recent trade tensions and new tariff announcements have added complexity to global markets. However, our diversified manufacturing footprint positions us well to respond to these changes and minimize disruption. By staying proactive, we are working to ensure continuity, stability and efficiency across our procurement and production networks.

While some leading indicators suggest the potential for a cyclical slowdown, we are preparing thoughtfully for a range of economic scenarios. Through a continued focus on financial discipline, deepening customer partnerships and driving operational excellence, we are building a stronger, more resilient foundation for a longer-term success.

Importantly, we are well positioned with two relatively recession-resistant sectors, industrial and fire, giving us confidence in our ability to weather near-term challenges. While we are not completely insulated from the uncertainty surrounding global tariff developments, we are moving forward with clarity and confidence.”

Fiscal 2026 outlook:

Expect FY 2026 Revenue of $210 to $220 million. This Revenue expectation includes the recently announced Veridian, LHD, Jolly Scarpe and Pacific Helmets acquisitions.
Expect FY 2026 Adjusted EBITDA, excluding any material negative impact from foreign exchange, of $24 to $29 million. This expectation includes the recently announced Veridian, LHD, Jolly Scarpe and Pacific Helmets acquisitions.

We first interviewed lake management during an April 2024 Skull Session Fireside Chat on as well as on Day 3 of the MS Microcaps March 2025 Virtual Conference.

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Tue, 11 Feb 2025 15:20:28 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($23.29 $221.2M market cap) released a letter to shareholders discussing its recent acquisitions as well as its future plans for mergers/acquisitions and possible joint ventures.

“As we now look ahead, we are focused on new M&A opportunities to further consolidate the fragmented fire market with the newly raised capital and Lakeland’s accelerating free cash flow to support this acquisition strategy. We are growing top-line revenue in our fire services and industrial verticals, combined with operating and manufacturing efficiencies, to achieve higher margins. All together, we could not be more excited for Fiscal Year 2026 and expect to grow faster than the markets we serve. I look forward to sharing exciting new milestones in the year to come.”

The last time we spoke with LAKE management was at Semco Capital’s CEO Networking Event in August of 2204, and we are looking to try and schedule another event with them as soon as we can align our schedule with the company’s CEO, Roger Shannon.

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Tue, 28 Jan 2025 16:16:24 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($23.10 $188.1M market cap) announced it was awarded a national contract for emergency medical, safety and rescue equipment through the Houston-Galveston Area Council ("H-GAC") Board to allow local governments across the United States to access Lakeland's extensive portfolio of firefighter protective gear at competitive, volume-based pricing through the HGACBuy Program.

"The HGACBuy Program award and nationwide customer base validates our continued investment in building a global fire brand. We are leveraging our leading market position in personal protective equipment and reputation for producing industry-leading equipment for firefighters, emergency responders and industrial workers in hazardous environments to accelerate growth globally. Our head-to-toe fire portfolio now includes a wide range of life-saving gear such as chemical protective clothing, high-performance Flame Resistant workwear, critical environments protective apparel, and more, all designed with the utmost attention to safety, durability, and performance. We look forward to serving the needs of HGACBuy Program customers as we continue to build long term value for our shareholders."

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Thu, 23 Jan 2025 17:36:21 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($2 $167.1M market cap) announced the pricing of a $40 million public offering. The company is offering 1.82 million shares at $22.00 per share.

“Lakeland intends to use the net proceeds from the proposed offering for the repayment of certain indebtedness, and for operations and the growth of its business, including working capital and other general corporate purposes.”

At close to 25% dilution, we will need to see if the payoff of “certain indebtedness” in the end will actually be accretive to earnings.

Even taking into account the dilution to LAKE would have value on the current earnings per share, estimates, adjusting for dilution would equate to $31.25 using a P/E of 25 on adjusted 2026 EPS estimates ($1.25)

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Fri, 06 Dec 2024 16:50:11 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($22.60, $167.1M market cap) announced fiscal Q3 2025 results:

Sales of $45.8 million vs $31.7 million in the prior year and ahead analyst estimates of $44.3 million.
EPS of $0.01 vs $0.34 in the prior year and well below analyst estimates of $0.40

The company fails to breakout non-GAAP earnings for the quarter but does mention that quarter was impacted by one time costs:

“Operating expenses increased due to inorganic growth, acquisition expenses, non-recurring expenses, and increased organic SG&A operating expenses, primarily compensation and professional fees. Operating profit was $0.8 million for the third quarter of fiscal 2025, compared to an operating profit of $3.6 million for the third quarter of fiscal 2024, due to the abovementioned impacts. Operating margins were 1.8% for the third quarter of fiscal 2025, as compared to 11.4% for the third quarter of fiscal 2024”.

It seems the EPS would not have met estimates either way as margins in the quarter were impacted by acquisition related setup costs. Organic gross margins were up for the quarter to 44.2% from 42.2% in the prior year.

Will need to see what EPS looks in the future as the company continues to grow the topline and acquisition integrations are behind them. Analyst EPS estimates for 2026 are $1.70.

Hopefully, the 10-Q has a better breakout on the one time charges experienced in the quarter.

Per the conference call, it seems some of the impact felt in Q3 could boost Q4 profits:

“Given that, what we do see in Q4 is as we had visibility to these orders that are shipping, we are expecting a significant release of that profit and ending inventory in Q4, which will in effect to what you just said, increase that margin. So that would be the revenue that we're expecting still some very large orders in Q4 including this multiyear backlog at LHD because what we see from production from our facilities, we expect to release of a significant part of that profit in the inventory, which will be accretive to EBITDA.”

Comments/outlook:

"The third quarter of fiscal 2025 was highlighted by strong sales revenue, driven by a significant 61% sequential and 245% year-over-year increase in Fire Services and continued global growth in our key industrial products," said Jim Jenkins, President, Chief Executive Officer and Executive Chairman. "Third quarter results met our expectations as our organic and inorganic Fire Services growth was supported by a rebound in U.S. sales and ongoing Latin American, European, and Asian momentum during the quarter. Expanding opportunities in Latin America, new sales leadership in Asia and an expected large Fire Services shipment from Eagle contributed to our results...

...we remain confident in our full-year projections and with expanding market opportunities in the growing and fragmented global fire market, as well as in industrial safety products. Looking ahead, we expect continued acceleration of global Fire Services business through organic growth and strategic acquisitions, and increased momentum in our industrial safety products," concluded Mr. Jenkins.

FY 2025 Reaffirmed Guidance and Outlook

Revenue - “We continue to expect FY25 Revenue of at least $165 million. This Revenue expectation includes the recently announced LHD, Jolly Scarpe and Pacific Helmets acquisitions.”
Adjusted EBITDA excluding FX - “We continue to expect FY25 Adjusted EBITDA, excluding any material negative impact from foreign exchange, to be at least $18 million.This Adjusted EBITDA expectation includes the recently announced LHD, Jolly Scarpe and Pacific Helmets acquisitions.”

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Wed, 04 Sep 2024 04:00:00 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($18.85, $139.0M market cap) announced Q2 2025 results:

Sales of $38.5 million vs $33.1 million in the prior year and below analyst estimates of $39.9 million.
Net loss of $0.19 vs $0.18 in the prior year
Non-GAAP EPS of $0.05 vs $0.32 in the prior year and well below analyst estimates of $0.35

"Lakeland delivered second-quarter results below our expectations, but we believe the shortfall was due to shipment timing, and we remain confident in our full-year projections. A substantial amount of the organic revenue shortfall is related to the transition of large North American channel partner accounts to LineDrive, our new industrial market representative. LineDrive continues to build pipeline opportunities, and we believe these sales will accelerate in the second half of the year. Additionally, both Jolly and Eagle had substantial fire orders delayed to the late third and early fourth quarter. LHD, which we acquired on July 1, has resumed production in anticipation of delivering on a multi-year backorder in the fourth quarter," said Jim Jenkins, President, Chief Executive Officer and Executive Chairman.

FY 2025 Reaffirmed Guidance and Outlook

Revenue - We continue to expect FY25 Revenue in the range of $160 million to $170 million. This Revenue expectation includes the recently announced LHD, Jolly Scarpe and Pacific Helmets acquisitions.
Adjusted EBITDA excluding FX- We continue to expect FY25 Adjusted EBITDA, excluding any material negative impact from foreign exchange, to be in the range of $18 million to $21.5 million(1). This Adjusted EBITDA expectation includes the recently announced LHD, Jolly Scarpe and Pacific Helmets acquisitions.

The lumpiness in quarters was the one caveat we’ve mentioned in the past as being the big short term risk in price volatility. This has actually been the reason why we have not added the stock to our open forum focus model portfolio.

The company has actually also been pretty communicative about quarterly financial volatility during our skull session Chats and even during my live interview with the CFO and CEO at Chicago, which you can see here.

This will continue to be an issue until the company scales up its acquisition strategy to broaden its customer base and product offering. It’s just something that one has to accept investing in LAKE. Our bullishness on the company and belief that management’s strategy will result in multibagger gains is still intact.

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Tue, 02 Jul 2024 17:54:06 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($21.07, $155.4M market cap) announced it has closed its acquisition of LHD Group, fire and rescue business with operations in Hong Kong and Australia, with annual revenues of around $27 million.

“The completion of this acquisition accelerates our long-term growth strategy by significantly expanding our market share and global presence in the fire service industry. LHD's premium products and services align remarkably well with our existing portfolio and provides us with new opportunities to enhance our service offerings and revenue streams. We are excited about the market expansion and cross-selling opportunities this acquisition brings and are confident that it will be immediately accretive to Lakeland."

The company is updating its fiscal 2025 Guidance:

Revenue - We now expect FY25 Revenue in the range of $160 million to $170 million up from prio guidance of $150 to $155 million.
Adjusted EBITDA - We expect FY25 Adjusted EBITDA, excluding any material negative impact from foreign exchange, to be in the range of $18 million to $21.5 million up from prior guidance of $17 to $20 million.

“We are pleased to close on this important acquisition, and we look forward to working with our new teammates at LHD to further expand the Lakeland family of fire and safety brands. We continue to believe our SSQ acquisitions like LHD position us for additional growth in revenue and profitability."

LAKE is clearly ahead of schedule in meeting its 2027 (fiscal year ends in January 2025 ) revenue targets of near $200 million. However, EBITDA margins implied by the guidance are around 12%. So, the next marker we are monitoring is the company meeting its high teens EBITDA goal, and the recurring revenue model from LHD should eventually help.

Research

Wed, 05 Jun 2024 14:31:38 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($18.85, $139.0M market cap) announced Q1 2025 results:

Sales of $36.3 million vs $28.7 million in the prior year and ahead of analyst estimates of $32.5 million.
EPS of $0.22 vs $0.18 in the prior year
Non-GAAP EPS of $0.32 vs $0.22 in the prior year and in line with analyst estimates of $0.31

"Lakeland delivered strong first-quarter results as we continued to execute on our commitment to expand our fire services business globally through organic growth and strategic acquisitions and to accelerate the growth of our industrial safety products," said Jim Jenkins, President, Chief Executive Officer and Executive Chairman. "Our Q1-FY25 net sales of $36.3 million is a 27% increase versus last year. We were very pleased to see organic revenue grow by $3.7 million, or 13%, year-over-year, driven by increases in our Fire, Chemical, Wovens and Disposables products. We also saw double-digit year-over-year organic growth across North and South America, including a 16% year-over-year growth in the U.S. and 54% in Latin America. While our Asian business remained soft in the first quarter, we continue to see healthy demand for our higher-value, Fire, Critical Environment, Disposables and Chemical product categories in North and South America, led by strong sales efforts and our container programs with key national customers. After quarter-end, Lakeland announced a strategic partnership with LineDrive, a leading outsourced sales & marketing company for industrial maintenance, repair and operations ("MRO"). We believe this partnership will have a significant impact on expanding Lakeland's products to a broader audience in the North American industrial sector," continued Mr. Jenkins…

…We continue to actively pursue attractive opportunities to expand our global fire services business, and in early April of this year, we announced the signing of an agreement to acquire the fire and rescue business of LHD Group."

Fiscal 2025 Guidance:

Expects revenue to be $150 to $155 million up from prior guidance of $140 to $150
Expects adjusted EBITDA of $17 to $20 million up from prior guidance of $16.8 to $18.5 million

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Thu, 02 May 2024 14:54:00 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($16.99, $125.2M market cap) announced a new strategic partnership with LineDrive, a leading outsourced sales & marketing company for industrial maintenance, repair and operations based in Chicago, Illinois.

“Within this partnership, LineDrive will leverage its extensive network and in-depth market knowledge to develop and enhance distribution partnerships, significantly extending the reach of Lakeland's quality and innovative portfolio of products. The collaboration is set to revolutionize how protective clothing and safety equipment are marketed and distributed, setting new standards for excellence and reliability in the industry.”

“The partnership between LineDrive and Lakeland Industries is expected to kick off with a series of strategic initiatives to expand distribution channels and introduce innovative marketing strategies to bring Lakeland's products to a broader audience. Both companies are dedicated to improving workplace safety and are eager to collaborate on developing solutions that meet the evolving needs of the industrial sector.”

Lakeland Industries, Inc. manufactures and sells a comprehensive line of safety garments and accessories for the industrial protective clothing market.

Research

Thu, 11 Apr 2024 16:59:30 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($17.67, $130.1M market cap) announced Q4 2024 results:

Sales of $31.2 million vs $29.0 million in the prior year and below analyst estimates of $32.5 million.
Non-GAAP EPS of $0.23 vs $0.02 in the prior year but below analyst estimates of $0.30

“We are particularly pleased with the performance of our Eagle Technical Products business, which has grown over 103% on a pro forma basis since being acquired by Lakeland. We are equally excited about the growth potential of our recently acquired Pacific Helmet and Jolly Boots businesses and our recently announced LHD fire and rescue business. We also saw healthy demand for our higher-value, critical environment, disposables and chemical product categories in North America and LatAm, which are a strategic focus for the Company's growth opportunities. During the year, we expanded our container programs with key national customers and took steps to bolster our North American industrial sales channels to capitalize on new market opportunities."

Fiscal 2025 guidance:

Revenue - We expect FY25 Revenue in the range of $140 million to $150 million. Above analyst estimates of $138.9 million
We expect FY25 Adjusted EBITDA, excluding any material negative impact from foreign exchange, to be in the range of $16.8 million to $18.5 million. Above analyst estimates of $13.9 million

It is important to note that the guidance does not reflect any contribution from the recently announced LHD fire and rescue business. With annual revenue of $27 million, operating roughly a half a year could add $13.5 million to the revenue guidance assuming the acquisition closes as planned. What’s even more noticeable about the company’s guidance is that the high end of the range already exceeds analyst 2026 estimates.

Furthermore, as we’ve indicated on several occasions, we believe the LAKE story has to be looked at through a longer term lens because short term quarterly results can exhibit some of volatility. We do expect some short term pressure on shares and would view big drops as opportunities to add more to our portfolio.

LAKE is a leading global manufacturer of protective clothing for industry, healthcare and first responders on the federal, state and local levels.

Research

Wed, 03 Apr 2024 15:26:06 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($17.79, $131.0M market cap) announced the acquisition of the Fire and Rescue business of the LHD Group in an all cash transaction for $16.7 million.

“Headquartered in Wesseling, Germany, LHD is a leader in firefighter turnout gear, accessories, and Total Care services, including laundry, repair, and maintenance, with an annual revenue of approximately $27 million”

The company expects the acquisition to be immediately accretive. This marks the 3rd acquisition in the past 16 months. In our October 2023 article, we pointed out that analyst multi-year earnings estimates are well below our projections, using metrics from the company's new strategic plan to target less cyclical markets and drive a material improvement in EBITDA margins. This acquisition will only boost those figures.

LAKE is a leading global manufacturer of protective clothing for industry, healthcare and first responders on the federal, state and local levels.

Research

Tue, 02 Apr 2024 14:43:42 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($17.82, $131.2M market cap) we wanted to provide clarity on a tweet we issued last week as we had a member ask which stock we were referring to in this post:

We were referring to LAKE, in our October 2023 article, we pointed out that analyst multi-year earnings per share estimates are well below our projections, using metrics from the company's new strategic plan to target less cyclical markets and drive a material improvement in EBITDA margins to the high teens (18% posited when talking about potential EPS scenario) from the current level of 10% to 12%

LAKE is a leading global manufacturer of protective clothing for industry, healthcare and first responders on the federal, state and local levels.

Even with our very strong bullish view on the company’s long-term prospects, we want to reinforce the caveat that quarterly financial results could exhibit lumpiness from time to time as the company continues to make acquisitions in areas that will provide more consistent revenue streams.

We would likely consider any quick sharp pullbacks due to negative reactions to quarterly lumpiness as a long-term buying opportunity.

Research

Thu, 07 Dec 2023 17:20:53 GMT

Yesterday, Lakeland Industries, Inc. (NASDAQ:LAKE), announced strong Q3 2024 results showing that this BigCapMicrocap multibagger set-up is playing out as we expected thus far:

Sales of $31.7 million vs $28.4 million in the prior year and ahead of analyst estimates of $30.9 million
EPS of $0.34 vs a EPS of $0.19 in the prior year and ahead of analyst EPS estimates of $0.27

“We are pleased with the progress of our acquisition strategy and how it positions us for growth in revenue and profitability. We are continuing to mine our strategic acquisition pipeline and work to close and further integrate new members of the Lakeland family. Despite ongoing economic headwinds in China and foreign currency fluctuations in our global markets, we will continue to focus on organic growth throughout the remainder of the year and remain encouraged by the opportunities in front of us."

In our October 2023 article, we pointed out that analyst multi-year earnings per share estimates are well below our projections, using metrics from the company's new strategic plan to target less cyclical markets and drive a material improvement in EBITDA margins to the high teens (18% posited when talking about potential EPS scenario) from the current level of 10% to 12%

Research

Fri, 01 Dec 2023 18:42:53 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($14.61, $107.5M market cap) a leading global manufacturer of of protective clothing for industry, healthcare and first responders on the federal, state and local levels, announced the acquisition of Pacific Helmets, a leading designer and manufacturer of helmets for the structural firefighting, wildland firefighting, and rescue markets in an all cash deal for $8.5 million.

“Pacific has a broad range of helmet models, styles and certifications, and they have demonstrated the ability to develop new products and sell successfully around the world. We expect Pacific to add seven to eight million dollars of sales revenue to Lakeland in our next fiscal year and to be immediately accretive."

In our October 2023 article, we pointed out that analyst multi-year earnings estimates are well below our projections, using metrics from the company's new strategic plan to target less cyclical markets and drive a material improvement in EBITDA margins.

Based on the assumptions we used to calculate our 3 year long-term EPS target of $2.46, we calculate that this acquisition could equate to $0.15 in EPS..Remember, a key requirement management set to meet its targets was the company consummating a couple of acquisitions per year.

The Pacific acquisition comes on the heels of the company acquiring Eagle Technical Products in December 2022.

Here is a clip from our Skull Session conversation with LAKE’s CFO on November 2nd, 2023 discussing the acquisition strategy.

Investors should note that LAKE is reporting its Q3 2024 results on Wednesday, December 6th. We want to again caution the need to be cognizant that quarterly financial results may be lumpy until the company’s new strategic plan gains steam.

Research

Wed, 06 Sep 2023 04:00:00 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) a leading global manufacturer of of protective clothing for industry, healthcare and first responders on the federal, state and local levels, announced Q2 2024 results:

Sales of $33.1 million vs $28.2 million in the prior year
EPS of $0.32 vs a loss of $0.11 in the prior year

“Lakeland delivered solid second quarter results and continued to build on the Company’s momentum, particularly within our strategic product lines,” said Charlie Roberson, President and Chief Executive Officer. "Our net sales grew significantly year-over-year, led by our higher-value strategic products, and we saw Adjusted EBITDA and Adjusted EBITDA margin expansion as our teams executed our focused sales plan.” “We remain committed to growing our share within higher-value product categories and markets, and this was demonstrated by the continued strong results we saw in our fire service and wovens product categories during the second quarter...

...We expect our improving financial performance to continue to support our capital allocation strategy, including strategic acquisitions, organic growth investments, and returning capital to shareholders.”

Research

Fri, 18 May 2018 14:53:34 GMT

Lakeland Industries, Inc. (NASDAQ:LAKE) ($15.45; $125.3M market cap) a leading global manufacturer of industrial protective clothing is back in focus due to the resurgence of Ebola outbreaks. Shares of LAKE have been inching up as renewed fears with Ebola outbreaks spread. This morning, the World Health Organization is holding an emergency meeting to discuss the risk of Ebola spreading from the Republic of Congo.

Research

Thu, 15 Jun 2017 15:18:54 GMT

Ex-GeoBargain $LAKE ($11.85, marked up 5%) announced Q1 2018 results:

Sales of $23.0 million vs $20.4 million in the prior year and ahead of analyst estimates of $21.9 million
Non-GAAP EPS of $0.25 vs $0.06 in the prior year and well ahead of analyst estimates of $0.16

Quotes from management:

"Both domestic and international revenue increased in the first quarter as the dollar modestly strengthened from the prior year in many of the markets in which we operate, while consolidated in-country sales in local currencies increased from the prior year period. Approximately $8 million in domestic sales for key product lines remained flat in the quarter primarily due to continued weakness in the oil and gas sector, but our profitability was enhanced as we transitioned away from lower margin subset markets. We have been placing concerted emphasis on allocating our resources toward higher margin products using modifications of existing product lines to create new, higher margin garments sold into new vertical markets. This capability is somewhat unique to Lakeland because we own our own manufacturing facilities and employ a highly trained workforce spanning five countries on three continents...

...With a strengthened balance sheet, all major global operations turning a profit in the first quarter and productivity and market share enhancement strategies in place, we are well positioned for continued growth during the balance of the year and beyond."

Q2 and Q3 fiscal 2018 Guidance Commentary from conference call Q&A:

Q2 seasonally will be a little bit less than Q1 simply because of the summer months. July and August tend to be the months, everybody in the northern hemisphere takes vacation. And if they’re not working at a factory, they’re not wearing our garments. So Q2 will probably fall just a little shy of this quarter on the revenue side. Earnings and margin should remain the same okay?

Third quarter, it seasonally will pick up again, get close to this quarter, if not exceed it. And if we exceed it, it will be because of new product introductions and some new verticals. As I said, the only thing that’s sort of sitting back there that could pop on is the European market and it may very well, but not in the second quarter. The Europeans take the whole month of August off so.

Research

Thu, 01 Oct 2015 15:05:23 GMT

Closed our long position in LAKE ($13.89)

Yesterday, via premium tweet, we stated that we locked in gains in LAKE. At its highs, LAKE was up over 50% from our recent buy call at $9.50 on the information arbitrage opportunity was presented when the company filed its NT 10-Q (an extension notice for 10-Q filings).

The filing stated that the company expected to report a significant increase in revenues and income from operations for Q2 2016, as compared to the comparable quarter in the prior year. Shares rose from $9.50 at the time of our alert, to a recent high of $15.78 on September 24, 2015.

Research

Thu, 17 Sep 2015 14:01:43 GMT

LAKE ($10.78; marked up 14% premarket) reports strong Q2 results

Our decision to add to our long position in LAKE on September 11, 2015 has paid off. Shares are up 29% since then, in a strong reaction to Q2 2015 results released after the market closed yesterday. We will will alert Geoinvesting Premium Members if we begin to unwind some or all of our long position.

This opportunity is a perfect example of how digging into places that many investors ignore, or are just not aware of, can lead to outsized investment gains. You don’t always have to be a “guru” to make money in the market, sometimes you just have to put the work in and know where to look. We call this information arbitrage; an opportunity that arises when public information is available that has not been fully or properly digested by market participants.

Seven months after closing our long position in LAKE, where we locked in over 100% returns, we re-established a long position in LAKE at $10.47 on May 19, 2015, after the company reported strong Q4 2015 results. Shares quickly rose to $12.86 before retracing in the midst of market volatility and there were some comments in the Q1 CC that investors may have interpreted negatively:

“While we are reporting on a quarterly basis, and showed strong growth in revenues and profits for the last two quarters, we need to emphasize the importance of taking a longer-term view when contemplating our prospects.

We saw traditional organic growth as well, as incidental growth from the Ebola outbreak. These incidental catalyst to our business, while not considered to be recurring or traditional in nature, are occurring on a somewhat frequent basis, and are often significantly incremental to our traditional growth.”

On Friday, September 11, 2015 via premium tweet, we stated that we were adding to our long position in LAKE based on the information arbitrage opportunity presented in its NT-10-Q filing. The company had stated it expected “significant” increases in revenue and income. Yesterday, after the close, LAKE reported its Q2 2015 results:

Sales of $29.5 million vs $22.8 million in the prior year and ahead of analyst estimates of $26.03
EPS of $0.50 vs $0.09 in the prior year and crushed analyst estimates of $0.28

Again, the company offered some guidance that can be perceived as cautious:

“Our consecutive quarterly growth rate, while not sustainable at the very high levels achieved during the first half of this fiscal year, demonstrates the leverage in our business and our enhanced presence in a total addressable market valued at nearly $7 billion globally.”

However, LAKE for the first time we can remember, has given a bullish longer term growth outlook:

“This plan is focused on long term growth in sales and profitability. Supported by the visibility afforded by our recurring customer base, our goal is to deliver an approximate double digit compounded annual revenue growth rate for the foreseeable future, which may further increase with the contributions of emergency events in any given year."

In related news, Craig-Hallum raised its LAKE target price to $21 from $19.

Research

Mon, 14 Sep 2015 14:36:45 GMT

Added to our long LAKE ($10.15) position

On Friday, shortly after the open, LAKE filed an NT 10-Q (an extension notice for 10-Q filings). In the filing the company stated:

“The Company expects to report a significant increase in revenues and income from continuing operations for the second quarter ended July 31, 2015 as compared to the comparable quarter in the prior fiscal year”

Via premium tweet, we stated we added to our long position due to this information arbitrage opportunity. Share rose 8% during Friday’s trading session. LAKE is slated to report results on September 16, 2015 after the close of the market.

Comments & Business Outlook

Fri, 07 Aug 2015 15:06:56 GMT

RONKONKOMA, N.Y., Aug. 6, 2015 /PRNewswire/ -- Lakeland Industries, Inc. (NASDAQ: LAKE), a leading global manufacturer of industrial protective clothing for industry, municipalities, healthcare and to first responders on the federal, state and local levels, today announced that on July 31, 2015 it completed a conditional closing of the sale of its wholly-owned Brazilian subsidiary ("Lakeland Brazil") to a company owned by a current manager of the subsidiary. This sale is pursuant to a shares transfer agreement previously signed on June 19, 2015 which set out the details to finalize the Company's exit from Brazil. The sale, which shall be deemed to have been consummated as of July 31, 2015, is subject to acceptance of the shares transfer on the Commercial Registry by the Brazilian authorities, which is expected to be completed within approximately the next thirty days. Although no assurances can be given in that regard, the Company expects Commercial Registry processing of the shares transfer will not adversely affect the closing.

In exchange for receiving the shares entitling full ownership of Lakeland Brazil, the new owner has assumed all liabilities and obligations of Lakeland Brazil, whether arising prior to, on or after the closing date of the shares transfer. In contemplation of the shares transfer, the Company provided approximately US$1,130,000 through August 1, 2015 to Lakeland Brazil and has agreed to provide additional amount of approximately US$95,000 on September 1, 2015 to support certain operational costs of Lakeland Brazil. In addition, the Company has agreed to provide partial funding in respect of certain labor court case reimbursements over the next two years. There are further bonus payments of US$150,000 conditional upon Lakeland Brazil's new owner not declaring bankruptcy or reorganizing after 12 months from the date of share transfer and an additional US$100,000 under similar circumstances after 24 months. The Company believes the transfer of Lakeland Brazil and its commitment to contingency coverage relating to labor court claims over the next two years will be more than offset by the anticipated U.S. tax benefit of approximately US$9.5 million to be gained through a worthless stock deduction for the Brazil business that the Company will claim on its U.S. tax return for the fiscal year endedJanuary 31, 2015.

The conditional closing of the transaction announced today includes the transfer by Lakeland Brazil of its Brazilian land ownership to the Company. The Company's exposure to certain liabilities arising in connection with the prior operations of Lakeland Brazil and the Company's claiming of the tax deduction is more fully disclosed in the Company's filings with the Securities and Exchange Commission. The Company estimates that the transactions involved with the completion of its exit from Brazil will result in a loss of approximately $1.2 million to be reflected on its income statement and an increase of approximately $46,000 to stockholders equity as a result of recording this transaction.

Christopher J. Ryan, President and Chief Executive Officer of Lakeland Industries, commented, "We are pleased to have completed this process which has been an extraordinary drain on our management team. The Company may now focus all of its energy on driving organic growth in the 12 regions around the world in which we operate. In turn, we'll be in a better position to improve our manufacturing leverage, operating efficiencies, profitability and cash flow. With our improved outlook and without the burden of Brazil, we'll have a broader runway to bolster our sales and marketing efforts and concentrate on new product innovations. We are very excited and revitalized by the completion of this exit process as well as concluding a three year turnaround that has put Lakeland Industries in a stronger position as we enter our next chapter of growth.

"Lakeland continues to gain brand awareness around the world which we believe will enhance our growth prospects. We've proven Lakeland's manufacturing and delivery platform is unique, which helped us win large contracts from epidemics, including Ebola, Avian Flu, and MERS, because we have the capability to produce and ship product quickly, meeting the demanding requirements of customers. We believe this demonstrated an important competitive advantage in execution and reputation which is increasingly making us a go-to choice not only for the major infectious disease emergencies that occur every year or two, but also for the many oil and chemical spills that occur on a regular basis.

"Our existing product lines are suitable for most every need within the industrial protective apparel industry. We have proven that we are among the leaders in product quality while possessing the ability to ramp up production based on market demand. Additionally, now that that we have the time to focus on them, a number of new initiatives being implemented -- including end-user market diversification and upgraded information systems and inventory management procedures -- are expected to deliver further benefits to our profitability and ability to serve our customers better. These are the results we are looking to achieve that will ultimately lead to building more shareholder value."

Comments & Business Outlook

Fri, 26 Jun 2015 18:27:45 GMT

RONKONKOMA, N.Y., June 25, 2015 /PRNewswire/ -- Lakeland Industries, Inc. (the "Company") (NASDAQ: LAKE), a leading global manufacturer of industrial protective clothing for industry, municipalities, healthcare and to first responders on the federal, state and local levels, today announced that it has signed a definitive agreement to exit its Brazilian operations through a transfer of shares of its wholly-owned Brazilian subsidiary ("Lakeland Brazil") to a company owned by a current manager of the subsidiary. The shares transfer and related details to finalize the Company's exit from Brazil are expected to be completed on or around July 31, 2015.

In exchange for receiving the shares entitling full ownership of Lakeland Brazil, the new owner will assume all liabilities and obligations of Lakeland Brazil, whether arising prior to, on or after the closing date of the shares transfer. In contemplation of the shares transfer, the Company has provided US $717,000 to Lakeland Brazil in the form of a capital raise and has agreed to provide an additional approximate US $508,000 through September 1, 2015 to support certain operational costs of Lakeland Brazil. In addition, the Company has agreed to provide partial funding in respect of certain labor court case reimbursements over the next two years. The Company believes the transfer of Lakeland Brazil and its commitment to contingency coverage relating to labor court claims over the next two years will be more than offset by the anticipated U.S. tax benefit of approximately US $9.5 million to be gained through a worthless stock deduction for Brazil that the Company will claim. The closing of the transaction announced today is subject to several conditions precedent, including the transfer by Lakeland Brazil of its Brazilian land ownership to the Company. The Company's exposure to certain liabilities arising in connection with the prior operations of Lakeland Brazil and the Company's claiming of the tax deduction is more fully disclosed in the Company's filings with the Securities and Exchange Commission (Form 8-K). While management is still analyzing the transaction management believes there will not be a material adverse change to stockholders equity as a result of recording this transaction.

Christopher J. Ryan, President and Chief Executive Officer of Lakeland Industries, commented, "The agreement announced today represents a significant milestone in the Company's strategy to exit from Brazil. For nearly three years we have expended considerable resources in terms of personnel and time working toward reducing or eliminating Lakeland Brazil's negative contributions to our consolidated results while working on this exit strategy. We are very pleased to have arrived at this point of our strategic efforts in a position to unlock a seemingly unrecognized value in the form of a tax benefit while significantly removing risks and uncertainties. As we have stated, our exit from Brazil will enable us to focus on improving our growth, profitability and cash flow generation in other markets and areas of the business which hold greater promise for Lakeland."

Research

Mon, 22 Jun 2015 15:39:58 GMT

LAKE ($11.68) announced it has successfully amended the Settlement Agreement from September 11, 2012 relating to an arbitration with the former management of its Brazilian subsidiary. This amendment is another step in the right direction to complete its exit from Brazil which we highlighted on May 22, 2015 when shares of LAKE were trading $10.20 as a potential catalyst that could boost shares by 40% (to $14.40) in the near term. Shares reached $12.86 on June 15, 2015 but have pulled back to current levels after itannounced strong Fiscal 2016 Q1 financial results, possibly because:

Q1 marked the last quarter the company would be benefiting from sales of its hazmat suits from the Ebola crisis.
No specific commentary was provided regarding future growth outlook.

Quotes from management on today’s arbitration payoff settlement:

"The payoff and satisfaction of the Arbitration Settlement clears an essential hurdle in our path for a complete exit from Brazil. As a result, we have effectively removed a major uncertainty with a potentially exploding default provision resulting from the arbitration and saved $337,000 in future payments. With our exit from Brazil expected to be complete by the end of July, we'll be able to further sharpen our focus on organic growth initiatives, enhancing profitability and driving free cash flow generation from continuing operations."

Comments & Business Outlook

Tue, 16 Jun 2015 15:49:22 GMT

First Quarter 2016 Results

Q1 2016 sales were $24.8 million vs $21.7 in the prior year period but below analyst estimates of $26.0 million.
Q1 2016 EPS from continuing operations were $0.30 vs $0.06 in the prior year and ahead of analyst estimates of $0.27.

Quotes from management:

Christopher J. Ryan, President and Chief Executive Officer of Lakeland Industries, stated, "The first quarter of fiscal 2016 continued if not accelerated the momentum from the second half of last year.

Effective in the first quarter, we implemented discontinued operations that reflects our decision to exit Brazil. The pending exit from our business unit in Brazil is making progress and we believe it will be completed within the second quarter of our current fiscal year. The Company's impressive performance in the first quarter is more evident now that we have removed Brazil from our consolidated global operations and report results from continuing operations on a year-over-year basis. Upon completion of the Brazil transaction, we will have essentially completed the turnaround strategy that commenced approximately three (almost four as the DuPont license terminations was July 2011) years ago. The impact from this turnaround can be seen across the board in our financial performance metrics, which has been further aided by higher margin sales relating to the Ebola crisis.

"In the first quarter of fiscal 2016, revenues from continuing operations increased 14% from the prior year. Less than 10% of fiscal 2016 first quarter revenues of $24.8 were derived from protective chemical and disposable garment purchased in connection with the Ebola outbreak. Despite the strong dollar that reduces sales on a reported basis in the U.S. and weakness in the global petrochemical market resulting from lower oil prices, we delivered organic sales excluding Ebola-related garments which is consistent with our annual growth plans.

"Lakeland's continuing operations delivered tremendous improvement. Beyond the top line growth, we also benefited from the manufacturing leverage in our business and disciplined expense management to drive improvements in our efficiencies and profitability. Net income from continuing operations increased by over 500%, while we also reported significant growth in free cash flow and Adjusted EBITDA.

"With our exit from Brazil nearing completion, we'll be able to sharpen our focus on organic growth initiatives, including new product introductions, further development of the global healthcare sector, and otherwise attaining market share in the 10 countries where we have continuing operations. The organic growth strategies that have been implemented continue to bear positive results, while we remain focused on expense management, profitability enhancements and cash flow generation. We reiterate that the Company's financial performance outlook from continuing operations remains very encouraging."

Research

Tue, 19 May 2015 04:00:00 GMT

Took a small position in $LAKE at current levels based on Q1 results

We will be more aggressive on adding $LAKE if shares pullback. In related news, Craig Hallum upped his $LAKE target to $19 from $17.

Comments & Business Outlook

Fri, 12 Sep 2014 04:00:00 GMT

RONKONKOMA, N.Y., Sept. 12, 2014 /PRNewswire/ -- Lakeland Industries, Inc. (NASDAQ: LAKE), a leading global manufacturer of industrial protective clothing for industry, municipalities, healthcare and to first responders on the federal, state and local levels, today announced the global availability of its protective apparel for use in handling the Ebola virus. In response to the increasing demand for specialty protective suits to be worm by healthcare workers and others being exposed to Ebola, Lakeland is increasing its manufacturing capacity for these garments and includes proprietary processes for specialized seam sealing, a far superior technology for protecting against viral hazards than non-sealed products.

"Lakeland stands ready to join the fight against the spread of Ebola," said Christopher J. Ryan, President and Chief Executive Officer of Lakeland Industries. "We understand the difficulty of getting appropriate products through a procurement system that in times of crisis favors availability over specification, and we hope our added capacity will help alleviate that problem. With the U.S. State Department alone putting out a bid for 160,000 suits, we encourage all protective apparel companies to increase their manufacturing capacity for sealed seam garments so that our industry can do its part in addressing this threat to global health.

Mr. Ryan continued, "With our diverse global operations and the breadth of our protective apparel line incorporating superior sealed seam technology, we are ideally situated to assist organizations worldwide as they handle Ebola. Despite reports citing the short supply of protective suits for handling hazardous materials, we believe it is very important to alert those in need around the world that Lakeland has appropriately qualified and certified suits, ample manufacturing capacity, and numerous distribution points to supply these garments."

Last Friday, U.N. Secretary-General Ban Ki-moon laid out plans to set up an Ebola crisis center, with a mission to halt the spread of the virus in West African countries in six to nine months. He is counting on public and private funding from around the world of some $600 million needed for supplies in West Africa. Nearly 2,300 people have died and 4,300 confirmed or probable cases of Ebola have been reported since March. Mr. Ban said in a statement, "The number of cases is rising exponentially. The disease is spreading far faster than the response. People are increasingly frustrated that it is not being controlled."

Within the past several weeks, Lakeland has provided suits that are being used by Doctors Without Borders in West Africa. Lakeland's global team worked with leaders from Doctors Without Borders to ensure that the technical data and performance specifications for Lakeland's garments exceeded the necessary protective requirements.

Comments & Business Outlook

Mon, 28 Apr 2014 04:00:00 GMT

Fourth Quarter 2014 Results

Revenues for the fourth quarter 2014 were $22.2 million vs $23.3 million in the prior year
Operating income was a loss of $388,000 in Q4 this year compared with an operating loss of $1,401,000 in Q4 last year and, excluding Brazil, increased from $35,000 loss last year to $280,000 profit this year.
Adjusted EBITDA for Q4 increased from a loss of $15,000 last year to a positive EBITDA of $1,403,000 this year and, excluding Brazil, increased from $522,000 last year to $1,628,000 this year.

Management's Comments

Christopher J. Ryan stated, "As stated previously, management believes it will have Brazil turned around by the second quarter in FY15. Other than Brazil, all of our other business units are doing well and as projected. Once Brazil is at breakeven, the full earning potential of the rest of the Company will be apparent.

It is important to note that our current bank covenants and lines of credit are NOT dependent upon operations in Brazil. Thus, management is free to completely reorganize it, and we have and will continue to follow such a course of action."

Comments & Business Outlook

Thu, 12 Dec 2013 05:00:00 GMT

Third Quarter 2013 Results

The company reported net sales of $22.8 million in Q3FY14 compared with $24.2 million in Q3FY13.
The company reported a loss per share of $0.31 in Q3FY14 compared to earnings per share of $0.05 in Q3FY13.

Christopher J. Ryan stated, "As stated previously, management believes it will have Brazil turned around by the first quarter in 2014. Other than Brazil, all of our other business units are doing well and as projected. Once Brazil is at breakeven, the full earning potential of the rest of the Company will be apparent.

"It is important to note that our current bank covenants and lines of credit are NOT dependent upon operations in Brazil. Thus, management is free to reorganize it, and we have and will continue to follow such a course of action."

Deal Flow

Wed, 02 Oct 2013 04:00:00 GMT

Entry into a Material Definitive Agreement.

On September 27, 2013, Lakeland Protective Real Estate, Inc. (the “Borrower”), a subsidiary of Lakeland Industries, Inc., closed on a loan arrangement with Business Development Bank of Canada (the “Lender”) for a secured term loan in the amount of Cdn$1,100,000 Canadian dollars (approximately US $1,063,933) (the “Loan Amount”). The terms of the loan are set forth in a Letter of Offer, dated August 30, 2013, between the Borrower and the Lender, which become effective on the closing date (the “Loan Agreement”). The maturity date of the loan is October 23, 2033. The per annum interest rate on the loan is fixed at 6.45% through August 23, 2018, and is subject to adjustment thereafter. Commencing November 23, 2013 and through August 23, 2018, the Borrower shall be obligated to make monthly payments of $8,168.96, which amount is inclusive of principal and interest.

At its option, Borrower may, once in any twelve month period, prepay up to 15% of the then outstanding Loan Amount without penalties or fees payable to Lender (the “Annual Prepayment”) provided that the loan is not in default. In addition to the Annual Prepayment, the Borrower may prepay at any time all or a part of the then outstanding Loan Amount, subject to a prepayment fee equal to three months interest on the principal amount being prepaid calculated at the fixed interest rate then in effect, plus any Interest Differential Charge (as defined in the Loan Agreement).

The Borrower’s repayment of the Loan Amount is secured by a security interest in substantially all of the assets of Borrower, including, without limitation, Borrower’s Canadian warehouse, pursuant to a general security agreement (the “Security Agreement”) entered into concurrently with the Loan Agreement.

The foregoing description of the Loan Agreement and Security Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Loan Agreement attached as Exhibit 10.1 and the Security Agreement attached as Exhibit 10.2 to this Current Report on Form 8-K, each of which are incorporated herein by reference.

Company Rebuttal

Tue, 17 Sep 2013 04:00:00 GMT

RONKONKOMA, N.Y., Sept. 16, 2013 /PRNewswire/ -- Lakeland Industries, Inc. (NASDAQ: LAKE), a leading global manufacturer of protective clothing for industry, healthcare and to first responders on the federal, state and local levels, is responding to recent inquiries of shareholders and investment articles surrounding the junior and senior financing transactions completed by Lakeland Industries, Inc. (the "Company") in June 2013.

The per annum interest rate on the Company's senior credit facility of $15 million with Alostar Business Credit, a division of Alostar Bank of Commerce, is LIBOR plus 525 basis points (with a floor of 6.25%). Since the applicable per annum LIBOR rate is lower than 0.5%, the current effective per annum interest rate on the senior debt is 6.25%.

As a condition precedent of the senior loan, the Company was required to obtain a $3.5 million subordinated loan. The Company secured a junior loan with LKL Investments, an affiliate of Arenal Capital, which provides for per annum interest at the rate of 12% through December 27, 2016, and the issuance to the junior lender of a common stock warrant to purchase 566,015 shares of the common stock of the Company at $.01 per share. The overall per annum rate of return of the entire $3.5 million junior debt financing, taking into account the 12% interest rate and assuming a three year exit on the warrant, is approximately 30%.

Being that the junior loan was a condition of the senior financing transaction, the Company has calculated a blended per annum rate of the loans of approximately 10 to 11% based upon certain reasonable assumptions, including the relative size of the two loans and attributing a value to the warrant based upon the market price of the common stock.

In addition, as part of the junior financing, the junior lender was given the right to elect one director to the Board of Directors of the Company commencing with the Company's annual meeting of stockholders in 2014. Accordingly, no representative of the junior lender is currently a member of the Board of Directors of the Company.

On September 13, 2013, the Company hired Eduardo Tavares as the executive in charge of its wholly-owned subsidiary, Lakeland Brasil S.A. ("Lakeland Brasil"). Mr. Tavares is primarily responsible for running the Company's Brazilian operations. Mr. Tavares was hired by the Company for his experience in turning-around distressed companies in Brazil, including companies which operate in the same markets as does Lakeland Brazil. Mr. Tavares also has extensive knowledge of the Company's customer base and its competitors.

Comments & Business Outlook

Fri, 13 Sep 2013 04:00:00 GMT

Second Quarter Fiscal 2014

The company reported sales of $24.6 million in Q2FY14 compared with $23.5 million in Q2FY13.
The company reported non-GAAP EPS of $0.14, compared to a loss of $0.09 for the same quarter of fiscal 2013.

Christopher J. Ryan stated, "As I have said in previous public disclosures, our focus and time is being devoted to downsizing the expenses in Brazil to conform same to its existing sales and we hope to be there by our fiscal year end in January 2014.

"We decreased operating expenses by $1.8 million in the last six months and we will continue to reduce expenses where appropriate. In the fiscal year ended January 31, 2013, we had $17.0 million of DuPont product revenues and $28.0 million of such revenues in FY11. In the current Q2, we lost $3.0 million in revenues in Brazilian operations compared to last year. We are responding by eliminating expenses that supported these revenues, while developing new revenues to replace these lost revenues. In spite of the lost DuPont and Brazilian revenues, overall sales increased 4.9% in Q2 of fiscal 2014 compared with Q2 last year. Most of the gains are in the US and China."

Comments & Business Outlook

Thu, 02 May 2013 04:00:00 GMT

A 13D just filed indicates that a large mutual fund has taken a large position in GeoSpecial LAKE.

13D and 13G Activity

Wed, 01 May 2013 04:00:00 GMT

13D filed 5/01/2013 by ANCORA ADVISORS takes 7.33% stake in LAKE

The shares of Common Stock covered by this Schedule 13D were acquired in recent months by Ancora Advisors, LLC for investment purposes in the ordinary course of business. Ancora Advisors, LLC reserves the right to take any and all actions that they may deem appropriate to maximize the value of their investments, including, among other things, purchasing or otherwise acquiring additional securities of the Issuer, selling or otherwise disposing of any securities of the Issuer beneficially owned by them. In each case, in the open market or in privately negotiated transactions or formulating other plans or proposals regarding the Issuer or its securities to the extent deemed advisable by Ancora Advisors, LLC in light of their general investment policies, market conditions, subsequent developments affecting the Issuer and the general business and future prospects of the Issuer. Ancora Advisors, LLC may take any other action with respect to the Issuer or any of the Issuer’s debt or equity securities in any manner permitted by applicable law.

Deal Flow

Tue, 23 Apr 2013 04:00:00 GMT

8-K 4/23/2013

Loan Agreement dated on April 19, 2013 between Lakeland Industries, Inc. and Bank Itau in Brazil to borrow R$560 thousand (approximately USD$280 thousand) for working capital

Deal Flow

Tue, 26 Feb 2013 05:00:00 GMT

RONKONKOMA, N.Y., Feb. 25, 2013 /PRNewswire/ -- Lakeland Industries, Inc. (the "Company") (NASDAQ: LAKE), a leading global manufacturer of industrial protective clothing for industry, municipalities, healthcare and to first responders on the federal, state and local levels, today announced that its UK subsidiary has closed with HSBC Invoice Finance (UK), Ltd ("HIF"), a £1,000,000 (approximately USD $1,500,000) Accounts Receivable Financing. The use of proceeds is for working capital. The terms allow for borrowing of up to 80% of eligible accounts receivable as defined.

Deal Flow

Wed, 17 Oct 2012 04:00:00 GMT

RONKONKOMA, N.Y., Oct. 17, 2012 /PRNewswire/ -- Lakeland Industries, Inc. (the "Company") (NASDAQ: LAKE), a leading global manufacturer of industrial protective clothing for industry, municipalities, healthcare and to first responders on the federal, state and local levels, today announced amendments to its primary credit facility with TD BANK, N.A. The Company is now in compliance with all covenants relating to the revised revolving credit agreement.

The amendments were required as a result of the arbitration award issued against the Company in May 2012 and the subsequent entry into a settlement agreement in respect thereof, as well as due to recent operating results of the Company, which collectively caused certain events of default under the TD Bank revolving credit facility and term loan facility, including an event of default for failure to comply with the minimum EBITDA covenant, which allowed TD Bank, at its option, to accelerate the loan.

"We are pleased to have successfully amended our credit agreement with TD Bank," said Lakeland Industries President and Chief Executive Officer Christopher J. Ryan . "The terms of the revised credit facility along with the recently announced Brazil arbitration award settlement remove a great deal of uncertainty for the Company. We appreciate that TD Bank has been supportive of our business pursuits and operational challenges. Management of Lakeland now looks forward to working toward international growth for the Company."

The amendments announced today modify the covenants of the former credit facility and as such waive all previous defaults while requiring no forbearance agreements. The revolving credit facility has been revised to a total borrowing commitment of $17.5 million, with a revised expiration date of June 30, 2013 at a maximum interest rate of LIBOR plus 3.50%, with current outstanding borrowings of approximately $15,500,000. The prior credit agreement allowed up to $30.0 million of borrowing capacity at a maximum interest rate of LIBOR plus 2.50% and had an expiration date of June 30, 2014. The revised credit facility -- as well as the prior agreement -- requires access fees for all unused portions of the total borrowing capacity provided to the Company. With the borrowing base formulas currently in place, the Company would be limited to approximately $17.5 million in any case.

Mr. Ryan added: "We have made significant progress in coming to terms on the Brazil arbitration settlement and successfully amending our bank facility. These have been two of the three pressing issues that need to be resolved so that we may fully focus our attention on the third issue which is the capital requirements associated with the Brazil arbitration settlement and other matters for which we continue to work with our advisors Raymond James in the evaluation of a range of strategic alternatives. We will announce developments at the appropriate time."

Maximization of Shareholder Value

Tue, 16 Oct 2012 04:00:00 GMT

Latest developments on Lake's details surronding their efforts to sell the company.

On June 12, 2012, the Issuer announced that it had engaged the investment banking firm of Raymond James & Associates, Inc. to assist the Issuer’s Board of Directors in its evaluation of a broad range of financial and strategic alternatives, including, but not limited to, changes in the Issuer’s capitalization, potential restructuring of existing debt or a possible sale of all or part of the Issuer. Subsequent to such announcement, representatives of the Issuer contacted Ansell Healthcare Products LLC, an affiliate of the Reporting Persons (“Ansell”), to inquire regarding its interest in exploring a range of potential transactions with the Issuer. Thereafter, following the execution of the Confidentiality Agreement (as defined below), Ansell conducted a due diligence investigation of the Issuer in connection with Ansell’s consideration of a potential acquisition or similar transaction involving the Issuer.

Based on its initial due diligence investigation of the Issuer, Ansell was unable to conclude that an acquisition or similar transaction was in the best interest of Ansell. Ansell has not made a determination whether to conduct further due diligence with respect to the Issuer but, subject to the consent of the Issuer, reserves the right to do so. In the event Ansell determines to conduct further due diligence with respect to the Issuer, there can be no assurance that Ansell will determine to make a proposal to the Issuer with respect to an acquisition or similar transaction, but (subject to the terms of the Confidentiality Agreement) Ansell reserves the right to do so.

To see more on this topic, please see our original report on LAKE here.

Comments & Business Outlook

Fri, 15 Jun 2012 04:00:00 GMT

First Quarter 2013 Results

Net sales from continuing operations decreased $1.6 million, or 6.2%, to $24.0 million for the three months ended April 30, 2012, from $25.6 million for the three months ended April 30, 2011.
Operating profit from continuing operations decreased $1.6 million for the three months ended April 30, 2012, from $1.6 million for the three months ended April 30, 2011.
Net income from continuing operations decreased $11.5 million to a loss of $(10.1) million for the three months ended April 30, 2012, from a profit of $1.3 million for the three months ended April 30, 2011. The decrease in net income primarily resulted from the $10,000,000 Arbitral Award in Brazil and loss in volume in the US resulting from the DuPont termination.
Earnings (loss) per share (EPS) from continuing operations on a fully diluted basis for the first quarter ended April 30, 2012 was $(1.94) as compared to EPS of $0.25 for the 2012 fiscal first quarter. Adjusting for the $10,000,000 charge EPS would have been break even for the quarter.

Management's Comments

Commenting on the financial results and recent developments, Lakeland Industries President and Chief Executive Officer Christopher J. Ryan said, "We reported yet another quarter of record top line performance for our international sales operations. This performance is driven by large bid orders received in Brazil and continued improvement in our other high growth markets in Latin America and Asia. International revenues from continuing operations as a percentage of consolidated sales increased to 59.2% in the first quarter of fiscal 2013, the highest level in the Company's history. This percentage grew from 52.5% in the fourth quarter of fiscal year 2012 and 42.5% in the first quarter of the prior year.

"Total international sales in the first quarter were a record $14.2 million, an increase of over 30% from $10.9 million in the same period of the prior year and 34% higher than the fourth quarter of last year. In Brazil, first quarter sales increased by 28% from the prior year, although this reflected only a portion of the shipments we had planned to make. As previously disclosed, the Company received large bid purchase orders for delivery in fiscal 2013, resulting in a marked anticipated rebound for total Brazil sales expected in fiscal 2013. Due to the timing of shipments and related revenue recognition, sales in the fiscal 2013 first quarter reflect only a portion of the total order backlog. Although on a smaller scale, our operations in other Latin American markets are experiencing significant growth. And China continues to deliver impressive double digit increases in revenue from sales throughout the region.

"Amid all of the progress we are making internationally, our performance improvements are being marred by the Brazil Arbitration Award which was ruled against Lakeland Industries. We have accrued $10,000,000 or a reduction of $1.91 per share in the first quarter for the judgment, although we are aggressively attempting to have the award set aside. As a result of this ruling, we are in default on our long term debt and also in default of the minimum EBITDA covenant related to our primary bank debt facility. We strongly believe that the arbitration decision is inconsistent with the underlying facts, and we continue to work with counsel to determine and evaluate our options. We believe that we have available resources, together with additional outside funding through debt or equity financings or asset sales, which will enable us to satisfy any potential award adverse to the Company and continue operations on a viable basis.

"To strengthen the Company's financial position, particularly in light of the Brazil Arbitration Award ruled against us, we have reduced our inventories by $3.4 million and paid down our bank debt by $1.7 million net, since the beginning of the fiscal year. These actions complement other previously announced initiatives, which include improvements to the Company's cost structure, reductions in overhead, and investments in sales and marketing to accelerate our top line growth both domestically and abroad.

"Now that we have removed our dependence on DuPont, we are in the process of effectuating a turnaround for our domestic operations, which will not be complete until we have regained our presence in the U.S. The turnaround in the U.S. along with continued growth internationally will put us in a position to accelerate earnings and cash flow based on the leverage in our business model. Due to the timing of certain large shipments in Brazil and related revenue recognition, some of the benefits to our consolidated financial performance that we had anticipated would impact our first quarter results will go into the second quarter. In summary, we remain very optimistic for the progress and potential of our international operations and at the same time are taking action to maximize our overall profitability and financial strength."

Investor Alert

Thu, 14 Jun 2012 04:00:00 GMT

Prior news from 5/14/2012

RONKONKOMA, NY--(Marketwire - May 14, 2012) - Lakeland Industries, Inc. (NASDAQ: LAKE) today announced that it has received notice of an unfavorable arbitration award in the arbitration proceeding in Brazil to which it is a party together with its wholly-owned subsidiary, Lakeland Brasil S.A ("Lakeland Brasil" and together with Lakeland Industries, Inc., the "Company") involving the Company and two former officers (the "former officers") of Lakeland Brasil. The Company plans to file on the date hereof a request for clarification of the award in favor of the former officers that may result in a modification of the award. The award will not be final until the motion for clarification is decided, after which the Company may still file a lawsuit to set aside the award in a State Civil Court in Brazil. The filing of the motion for clarification will stay enforcement of the award. Given the difficulty in modifying or setting aside arbitration awards, there can be no assurance that the Company will be successful in achieving any significant modifications to the arbitration award or to have it set aside. Full release

Maximization of Shareholder Value

Thu, 14 Jun 2012 04:00:00 GMT

Prior news from 6/12/2012

RONKONKOMA, N.Y., June 12, 2012 /PRNewswire/ -- Lakeland Industries, Inc. (NASDAQ: LAKE) (the "Company") today announced that it has engaged the investment banking firm of Raymond James & Associates, Inc. to assist the Board of Directors in its evaluation of a broad range of financial and strategic alternatives, including, but not limited to, changes in the Company's capitalization, potential restructuring of existing debt or a possible sale of all or part of the Company. The Company determined to pursue a review of these transaction alternatives in order to enhance shareholder value and strengthen its financial position in light of the potential enforcement of the $10 million arbitral award against the Company which was initially reported by the Company in May 2012.

Comments & Business Outlook

Wed, 18 Apr 2012 04:00:00 GMT

Fourth Quarter 2011 Results

Net sales from continuing operations decreased $4.7 million, or 18.8%, to $20.2 million for the fourth quarter ended January 31, 2012 compared to $24.8 million for the quarter ended January 31, 2011.
Net loss from continuing operations was $(1.0) million for the quarter ended January 31, 2012 as compared with net income from continuing operations of $1.2 million for the quarter ended January 31, 2011.
Earnings (loss) per share (EPS) from continuing operations for the fourth quarter ended January 31, 2012 was $(0.19) as compared to EPS of $0.23 for the 2011 fiscal fourth quarter.

Management's Comments

Mr. Ryan continued, "Lakeland Industries is clearly making progress in turning its business around through the creation of a global platform intended to deliver long term profitable growth. Important steps were taken throughout fiscal 2012 and thus far in 2013 to bring us closer to realizing the potential of our global platform.

"Notable developments include the receipt of a signed purchase order valued at approximately $5.3 million net of VAT taxes from the Brazilian Navy. Revenue from this order is expected to be recognized in the first through third quarters of fiscal 2013. We also received a separate signed purchase orders for firefighting gear in Brazil valued at approximately $2.3 million net of VAT taxes, with delivery of products and revenue recognition expected during the first half of fiscal 2013.

"Signed purchase orders from the Company's operations in Brazil combine for approximately $8 million, the highest backlog in our history.

"Further to our growth in Brazil, the timing of these large orders was fortuitous as they aligned with the expansion of our manufacturing facilities in that country. Our manufacturing capacity was doubled in fiscal 2012. We also have just completed the expansion of the capacity and capabilities of our Mexican plant, which will further accommodate our growth in Chile and Argentina and the plant closure in Missouri. A catalyst for the changes in Mexico is the increasing labor and shipping costs for manufacturing in China. We will take advantage of our geographically diversified manufacturing bases to profit from our international sales traction.

"Evidenced by large orders for proprietary products in Brazil and the need for Lakeland-branded products in the U.S. and other countries, we continue to invest in new product development and certifications. Research and development expenses relating to new product development initiatives were nearly $430,000 in fiscal 2012 and are projected to increase to approximately $510,000 this year.

"Among our cost savings initiatives in fiscal 2012, we designated our glove manufacturing subsidiary in India for discontinuation. In addition to pre-tax charges of $0.9 million taken in the third quarter relating to our manufacturing business in India, we have written down the real estate assets by $540,000 net of taxes in the fourth quarter. A total of $1.8 million in pre-tax charges have been recorded in fiscal 2012.

"A major aspect of our turnaround relates to the significant part of the Company's disposable and chemical product sales in the U.S. which have been removed as a result of the termination of our licensing agreement with DuPont terminating our licensing relationship. The fourth quarter saw a winding down and ultimate elimination of sales of DuPont products. We are in the process of replacing these lost sales with Lakeland-branded offerings. Charges were taken in the fourth quarter for approximately $223,000 pertaining to the reduction of manufacturing and warehousing capacity in Missouri that are no longer required, although the overhead savings will be realized beginning in our second quarter of fiscal 2013.

"As we enter the new fiscal year, we are pleased to report that we expect to return to profitability in the first quarter. This turnaround is occurring faster than we anticipated due to the strength of our Brazilian operations. Our international sales from continuing operations - comprising 52.5% of total sales in the fourth quarter, which marks the first time in the Company's history that foreign sales have been greater than domestic sales - are expected to continue to grow as a percentage of total revenues. And with domestic revenues at a low water mark, we have the opportunity for improvement here as well. With available, lower cost manufacturing capacity and the accumulation of market share in sales channels in some of the fastest growing markets around the world, we are excited for what 2013 holds for Lakeland Industries."

Notable Share Transactions

Mon, 09 Jan 2012 05:00:00 GMT

RONKONKOMA, NY--(Marketwire - Dec 28, 2011) - Lakeland Industries, Inc. (NASDAQ: LAKE) today responded to the Schedule 13D filed with the Securities & Exchange Commission on December 23, 2011 by Ansell Limited ("Ansell"). Such Schedule 13D reported pursuant to applicable securities regulations, the purchase and ownership by Ansell of 504,896 shares of common stock of Lakeland, representing 9.66% of the issued and outstanding shares. Ansell indicated that it acquired the shares for investment purposes.

Commenting on the filing, Christopher J. Ryan, Lakeland's President and Chief Executive Officer, said: "The purchases by Ansell, as reported this past Friday, were undertaken by Ansell through no solicitation or understanding with Lakeland. We believe such purchases reflect the undervaluation of the price of Lakeland's stock. At the current time, Lakeland's book value per common share is $14.34, and its tangible book value per share is $11.47. Based upon Friday's closing price of the common stock of $8.98, the aggregate common stock valuation of $46.9 million is less than one-half of Lakeland's trailing twelve (12) month's revenues of $101.2 million. This discount of greater than 50% exists, even after the Ansell announcement and the increase in the stock price from the $7.88 closing price on Thursday. In addition, given the foundation we have built for strong worldwide growth, which management expects will be reflected in improved financial performance both near and long term, we believe that our common stock market price does not reflect Lakeland's intrinsic value."

13D and 13G Activity

Fri, 06 Jan 2012 05:00:00 GMT

On December 28, 2012 LAKE responded to the Schedule 13D filed with the Securities & Exchange Commission on December 23, 2011 by Ansell Limited ("Ansell"). Such Schedule 13D reported pursuant to applicable securities regulations, the purchase and ownership by Ansell of 504,896 shares of common stock of Lakeland, representing 9.66% of the issued and outstanding shares. "We believe that our common stock market price does not reflect Lakeland's intrinsic value." (source)

Comments & Business Outlook

Tue, 15 Jun 2010 04:00:00 GMT

LAKE announced financial results for its first quarter fiscal year 2011 ended April 30, 2010.

Financial Results Highlights and Recent Company Developments

Revenue of $25.4 million in Q1FY11 at highest level in 6 quarters
International expansion efforts drive non-US revenue growth and improved market share
Revenues from outside the US were 39% of total in Q1FY11 as compared with 28% for Q1FY10
International Growth
- Brazil acquisition added:
  - $2.9 million of sales in Q1FY11
  - Gross margin of 49.4% for Q1FY11
- Stage set for further market expansion with strategically positioned global manufacturing facilities and enhanced product lines
Sales of disposable products in North America declined by 8% in Q1FY11 compared with prior year periods due to continued depressed economy, particularly in the automotive supply chain
Despite weakness in US sales during Q1FY11, the US Glove Division increased sales by 61.7% over Q1FY10, driven by Indian glove product finally gaining traction
Gross margin improves due to contributions from international operations
Operating expenses increased largely due to:
- Additional SG&A in China resulting from $1.2 million increase in external sales from China
- Foreign exchange losses mainly from unhedged losses against the Euro in China
- Increased operating expenses in Brazil, largely sales personnel and related staff to support growth initiatives
Effective inventory control and cash management initiatives resulted in $4.6 million reduction of bank debt at 4/30/10 from 1/31/10
Cash position increased by 12% to $5.7 million at end of Q1FY11 from beginning of fiscal year
New leadership for Brazil operations; VAT tax issue arises from dispute between two states
Charge of $1.6 million has been taken as a result of VAT tax expense in Brazil relating to periods prior to the acquisition by Lakeland.

Management's Comments

Commenting on the financial results, Lakeland Industries President and Chief Executive Officer Christopher J. Ryan said, "We are pleased to report an improvement in consolidated revenues and gross margin for the first quarter of fiscal 2011. Upon reporting our year end results, we had anticipated a softer first quarter due to several larger contracts and certain seasonality issues. The improved performance was driven by continued growth from our international operations which generally deliver higher margins than our domestic sales.

"Since the end of the first quarter, a few events have occurred which we believe bode well for Lakeland Industries for the immediate and longer terms. The first event is the Gulf of Mexico oil spill. There appears to be minimal if any progress being made to contain the spill. As we have stated, in times of natural disaster, there typically is large and urgent need for the environmental, protective and safety apparel which we manufacture and distribute globally. Although we have increased production of these types of products at our facilities around the world to meet the substantial increase in demand for oil spill containment and remediation purposes, we are presently capacity constrained and the back orders are mounting. We are also experiencing severe stockout conditions as a result of our winding down inventory levels in anticipation of the EI DuPont de Nemours & Co. ("DuPont") transition.

"Reflecting the pick up in demand globally as the recession had abated with economic and industrial growth returning in many corners of the world, during the first quarter we had already begun to see our manufacturing capacity become challenged. As a result, we had anticipated sales growth in the second quarter and thereafter. The requirements pertaining to the Gulf of Mexico oil spill are incremental to this anticipated growth.

"Later in the year, we expect our manufacturing capacity to be realigned as a result of a second event. In May we disclosed a new agreement with DuPont relating to our licensing and production of garments using their material. Lakeland Industries was recently named one of what is expected to be a limited number of wholesale distributors for the sale of DuPont garments in the United States. To this end, we will remain a supplier to our existing customers and we will have additional marketing opportunities domestically. DuPont will supply us with finished goods, which means that, except for custom orders, we will no longer be purchasing from DuPont the raw materials that are made into the garments, nor will we be required to hold such large quantities of raw materials, work in progress and finished goods in our inventory. A substantial portion of shipping costs and related logistics and support personnel expenses also will be eliminated. This agreement is being phased in as we work through our remaining inventory and certain modifications are anticipated. However, we expect that upon full implementation as the year progresses we will significantly reduce our annual expenses.

"Consistent with our strategy for the past few quarters and in light of the new agreement with DuPont, we have systematically been reducing our inventory levels. Against a backdrop of increasing sales -- with the first quarter of fiscal 2011 at the highest level in a year and a half " we have seen an improvement in our working capital, inventory turns, cash generation, cash position and debt level. At April 30, 2010, we had reduced our inventory by nearly $5 million from the beginning of the fiscal year three months earlier, reduced the borrowings under our credit facility by nearly half to $5 million, and increased our cash balance nearly 12% since January 31, 2010 to $5.7 million. We have sufficient cash flow and balance sheet strength to accommodate the unanticipated Brazilian tax issue, and are well positioned for continued performance improvements with a markedly enhanced financial condition as well as to capitalize on the many growth opportunities we have identified within our global operating footprint."

Research

Wed, 19 May 2010 04:00:00 GMT

We will track the Lakeland Industries story.

Fiscal year 2010 ended January highlights:

Achieves milestone of 18th consecutive year of profitability
EPS of $.20 for 4Q10 represents best fourth quarter in three fiscal years
4Q10 revenue increased 11.5% over 4Q09, reversing a year-long trend
4Q10 sales from outside the U.S. as a percentage of consolidated sales increased by 25% over 4Q09 to 39.1% of total sales
Operating profits reported by new divisions in Brazil and China; India sales growth gaining traction
Reduced bank debt by $4.7 million in 4Q10 and by 61% in fiscal 2010

Strong Commentary:

Commenting on the year end financial results, Lakeland Industries President and Chief Executive Officer Christopher J. Ryan said, “It is with perseverance and successful implementation of our international growth strategy that Lakeland Industries reported its 18th consecutive year of profitability. Our performance in the final quarter of fiscal 2010 demonstrated the benefits of our global diversification as we rebounded from a loss in the third quarter to produce our highest level of fourth quarter earnings per share since fiscal 2007. Fourth quarter sales reversed a year-long trend of declining revenue by increasing 11.5% from the prior year.

“While sales in the U.S. have essentially stabilized after more than a year of deterioration, we view our investments in our international operations that commenced several years ago as being the key to our recently improved sales performance as well as for creating a more balanced and diversified platform for the long term. To this end, we believe we are positioned more competitively on a global scale. Lakeland has put in place the necessary infrastructure to target an addressable global market that dwarfs the U.S. market in size while growing significantly faster. With our mix of global distribution capabilities, manufacturing facilities, and a broad line of high quality products, we are poised to attain increased international sales and market share in fiscal 2011 and beyond.

“A key element in our international growth strategy has been our entry into Brazil. In the fourth quarter of fiscal 2010 our Brazil operations delivered impressive growth, which capped off improved sales for all of fiscal 2010 at $13.2 million. We continue to improve upon our business in Brazil through investment in new products and sales/marketing support. Our sales in fiscal 2010 in Brazil compares very favorably with calendar 2007 sales of $8.5 million, the last full year prior to our acquisition of this business in 2008.

“In addition to Brazil, we are gaining traction in our businesses in China, which until recently had only been a manufacturing base, India, Chile and the UK. International sales in the fourth quarter improved by 25% over the prior year and now comprise over 39% of our consolidated sales – up from approximately 5% in fiscal 2007 and 31% in fiscal 2009. To accommodate these sales channels, we have built, acquired and made capital investments for manufacturing of products in the U.S., Brazil, Mexico, China, and India, and presently offer 100 products worldwide. From this platform we intend to add scale in existing markets and to leverage our presence by broadening our reach into Argentina, which is already functioning, and into Russia and Kazakhstan later in fiscal 2011. By this time next year, we anticipate that new products and markets cultivated over the last four years should account for 50% of our total revenues."

If the company can build on its fourth quarter performance, its shares may eventually possess value. With a trailing EPS of only $0.19, its likely a little early to take a position in LAKE unless an interview sheds some light on where EPS will end up in the Fiscal 2011 year ending in January.

Source: Business Wire (April 16, 2010)