Acme United Corporation Reports 9% Sales Increase and 22% Increase in Net Income for the Fourth Quarter

  Acme United Corporation Reports 9% Sales Increase and 22% Increase in Net
  Income for the Fourth Quarter

Business Wire

FAIRFIELD, Conn. -- February 26, 2014

Acme United Corporation (NYSE MKT:ACU) today announced that net sales for the
fourth quarter ended December 31, 2013 were $21.4 million, compared to $19.5
million in the comparable period of 2012, an increase of 9%.

Net income was $524,000, or $.15 per diluted share, for the quarter ended
December 31, 2013, compared to $431,000 or $.14 per diluted share, for the
comparable period of 2012, an increase of 22% in net income and 7% in diluted
earnings per share.

Net sales for the year ended December 31, 2013 were $89.6 million, compared to
$84.4 million in 2012, an increase of 6%.

Net income for the year ended December 31, 2013 was $4,003,000, or $1.22 per
diluted share, compared to $3,549,000, or $1.13 per diluted share for the
comparable period of 2012, a 13% increase in net income and 8% increase in
diluted earnings per share.

Net sales in the U.S. segment for the quarter and year ended December 31, 2013
increased 11% and 9%, respectively, compared to the same periods in 2012. The
increases for both periods were primarily due to higher sales of Camillus
knives and back to school products as well as increased distribution of first
aid kits. Net sales in Canada for the three months ended December 31, 2013
decreased 7% in U.S. dollars but remained constant in local currency compared
to the same period in 2012. Net sales in Canada for the year ended December
31, 2013 decreased 8% in both U.S. dollars and local currency compared to
2012. The sales decline in Canada was primarily due to general softness in the
office products industry. European net sales for the three months ended
December 31, 2013 increased 8% in U.S. dollars (2% in local currency),
compared to the same period last year. European net sales for the year ended
December 31, 2013 decreased 2% in U.S. dollars (5% in local currency),
compared to last year. The decreased sales in Europe were primarily due to the
bankruptcy and liquidation of a large customer in Germany in the second
quarter of 2012.

Gross margins were 34.5% in the fourth quarter of 2013 versus 33.6% in the
comparable period last year. Gross margins were 35.5% for the year ended
December 31, 2013 versus 35.3% for the comparable period in 2012.

Operating profit was $763,000 for the quarter ended December 31, 2013 compared
to $465,000 for the same period in 2012, a 64% increase. Operating profit was
$5,879,000 for the year ended December 31, 2013 compared to $5,361,000 last
year, an increase of 10%.

Walter C. Johnsen, Chairman and CEO said, “We performed well throughout the
year, and I am pleased with the financial results. We achieved record sales,
strengthened our product offerings across all our brands, and acquired a
superb facility in North Carolina to consolidate many of our operations. Mr.
Johnsen added that the company has continued to build its balance sheet, and
is positioned to finance continued growth.”

The Company’s bank debt less cash and cash equivalents on December 31, 2013
was $11.3 million compared to $14.6 million on December 31, 2012. During the
year ended December 31, 2013, Acme purchased a new distribution facility in
North Carolina for $2.8 million, added $.9 million in refurbishments to the
facility, and paid $.7 million in dividends on its common stock. On August 21,
2013 the Company received $1.7 million from early repayment of a mortgage
receivable. During the year the Company also generated $5.5 million in free
cash flow while reducing inventory by $2.1 million.

ACME UNITED CORPORATION is a leading worldwide supplier of innovative cutting,
measuring and safety products to the school, home, office, hardware and
industrial markets. Its leading brands include Westcott®, Clauss®, Camillus®,
PhysiciansCare ® and Pac Kit®.

Forward-looking statements in this report, including without limitation,
statements related to the Company’s plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that such forward-looking statements involve
risks and uncertainties including, without limitation, the following: (i)
changes in the Company’s plans, strategies, objectives, expectations and
intentions, which may be made at any time at the discretion of the Company;
(ii) the impact of uncertainties in global economic conditions, including the
impact on the Company’s suppliers and customers; (iii) changes in client needs
and consumer spending habits; (iv) the impact of competition and technological
changes on the company; (v) the Company’s ability to manage its growth
effectively, including its ability to successfully integrate any business it
might acquire; (vi) currency fluctuations; and (vii) other risks and
uncertainties indicated from time to time in the Company’s filings with the
Securities and Exchange Commission.

                                                         
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
YEAR END REPORT 2013
(Unaudited)
                                                                
                                        Quarter Ended           Quarter Ended
Amounts in $000's except per         December 31, 2013    December 31,
share data                                                      2012
                                                                
                                                                
Net sales                             $ 21,379                $ 19,534
Cost of goods sold                      14,004                  12,979
Gross profit                            7,375                   6,555
Selling, general, and                   6,612                   6,090
administrative expenses
Income from operations                  763                     465
Interest expense                        (122)                   (125)
Interest income                         13                      61
Net interest expense                    (109)                   (64)
Other expense, net                      (19)                    (5)
Total other expense, net                (128)                   (69)
Pre-tax income                          635                     396
Income tax expense (benefit)            111                     (35)
Net income                            $ 524                   $ 431
                                                                
Shares outstanding - Basic              3,189                   3,118
Shares outstanding - Diluted            3,395                   3,175
                                                                
Earnings per share basic              $ 0.16                  $ 0.14
Earnings per share diluted              0.15                    0.14
                                                                

                                                           
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
YEAR END REPORT 2013 (cont.)
(Unaudited)
                                                                  
                                                                  
                                          Year Ended              Year Ended
Amounts in $000's except per share     December 31, 2013    December 31,
data                                                              2012
                                                                  
Net sales                               $ 89,577                $ 84,370
Cost of goods sold                        57,753                  54,623
Gross profit                              31,824                  29,747
Selling, general, and                     25,945                  24,386
administrative expenses
Income from operations                    5,879                   5,361
Interest expense                          (502)                   (444)
Interest income                           152                     179
Net interest expense                      (350)                   (265)
Other expense, net                        (35)                    (99)
Total other expense, net                  (385)                   (364)
Pre-tax income                            5,494                   4,997
Income tax expense                        1,491                   1,448
Net income                              $ 4,003                 $ 3,549
                                                                  
Shares outstanding - Basic                3,168                   3,116
Shares outstanding - Diluted              3,283                   3,133
                                                                  
Earnings per share basic                $ 1.26                  $ 1.14
Earnings per share diluted                1.22                    1.13
                                                                  

                                                      
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
YEAR END REPORT 2013
(Unaudited)
                                                             
Amounts in $000's                 December 31, 2013    December 31, 2012
                                                             
Assets:
Current assets:
Cash                               $ 11,644                $ 9,750
Accounts receivable, net             15,629                  16,442
Inventories                          28,219                  30,292
Prepaid and other current            1,494                   1,925
assets
Total current assets                 56,986                  58,409
                                                             
Property and equipment, net          5,936                   2,353
Long term receivable                 -                       1,702
Other assets                         5,157                   5,364
Total assets                       $ 68,079                $ 67,828
                                                             
Liabilities and stockholders'
equity:
Current liabilities
Accounts payable                   $ 4,789                 $ 6,480
Other current liabilities            5,087                   5,250
Total current liabilities            9,876                   11,730
Non-current liabilities
Long term debt                       22,912                  24,320
Other non current liabilities        286                     912
Total liabilities                    33,074                  36,962
Total stockholders' equity           35,005                  30,866
Total liabilities and              $ 68,079                $ 67,828
stockholders' equity
                                                             

Contact:

Acme United Corporation
Paul G. Driscoll, 203-254-6060
FAX: 203-254-6521
 
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