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Crown Crafts (CRWS) Q1 Earnings Decline Y/Y, Gross Margin Down
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Crown Crafts, Inc. (CRWS - Free Report) reported a loss per share of 3 cents in the first quarter of fiscal 2025 against the year-ago quarter’s earnings of 4 cents per share.
Revenues in Detail
Crown Crafts registered revenues of $16.2 million in the fiscal first quarter, down 5.3% year over year.
Per management, the decrease was primarily due to a major retailer reducing inventory levels and the loss of a program at another major retailer.
Segment Details
Crown Crafts derives revenues from two segments — Bedding, blankets and accessories and Bibs, toys and disposable products.
For the quarter under review, sales of bedding, blankets and accessories were $6.3 million, up 12.2% from the year-ago quarter.
Sales of bibs, toys and disposable products during the fiscal first quarter were $9.9 million, down 13.8% year over year.
Crown Crafts, Inc. Price, Consensus and EPS Surprise
In the quarter under review, Crown Crafts’ gross profit declined 16.4% year over year to $3.9 million. The gross margin contracted 323 basis points to 24.7%.
Operating Expenses Analysis
Marketing and administrative expenses rose 5.4% year over year to $4.3 million.
Profitability
Operating loss totaled $0.3 million in the fiscal first quarter against the year-ago quarter’s operating profit of $0.7 million.
In the fiscal first quarter, Crown Crafts’ net loss was $0.3 million against the year-ago quarter’s net income of $0.4 million.
Liquidity & Debt Management
Crown Crafts exited first-quarter fiscal 2025 with cash and cash equivalents of $1.1 million compared with $0.8 million at the fiscal 2024-end. Long-term debt at the fiscal first-quarter end was $1.5 million compared with $8.1 million at the fiscal 2024-end.
Net cash provided by operating activities at the end of first-quarter fiscal 2025 was $8 million compared with $6.3 million a year ago.
Our Take
Crown Crafts exited the first quarter of fiscal 2025 with dismal top-line and bottom-line results. Lower sales of bibs, toys and disposable products were also discouraging. During the reported quarter, the gross margin contracted, which did not bode well. Per management, the company was impacted by the prolonged inflationary pressures faced by consumers, limiting their discretionary income and certain non-routine costs that resulted in a loss for the quarter. This looks promising for the stock.
On a positive note, an uptick in sales of bedding, blankets and accessories during the reported quarter was impressive. Per management, the acquisition of Manhattan Toy expanded Crown Crafts’ distribution channels and it continues to receive positive feedback on the new product development by Manhattan Toy.
In July, the company acquired substantially all the assets of Baby Boom Consumer Products, Inc. Management believes that the buyout will likely enhance its presence in the toddler bedding segment and expand its product lineup with the addition of diaper bags. This raises our optimism about the stock.
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Crown Crafts (CRWS) Q1 Earnings Decline Y/Y, Gross Margin Down
Crown Crafts, Inc. (CRWS - Free Report) reported a loss per share of 3 cents in the first quarter of fiscal 2025 against the year-ago quarter’s earnings of 4 cents per share.
Revenues in Detail
Crown Crafts registered revenues of $16.2 million in the fiscal first quarter, down 5.3% year over year.
Per management, the decrease was primarily due to a major retailer reducing inventory levels and the loss of a program at another major retailer.
Segment Details
Crown Crafts derives revenues from two segments — Bedding, blankets and accessories and Bibs, toys and disposable products.
For the quarter under review, sales of bedding, blankets and accessories were $6.3 million, up 12.2% from the year-ago quarter.
Sales of bibs, toys and disposable products during the fiscal first quarter were $9.9 million, down 13.8% year over year.
Crown Crafts, Inc. Price, Consensus and EPS Surprise
Crown Crafts, Inc. price-consensus-eps-surprise-chart | Crown Crafts, Inc. Quote
Crown Crafts Gross Margin
In the quarter under review, Crown Crafts’ gross profit declined 16.4% year over year to $3.9 million. The gross margin contracted 323 basis points to 24.7%.
Operating Expenses Analysis
Marketing and administrative expenses rose 5.4% year over year to $4.3 million.
Profitability
Operating loss totaled $0.3 million in the fiscal first quarter against the year-ago quarter’s operating profit of $0.7 million.
In the fiscal first quarter, Crown Crafts’ net loss was $0.3 million against the year-ago quarter’s net income of $0.4 million.
Liquidity & Debt Management
Crown Crafts exited first-quarter fiscal 2025 with cash and cash equivalents of $1.1 million compared with $0.8 million at the fiscal 2024-end. Long-term debt at the fiscal first-quarter end was $1.5 million compared with $8.1 million at the fiscal 2024-end.
Net cash provided by operating activities at the end of first-quarter fiscal 2025 was $8 million compared with $6.3 million a year ago.
Our Take
Crown Crafts exited the first quarter of fiscal 2025 with dismal top-line and bottom-line results. Lower sales of bibs, toys and disposable products were also discouraging. During the reported quarter, the gross margin contracted, which did not bode well. Per management, the company was impacted by the prolonged inflationary pressures faced by consumers, limiting their discretionary income and certain non-routine costs that resulted in a loss for the quarter. This looks promising for the stock.
On a positive note, an uptick in sales of bedding, blankets and accessories during the reported quarter was impressive. Per management, the acquisition of Manhattan Toy expanded Crown Crafts’ distribution channels and it continues to receive positive feedback on the new product development by Manhattan Toy.
In July, the company acquired substantially all the assets of Baby Boom Consumer Products, Inc. Management believes that the buyout will likely enhance its presence in the toddler bedding segment and expand its product lineup with the addition of diaper bags. This raises our optimism about the stock.