Wednesday, Blyth, Inc. (BTH), a designer and marketer of home fragrance and decor products, reported a loss for the second-quarter, reflecting lower sales and a charge related to the company's investment in ViSalus Sciences.
Net loss for the quarter attributable to the shareholders was $15.6 million or $1.74 per share, compared with a net income of $3.0 million or $0.33 per share for the prior year.
Quarterly results included a non-cash, pre-tax goodwill and other intangibles impairment charge of $16.5 million, resulting from the revaluation of goodwill and other intangibles associated with the company's investment in ViSalus Sciences.
Excluding exceptional items and the reversal of the accretion of redeemable noncontrolling interest in excess of fair value in the amount of $0.04 per share, loss would have been $0.01 per share, compared with an income of $0.35 per share last year.
Greenwich, Connecticut-based Blyth's quarterly net sales declined 16% to $199.4 million from $236.8 million in the prior-year period, impacted negatively by lower sales volumes across all of its business units as U.S. consumers continue to scale back spending. On a local currency basis, sales declined about 10% compared with last year.
Segment-wise, in the Direct Selling segment, net sales declined 13% to $123.3 million from $141.4 million in the same period last year, and on a local currency basis, sales were down 4%. Catalog & Internet segment's net sales decreased 6% to $36.9 million from $39.3 million last year due to a planned catalog circulation reduction for the Miles Kimball Company brands, and the recessionary sales environment.
Wholesale segment's net sales for the quarter was $39.1 million, down 30% froom $56.0 million last year driven by lower sales of seasonal decorations, home decor products and foodservice products.
For the six-month period, net loss attributable to the shareholders was $13.1 million or $1.47 per share, compared with a net income of $4.2 million or $0.45 per share last year. Excluding exceptional items, earnings for the period would have been $0.30 per share, compared with $1.05 per share last year.
Year-to-date, net sales declined about 15% to $414.1 million from $486.6 million in the comparable period in the previous year.
Separately, the company said it expects full-year 2009 earnings to be in the range of $1.14 to $1.44 per share, lower from the previous expectation of $2.90 to $3.20 per share. Apart from the $1.71 per share charge arising from a revaluation of goodwill associated with its investment in ViSalus Sciences, Blyth's current earnings per share estimate reflects expected restructuring charges of $0.15 per share related to the merger of its wholesale seasonal and home decor businesses into a new company, Midwest-CBK.
Further, the company said for fiscal 2009, it continues to expect earnings, on a normalized, non-GAAP basis, to be in the range of $3.00 to $3.30 per share.
Robert Goergen, chairman and chief executive officer, commented, "Our full year guidance reflects significant improvement in the performance of our ERP system at the Miles Kimball Company versus prior year, which is expected to result in markedly improved profitability during the seasonally important second half."
BTH is currently trading at 41.76 per share, down 5.00%, on the NYSE.
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