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Acme United Reports 9% Sales Increase, and 65% Net Income and EPS Increase for Fourth Quarter of 2019

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FAIRFIELD, Conn., Feb. 27, 2020 (GLOBE NEWSWIRE) -- Acme United Corporation (NYSE:ACU) today announced that net sales for the fourth quarter ended December 31, 2019 were $33.9 million, compared to $31.1 million in the comparable period of 2018, an increase of 9%. Net sales for the year ended December 31, 2019 were $142.5 million, compared to $137.3 million in 2018, an increase of 4%.

Net income for the quarter ended December 31, 2019 was $977,000, or $0.28 per diluted share, compared to $591,000, or $0.17 per diluted share, an increase of 65% for both net income and earnings per share.  Net income for the year ended December 31, 2019 was $5.5 million, or $1.60 per diluted share, compared to $4.6 million, or $1.30 per diluted share in 2018, increases of 20% and 23%, respectively. 

Chairman and CEO Walter C. Johnsen said, "Acme United delivered an excellent year in 2019 from many different perspectives. On the new product front, we introduced the next generation of Smart Compliance first aid kits while at the same time expanding distribution of our innovative Safety Hub refill software.  We had strong sales of our new Westcott adjustable scissors, which have adjustable tension and operate more smoothly than traditional scissors.  Camillus knives continued to gain market share in the U.S. and Canada.

"On the sales front, we achieved our ninth consecutive year of record sales.  We generated strong cash flow, increased our dividend, and reduced net debt by almost $10 million.  We also began 2020 on a strong note, acquiring First Aid Central, a Canadian first aid and safety supplier, in early January. The acquisition, which we expect to be accretive in 2020, expands our product offerings, global distribution capabilities and online presence."

Mr. Johnsen added, "With our continuing sales momentum in first aid and safety products, expanded line of Westcott cutting tools, increased capacity at DMT, and contributions from our recent acquisition of First Aid Central, we believe we are well positioned for growth in 2020."

In the U.S. segment, net sales for the quarter ended December 31, 2019 increased 11% compared to the same period in 2018. Net sales for the year ended December 31, 2019 grew 4% over 2018. The sales increase for both periods was mainly due to strong sales of first aid and safety products.

Net sales in Canada for the quarter ended December 31, 2019 decreased 4% in both U.S. dollars and local currency compared to the prior-year period.  Net sales for the year ended December 31, 2019 decreased 5% in U.S. dollars and 3% in local currency compared to the same period in 2018. 

Net sales in Europe for the quarter ended December 31, 2019 decreased 10% in U.S. dollars and 7% in local currency compared to the same period in 2018.  Net sales for the year ended December 31, 2019 increased 8% in U.S. dollars and 14% in local currency compared to last year. The sales decline in the quarter was mainly due to a large promotional sale in the fourth quarter of 2018 that did not repeat in 2019.  Net sales for the year grew mainly due to new customers in the office products channel, growth in sales of DMT sharpening products, and strong e-commerce demand for these products.
           
Gross margin was 36.3% in the three months ended December 31, 2019 compared to 36.5% in the same period in 2018.  Gross margin was 36.5% for the year ended December 31, 2019 compared to 36.9% for 2018.

The Company's debt less cash on December 31, 2019 was $30.0 million compared to $39.6 million on December 31, 2018.  During the year, the Company distributed $1.6 million in dividends on its common stock and generated $13.0 million in free cash flow, including a $2.1 million reduction in inventory.

Conference Call and Webcast Information
Acme United will hold a conference call to discuss its quarterly results, which will be broadcast on Thursday, February 27, 2020 at 12:00 p.m. EST. To listen or participate in a question and answer session, dial 800-353-6461. International callers may dial 334-323-0501. You may access the live webcast of the conference call through the Investor Relations section of the Company's website, www.acmeunited.com. A replay may be accessed under Investor Relations, Audio Archives.

About Acme United
ACME UNITED CORPORATION is a leading worldwide supplier of innovative safety solutions and cutting technology to the school, home, office, hardware, sporting goods and industrial markets. Its leading brands include First Aid Only®, PhysiciansCare®, Pac-Kit®, Spill Magic®, Westcott®, Clauss®, Camillus®, Cuda®, and DMT®. For more information, visit www.acmeunited.com

Forward Looking Statements
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; (vii) increases in the cost of borrowings resulting from rising interest rates; (viii) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; and (ix) other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission. 

CONTACT: Paul G. Driscoll Acme United Corporation 55 Walls Drive Fairfield, CT  06824
    Phone: (203) 254-6060 FAX: (203) 254-6521  



ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
YEAR END REPORT 2019
  (Unaudited)
           
    Quarter Ended     Quarter Ended
Amounts in $000's except per share data   December 31, 2019     December 31, 2018
           
           
Net sales $ 33,873     $ 31,130  
Cost of goods sold 
  21,579       19,768  
Gross profit 
  12,294       11,362  
Selling, general, and administrative expenses
  10,893       10,269  
Income from operations 
  1,401       1,093  
Interest expense 
  (338 )     (523 )
Interest income   12       10  
Net interest expense   (326 )     (513 )
Other (expense) income, net   (46 )     18  
Total other expense, net   (372 )     (495 )
Pre-tax income   1,029       598  
Income tax expense   52       7  
Net income $ 977     $ 591  
             
  Shares outstanding - Basic   3,352       3,363  
  Shares outstanding - Diluted   3,495       3,421  
             
Earnings per share basic $ 0.29     $ 0.18  
Earnings per share diluted   0.28       0.17  
             
             
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
YEAR END REPORT 2019 (cont.)
(Unaudited)
             
             
      Year Ended     Year Ended
Amounts in $000's except per share data   December 31, 2019     December 31, 2018
             
Net sales $ 142,457     $ 137,321  
Cost of goods sold   90,456       86,672  
Gross profit   52,001       50,649  
Selling, general, and administrative expenses   43,572       43,192  
Income from operations   8,429       7,457  
Interest expense   (1,828 )     (1,891 )
Interest income   40       33  
Net interest expense   (1,788 )     (1,858 )
Other expense, net   (98 )     (68 )
Total other expense, net   (1,886 )     (1,926 )
Pre-tax income   6,543       5,531  
Income tax expense   1,030       933  
Net income $ 5,513     $ 4,598  
             
  Shares outstanding - Basic   3,352       3,371  
  Shares outstanding - Diluted   3,453       3,542  
             
Earnings per share basic $ 1.65       1.36  
Earnings per share diluted   1.60       1.30  
             
             
             
ACME UNITED CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
YEAR END REPORT 2019
(Unaudited)
             
Amounts in $000's   December 31, 2019     December 31, 2018
             
Assets:          
Current assets:          
  Cash $ 6,822     $ 4,409  
  Accounts receivable, net   25,485       25,102  
  Inventories   39,261       41,332  
  Prepaid and other current assets   1,578       2,149  
Total current assets   73,146       72,992  
             
  Property and equipment, net   14,036       14,543  
  Intangible assets, less amortization   15,793       17,044  
  Goodwill   4,696       4,696  
  Operating lease right of use asset   2,989       -  
  Other assets   89       203  
Total assets $ 110,749     $ 109,478  
             
Liabilities and stockholders' equity:          
Current liabilities:          
  Accounts payable $ 6,693     $ 7,983  
  Operating lease liability - short term   1,047       -  
  Mortgage payable - short term   267       267  
  Other current liabilities   8,626       5,115  
Total current liabilities   16,633       13,365  
Non-current liabilities          
  Long term debt   33,240       40,283  
  Mortgage payable - long term   3,178       3,444  
  Operating lease liability - long term   1,961       -  
  Other non current liabilities   32       53  
Total liabilities   55,044       57,145  
Total stockholders' equity   55,705       52,333  
Total liabilities and stockholders' equity $ 110,749     $ 109,478  
             

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