Lakeland Industries, Inc. (LAKE), a manufacturer of protective clothing and safety garments, reported second quarter 2009 financial results this morning. Revenues rose to $27.6 million, an increase of 27% year-over-year and a quarterly record. Net income rose 114% to $1.6 million, or 30 cents per share, compared to $0.8 million, or 14 cents per share a year ago. One analyst surveyed expected earnings of 23 cents per share.
“This quarter again showed that Lakeland is clearly making progress in its overseas expansion and in translating that growth into strong bottom line results,” said Christopher J. Ryan, President and CEO. “After successfully completing the initial phases of integrating our Brazilian acquisition, we are pleased to report that the operations there are meeting our expectations — with gross margins continuing to rise and new sales channels accelerating our market penetration. At the same time, we are preparing for our entry into Russia and other former Soviet states, while evaluating new products and expanding our manufacturing footprint in China. In addition, our Indian operation commenced production this quarter and is presently shipping our new line of chemically-resistant gloves to our sales and warehousing facilities in Chile, Canada, the UK, China, and the U.S., effectively positioning the Company to take advantage of regional demand and favorable international trade policies.
“Our overall strategy — to manage costs domestically while rapidly expanding overseas — remains intact, and we are constantly reviewing all major markets to rapidly deploy assets where appropriate to maximize returns to our shareholders. While we delivered an impressive 27% increase in overall quarter-over-quarter revenues, our internally generated growth initiatives have led to the highest level of increased sales in the Company’s recent history with an improvement of 13% in the latest quarter as compared to the prior year, excluding Brazil. We continue to see excellent top-line and bottom-line growth in fiscal 2009 and the years to come, outside the U.S.”
Shares of LAKE closed at $12.66 and have traded in 52-week range of $9.51 – $13.62. With 5.5 million shares outstanding, LAKE has a market cap of $69 million. LAKE is thinly traded, with an average daily volume of 7,000 during the past three months. With stockholder’s equity of $71.2 million, there is little downside risk to owning the shares at these levels.
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