lake_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2024

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________

COMMISSION FILE NUMBER: 0-15535

LAKELAND INDUSTRIES, INC.

(Exact name of Registrant as specified in its charter)

Delaware		13-3115216
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

1525 Perimeter Parkway, Suite 325 Huntsville, AL		35806
(Address of Principal Executive Offices)		(Zip Code)

(Registrant's telephone number, including area code) (256) 350-3873

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	LAKE	NASDAQ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☒
Nonaccelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.

Class		Outstanding at August 31, 2024
Common Stock, $0.01 par value per share		7,396,604 Shares

LAKELAND INDUSTRIES, INC.

AND SUBSIDIARIES

FORM 10-Q

The following information of the Registrant and its subsidiaries is submitted herewith:

PART I - FINANCIAL INFORMATION:

		Page
Item 1.	Financial Statements (Unaudited)

	Condensed Consolidated Statements of Operations Three and Six Months Ended July 31, 2024 and 2023	3

	Condensed Consolidated Statements of Comprehensive Income (Loss) Three and Six Months Ended July 31, 2024 and 2023	4

	Condensed Consolidated Balance Sheets July 31, 2024 and January 31, 2024	5

	Condensed Consolidated Statements of Stockholders’ Equity Three and Six Months Ended July 31, 2024 and 2023	6

	Condensed Consolidated Statements of Cash Flows Six Months Ended July 31, 2024 and 2023	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	29

	PART II - OTHER INFORMATION:

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30

Item 5	Other Information	30

Item 6.	Exhibits	31

	Signature Pages	32

Table of Contents

LAKELAND INDUSTRIES, INC.

AND SUBSIDIARIES

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

($000’s except for share and per share information)

	Three Months Ended July 31,						Six Months Ended July 31,
	2024			2023			2024			2023
Net sales	$	38,512		$	33,071		$	74,822		$	61,771
Cost of goods sold		23,277			18,888			43,403			35,144
Gross profit		15,235			14,183			31,419			26,627
Operating expenses		16,826			10,453			30,809			20,959
Operating profit (loss)		(1,591	)		3,730			610			5,668
Other income (expense), net		165			(65	)		177			(134	)
Interest expense		(370	)		(1	)		(542	)		(9	)
Income (loss) before taxes		(1,796	)		3,664			245			5,525
Income tax expense (benefit)		(420	)		1,199			(32	)		1,740
Net income (loss)	$	(1,376	)	$	2,465		$	277		$	3,785
Net income (loss) per common share:
Basic	$	(0.19	)	$	0.33		$	0.04		$	0.52
Diluted	$	(0.19	)	$	0.32		$	0.04		$	0.50
Weighted average common shares outstanding:
Basic		7,390,873			7,409,305			7,371,358			7,340,914
Diluted		7,390,873			7,591,786			7,648,300			7,523,395

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

($000’s)

	Three Months Ended July 31,						Six Months Ended July 31,
	2024			2023			2024		2023

Net income (loss)	$	(1,376	)	$	2,465		$	277	$	3,785
Other comprehensive income (loss):
Foreign currency translation adjustments		950			(909	)		1,108		(1,627	)
Comprehensive income (loss)	$	(426	)	$	1,556		$	1,385	$	2,158

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(000’s except for share information)

ASSETS	July 31,			January 31,
	2024			2024
Current assets
Cash and cash equivalents	$	24,880		$	25,222
Accounts receivable, net of allowance for doubtful accounts of $1,033 and $857 at July 31, 2024 and January 31, 2024, respectively		22,933			19,169
Inventories		67,920			51,250
Prepaid VAT and other taxes		2,043			2,753
Income tax receivable and other current assets		10,753			3,111
Total current assets		128,529			101,505
Property and equipment, net		12,618			10,685
Operating leases right-of-use assets		11,937			10,969
Deferred tax assets		3,104			3,097
Other assets		163			110
Goodwill		20,298			13,669
Intangible assets, net		14,498			6,830
Equity investments		4,474			4,719
Convertible debt instruments		2,800			2,161
Total assets	$	198,421		$	153,745
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	16,578		$	7,378
Accrued compensation and benefits		4,531			3,922
Other accrued expenses		6,723			2,487
Income tax payable		-			1,454
Short-term borrowings		-			298
Accrued earnout agreement		-			643
Current portion of operating lease liabilities		2,505			2,164
Total current liabilities		30,337			18,346
Deferred income taxes		2,114			2,097
Loans payable – long term		29,484			731
Long-term portion of operating lease liabilities		11,770			9,121
Total liabilities		73,705			30,294
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.01 par; authorized 1,500,000 shares (none issued)		-			-
Common stock, $0.01 par; authorized 20,000,000 shares Issued 8,754,812 and 8,722,965; outstanding 7,396,604 and 7,364,757 at July 31, 2024 and January 31, 2024, respectively		87			87
Treasury stock, at cost; 1,358,208 shares at July 31, 2024 and January 31, 2024, respectively		(19,979	)		(19,979	)
Additional paid-in capital		79,743			79,420
Retained earnings		69,117			69,282
Accumulated other comprehensive loss		(4,252	)		(5,360	)
Total stockholders' equity		124,716			123,450
Total liabilities and stockholders' equity	$	198,421		$	153,745

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

(000’s except for share information)

																	Accumulated
											Additional						Other
	Common Stock				Treasury Stock						Paid-in			Retained			Comprehensive
	Shares		Amount		Shares			Amount			Capital			Earnings			Loss			Total
			($000’s)					($000’s)			($000’s)			($000’s)			($000’s)			($000’s)

Balance, January 31, 2023		8,655,699	$	87		(1,330,694	)	$	(19,646	)	$	78,475		$	64,765		$	(3,691	)	$	119,990
Net income		-		-		-			-			-			3,785			-			3,785
Other comprehensive loss		-		-		-			-			-			-			(1,627	)		(1,627	)
Dividends		-		-		-			-			-			(466	)					(466	)
Stock-based compensation:
Restricted stock issued		65,533	-			-			-			-			-			-		-
Restricted stock plan		-		-		-			-			445			-			-			445
Return of shares in lieu of payroll withholding		-		-		-			-			(409	)		-			-			(409	)
Treasury stock purchased		-		-		(27,514	)		(333	)	-			-			-				(333	)
Balance, July 31, 2023		8,721,232	$	87		(1,358,208	)	$	(19,979	)	$	78,511		$	68,084		$	(5,318	)	$	121,385

Balance, April 30, 2023		8,709,256	$	87		(1,353,508	)	$	(19,922	)	$	78,543		$	65,839		$	(4,409	)	$	120,138
Net income		-		-		-			-			-			2,465			-			2,465
Other comprehensive loss		-		-		-			-			-			-			(909	)		(909	)
Dividends		-		-		-			-			-			(220	)	-				(220	)
Stock-based compensation:
Restricted stock issued		11,976	-			-			-						-			-		-
Restricted stock plan		-		-		-			-			38			-			-			38
Return of shares in lieu of payroll withholding		-		-		-			-			(70	)		-			-			(70	)
Treasury stock purchased		-		-		(4,700	)		(57	)	-			-			-				(57	)
Balance, July 31, 2023		8,721,232	$	87		(1,358,208	)	$	(19,979	)	$	78,511		$	68,084		$	(5,318	)	$	121,385

Balance, January 31, 2024		8,722,965	$	87		(1,358,208	)	$	(19,979	)	$	79,420		$	69,282		$	(5,360	)	$	123,450
Net income		-		-		-			-			-			277			-			277
Other comprehensive income		-		-		-			-			-			-			1,108			1,108
Dividends		-		-		-			-			-			(442	)	-				(442	)
Stock-based compensation:
Restricted stock issued		31,847	-			-			-						-			-		-
Restricted stock plan		-		-		-			-			627			-			-			627
Return of shares in lieu of payroll withholding		-		-		-			-			(304	)		-			-			(304	)
Treasury stock purchased		-		-		-			-			-

SEC Form 10-Q filed by Lakeland Industries Inc.