First quarter sales at Hamilton Beach were down slightly but the small appliance supplier reported an increase in net income for the period ended March 31.
The company reported net income of $0.7 million and revenues of $114.2 million for the first quarter of 2017 compared with a net loss of $0.3 million and revenues of $115.7 million for the first quarter of 2016. Operating profit increased to $0.8 million in the first quarter of 2017 from $0.1 million in the first quarter of 2016.
According to the company, revenues decreased in the first quarter of 2017 mainly due to reduced sales volumes, primarily in the U.S. consumer retail market in part driven by a decline in retail demand in the first quarter as retailers re-balanced inventory after the holiday selling season. An increase in revenues from the favorable effect of sales of new and higher-priced products partly offset the effect of the reduced volumes.
Hamilton Beach’s sister company, Kitchen Collection, reported a net loss of $2.1 million and revenues of $26.7 million for the first quarter of 2017 compared with a net loss of $1.9 million and revenues of $28.4 million for the first quarter of 2016. The first quarter 2017 net loss increased moderately compared with the first quarter of 2016 primarily as a result of a shift in sales mix to lower margin products.
The decrease in revenues was primarily due to the effect of closing 22 underperforming stores since March 31, 2016, and a decline in comparable store sales. The decrease in comparable store sales was mainly attributable to fewer customer visits, which also resulted in a decline in the number of store transactions, and was partially offset by improvements in the average sales transaction value. Sales at newly opened Kitchen Collection stores and an increase in e-commerce sales also partially offset the revenue decrease.
As of March 31, 2017, Kitchen Collection operated 208 stores compared with 222 stores at March 31, 2016.