Crown Crafts (CRWS) 12 Nov 242025 Q2 Earnings call transcript

Thank you, Cindy, and good morning, everyone. We appreciate you for joining us for the Crown Crafts Second Quarter Fiscal 2025 Conference Call.

Joining me today are Crown Crafts' President and CEO, Olivia Elliott; and the company's CFO, Craig Demarest.

Earlier this morning, Crown Crafts filed its 10-Q and issued a press release regarding their second quarter fiscal '25 financial results. A copy of the release is available on the company's website, crowncrafts.com.

company differ certain or materially the actual statements, implied. call, may results from today's will forward-looking make and During those expressed be obligation to These uncertainties these statements. and to subject update company beyond may the no statements control Crown under risks is Crafts' are that and

For about Commission. Exchange risk the factors please other uncertainties, and more to the the Securities information refer company's company's and filings with

the will company's call would Relations is you being be like available a and I through Finally, today's replay Investor page. to recorded, remind

Now like the turn call President the and I to would over CEO, to Olivia Elliott.

a John, morning, acquisition and favorable and contribution Thank solid Baby Baby Boom bottom Products, pleased to you, a quarter as environment. was line. strong recent macro quarter our a good profit the contributed of to we The second report gross our from Consumer of purchase reflects of continued of assets our our Boom We're which await results, assets, stronger which everyone. positively the highlight overall execution

We're power. for Index purchasing April. since Sentiment rate And as important its toddler Consumer Baby the just cuts the customer that a in diaper the The and of presence most past branded comes enhances of acquisition adding we to Interest point extends our Michigan's Boom's consumer licensed demand the Baby excited addition portfolio this potential addition just selling highest and and product offerings are positive season. products further bags. head our with our about at inflection Boom segment into of to of lower University climbed inflation level Friday,

forward our confident we're ahead, trajectory. in Looking

Craig over quarter solid more second results cover and Before outlook, I strategy our on share I'll to turn detail. in it more to our

is million, Net from quarter a increase program and current Olivia, sales you, year was for attributable $XX.X net of million of legacy $X.X retailer. quarter the the to morning, of declines fiscal quarter. addition major Boom, in our $XX.X a sales in including 'XX The were largely million primarily prior the businesses, bid everyone. added in second by at the up of good Thank loss which offset year the Baby discussed and previously

Gross profit footprint was profit fiscal in XX.X% lease reduce offset and a costs by to The slight increase product reflects year expense from the consolidation a earlier. quarter mix, in look change actively improved in We're warehouse strategic through for XX.X%, our evaluating partially for the associated higher California. XXXX. our

per net an marketing expenses $X.X million, XX.X% from second of More and the or increase prior than the the Boom from year $X.XX to acquisition. quarter $X.X $XXX,XXX share costs income income increase million administrative was $X.X were Baby sales up to or year prior for million of or Our in $X.XX prior quarter, quarter the relates the per associated to with year quarter. quarter the of half diluted XX.X%. Net net share compared in $XXX,XXX diluted

at the the quarter million $XXX,XXX our the sheet. position second million, to financial and end cash remain strong quarter a of of and in now Turning at the from up $X of amounts million fiscal cash 'XX, Baby at equivalents $X.X were end We at balance end as to the the first of acquisition. of the fund million $XX.X at quarter the compared our fiscal the quarter second on to Boom reflecting end in were 'XX. end Borrowings the revolver borrowed $X.X

which $X purchase $XX through million $XX $XX.X was of XX $XX of loan an revolving adjustments July closed purchase on for at term borrowings closing. million from We X-year total funded working capital and a line our million million. the to acquisition after million available price for The or credit, increased under

cash borrowings. to our our use flow to repay expect We rapidly

needs. inventory of balance our debt due working quarter-to-quarter always, purchases may to timing from capital the as and fluctuate However, other

regular long-standing per dividend, our share and which in paid paid dividend January. our we declared will of $X.XX be next Finally,

the call over additional for turn I'll Olivia comments. to back Now

upcoming optimistic holiday the We're about to opportunity Craig. you, season Thank drive and the higher revenue.

made For NoJo. for now significant integrating progress have one, X owned approximately the we've months brand into and Baby Boom

we Walmart, and opportunities additional Toy, legacy Manhattan in we'll our several Boom brands. cross-selling Toy addition, continue In products pursue have and Baby Manhattan to among

we evaluate As in continue Craig mentioned, we warehouse XXXX. to consolidation expect options and achieve fiscal sometime strategically can

macro on top business manage actively continue and our to line and our Overall, profitably to prospects as while We're driving capture optimistic position next quarter. our share long-term as as progress look cost to ever updating growth, the structure you will environment our improves. market about we forward

that, open line Cindy? up would With the like questions. for I to

Lenox question comes first Our Financial from of Doug Services. Ruth

Congratulations higher the gross improved and revenue on the margin.

Thank you, Doug.

warehouse wanted X/XX/XX. And narrow down where the first. the status you might by you you to some Could had of you told ask us to I the be us to from are? that about X you previously questions X able thought to X And maybe tell then choices

any on that? curious, update kind of Just

Christmas currently a hopefully, locations at And We're by hopefully the X, it going visits the we're least some to go have -- We're at holidays that's before year. down think probability. X we'll well, I still the holiday. the to that end site do considering. fiscal of before narrowed

Manhattan Toy. Okay. had sounds And questions positive. then That some I about

going? is the in you And You sell-through been products have some and noted that how any that's at Walmart. there about of feedback the

Yes.

kind have Walmart the what Toy their products of and or some Manhattan we So stores. better their better of considers area

well. And is doing so the far, sell-through

products and well. they're think doing very are I popular the

the then the previously, about had -- that improve and us And Toy trying Okay. Manhattan to margins told has working? how you been

as got other have because product hard to already warehouse, the we're it's improved if bit you and in little the some as do It and we're that. But developing we're profitability. definitely new something products improving. pricing, They're a you've already doing time manufacturers for new getting takes or placed switching of products

job new with website? wonderful I is a that. I then on the thought the feedback company really any it great. Toy And did there Manhattan that thought looked

that bit more comes do product. for little a looking somebody we when our think flows good. website engagement Thank you. very It Yes. We to and have it's better, we think

to Okay. there And your Toys then some the any in the distributor that? Is distribute Europe of -- Toy on Manhattan progress Europe. what about using in Sassy

Yes.

had we in booth together in September. so in both the Germany And lines same

so through we're some those progress distributors. Toy getting making products on already the Manhattan sold And

And Wow, the what then to toys Manhattan team? doing -- very product your was with there Toy. development with good. the about encouraged for what You very developing new seem team be

Yes.

teams. utilizing kind Toy the so and And we're Sassy crossing of Manhattan

the we working some they're of that all we're products good So new products, think very on being developed. getting and

Bluey, and there PAW the Boom. some doing another? a any quite that us Can seems Okay. Patrol. Ms give Then to We -- bit X have CoComelon, one Baby Rachel Is licenses, to feedback? these you shifting than you the be better have

well. clearly, Bluey doing licenses most of I around So all the of popular is right now. the licenses mean, one are

but started So had we has acquisition, it's Rachel on in did That popular. fire. the just coming think looks Ms after of and really product is good it I extremely prospects. lot a

for Ms product the is Rachel? What

and toddler type thing. It's blankets, the sets that pillows, little A of squishy some bedding. bedding

Yes.

that the continued was you did or folks So developing consumer and that. brands with of not have have it happened? what Is process in on that now the

in, already but Correct. started may order. just on I it It yet. was coming shelves hit it any mean had not have

now. shipping we should so be And that

bit business? can then bags a that about what's little with talk the diaper you happening And and specifically

of in were area. Jersey New for [indiscernible] them is bags permanent and We new a of process to team the office. in residing little in group's retained design diaper moving carved in the us. offices still are So a They kind out

acquisition. growing heavily the came so and that team little on a shrunk had focusing to acquisition, with the that prior we're line. It And product bit

want so put focus to that it. a interested has It's on always lot And we category of a us.

we lot a there's opportunity And there. so think of

what doing pleased for people the there of and with And they're company? are efforts you the the

Yes, absolutely.

us with Okay. you would And told that be expand there an that? any thought business. previously to then there Legoland, update you that Is opportunity that

Yes.

summer only so starts the 'XX. some number mean, product, And XXXX. the in sell of we are are in should They we've open that also not that believe looking but I to, of products sometime it new to expanded Legoland, forward we building I parks our

about questions. any on business? more X Is direct-to-consumer got I that? the Okay. How update there

Yes.

running, furiously working then And we're running website Babies up go. and selling to before NoJo's holidays. so and Sassy to up we're and get And ready direct-to-consumer hoping to fast and have the

then of comment And sort Could last for about additional talking offer was you're the that process last comments your thing XXXX? any was strategic what Okay. does you the there?

because I just not our any no, I We're now. that wouldn't the mean, already really, acquisitions, it if do but along right and That wouldn't mean we've not came what something being to additional we done. focus now need possibly focusing we take at couldn't integrating say said, we cost heavily we're it to that's the absorb warehouse. on acquisitions looking the control, right time really mean

of question Pinnacle. John comes from next Our Deysher

of million in you couple you Solid be you you X One, do quarter. the months, a sales year? I expect that about way? sales expected bought owned it questions. I in but that to you still Baby just know Are Boom, $XX press million. only you've tracking it when for had release said per still $XX

more have good a X that's That's happen of won't months. in an run fiscal think because we'll XXXX annual I I rate. them only estimate. mean it

Okay, I see.

should to Is on looks run acquisition we about think there. marketing forward? that was about that? if like And it Or and take we You're it going still use reasonable the how sales. costs, of the rate out confident administration, XX% a

I onetime. there the cost, I that acquisition nothing mean there if else take number. mean was it's probably in bad a you out not was

Okay.

we the good. real to terms So That's sales, where XX% that's estate just understand of -- with And in are reasonable. consolidation. make I sure then

have idea what we by that like? quarter year, better as call suggesting next You're looks footprint we'll the the to have the time fourth a

Yes.

a that's I likely think option.

Dennis from question Scannell next Rutabaga The of Capital. comes

a just So of for things me. couple quick

Boom $X.X sales. in contributed Baby million So

XX% growth. So of your that's sales about up

less So I sales core than XX%, around a XX%. little legacy guess, down

legacy retail much how versus about that that customers in-source products? of bib decided So just one program of to your was kind of that

That was about $XXX,XXX.

Okay.

decline? a note all. of optimism destocking hear with either Anything confidence. the losing anything of of on So you of that space, rate in going definitely turn and particular in a shelf portion consumer anything in that sales else about terms but say or sales nature? I perhaps can else it, customers decline, But decreases the the not

board. product It's really the bibs, others than retailers weak space. right the any of other it But part, and lines. -- just one that there was across major almost kind the It's we across the than board we're subsidiaries worse lost the for is that board is and across seeing now. Other the board most retailer across point-of-sale shelf haven't and

Yes.

Okay. quick thing. other One

exactly can new -- much come you the on a all least of particularly that administration little campaign it's going With of the talk you tell change lot product looking about in your early tariffs, talk high what how in little there tariffs But administration, trail, will kind you're a to a strategy, at early doing. -- sourcing again, and China the to forward? about be how bit of China. Are your at does was from

countries move off on the And some of they you X X product end everything the at it China. Almost to much and are hand China. -- infrastructure at it The from to very costs your the gets give day, still going costing so We've that better. handed we've later. off It's and say is other they're We some go far comes weeks better. and day coming been products. But countries. better is from tried looked to it

said, tariffs at can't just that being So the That look places other ready, -- pass to viable. there countries be option. continue are and case is it's along become just we more higher we China other in still and better

is in your here And Or some like Yes. not Mexico Right. are right? that it's the manufacturing competitors there or competitors access? anywhere something naively, sourcing U.S. just other or differently,

in any I Mexico. we the explored is there's very it mean If have little. U.S.,

there. doing bit Mexico think there's just the day, the of because we end At it's our and anything haven't better some pulled competitors moved in probably I of trigger a China. to the still little

back like Olivia over I conference Elliott for remarks. session. would to any question-and-answer our turn to the concludes closing This

for your you in continued company. interest our Thank

Advisors' Part with speaking again to Dallas Three XX, third look the results Investor forward on Conference Thank February. in in and quarter in we participating we report IDEAS be will We November you. our when you

Thank you presentation. concluded. The now conference today's attending for has

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