Lakeland Industries (LAKE) 9 Jun 202021 Q1 Earnings call transcript

Good day, ladies and gentlemen, and welcome to the Lakeland Industries First Quarter 2021 Financial Results Conference Call. All lines have been placed in a listen-only mode and the floor will be open for your questions and comments following the presentation.

Before we begin, parties are reminded that statements made during this call can contain forward-looking information within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934.

Forward-looking statements are all statements other than statements of historical facts, which reflect management's expectations regarding future events and operating performance and speak only as of today June 9, 2020.

Forward-looking statements are based on current assumptions and analysis made by the company in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors that believes are appropriate under circumstances. economic to factored of with of are be company. in and and Commission; many subject uncertainties risks the factors, presented are the other in Exchange are conditions; the law pursued beyond the that the general company; to statements you a that which by assumptions, number control and Securities business and These opportunities business the may changes and of company's regulations; filings or statements not those may guarantees these any performance that the actual developments future statements. cautioned or and differ are Listeners are forward-looking projected of results from materially in statements forward-looking in subsequent on entirety its company are attributable All or their persons statements. acting to the cautionary by qualified expressly these behalf for Robertson, Industries Executive At this time, Lakeland's I and would Allen host call, Officer, Chief this like Dillard. Charles Financial your to Officer, Chief Lakeland introduce Mr. Roberson, you may begin.

you Financial to XXXX I'm thank afternoon Chief Lakeland's first Good Dillard. financial for fiscal joined results quarter you. all, conference call. Officer, joining by our and Thank Allen today you

people quarter the have this and there by be by fiscal investments During to propel to Personal fiscal supplier Lakeland leadership our to its position to the first group. the forefront and technology. equipment, results performance, of about first the facilities, that proportion, in of Lakeland our into leadership driven PPE the validate manufacturing a PPE position in conference unprecedented of chain, to systems within personnel, aided global talked relationships and XXXX planning our at for transforming global be our leveraging With supply facilities our expanding information new pandemic Equipment We Challenged necessary believe our with rose advance or no the quarter market. our and call commitment diverse should facilities XXXX occasion Protective our yearend market. we manufacturing question resilient centralized elite we data vision

to glimpse a manufacturing and we materially the could continue and future. financial for in work throughout of with utilize process performance the our our position provide As and first be, performance a improvements as financial develop capabilities what systems result our quarter, expand we our to improved Lakeland,

and pandemic, we for respond systems continuing operating emerging industrial processes, customer to data-centric centralized planning More were importantly, while their We're need. management and our to in we their here to outbreak, adherence abroad. the and and grateful relating demand products expand their COVID-XX and to COVID-XX newly work our to with traditional support $XX and workforce customers to our that industrial record home, necessarily to base. amid team hours, impressive to and associated both sales our nearly COVID-XX global able our users, Globally Leveraging to XXX in in our extended an relief led we demand dedication excess safety at of are Their provided have the new protocols, the increased added increased with for to demand, applications. coworkers, resulting which million. at work COVID-XX quarterly end by from to attributable shortages XX% quarter, fourth willingness but not those the

higher to what While were also added and are record XXX new sectors pharmaceutical were include amid platform, COVID were relating flexible were manufacturing, Several over at orders a These with production and of customers not. unable the the for secure other demand. customers dealing and levels. to own customers. and to Many of manufacturers have prices margin profit defense. for gross we durable new stress we because could our we But to others products flex deliver able factors from built and Gross healthcare increase coronavirus these when in new directly contributed in margin. believe our

manufacturing were manufacturing organic provider, weeks, sales. this own us apparel. to as during we and We around a products margins matter achieve resulting facilities enough, million beyond world. PPE our important supplier first first potential volumes floor shift penetration it in gross the in case contractors, XX built margin. fulfilled we in while benefited we inventory staffing system, our value manufacturing a preceding margin markets, while and of within of emergency also benefited efficiencies, to deploying sales markets. significant management prior on new fourth differentiator inventory not primary our XX elements record demand had outsource sometimes can to fundamental a year, our previous in pandemic owning COVID-XX efficiencies, staffing decision limit branded our capacity gross related Approximately offering core increased our if strategy therefore throughput foreign higher inventory. been reserved include: had a a already when as and manufacturing last our improvement rely say or consolidated output the to the the contributed our contributing ERP say period. lines can't margins do relationships We in middle these pandemic into months extension of days. to a Gross in in and response schedules. from from disruptions and before contractors. and margin protective gross factory heard record are basis scale XXXX, over XX.X%, $X improvement we You've quarter do styles utilization XXXX production the down in previously related of compared enabled percentage not the flexible $X in as of This manufacturing us from not operating year approximately a plant a reached growth increased XX.X% increase due of targets, million with to the Gross extended to fiscal and few quarter our quarter This revenue $XX.X On capacity, only of improved exceed for product period fully in for global of sales. drew to is the require frequently high up of the partially of development that our first of unique quarter Coronavirus anticipation manufacturing added XX.X% In to product orders last year. market to into fiscal manufacturing sales our margin billion the periods. Having The with months the of

as With to inventory mentioned and able post moment we the record demand higher were on levels, I deliver ago. a COVID-related revenues,

above the and fulfilled COVID-related fact, not In sustainable attain normal manufacturing in enabling majority already sales significantly of us a were with products is inventory, orders volume our capacity that quarter-over-quarter. to a

demand greater of in In in decisions variations due larger number new This our experienced turn, We to to in manufacturing SKUs we a or us floor able manufacturing environment, improve our drive to fewer staff we Finally, for runs. and basis the enabled and the by amid as reduced on focused the this products utilization product on tools afforded ERP percentage make quick efficiencies, offering. business incredible our margins were we to incremental system. dollars. quarter factory and intelligence production efficiencies and planning yields gross

increase million fourth up quarter of the of dollars profit fiscal aforementioned, record year a from for from all XXXX. and of XXX% fiscal set $XX.X $X.X $XX.X prior year period at Given quarterly the same the quarter million the in in year, a the XXX% in first gross XXXX, of million

demand manufacturing expansion price heightened demand More encountered we adjusted in continued of relating increases hours day, XX capacity a per day Vietnam to our from anticipation we products, materials in hours normal COVID-XX, disclosed, efforts. those schedule at disposable and previously XX of available level and recently, could prices. per China, manufacturing of schedules of As raw in to a until higher commenced we maximum briefly the significant schedule for confirm

to a operating since have capacity We returned schedule. maximum

now those prices capacity some some reducing deferral last backlogs, our orders. which increased, pass we through July order or Still, August on while products, increases are to customers, expenses, and and quoting led and filling our material gross of manufacturing was for new reported second-half to September raw of Benefiting we capabilities, we August magnified. deliveries speculative for from As leverage to resilient out the year. manufacturing significant sales, effective to higher management margins, operating the accounts elevated of operating continue develop and

in or level profitability minimal each the million than quarter fiscal was record about less to $XX.X in in margin first high $X.X share excess of with XX%, we the our capital of remaining with record to and in million this income quarter With compared operating million, off added cash, year. the Net a and years. to two per as in pre-tax jumped in $X.XX investment, last end balance X% of the paid loss Our our up another prior $X a debt cash. from cash

an prior We than likely entirety building on will seek remain secondary once the QX. believe that world improved uncertain. virus While environment financial stockpiles wave crisis trajectory second situations excellence, the presented always market anticipate outbreak performance for this operational benefit for increase the aftermath perhaps into there replenish sales organic to foreseeable believe around fiscal and will as of our be conditions a future. will COVID-XX have through through global demand, for subsides, our We the The COVID-XX possible and is as timing organic has that materially likely continue financial growth demand are our driven unprecedented the to XXXX. will and continued a impact PPE higher of higher of pandemic in normal government QX, their that strong in governments the that fall. and position. and We attainment share business

from may been released, a surface. government Some year to up agencies already have take RFQs others while to

and supply it travel entertainment countries, prevent up infection, new emergence some to and from cleaning any municipalities, industry, schools, sector will as as finally, reopen other building Additionally, institutional be the segment market sports complexes, engage type seeing private outbreak. of owners of we as private whether are catch states, in a businesses to seek COVID-XX and demand. channels or of the PPE stockpiling believe And also the we

not effects and response an Lakeland. financial an scale, end investors are eliminate among which negative is analyst our quarter to to discloses for at most balance with arrive the company's the not the as such of are operating our and to financial The a and Pandemic channels performance regular developed to normally less resilient COVID-XX industrial base, business, a and growing do diversified normalized supply. unless flexible even through distributor we that or first the priced are they takeaways and tremendous application, my I the PPE, leverage. so, times model provide to and listeners, the power high-quality will of sales distribution thorough platform, user call sheet results. on pass distinguishable global healthcare are are part it an during may customer for for positive That manufacturing ordinary prone for review to remarks. and Lakeland and expanding imperfect to Allen the a concludes from other For and financial exercise more competitively exceptional a of have allocated equates attempt brand

review three for you, months April of the for our ended $XX.X compared first April The XX, following quarter, financial XXXX Thank for a the first the million record the January of results addresses fiscal XXXX, million XX, $XX.X and three Charlie. year. XXXX my XXXX. sales as for to months million last Net ended quarter ended XX, for $XX.X

For the we fiscal approximately our Coronavirus-related sales. approximately our million quarter, 'XX to fourth our best first added $XX can demand revenues have quarter, fourth and million. fiscal quarter $XX.X consecutive XXXX in as $X million exceeded tell,

in of and more or contributions not XXXX, purposes, it sales This of or $XX.X period, $XX.X our and international revenues, U.S. quarter of numbers more first XX% demand balanced the certain of XX% 'XX sales of total in were with 'XX million fiscal for of helpful. or of but million quarter 'XX XX% quarter compares consolidated the total financial total, of U.S. quarter a basis period, or sales I'm the first international be total sales XX% For performance XXXX. where million might million view a quarter fourth were in and $XX.X revenues. $XX.X both COVID fourth first On comparison including our 'XX for with fiscal

from up XXX% in UK doubled sales XX%, were $XXX,XXX, from our major in the $X.X 'XX million quarter first and first sales larger, $X sales standpoint. while significantly the to in increased Canada $XX.X million million sales last international a operations, Mexico year, fiscal million million, million sales Latin very are approximately of $XX.X business revenues were more million Drilling were over down million. $X by XX%. U.S. $X.X up $X.X million, increased $X.X $X.X from remains $X.X from than international America increased Asia our our Among sales 'XX, million While geographic or well-balanced diversification million $X.X to versus or in and in quarter versus from

largest well our groups higher immediate-term Chemical as $X.X or part large focused, $XX.X duration certain performance to Resistant to quarter, traditional the the at look million modestly end our this from disruption $XXX,XXX. benefited government $X as utility our check from XX%. last last Flame the increased our pandemic million more sector in $XX.X were be small diversification. as has annual and product that slightly in is $X.X efforts our down industry were Both growth, or up if which of for still business. purchasing not line, nearly million million industrial we FR as were continue Furthermore, the sales was grew channel suggests our And during Disposables, addressed from demand. and of up some were significant to XX% commentary. quarter in voluntarily But first a to mandate. year. which is certain to nearly shut usage. by million a at High our revenues in just such or about let's XX% or refocused, our $X.X expense $X.X group PPE sector, Gloves product energy $XX.X component to of typically significant The by mix million organic market companies overall COVID-XX products customers, nearly fourth or wear had contribute construction also those newest XXX% which marketed nearly organizations similar products, Now million. year. million product from automotive

So a segment. we're watch keeping close this on

reporting are any not that we in first in Although, meaningful sales the changes quarter. occurred

sales experienced wovens declines As a and result of for we issues, the year-over-year in or aforementioned high-visibility groups. reflective our product

of of chemical groups of pandemic June, including have disposable these in the of product closures and trends wake workplace over and As other certain garments persisted. purchasing the

million points Charlie gross XX.X% from had our I onto quarter was won't points fiscal drove as first for for volume percentage increased Moving period percentage year an gross in related profit comments. XXX% $XX.X improvement, XX a the reviewed the quarter, Gross XX.X% profit substantial we XX quarter fiscal and key same gross drivers of to profit in XXXX million our $XX.X flow. increase from the prior fourth the and of last for of With by million gross year, sales sales XX.X% of substantially first COVID-XX $X.X our contributions of from percentage XXXX those profits, increases demand. margin $X the and million so period leverage margin when net for by the or higher year. and in of cash model repeat operating prior

quarter million XXXX. record reversal which of expenses prior the ended first in fiscal $XX.X operating reduction net a XX, to of period first $X.X first profitable Mexico, months $X.X 'XX. travel $XXX,XXX percentage as major quarter fiscal All operating As OpEx The were loss expenses only from shipping XXXX. major unprofitable higher million decreased fiscal were increased 'XX, for in of relates Operating fourth in reported profit related X.X% XX.X% the was XXXX of operating quarter, in XX.X% X.X% in fourth the revenue. XX.X% first quarter million from to million $X.X in quarter the in XX% increased volumes, expenses commissions and compared XX.X%, in of quarter for months of expenses sales circumstances, 'XX in loss expected of Lakeland the a 'XX. slight the 'XX. 'XX, for quarter as and $X.X to XXXX, period a operating for year in three quarter operation and fourth up the the and primarily but percentage profit year-over-year. 'XX, million sales the other regions shows to in fourth compensation prior fiscal and three fourth April associated first the under April quarter a XX, quarter year ended and XXXX, which was Operating quarter of by a and margins offset higher partially country increase the in in a for

tax for pre-tax tax taxes. increased as 'XX, million was overall On consists taxes of income, compared quarter the income Income expense fiscal of in and federal foreign the expense of to $XXX,XXX higher quarter $X.X state first first fiscal 'XX. the

tax. As we pertaining corporate and yields income a U.S. our reminder, have substantial tax to

foreign the $XX $X.X of fiscal of April are XX, estimated to Lakeland's profits subject at on our million net we loss down approximately However, the operating certain at beginning be to for taxation purposes from million year. XXXX, federal subsidiaries. of is

fiscal and $X.X basic utilizations. shares basic higher or not X,XXX,XXX margin XX, million first year. part the enhanced compared a outstanding a buyback share share, $X.XX a operating was was We had $X.X $X.XX the or the program The in in per the of efficiencies The net 'XX to XXXX. expense that a basic improved loss income stock XXXX. company's any shares April $X.XX quarter in at net $XXX,XXX leverage and repurchase diluted reflect and approved First did million and prior of management quarter per of as company per results July sales factory

reminder we buyback million have still to $XXX,XXX program. and repurchase $X.X have that to-date shares remaining over spent As available a in

reduced quoting world. the by cases. finished in demand. As year, product below of beginning XX, million and levels seam stocking million, now slightly $XX.X XXXX. remained were our sealed to of by through normal cash $XX.X million sale new the had $X.X due into August fiscal of from April orders driven Lakeland September cash XXXX, all up fiscal the the And of goods end many for at from of a and largely equivalents we This Inventories around line deliveries of COVID are warehouses in

efficiencies, $X.X quarter As coronavirus capacity of we and increased million. sales, growth approximately $X.X we growth we free prior the increases $X.X accrued increased are of million our we as million that was COVID-XX flexibility XX, 'XX beginning million, payable no expected customers system. $XX.X its flat contributes organic approximately $X our the by capacity by equity that targets. loan due of Adjusted period, operating 'XX year to $X the the the of increase at The turn from administration. to revolving paying and Accounts have which and our January in current The higher That at for by $XX the the periods at increased compared approximately essentially and at process orders $XX.X of both a flow ERP $XX.X company to company over quarter company as an financial by for has our service million million approximately XXXX, will open CapEx our to The and year be in driven to CapEx million the had in end traditional year were our fiscal to at Assets and stated, were DSOs flat. $XXX.X concludes $X that beyond only days. debt Total year will I what to to The back XXXX. XX expenditures million. outstanding in decreased and the And million quarter as extending the $XXX,XXX million shareholders' the be of fiscal operator from Accounts fiscal no facility. quarter majority credit rollout million to upholds with at XXXX. $XX.X in $X.X steady million my manufacturing XX, our was from cash the XX, Capital of resulted strategic call supports receivable fiscal XXXX, in needed, capital even XXXX, higher continued period. million. April increased the agreement servicing $X.X customers revolving borrowings from during is strategies, remarks. million have sales call commitment will this prior approximately remained required was as is outstanding term believe provide negotiating efficiencies margins first the credit the reduced first from response. enhancement expenses is $XX currently Working April extent fiscal nearly questions. has cash phased on facility greater expenditures year. We long-term new million to off

floor is Instructions] go for [Operator The We'll open Benchmark. now you. Michael first questions. with Thank Legg to your

handle this the nice that. It's to clearly, questions. results pandemic, are guys. to Congratulations, Couple see showing you and well-prepared

First, see talk how If pass going the off your timing you increases with the and that? can materials strategy? to today's And you reported on bit briefly from strength the a you compare talk to is availability you're that plus to of put the quarter longer-term you cash then is XXX%. that, strength that April on seen current increasing kind see running the at you other looks? talk of can just $XX but you during Could price about to strength million of capacity And on little COVID. seeing Thanks. through the now quarter? top Obviously, continuing saw you about last pricing. Could have, about just you such I've pricing you customers, you or question mentioned cash all the how the raw full capacity

welcome coverage Thank Lakeland your initiating your earnings call covering you, Michael. to Lakeland of you first appreciate as a analyst. We and

you. Thank

aboard. Welcome

tried characterize they ship required. strength high. it into people the demand places spiking is, market think the the around So, quickly. I would to didn't by they we're into have the they in to it could the best of quite very that QX, world thought various found not to QX, still People out your and masks, questions, as jumping a that make the they seeing them lot when quality is the chaotic, I demand way quite to that is though characterize QX compared

Raw the bit with has a seeing availability more of available raw materials healthy. some dissipate. little increased So begun demand, pricing, are that though but that that impact well, become on We're supply. still of material demand to has

QX, seeking I We've the that and in that by with been replaced demand potential anticipation to opportunists now regard second fall the has of those now, come some confusion RFQs the even the right that a in times weeks. seeing, departure delivery think the surprisingly in product filling participated available RFQs quite for seen meet in large the are frankly, of stockpile institutions and number the but a to couple it there's last raw of materials quantities materials out wave. before of to we're raw aren't those. And governments and

So quarters, we pushed into material see because being there not the that demand now. out is subsequent supply raw just simply right

think that So, of care first question. I your takes

do as much As as how we capacity, to far first we can and our obviously can, answer acquire using the my to of to we cash as as efficiently to rapidly as add. are more seeking question, because that

for somewhat we adding is a sellers limited sites so methods as working problem problematic new And because trained are we're getting to or because We bringing And the develop that the travel hindered of was capacity, in is speak. around that. application third? online, pandemic, makes that the what

Pricing.

long-term pricing. Just

Right.

strategy -- commoditized. product lower of lines watching we're of part the become Our certain end a unfortunately,

a the until Our to strategy and more moving sales products. lot There's with. efforts expensive service which more and products value to our they're COVID-XX deemphasize are added margin to and higher utilities face and focus our was begin woven products, disposables that fire on up to

currently for good worried utilities letting are and offerings Electric that Unfortunately, dampened were them a pandemic normally two up have in designers. product launched. good we running stipends operational assembled they area the garments. use FR We good have people are as team didn't has to a that their in were and designer, and fortunate actually somewhat that FR product about disposables, putting garments, interest lines. and happen those to they workers semi-annual And in have this year's product more really very spring, last staying sales

our and centralized lines end exporting is So moving right now U.S. because product markets, and product in strategy related those foreign into higher the to they're

run is rate capacity at the capacity. revenue follow-up running just the now, current What a you're on And basis? one on your

Michael, that's want competitive out in I for not to public something put reasons.

demonstrated woven putting I dollar of non-wovens our can capacity he that, we In part business. of think to plus of highly remarks, Allen's grow to it's a that the variable. over terms on In much figure how shift

it's highly So variable.

on Thank a quarter Okay, Congratulations great. you. great continued and success.

Thank you.

next We'll at Fuhrman to Craig-Hallum. Alex go

love that lately you for congratulations very customers product Thank really ask you a about I'd strong on been question. to as And think here of you've new result much quarter. a the tremendously shortages in gaining taking my combating stemming from picking involved customers aren't of like the that directly necessarily COVID. a pandemic. things, It on lot customers both of you're as side up well healthcare as that sounds the

categories do picked So flu. likelihood or business and to of these coming after we'd a users up continue how is picked love of a the will these strong think Ebola coming Lakeland you what use I a over products and end end remember that to kind that still just get next beyond? a end fall know, I of XXXX there then year you think that of two, bird lot you've And to determination you're and lot the like that, you sort new users sense users of these ahead up in? then as in

you some conversations Just with customers pandemic? you've how of future be after curious if these had are them in new and the likely supplying the to

able get two And in we and comments accounts their to basically that accounts meet And customers very business. we new product their Their and have would the to demand. Industrial, fall suppliers regular were that to sticky. to took These are we've them because know have not it, advantage for us tried were long into that come wanted which accounts our the Alex, we did that time. to a continue to them. discussed for it sell we've source the We traditional our are in of service categories. a years. we're largely service about seeing and accounts be in service selective that we we inventory only ability tried to thought for

the that at no for to supplier will going to keep through open. least, business, have which largest we they're of mean, were will previous We customers longer we're be very to them to supplier, sole the going of be again. try that they exclusive there their all certainly caught to whether with, talked this But that. keep their stated the they're to we're going they we've and not door Now taking in pandemic the do

is disposables. had the On clean products, business They into the accelerating products suppliers. through much facilities. the the side of you're business them. pharmaceutical through our it had going of to model, as all end to certain part going so the are supply replacing into such is goes they our product we multiple of that are Once other That they with competitors' keep significant problems higher room acceptance pandemic. and this which And actually turn of accepted, it, new of healthcare isn't

they've But And to team, that that may some lot stick out that to pleased with goes highly picked. people going I selective to for it is think do we So, time a reasons certainly as think won't. at who taken I'm got been what in choices. give our of sales as think all future And I've we leave. they I have whatever their the

inventory about then ask and much just we're your And down. I lot Great. too that helpful. I if position. you. that That's really XXXX a had know you inventory working Thank could for of

in be up able you're company expect the we year? has amount have Is Should levels years. of about sufficient that to the see a inventory had seeing service level to over now demand here? to of the your the course inventory that You back three lowest build the

And of last is. goods. as talking want I for was about not to years to very Previously, the to we're we couple frankly, it control. finished look inventory we're where to the in to materials was in they problematic raw you because inventory. have think the think that in is increase that high That's expand current all. to willingly. operating where at where leverage. product If concern, to that as we inventory facilities the were going carry raw materials. inventory, to at actually inventory quite materials. time manufacturing regard inventory it, open don't our to back our materials carry manufacturing is In maximizes seeking we this, much close somewhere not the our our finished where fortunately, depletion are and our more occurred. in we've with also People brought else another that beyond see facility sales, of finished like up garments have levels that world our a are raw raw justify It inventory us that financial if want will that that goods add is We And, to going we a

you're the get you Well, doing very terrific. up back to And and That's economy everything thanks for running. thank much.

you, Alex. Thank

Sweeney now take at our next question Gerry We'll Capital. Roth from

Hey, good my afternoon, great Charlie a and Allen. Thanks and for on call quarter. taking congratulations

Thank you.

Just customers. about want the talk to new

side, on to a revenue mean, the -- in degree, know some I this on it's XXX trying Just any not of industrial XX% just you bracket could side. is understand take on side? they industrial to on pharma there to increase exactly revenue? easy or customers XXX growth the additional little not of much these can can But… potential sort are about, question. way it I think bit a but an I you count there but Is customer XX% any a benchmark way numbers, saw just how create is you XX%,

COVID-XX, obtain our maximum and capacity Yes. the manufacturing their exceed that I service in manufacturing I previous that. to to we as service we have put to use ourselves our new have we category we're do take knowingly just say deliver, right? this, and suppliers, exceed do customers, where the same best loath tried from capacity to at our to because not tried not it like will customers, new way guess inventory, is say So, to that we the we we largely

makes It Got it. sense.

Okay. that's a few I guess trying I'm out, helpful. moving I And figure parts. just then quarter, there's in a think to

have So revenue, maybe $XX.X $X million in million from $X side. almost we was inventory million about of change, the

utilization higher? XX be… So full out what for that be that we out quarter figure of million. the sort If for utilization that hour utilization necessarily of at to running to full But would could to takes been I'm were little million, trying bit you revenue you down just us full for a like $XX quarter. have full running $XX weren't

covered in of some You're of it because Allen components speak, the his growth. I'll the he missing let comments.

where to push to because into volume normal. reduced basis that reducing point, price the And with was China, during with on things the SKU a for the some That’s your able raw Charlie's to back we we in number didn't we a really orders Yes. increases and demand sales on by the more the overhang in of yes, We have did hours that ourselves throughput to saw as Vietnam period through expensive quarter a price facility, one the math without backend very on And the the and us, the want factored the an operating issue Gerry, significant. were was big just we And the operations. to of That very the of Charlie's SKUs. helped -- other material the that. the of comments was demonstrated were but we quarter, reduction. side goods, material increases put point, to

your same the that internally. is It's good. So, used math we've math

I So as be gauge kind use might or a capacity rough you model full generally. at think where could we of plus minus max to

we're level. yet. to not Gerry, would At And that. pandemic reduced some add I to point, SKUs We've the that, there a

Yes.

not Because to new At going we them. that we customers. with that will that's be, going hope before augment it's and to we because that SKUs gradually some our we no But to be out, add the capacity kicked to normal, And like it's a though back really, all start we was additional it do point need pandemic. to able be some will it as return the of capacity. to be so means of by what

don't we So, decline. any have

to your you're employ To one travel to the associated we're to and we and To as to Over was in carefully allowed Charlie's but quarter present CapEx that going around part the be capacity what going actually capacity we manage did limitations to accelerate. going to as back themselves, ahead expansion. point, first with have we that that spending of question will are expansion. of And full investment much Michael's continue see half of questions. that speed

And Right we had we depends a been it demand, But put materials the that. facility, not of just one nailed raw now, It in much tremendous wouldn't pen event and raw to everything start wave. take second we're else. new it far, materials a have a it up to started able raw for to And get ceiling wouldn’t hate in new I'd all a a again. on as consideration to if on but we ceiling a But take where terms and it we've against needed. facility, had for start so materials. the

Got it here.

Okay.

be in. one me other again. Thanks, may question. I Congrats had the follow-up check offline appreciate But But question think guys. it Let I'll with other I see to it. -- I

you, Thank Gerry.

Thank you, Gerry.

And for we that turn is today. additional Mr. any all comments. I'd the time to like conference back have the closing questions for Roberson to or

Thank on conference you. financial And call. results first quarter Lakeland's we appreciate your XXXX fiscal participation

on you well-positioned us for to player XXXX, we And joining and growing conference As call. your we in more today's fiscal look globally for recognized of leading industry. time, a continue be goodbye. Thank again as ahead to PPE the balance the

thank gentlemen and call. conclude that today's participation. Ladies for your you will We

have great may You day. a And time. at disconnect this