YEAR ENDED DECEMBER 31,
(in thousands, except per share data)
2021
2020
2019
NET SALES
$862,924
$769,169
$734,902
ADJUSTED EBITDA(1)
NET INCOME (LOSS)
ADJUSTED NET INCOME (2)
DILUTED INCOME (LOSS)
PER COMMON SHARE
ADJUSTED DILUTED INCOME
PER COMMON SHARE (2)
95,117
20,801
36,795
$0.94
$1.67
77,326
(3,007)
20,203
$(0.14)
64,064
(44,415)
9,179
$(2.16)
$0.95
$0.44
AREAS WHICH CONTINUE TO DRIVE
GROWTH HAVE BEEN OUR ABILITY
TO ADD NEW PRODUCTS, GROW
INTO ADJACENT CATEGORIES,
AND EXPAND OUR TRUSTED,
CONSUMER FAVORED BRANDS.
/ 02 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
Adjusted EBITDA of
$95.1
Asia Pacific
presence grew
47.5%
2021 SHAREHOLDER LETTER
Dear Fellow Shareholders:
2021 was a banner year at Lifetime Brands. We demonstrated our remarkable resiliency and
ability to effectively manage through a number of macroeconomic challenges. Through it all,
we delivered great products for our customers, more opportunities for our employees and
record results for our shareholders.
Our ability to execute enabled us to generate adjusted EBITDA¹ of $95.1 million, which
represents an increase of 23% compared to the prior year. In the face of supply chain
disruptions and inflation pressures, we outperformed on net sales and EBITDA compared
to 2020, and our full-year financial performance achieved record levels. At the same time, we
maintained our commitment to invest in our long-term success as evidenced by several publicly
disclosed initiatives. Our impressive results reflect the progress we have made in implementing
our transformative strategy – Lifetime 2.0, which we completed in early 2021. Our next
five-year strategy – Lifetime 3.0 – seeks to continue executing on our many growth initiatives,
while managing costs prudently, as we extend and build upon our leading positions in the
marketplace and capitalize on the substantial capacity we have created on our balance
sheet to pursue new value added growth opportunities.
A RECORD YEAR FOR LIFETIME
Throughout 2021, we saw continued strong demand across the majority of our product
categories, resulting in robust earnings and cash generation and continued market share
gains. The launch of Drew Barrymore’s Beautiful housewares line at Walmart has been received
enthusiastically, and we believe the line will continue to grow in volume and expand into
additional categories in the years ahead. We also re-launched the Year and Day e-commerce
brand we acquired in 2020, and are pleased with the response to its modern offering of
dinnerware, flatware and glassware that directly targets the tastes and sensibilities of millennial
consumers. Another milestone included our launch of KitchenAid cutlery, which expanded our
product offerings for the well-loved KitchenAid brand and contributed to our success in cutlery,
which reached an all-time high in net sales in 2021. Other brands, such as Taylor, Rabbit and
PlanetBox, also had a banner year in 2021.
Since the transformation that we implemented in 2020, we have seen a dramatic
improvement in our results. We continue to expand our Asia Pacific presence, which grew
47.5% and achieved full-year positive contribution margin in 2021. Major factors contributing
to such success were our sales in Australia and New Zealand, the progress with our
e-commerce business in China, as well as the sustained momentum from our successful
launch in Tmall. We are taking our experience from the Tmall launch and applying it as we
transition even more categories and brands to the Tmall platform. All of these initiatives,
combined with our transformed operational footprint internationally, have resulted in Lifetime
being well-positioned for the future.
We continued to grow our e-commerce sales even as brick and mortar channels came back
relatively stronger in 2021 compared to 2020 as COVID-related restrictions eased. Driven by
strategic investments in process and people, our e-commerce net sales in total have grown by
more than 60% since the start of the pandemic. Over the past year, we also accomplished our
goal of transitioning all of our direct-to-consumer websites to the Shopify platform, which will
1Earnings before interest, tax, depreciation and amortization and other non-cash adjustments (Adjusted EBITDA)
is a non-GAAP financial measure. For a reconciliation of this non-GAAP financial measure to its most directly
comparable measure, net income, see page 42 of the 10-K.
One of our greatest accomplishments in 2021 was
the continued growth and increased profitability of
our international business over the past year
“
“
/ 03 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
provide a uniform back end for our direct-to-consumer
business and create significant operational efficiencies
across the organization.
RESPONDING TO MACROECONOMIC CHALLENGES
Of course, 2021 was also a year of significant macroeconomic
headwinds, which were felt across many industries. Lifetime
has pursued a proactive approach to managing these
headwinds. We took decisive action to effectively mitigate
supply chain and inflationary pressures, but we were not immune
to the disruptions, and Lifetime felt the impact of increased
labor, shipping and material costs, as well as the availability of
adequate shipping containers, vessels and trucks throughout
the year. Our mitigation efforts were focused on driving down
operating costs, increasing prices and investing in inventory
levels, while maximizing the availability of our products,
leveraging our scale, our strong balance sheet and our market
share as competitive advantages. On the labor side, our
continuous improvement model yielded impressive results in
driving labor efficiencies, as evidenced by our warehouse
expense remaining flat as a percentage of net sales,
notwithstanding the meaningful inflationary cost pressures.
Additionally this year, we optimized our distribution center
operations by transitioning from the use of predominantly
temporary labor to more permanent positions, which has
helped us retain talent and keep our operations fully staffed.
These mitigating actions have continued to pay off, and we were
able to effectively manage for macro headwinds and the multiple
obstacles they created in 2021. We expect these pressures to
persist in 2022 and anticipate the normalization of supply chain
costs in 2023. As we have demonstrated since the beginning
of the pandemic, we have been flexible and agile in managing
through these challenges, and we remain confident in our
ability to continue to deliver industry leading results in the
current environment.
WELL POSITIONED FOR CONTINUED GROWTH
I would like to emphasize that despite all the challenges we
faced and our focus on reducing operating costs, 2021 was
also a year of significant investment in growth initiatives. The
impressive performance of our brands and the strength of our
balance sheet enabled us to continue to drive our initiatives
forward without missing a beat, and each of our initiatives are
progressing at a healthy pace. Our commercial food service
business, Mikasa Hospitality, continues to ramp up well. We
have staffed the business with world-class professionals,
and we saw the results in 2021 as we began to win several
significant national accounts. I am incredibly excited about
the potential of Mikasa Hospitality for the front-of-house
food service market, and I am more confident than ever that
this business represents a significant opportunity for Lifetime
over the next few years. We expect this business unit to attain
profitability in 2022.
As mentioned above, our international expansion is progressing
very well. We opened a new distribution center in the
Netherlands in 2022, which will enhance our ability to ship
across Europe and drive greater profitability. Our Asia Pacific
markets are poised for continued success, building on the new
initiatives we have put in place over the last couple of years. We
are proud of what we have accomplished in the turnaround of
our international operations and look forward to future
contributions from this business segment.
In line with our strategic plan, we also expanded into adjacent
categories, including outdoor, pet, and storage and
organization, and will continue to pursue such opportunities.
While we are still in the early stages of establishing these
categories, the results in 2021 were promising. Our product
development engine is working hard to build out these
categories, and we expect incremental net sales contributions
beginning in 2022.
As you can see, it has been quite an eventful year, and I would
like to thank all of our shareholders for your ongoing support of
Lifetime Brands. We are proud of our accomplishments in 2021
and I am proud of how our employees continue to deliver
excellent results and to exceed expectations. We are even
more excited about the opportunities ahead to create significant
value for our shareholders. I look forward to keeping you
updated on our progress.
Robert B. Kay
Chief Executive Officer
/ 04 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
LIFETIME BRANDS IS A LEADING GLOBAL
DESIGNER, DEVELOPER, AND MARKETER
OF HOME CONSUMER PRODUCTS
/ 05 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
Lifetime targets its products and brands to achieve #1
market positions, and holds such positions in Kitchen
Tools & Gadgets*, Cutlery*, Barware Accessories, and Bath
Scales*; and the #2 position across Tabletop categories.
This success comes, in part, from an award-winning in-house
product design and development team, a strong sales
and marketing team, and best-in-class execution and
operational capabilities. Additionally, our 2 million-plus
square feet of warehouse and manufacturing space across
the United States, Europe, China, and Puerto Rico, in
combination with our vast distribution network, all well
established pre-pandemic, set the company in a strong
position to weather potential pitfalls in any economic climate.
This capability has allowed the company to continue to show
solid performance during the global supply chain crisis that
began in 2021 and continues today. Our diversified revenue
sources and stable end markets result in significant cash
flow generation, which continues to provide the company
significant strategic benefits and creates value for our
shareholders. Finally, our ability to reach consumers in
every sector, along with our solid infrastructure, allow us
to efficiently manage our business and grow our market
shares in our respective product categories.
For Lifetime Brands, 2021 was a year of steady investment in
growth, despite the challenging macroeconomic headwinds
we faced. Thanks to the continuing success of our brands, our
strong balance sheet, and excellent financial performance,
we were able to support our long-term growth plans while
delivering profitable growth. This resulted in another record
year of revenues and growth for Lifetime as we reached
$862.9 million in net sales and increased our Adjusted
EBITDA to $95.1 million, which reflects 23% growth over
the prior year.
*The NPD Group / Retail Tracking Service, US dollar sales, 12 months
ending December 2021
LIFETIME BRANDS IS A LEADING GLOBAL
DESIGNER, DEVELOPER, AND MARKETER
OF HOME CONSUMER PRODUCTS
THE COMPANY IS COMPRISED OF MOSTLY OWNED/CONTROLLED BRANDS
AND A MINORITY OF LICENSED AND PRIVATE LABEL CONSUMER BRANDS WITH
TARGETED BRAND EQUITY. OUR CUSTOMER BASE INCLUDES MOST RETAILERS
THAT CARRY HOUSEWARES PRODUCTS.
/ 06 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
“
Ecommerce continues
to grow for Lifetime
even as online sales in
general have declined
for other categories
over the past year
“
STRENGTH IN A CHALLENGING ENVIRONMENT
The Lifetime 2.0 strategy that the company initiated in
2018 has proven to be quite successful in positioning the
company for growth and to effectively manage through
various macroeconomic headwinds that have existed
since 2019. Over these past several years, Lifetime
successfully navigated through a trade war and endured
a global pandemic that paralyzed society and the economy,
which subsequently created a global supply chain crisis
impacting both the availability and price of goods. At the
start of 2021, we faced substantial uncertainty regarding
numerous aspects of the economy.
Despite these significant headwinds, we’ve experienced
impressive performance across divisions, with core brands,
including KitchenAid and Farberware, doubling in sales and
volume over the past five years. Other successes include
our cutlery line of business, which hit an all-time revenue
high in 2021. Other product lines such as Taylor, Rabbit,
and PlanetBox had their most successful year ever in 2021.
Areas which continue to drive growth have been our
ability to add new products, grow into adjacent categories,
and expand our trusted, consumer-favored brands. Some
examples include KitchenAid cutlery, which was a new
brand we launched in 2021 to further our market position
in kitchen knives and cutting boards. We also strengthened
our bakeware business with exciting new offerings from
Chicago Metallic and a new line of KitchenAid
bakeware products.
During this past year, we launched Drew Barrymore’s
Beautiful housewares line at Walmart. We are
enthusiastic about its reception and believe the line
will continue to grow in volume and expand into additional
categories. We also re-launched the Year and Day website
we acquired in 2021, and are pleased with the response
of its modern offering of dishware, flatware, and glassware
that directly targets the tastes and sensibilities of
younger consumers.
Other initiatives in 2021 include new product launches in
the barbecue category, most notably under our Farberware
brand, and in storage and organization, with an innovative
collection of storage containers through our Copco brand.
We also entered into new categories such as pet products,
which contributed to our strong performance. We are still
in the early stages of establishing these categories, but
the initial launches proved successful, and we are
positioned to see more meaningful revenue contributions
starting in 2022.
/ 07 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
At-home and hybrid working has sustained the robust
demand for products across our categories in most
channels, with a strong lift in ecommerce sales. Our
continued investment in ecommerce across pure play,
retailer/omni channel, and company-owned sites
continues to show significant results. In growing
our ecommerce program, we have taken advanced
measures to enhance content so as to further
differentiate our brands and products.
Ecommerce continues to grow for Lifetime even as
online sales in general have declined for other categories
over the past year, as brick and mortar channels regained
some lost market share after having shuttered stores
during COVID-related lockdowns in 2020. Driven
by strategic investments in process and people, our
e-commerce revenues in total have grown by more than
60% since the start of the pandemic, and by more than
70% compared to 2019.
In addition to our pure-play e-commerce growth,
we continue to see very strong shipments with our
omnichannel retailers. Contributing to this growth has
been our ability to consistently execute drop shipments,
which grew approximately 38% in 2021 after having
grown approximately 160% in 2020. With vaccinations
implemented and restrictions lifted, we also saw a
meaningful increase in brick-and-mortar sales as
stores reopened.
In 2021, we increased our investment in Mikasa
Hospitality, our tableware and serveware offering
to the commercial food service industry. We ramped
up sales efforts since the start of the pandemic, gaining
meaningful traction with distributors and customers. We
brought on key talent to bolster sales capabilities and
help us successfully execute on this massive opportunity,
and our investments in the commercial foodservice
business have begun to show results.
We are optimistic about the potential for this front of
house foodservice initiative to complement our leading
position in back of house smallwares. We believe we
will see market share gains in this category in 2022
and beyond as the hospitality industry begins to
flourish again.
/ 08 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
As a result of being proactive in
the face of adversity, Lifetime
has continued to generate
significant free cash flow
“
“
/ 09 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
SUPPLY CHAIN AND
INFLATIONARY ISSUES
& MITIGATING ACTIONS
In 2021, the global supply chain crisis created sizeable
roadblocks to manufacture and transport goods around
the globe. This significantly impacted the availability
of products and affected a corresponding meaningful
increase in the cost of transportation across the ocean
and into domestic markets.
This resulted in Lifetime having limited availability of
containers and an increased freight cost to import
products. The continued issues of unknown container
availability, port delays, and costs of shipping existed
throughout the year, and made supply planning
difficult as well as increased product costs. Adding
to these supply constraints, 2021 showed a noticeable
increase in the inputs to cost of goods, including
commodity prices, labor costs, and other
inflationary pressures.
Lifetime effectively managed these macro headwinds
through a combination of measures: utilizing our strong
balance sheet, active supply chain management, and
passing through price increases. Specifically, these
strategies included a significant investment in inventory,
product cost out initiatives and sourcing strategies to
counteract these higher prices, and longer lead times
to receive goods. This helped sustain us and assured
product availability to our customers and consumers
to meet continued strong end market demand for our
products. Our strategies included the need to raise
selling prices in the second half of fiscal 2021 to aid in
the offset part of these cost inputs.
As a result of being proactive in the face of adversity,
Lifetime has continued to generate significant free cash
flow, enabling us to further deleverage while increasing
our rapid pace of investment in the business and
inventory, as well as funding our strategic
growth initiatives.
/ 10 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
G R O
Increased ecommerce
revenue by more
than 60%
Invested more in Mikasa
Hospitality to increase
penetration in commercial
food service
Expanded our ecommerce
program and team to meet
the growing demand
/ 11 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
W T H
Achieved an increase of
38% in drop shipments
Expanded our
KitchenAid business
with the launch of
KitchenAid Cutlery
Grew our Farberware
offerings to include
a new BBQ line
/ 12 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
/ 13 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
/ 14 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
A warehouse
in the Netherlands
Increased the
number of
in-country
managers
Lifetime’s international
business showed growth
in top line and meaningful
improvement in
bottom line
“
“
/ 15 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
47.5%
APAC growth
INTERNATIONAL
BUSINESS
The transformation of our international business has
been a key strategic initiative of Lifetime, and 2021
gave evidence of the success that has been achieved
on this initiative. Offset by some Brexit-related
impacts as well as the negative end market impacts
from COVID in Europe, Lifetime’s international
business showed growth in top line and meaningful
improvement in bottom line. While still negative,
the improvement in EBITDA contribution from this
business was $8 million compared to prior year, with
the small loss in 2021 being driven by Brexit impacts.
We continue to be on-plan in our international
business and have now implemented additional
steps to offset the previously unknown impacts
from Brexit that we experienced in 2021.
The turnaround plan included an investment in
top talent (6 in-country managers for targeted
geographies, with a plan already in place to
increase the number of managers in 2022) to
target our major geographic markets globally.
Our strategies are showing good progress.
For example, we grew substantially in APAC,
achieving growth of 47.5%.
To offset the impediments to trade created
by Brexit, we began the establishment of a
warehouse in the Netherlands, which will be
live by the Q2 2022. This will benefit us from
both a cost and a revenue perspective. Overall,
the progress of our international strategy was
substantial in 2021, and we view the continued
execution of this strategy to be a meaningful source
of revenue and profit growth in 2022 and beyond.
Lifetime continues to be a consistent and important
leader in our industry. The macroeconomic
challenges of the past couple of years have shown
the strength of our strategy and our company, and
allowed us to accelerate our strategic plan. Our
supply chain is highly dependable, our products and
brands remain in strong demand from consumers
and retailers, and we continue to invest in new
initiatives to provide for future growth and stability.
We have gained meaningful market share in the
majority of our categories over the past several
years, and we continue to capitalize on
these successes and pursue incremental
growth opportunities.
Our progress provides confidence that Lifetime
is past an inflection point, where we achieved a
new level of performance in our core business,
created meaningful value from our international
operations, and positioned the company to capitalize
on continued profitable growth opportunities. We are
enthusiastic about our competitive positioning and
the many opportunities we are pursuing to continue
to grow within and beyond our existing markets.
/ 16 /
LIFETIME BRANDS, INC.
2021 ANNUAL REPORT
Lifetime continues to be a
consistent and important
leader in our industry
“
“