Good day, ladies and gentlemen, and welcome to the First Quarter 2012 Lifetime Brands Earnings Conference Call. My name is Brian, and I will be the operator of today's call. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. And now, I'd like to turn the call over to your host for today's call, Ms. Harriet Fried of LHA. Please proceed, ma'am.

Good morning, everyone, and thank you for joining Lifetime Brands' conference call. With us today from management are Jeff Siegel, Chairman, President and Chief Executive Officer; and Larry Winoker, Senior Vice President and Chief Financial Officer. Before we begin, I'll read the Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. The statements that are about to be made on this conference call that are not historical facts are forward-looking statements and involve risks and uncertainties, including the company's ability to comply with the requirements of its credit agreements, the availability of funding under those credit agreements, the company’s ability to maintain adequate liquidity and financing sources and an appropriate level of debt, changes in general economic conditions which could affect customer payment practices or consumer spending, changes in demand for the company's products, shortages of and price volatility for certain commodities, the effect of competition on the company's markets and other risks detailed in Lifetime's filings with the Securities and Exchange Commission. The company undertakes no obligation to update these forward-looking statements. The company's earnings release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. Included in this morning's release is a reconciliation of these non-GAAP financial measures to the comparable financial measures calculated in accordance with GAAP. With that introduction, I'd like to turn the call over to Mr. Siegel. Go ahead please, Jeff.

Thanks, Harriet, and good morning, everyone. With me today on the call is Larry Winoker, our CFO. Hopefully, you will -- you've all had the chance to review the earnings announcement we issued this morning. Lifetime is clearly off to a good start for the year, with an 18.7% increase in net sales, a 6.4% increase in organic net sales, a 70 basis point increase in gross margin and a net income of $1.3 million or $0.11 per diluted share. In fact, this is Lifetime's best first quarter bottom line performance since the year 2000. The results we've generated to date in fiscal 2012 have been very encouraging. Looking first at our core U.S. wholesale businesses, Kitchenware and Tabletop, together, these recorded an 11.1% increase in net sales all of which was organic. The real standout was Kitchenware, where net sales grew almost 27%. The increase in this product category was primarily attributable to successful new programs launched during the period. Those of you who listened to our fourth quarter call in March may remember that I mentioned that some of our retailer partners had shifted some new product launches to 2012, so they could better manage their year-end inventories. The launches of these Kitchen Tool & Gadget programs did indeed begin in the first quarter and we were -- and they were the principal driver of our growth. These market share gains should provide for additional Kitchenware business for at least the next year. I'd also like to note that the -- if these rollouts occurred in the fourth quarter, we would have had the benefit of reorder activity in the first quarter. So not all of business have moved. At the recently concluded International Home + Housewares Show in Chicago, we showed several new lines that were enthusiastically…

Thanks, Jeff. As we reported earlier this morning, net income for the first quarter of 2012 was $1.3 million or $0.11 per diluted share as compared to a loss of $900,000 or $0.08 per diluted share in the 2011 period. Income from operations was $3.2 million for the quarter as compared to a loss of $23,000 for the corresponding period in 2011. Consolidated EBITDA, a non-GAAP measure that is defined and reconciled to net income in our earnings release was $6.2 million for the first quarter, and $2.7 million for the 2011 period. Consolidated EBITDA for the trailing 4 quarters ended in the 2012 period was $41.6 million versus $39.9 million for the same period last year. For our wholesale segment, net sales for the current quarter increased 21.7% to $103.3 million. The increase is primarily attributable to very successful new Kitchenware programs during the period and sales of Creative Tops in our U.K. business. These increases more than offset the declines in our Tabletop and home solutions product categories. The decline in Tabletop reflects the absence of onetime sales in 2011 from excess sterling silver finished goods inventory and also a major dinnerware rollout. For home solutions, the decline reflects continued category weakness. Wholesale segment gross margin was 35.4% in the 2012 quarter compared to 34% for the corresponding 2011 period. This increase reflects the absence of the low-margin excess sterling silver finished goods I've noted and changes in product mix. Wholesale distribution expense as a percentage of sales, shipped from the company's warehouses was approximately 9.8% in the 2012 quarter versus 10.9% last year. This significant improvement reflects the benefit of an increase in warehouse shipments, which is supported by a largely fixed cost base, as well as improved direct labor management and lower facility expenses, including the…

[Operator Instructions] And your first question comes from the line of Lee Giordano from Imperial Capital.

Can you talk a little more about the shift in Q1 from Q4 on those launches? How much of that, if you can quantify it, how much of that was impacted from that shift?

It wasn't a great amount. There's a few million dollars that did shift that we expected to originally ship in 2011. But it's hard to quantify the difference because we didn't get the -- we would've gotten the reorders in the first quarter of 2012. So it's not a very big difference. I would say net difference is probably $1 million.

Okay. And then on Savora, the new line, what are the margins on that type of product? Are they higher than your -- the current product lines?

Yes, slightly. They are slightly higher. It's a very different thing for Lifetime. It's a much, much higher-end product. It's been very, very well-received by the people that we want to sell it to. It opens a new world for us. There would be no cannibalization at all because it's a different -- completely different price points than we normally do business at. And we are very, very enthusiastic about this. We spent a lot of money last year in developing this line and a lot of research was done to develop the line.

Sounds great. And then lastly, on the Tabletop category, can you give us an update on what's happening with reactive glaze? Is this still a key trend for you and will it be a key component of sales in 2012?

Yes, it still is. The pans that we introduced in 2011 are still selling very well. Reactive glaze has not shown that it's slowing down. At some point it will, and other things will replace it because that's the nature of the Tabletop business, and we're certainly working on the replacements ourselves when it does slowdown, but to date, it really hasn't slowed down very much. It's just about the same.

And your next question comes from the line of Gary Giblen of Aegis Capital.

One quick question and one industry question. So Larry, it sounds like the tax rate of 38% to 39% would be applicable for the year because it just reflects your blended rate on your jurisdictions now.

Yes, that's the blended rate obviously. If the blend of profit shifts, that would shift. But it is lower than it has been because of more profits coming from outside the U.S.

Right, okay. And then, I mean, you answered so many company-specific questions in the, I guess, the presentation, but in terms of the consumer environment and the retailer open to buy kind of environment, would you say it's getting better or just flat or what's the environment out there?

I think it's getting slightly better. Everyone's seen the results from retailers in the first few months of the year. The results were stronger in the ready-to-wear areas and not as strong in the home areas, but it's certainly as you can see it didn't affect our results. Overall, we find great enthusiasm at the retail level, inventories are not high at all at retail. So we expect things to be on a normalized basis, but I don't see anything going -- heading really upwards in any major way either though. I really don't.

And are results, I mean, are your sales results kind of -- or the store's results consistent month by month or is it kind of choppy in terms of consumer takeaway?

It's been fairly consistent. It hasn't been choppy at all. I mean, normally, the first quarter of the year for us is normally more rollouts of new things. Rollouts occur in the first and third quarter, second quarter has not rollouts. Second quarter is reorder business. So it's a -- but we think, we see things being fairly normalized right now, and they have been for some time. We see -- I think the reason we're doing well frankly is market share gains. It's not that the retail is increasing, frankly.

Yes, I understand. But at least you're not fighting terrific headwinds like a year ago or something.

No. No. Not at all. We're not seeing anything on the negative basis. No.

[Operator Instructions] And gentlemen it appears there are no other questions in the queue at this time.

Okay, thank you. I guess we answered the questions. Thanks for joining the call today. As you can see, Lifetime's off to a solid start in 2012. While we're cautious about the economic uncertainties that exist in the global economy, we will be working hard to maintain our momentum. I hope you join us for an update when the second quarter results are in. Thank you.

Ladies and gentlemen, that concludes today's conference call. You may now disconnect your lines and have a nice day.