Good day, ladies and gentlemen, and welcome to the Third Quarter 2014 Lifetime Brands Earnings Conference Call. My name is Katina, and I'll be your coordinator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. I would now like to turn the presentation over to your host for today's call, Ms. Harriet Fried of LHA. Please proceed.

Good morning, everyone, and thank you for joining Lifetime Brands Third Quarter 2014 Conference Call. With us today from management are: Jeff Siegel, Chairman 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 me made in 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 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 volatilities for certain commodities, the effect of competition on the company’s market 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. Including 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. Please go ahead, Jeff.

Thanks, Harriet, and good morning, everyone, and thank you for joining us to go over our third quarter 2014 results. As I mentioned on our last call, we've been making significant investments this year to expand our business aggressively on a global basis. The importance of this focus on acquisitions and international expansion benefited us in the third quarter when we were able to post record sales and EBITDA despite the difficult retail environment that continues to prevail in the U.S. For the quarter, net sales rose by $20 million or 14% to a record of $162 million. The acquisition we made in the first half of 2014, Kitchen Craft, Built and La Cafetière, generated almost $21 million of sales. As you recall, our acquisition of Kitchen Craft in mid-January was designed to expand our existing U.K. housewares assortment and to make us a more effective global resource for retailers. Our acquisition of Built in March provided us with exciting new product classification to sell to upscale retailers worldwide, and our acquisition of La Cafetière, also just 6 months ago, expanded our reach into a wide range of products for coffee and tea. We expect to see significant sales growth in both Built and La Cafetière starting 2015. We are pleased with the way all of these businesses are performing and the contributions they will be making to Lifetime's product platform, sales and profitability. In addition, higher sales at our U.K.-based Creative Tops and sales to Walmart, China, whose 400 stores we started supplying in the second quarter, contributed to our revenue gain in the third quarter. We now have several truly global brands, including Farberware, Sabatier, Mikasa, Savora, Fred & Friends, Built and La Cafetière that are available today at retailers in over 100 countries in which we do…

Thanks, Jeff. As we reported earlier this morning, the net loss for the third quarter of 2014 was $1.6 million or $0.12 per diluted share as compared to a profit of $1.1 million or $0.08 per diluted share in the 2013 period. Adjusted net income for the quarter was $5.7 million or $0.41 as compared to adjusted net income of $6.1 million or $0.47 in 2013. The table, which reconciles this non-GAAP measure to reported results was included in this morning's release. Income from operations before intangible asset impairment and restructuring expenses was $11.8 million in both the 2014 and 2013 periods. Consolidated EBITDA, a non-GAAP measure, does reconcile us to our GAAP results in the release, with $16.5 million for the current quarter and $15.1 million for period of 2013, and consolidated EBITDA for trailing 4 quarters in the 2014 period was $42.6 million compared to $40.3 million in the 2013 period. For our U.S. wholesale segment, net sales in the 2014 quarter decreased 2.2% to $125.3 million. The decrease was due to lower sales to warehouse clubs for Kitchenware and pantryware products, partially offset by higher sales of tableware products to the clubs. In addition, there was a decline in sales of home decor products. The quarter also reflects the inclusion of Built, which was acquired in March of this year. The U.S. Wholesale segment gross margin was 34.9% in the '14 quarter compared to 35.5% in the 2013 quarter. The decrease reflects an increase in the proportion of tableware products sales and an increase in promotional activities to support the introduction of new brands and products. U.S. wholesale distribution expense as a percentage of sales shipped from our U.S. warehouses was approximately 8.8% in the 2014 quarter and 8.2% in the third quarter of 2013. This increase…

[Operator Instructions] Your first question comes from the line of Laura Champine representing Canaccord.

Larry, just a clarification. On the SG&A expense guidance, did you say it's 50 basis points expected to increase on the rate?

Correct.

Okay. Can you comment, so inventories were up substantially more than sales. Of that, I think it was a 28% increase. How much of that was due to slower sales than you had expected? And how much of it was a purposeful inventory build?

Very little is due to slower sales, because we do manage our inventory very carefully, but there was -- I would say no more than about $2 million was due to slower sales, which will correct itself, certainly, within the next quarter. A large part of it, that we brought goods in early in anticipation of issues on the West Coast with the docks. I don't know if you've been reading what's been going on there, but there's been a tremendous slowdown in getting things out of the ports on the West Coast. We anticipated that in July and advanced shipments in order to compensate for that.

And Laura, also, that $24 million, if you're looking at it versus September last year, your comparable period, $24 million of it is from acquisitions and small pieces, with Walmart China but it's basically Kitchen Craft, La Cafetière.

Got it. And then on the -- you called out distribution expense, and said that the rate would increase this year. And, of course, this quarter and last quarter, distribution expenses have been growing faster than sales. Can you attribute that for us, and let us know when it gets back in line with sales, in your view?

Yes, I mean -- if by, well, pretty close to the end -- it's going to be up modestly. Because it's a large component of fixed cost in our warehouse. So low organic growth is -- it's hard to overcome by cutting expenses. But if we grow at the 3% to 4% or more that we've talked about in the past, it'll certainly be in line. In fact, at 5%, it should improve.

[Operator Instructions] Your next question comes from the line of Frank Camma representing Sidoti. Frank A. Camma - Sidoti & Company, Inc.: Just real quickly. Having trouble tying up to the $0.41 here. On the last page of the press release, you're backing -- you're adding back the intangible asset impairment of $2 million. But on the income statement, it's $3.3 million. So I was just wondering, is that after tax? Is that...

Yes, all the numbers in the table are after net of tax. Frank A. Camma - Sidoti & Company, Inc.: Okay, all right. That makes sense. And did have a follow-up to the fourth quarter here, on what you had -- I was writing it down, but I don't think I caught it. On the gross margin side, what -- the commentary you made on that?

Yes, so I said that we expect gross margins to be approximately 36.5% versus what we have last year of 37.2%. And basically, the reasons that I had cited, the third quarter. That the tableware is growing faster than kitchenware, which is, table, as you know, is a lower margin business. And then some activity because all the activity we talked about, new brands, new licenses we have. We've done some -- or described it, rightly described it as promotional to get placed with built-in products. Frank A. Camma - Sidoti & Company, Inc.: Okay. And I guess, the other question I wanted to ask kind of ties into the inventory question here, but are you seeing retailers, other companies that follow, the categories are clearly, the retailers are paring back on inventory levels. Are you feeling that as well?

Let me answer that. To a small degree. It seemed -- they seem to go in spurts. Some of them, in one of the larger -- largest retailers that we deal with, for about 2 weeks was very slow in placing orders, and then they opened up. I think in general, retailers are very cautious on inventory, and that goes in, not only our classifications, in all classifications. They're being very cautious, bringing in goods much closer to need and watching sellthroughs. I think there are some issues that, from what we perceive with -- there are some issues that we see in retailers in -- in the shift of business to Internet sales, all the brick-and-mortar retailers, as you know, also have Internet sites that are growing at a much more rapid rate than the brick-and-mortar stores. As the business shifts rapidly towards the Internet, which it is, I think they're having a little more difficulty understanding their inventory needs in brick-and-mortar versus Internet. Frank A. Camma - Sidoti & Company, Inc.: And a last question, it's just on the -- now that you have the growing international component, is there -- are you at much riskier on FX in the final quarter of the year?

Well, of course, there's always translation -- reporting translation, but on the FX, yes, there's exposure. Kitchen Craft has a hedging program to address that. La Cafetière's quite small, but that -- well, La Cafetière isn't really holding, it in Creative Tops. So just as a business with that as international operations, especially where we do business, because everybody pays Chinese vendors in dollars, whether they be in the U.S, Brazil, or Canada or the U.K. So yes, they do have a hedging program to address that.

With no further questions at this time, I would now like to turn the call back to Mr. Jeff Siegel for closing remarks.

Well thank you, all, for joining us on the call, and we look forward to our next call when we review the full year's performance and discuss our initiatives for 2015. Thank you.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.