EX-99.1 2 v137038_ex99-1.htm Unassociated Document

EXHIBIT 99.1                  

FOR IMMEDIATE RELEASE
CONTACT:  Edward Nebb
 
Comm-Counsellors, LLC
 
203-972-8350
 
enebb@optonline.net

LAZARE KAPLAN INTERNATIONAL INC.
SECOND QUARTER FISCAL 2009 RESULTS

NEW YORK, N.Y. – January 13, 2009 – Lazare Kaplan International Inc. (AMEX: LKI) today announced financial results for the second fiscal quarter of fiscal 2009 ended November 30, 2008.

Net sales for the three and six months ended November 30, 2008 were $41.3 million and $119.6 million, respectively, as compared to $90.5 million and $193.1 million for the prior year periods.

Polished diamond revenue for the three and six months ended November 30, 2008 were $20.2 million and $61.1 million, respectively, as compared to $43.0 million and $76.9 million for the prior year periods.  The current quarter and year to date decrease reflects lower sales of both branded diamonds and fine cut commercial diamonds.  Polished diamond sales have been significantly impacted by the worsening global economic conditions, and the reluctance of customers to purchase inventory in response to liquidity concerns.

Rough diamond sales were $21.1 million and $58.5 million for the three and six months ended November 30, 2008, as compared to $47.5 million and $116.2 million for the comparable prior year periods.  The decrease in rough diamond sales primarily reflects reduced sourcing activities as the Company sought to preserve liquidity and declined to purchase rough diamonds it considered overpriced in light of current market conditions.

“The recent global financial crisis and economic downturn has negatively impacted the sectors of the diamond and jewelry industry in which the Company operates”, said Mr. Leon Tempelsman, President of Lazare Kaplan International Inc.  “Diamond and diamond jewelry purchases are dependant on the availability of consumer discretionary spending.  Uncertainties regarding future economic prospects and a decline in consumer confidence during the current fiscal quarter translated into lower purchases and sales by diamond producers, wholesalers and retailers in virtually all sectors of the diamond and jewelry industry”.

Net income / (loss) for the three and six month periods ended November 30, 2008 was $(3.7) million, or $(0.45) per fully diluted share, and $(2.9) million, or $(0.35) per fully diluted share, compared to $0.3 million, or $0.03 per fully diluted share, and $0.7 million, or $0.09 per fully diluted share, in the respective prior year periods.  Fully diluted earnings per share for the three and six month periods ended November 30, 2008 are based on the weighted average number of shares outstanding of 8,252,679, as compared to 8,337,818 and 8,329,649 in the comparable prior year periods.

Lazare Kaplan International Inc. sells its diamonds and jewelry products through a worldwide distribution network.  The Company is noted for its ideal cut diamonds, which it markets internationally under the brand name, Lazare Diamonds®.

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements involve known and unknown risks and uncertainties which may cause the Company's actual results in future periods to differ materially from forecasted results.  Those risks include a softening of retailer or consumer acceptance of, or demand for, the Company's products, pricing pressures, adequate supply of rough diamonds, liquidity, and other competitive factors.  These and other risks are more fully described in the Company's filings with the Securities and Exchange Commission.  The information contained in this press release is accurate only as of the date issued.  Investors should not assume that the statements made in these documents remain operative at a later time.  Lazare Kaplan International Inc. undertakes no obligation to update any information contained in this news release.
 
(Financial table to Follow)
 
 
Consolidated Statements of Operations

 
November 30, (unaudited)
  
Three Months Ended
    
Six Months Ended
  
(In thousands, except share and per share data)
  
2008
    
2007
    
2008
    
2007
  
                         
Net sales
   $ 41,260     $ 90,528     $ 119,561     $ 193,121  
Cost of sales
     40,577       84,179       112,433       178,479  
      683       6,349       7,128       14,642  
Selling, general and administrative expenses
     6,597       6,948       13,507       13,235  
Interest expense, net of interest income
     (856 )     (1,501 )     (1,335 )     (3,004 )
Equity in income of joint ventures
     893       2,486       3,425       2,561  
Income / (loss) before income tax provision
                                
    and minority interest
     (5,877 )     386       (4,289 )     964  
Income tax provison / (benefit)
     (2,131 )     95       (1,606 )     253  
Minority Interest
     (3 )     -       (198 )     -  
NET INCOME / (LOSS)
   $ (3,749 )   $ 291     $ (2,881 )   $ 711  
                                 
EARNINGS /  (LOSS) PER SHARE
                                
                                 
Basic earnings / (loss) per share
   $ (0.45 )   $ 0.04     $ (0.35 )   $ 0.09  
Average number of shares outstanding
                                
    during the period
     8,252,679       8,257,082       8,252,679       8,258,033  
                                 
Diluted earnings / (loss) per share
   $ (0.45 )   $ 0.03     $ (0.35 )   $ 0.09  
Average number of shares outstanding during
                                
     the period, assuming dilution
     8,252,679       8,337,818       8,252,679       8,329,649