Second quarter operating profit was $7.7 million in 2007 versus an operating loss of $27.7 million in 2006. Last year’s loss included a non-cash, pre-tax goodwill impairment charge of $36.8 million from the write-down of goodwill associated with Blyth’s North American Wholesale businesses. In addition, the BHI North American mass channel candle business experienced a loss of $5.0 million this year and $3.6 million last year. Excluding the goodwill impairment charge from last year, as well as BHI’s losses from both years, Operating income for the second quarter would have been $12.7 million this year versus $12.7 million last year. Net earnings for the second quarter were $3.2 million versus a net loss of $89.4 million a year earlier.
"During the second quarter, which is typically the smallest quarter for the company, we were able to control costs aggressively, resulting in improved year-to-date operating profit versus last year," said Robert B. Goergen, chairman of the board and CEO, Blyth. "We are seeing the effects of continued weakness in the housing sector, resulting in softness in home decor purchases, as well as overall lower discretionary consumer spending that may relate to higher gasoline prices. We will endeavor to offset the impact of these forces with continued expense management and selective promotional activity."
"We anticipate continued gross margin improvement versus last year, which is expected to offset the effects of the soft sales environment that we may experience, as well as upward pressure on commodity costs," said Goergen.