ONEIDA, N.Y., May 26, 2004 (PRIMEZONE) -- Stockholders at Oneida Ltd.'s 123rd Annual Meeting today re-elected four members of the Board of Directors. In addition, Oneida Chairman and Chief Executive Officer Peter J. Kallet noted that the company's operations are experiencing signs of improvement following several difficult cost-saving measures taken during the past 12 months.
During the meeting at the Oneida Community Mansion House, stockholders elected the following members of the Board of Directors to new three-year terms: William F. Allyn, Chairman and Chief Executive Officer of Welch Allyn Ventures, LLC; Allan H. Conseur, Executive Vice President of Oneida Ltd.; Gregory M. Harden, President and Chief Executive Officer of Harden Furniture Co., Inc.; and Catherine H. Suttmeier, Corporate Vice President, Secretary and General Counsel of Oneida Ltd.
IMPROVEMENTS, BUT CHALLENGES REMAIN
Addressing shareholders, Mr. Kallet said that sales and order income in both the consumer and foodservice business increased during the first quarter following an extended economic downturn. The improvement indicates that "even through this tremendously difficult time, our sales organizations have been able to weather the storm and are growing market share in our consumer and foodservice business units," he said.
"Indications are that our economy is showing continued, sustainable signs of growth for both consumer and foodservice," Mr. Kallet added. A major challenge now will be to rebuild adequate product supply levels to satisfy the recent upswing, he observed.
RECOUNTING DIFFICULT BUT NECESSARY ACTIONS
Mr. Kallet retraced the worsening conditions since the beginning of 2003 that forced the company to take "actions ... that we never would have anticipated, but they were absolutely necessary, as unpleasant and painful as they have been, to restore our company to profitability." The measures included job eliminations, benefit reductions, the closings of five factories and a major reconfiguration of the remaining factory in Sherrill, N.Y., and halting of dividend payments.
In early 2003, Mr. Kallet explained, Oneida's sales began to be affected by the impact of the Iraq War and the SARS virus on consumer confidence, travel and overall spending. Declining sales were coupled with a stronger dollar overseas and increased import competition at lower product costs than could be achieved in Oneida's domestic facilities; this compounded the underutilization and negative manufacturing variances at Oneida's factories, leading to the decision to close five sites. Oneida attempted to counter the losses and declining volume with an infusion of capital from a private investor but was unsuccessful in early 2004, adding to the pressures for further cost reductions that affected benefits.
"These were unprecedented actions affecting thousands of jobs and thousands of team members of Oneida: hard working, dedicated professionals that had signed on to devote their careers to the success of Oneida," Mr. Kallet remarked. "We know full well how our actions have affected our current and past employees. We understand how difficult it has been for our people here in Sherrill and Oneida and in our other locations."
ADDRESSING THE FUTURE
Looking toward the coming year, Mr. Kallet said Oneida continues to work closely with its lenders and to explore potential new financing sources as it strives to restructure its existing indebtedness and provide ongoing liquidity. He observed that "our lenders have been very supportive and cooperative throughout this difficult economy and we appreciate their help and support," and added that Oneida is "pursuing all possible measures and considering all alternatives in order to reduce expenses and maximize sales to sustain us through this period."
Regarding the recent suspension and move to delist Oneida's stock from the New York Stock Exchange, Mr. Kallet said the company hopes to reapply for the listing at some point in the future, but "this will require improvement in our financial results and market value."
In closing, Mr. Kallet remarked that while Oneida "clearly faces many challenges for 2004 and beyond," it has "always been a resilient company and will continue to be." Recent steps taken by the company reflect its longtime capacity to "adapt to changing conditions and draw upon existing strengths to overcome obstacles and continue moving forward," he concluded.
Oneida Ltd. is a leading source of flatware, dinnerware, crystal, glassware and metal serveware for both the consumer and foodservice industries worldwide.
Forward Looking Information
With the exception of historical data, the information contained in this Press Release, as well as those other documents incorporated by reference herein, may constitute forward-looking statements, within the meaning of the Federal securities laws, including but not limited to the Private Securities Litigation Reform Act of 1995. As such, the Company cautions readers that changes in certain factors could affect the Company's future results and could cause the Company's future consolidated results to differ materially from those expressed or implied herein. Such factors include, but are not limited to: changes in national or international political conditions; civil unrest, war or terrorist attacks; general economic conditions in the Company's own markets and related markets; difficulties or delays in the development, production and marketing of new products; the impact of competitive products and pricing; certain assumptions related to consumer purchasing patterns; significant increases in interest rates or the level of the Company's indebtedness; inability of the Company to maintain sufficient levels of liquidity; failure of the Company to obtain needed waivers and/or amendments relative to its financing agreements; foreign currency fluctuations; major slowdowns in the retail, travel or entertainment industries; the loss of several of the Company's key executives, major customers or suppliers; underutilization of or negative variances at some or all of the Company's plants and factories; the Company's failure to achieve the savings and profit goals of any planned restructuring or reorganization programs; international health epidemics such as the SARS outbreak; the impact of changes in accounting standards; potential legal proceedings; changes in pension and medical benefit costs; and the amount and rate of growth of the Company's selling, general and administrative expenses.