DD ON INTERNATIONAL CUTLERY (OTCBB: ICUT)
127 West 25th Street
New York, NY 10001
(212) 924-7300
Outstanding: 10,189,248
Float: Approx. 3 m.
70% Held by Insiders
Reporting Status: Fully Reporting
COMPANY SUMMARY AND HISTORY
International Cutlery Ltd. ("the Company") operates 19 retail stores and kiosks along the East coast. These retail outlets are located in shopping malls and airports. The company sells cookware, cutlery, household items and kitchen utensils. The company recently added to its product mix of merchandise by adding gift and impulse items which include travel accessories and games. The company has approximately 110 employees. According to Hoovers, the Company's main competitors are Williams-Sonoma and Bed Bath & Beyond.
I checked out 3 of the malls where the Company has outlets. The anchor stores at the Montgomery Mall (Betheseda, MD) include Nordstrom, JC Penny and Sears. The anchor stores at the Connecticut Post Mall include Filene's and JC Penney. The anchor stores at the Trumbull Shopping Park include Macey's and Lord & Taylor.
The Company's IPO was in December 1995. The Company was delisted in August 1997 because its bid was below the minimum.
FINANCIAL
Following is a comparison of the most recent thirteen week reported period to the prior period:
Revenues: Increase of 14.1 %
Same Store Sales: Increase of 24.8%
EPS: Improvement to (.05) from (.16)
The Company has a relationship with Sharp which includes a line of credit. A note is due July 31, 2001 which can be converted into a maximum of 60% of the outstanding shares of the Company's common stock, excluding the Class A and Class B common stock.
BUSINESS PLAN
The Company attributes much of its recent success to the additions it has made in its product mix of merchandise. Accordingly, the Company intends to continue in this direction. In addition, the Company is embarking on an expansion plan which includes the opening of several new outlets in Florida in the very near future and to expand nationally.
RUMORS
There appear to be several rumors that have been posted. The first pertains to expansion. This does not appear to be in serious dispute. The Company has confirmed that it is shortly opening up several new outlets in Florida. In addition, it has been published that the Company intends to expand nationally. (See references below)
The second rumor pertains to the negotiation of an agreement with QVC. According to one post which is referenced on this thread, while the CEO did not issue a denial, his comments can be fairly interpreted as such because he apparently commented that perhaps he should look into it. My husband talked with an employee at the Company "off the record" and he asked directly about the QVC deal which was mentioned on SI. The response he received was that "the posts were accurate." I will not attempt to reconcile what appear to be different responses. There are several explanations, but any such attempt would be pure speculation.
MY OPINION
This is obviously not DD. This is simply my opinion.
I believe International Cutlery should change its name to better reflect its diversified inventory. Other than this, however, this looks like a better than average BB company. Several years ago ICUT was showing a -.50 EPS and yet trading at several dollars. Most recently the Company posted only a -.05 EPS. The Company has shown increased revenues and a huge 24.8% increase in same store sales. With ICUT we have a real business, real sales, real inventory and a real plan for expansion. The company has good management and is forward looking. In my opinion a fair evaluation for this company is currently .50 per share. If the QVC agreement materializes a fair value would be closer to $1.00.
RESEARCH
Following are some sites that reference ICUT:
marketguide.com
marketguide.com
hoovers.com
nasdaqnews.com
news.stockmaster.com
sec.yahoo.com
sec.gov
snap.com
trumbullshoppingpark.com
connecticutpostmall.com
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